By Mary Taruvinga
A LOCAL company, Profert Zimbabwe (Pvt) Ltd, has dragged the Reserve Bank of Zimbabwe (RBZ) to court for failing to reverse a transaction of $1, 112, 45 54 after a foreign liability deal was reversed.
The company had transferred a total of $3 619 288 but later realised that the deal would not be approved and demanded reversal.
Court papers show that the central bank only reversed $2, 506, 836, 95 but withheld the balance despite demand by Profert Zimbabwe.
Profert Zimbabwe’s business involves importing goods into the country.
According to court papers, in 2019 plaintiff had two outstanding foreign obligations to Profert (Pty) Ltd, a South African company, in the amounts of US$2 506 836 95 and US$1 112 451 54 totalling US$3 619 288 49.
The plaintiff through its banking agent, Stanbic Bank, approached RBZ with a view of registering its foreign liability and legacy debt to Profert (Pty) Ltd in accordance with the Exchange Control Directive to Authorised Dealers issued by RBZ Exchange Control Division on 22 February 2019 and blocked funds framework as set out in RBZ Exchange Control Circular 08 dated July 24 2019.
In order to be eligible to utilise the blocked funds, plaintiff was asked to transfer the outstanding foreign liability amounts in RTGS to RBZ.
Accordingly, on July 1 2019, Profert Zimbabwe (Pvt) Ltd authorised the transfer of $3 619 288 49 from its account with Stanbic Bank to RBZ.
The amount was transferred on July 10, 2019.
Subsequently, due to a change in RBZ block funds requirements, the complainant discovered that liabilities in relation to bills of entry prior to January 1 would not be approved by the central bank.
Accordingly, by letter dated October 16 2019, Profert Zimbabwe requested the immediate return from RBZ of $2 506 836 95.
This amount represented plaintiff’s liabilities to Profert (Pty) Ltd relating to goods imported prior to January 1, 2016.
On 30 April this year, RBZ notified the plaintiff that its registration of blocked funds of US $1 112 451 54 to Profert (Pty) Ltd was not approved.
The company requested RBZ to immediately return all sums it had transferred to the central bank.
“Despite plaintiffs’ demand, on October 16 2019, defendant only transferred $2 506 836 95 to plaintiff on May 15 2020. RBZ had no lawful basis to retain this amount following demand for the same,” reads the summons filed against RBZ.
“Accordingly, plaintiff seeks an order that RBZ shall pay plaintiff interest at the rate prescribed pursuant to the prescribed rate of interest from October 16, 2019 to May 15 2020.
“Further, defendant continues to retain $1 112 451 without any lawful basis to do so. Accordingly, plaintiff seeks that defendant shall pay the amount of $1 112 451 54 together with interest,” said Profert Zimbabwe.
The case is pending.