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- The Special Investigating Unit wants to appeal a ruling blocking its probe in Telkom.
- A court ruled last month that the telecoms group was not a state institution.
- The unit says the question of what constitutes a state institution needs to be clarified.
- For more financial news, go to the News24 Business front page.
The Special Investigating Unit (SIU) has filed papers to apply for leave to appeal a court ruling halting its investigation into allegations of wrongdoing at Telkom.
Last month, the North Gauteng High Court in Pretoria ruled that the SIU's probe into the telecommunications provider was invalid and "of no force or effect".
The court also set aside President Cyril Ramaphosa's proclamation from early 2022 that authorised the investigation.
Ramaphosa had directed the SIU to probe allegations of maladministration and malpractice at Telkom stretching back to 2006.
The investigation included probing Telkom's decision to grant consultancy Bain & Co. a R91 million contract for advisory services in 2013 without going to tender.
Court documents show that Telkom denied there was anything wrong with the tender. It said Bain was appointed during a period when it had been exempted from the Public Finance Management Act.
READ | Telkom shares fall 5% as it calls off talks with Maseko consortium
In her ruling, Judge Vuyelwa Tlhapi found that Telkom was not a state institution and that the president's proclamation was "overboard".
She ruled that the SIU's probe, which had already been ongoing for more than a year, was invalid and that it should return the documents it had taken from Telkom.
The government directly owns 40.5% of Telkom's shares. The Public Investment Corporation (PIC) owns another 15.3% of its shares on behalf of the Government Employees Pension Fund.
Tlhapi ruled that the state and the PIC's shareholding should not be combined when trying to answer the question of whether Telkom was a state-owned entity. While she acknowledged that the state owned a "big chunk" of Telkom's shares, she said it was not a major shareholder.
The SIU says it will now seek to appeal the ruling.
"The high court found that Telkom is not a state institution and therefore, the SIU could not investigate allegations of serious maladministration, malpractice, and possible corruption in the affairs of Telkom," said the unit.
"The court needs to give a fuller picture of what constitutes a state institution as this can set a legal precedent on which institutions the SIU can exercise its powers."
The SIU said the question of what constitutes a state institution needs to be settled:
In its application for leave to appeal, the SIU said the court had also erred when it ruled that Ramaphosa had to "hear out" Telkom before issuing his proclamation.
The unit said there was no case law to back up the court's view.
"This paragraph in the judgment sets a dangerous precedent for investigations by the SIU and proclamations currently under consideration by the President and to be issued by him," it said.
