As the fight surrounding who is supreme in running the affairs at Uganda Telecom (UTL), the Uganda Law Society (ULS) has weighed in calling on the government not to deviate from the Attorney General’s opinion on the matter.
The lawyers, in a statement dated June 29, said they have a right to demand that persons holding public offices conduct public affairs and themselves with the expected level of decorum and in a manner that does not erode the confidence of the public in those offices.
For more than a week, matters concerning the management of UTL have generated debate after the State minister for Privatisation and Investment, Ms Evelyn Anite, said government had lost control over the company in which it owns 31 per cent shares.
The minister has since started a process of removing the UTL current administrator Mr Twebaze Bemanya, accusing him of being defiant to the government’s effort to get accountability of revenues being generated by the company since he was appointed administrator in May 2017.
However, a sharp disagreement has ensued between Ms Anite and Mr Mwesigwa- Rukutana, the Deputy Attorney General, after the latter in a letter on June 28 gave a legal opinion saying the minister does not have supervisory power over UTL while under insolvency.
However, Ms Anite insists that Mr Bemanya, who also is the Registrar General of Uganda Registration Services Bureau (URSDB), must be removed and replaced as the administrator/official receiver of UTL because he has been insubordinate to the Ministry of Finance by refusing to be audited.
In a statement issued on Saturday, the Uganda Law Society President Simon Peter Kinobe argued that the Deputy Attorney General acted within the law not to take Ms Anite’s instructions to make an application in court seeking the removal of Mr Bemanya.
The lawyers’ body says Ms Anite is a shareholder in UTL and by the insolvency law, shareholders cannot be supervisors of such a company under administration.
“Once a company embraces insolvency proceedings, be it liquidation, receivership or administration, the shareholders cannot supervise (or purport to supervise) the office holder (liquidator, receiver or administrator),” the statement reads in part.
USL states that in the current circumstances, the UTL creditors’ interests take precedence over the interests of the shareholders.
“Therefore, the Hon. Minister of Finance as a shareholder cannot be held out as the supervisor of the administrator of “his” insolvent company,” Mr Kinobe added in the statement.
The ULS said though it does not have the mandate to advise Cabinet, it concurs with Mr Rukutana because administration is an insolvency process with clear consequences under the Ugandan law.
He cited Section 155 of the Insolvency Act, which provides that “the implication of the appointment of an administrator is that the company’s shareholders and management are divested from the company and the full authority of running the affairs of the company is vested in the administrator with a view to salvaging the company from insolvency/liquidation.”
