Placing dodgy SAA deal “on ice” not good enough

This comes after the South African Airways (SAA) was placed on extended terms by OUTA’s lawyers where they have until Monday (18th July 2016) to provide an undertaking not to continue with the BnP arrangement, failing which legal action will ensue.

The Organisation Undoing Tax Abuse (OUTA) requires the deal to be cancelled, not to be put on ice. Furthermore, we have requested National Treasury to put BnP Capital on their ‘restricted suppliers’ list for failing to disclose the suspension of their FSB license, which will bar all government institutions from doing business with BnP Capital.

“Our urgent application to interdict the contract is still ready to be launched if need be. SAA cannot simply put the deal ‘on ice’ as we maintain their appointment is completely unlawful, even if BnP manage to get the suspension of their FSB licence lifted,” said Ivan Herselman, OUTA director of legal affairs. “Therefore, we still require an undertaking in writing from SAA or their lawyers that they will not proceed with the transaction at all.”

In addition to OUTA’s request for National Treasury to place BnP Capital on its ‘restricted suppliers’ database, OUTA will also request the FSB to revoke their license for continuing to attempt to transact with SAA, after their license had been suspended.

“The medium to long term strategy is still to bring the SAA board to book for constant breaches of their fiduciary duties over a protracted period. The current SAA board and its chairperson should resign, or be removed by the minister or a court order, as we believe they are not fit for office and positions they currently occupy,” Herselman added.

OUTA will keep a close watch on these transactions at SAA and even if the BnP Capital deal is halted, we would not like to see it replaced with another unlawful or wasteful expenditure decision. This airline does not exist for the enrichment of individuals or companies and all transactions should be conducted at the lowest cost or best outcome for the Airline and thereby, the South African public.