Shuttleworth to give R250 million away

South African IT billionaire Mark Shuttleworth says he intends to put a sum of R250 million into a trust to address constitutional rights of African citizens.

The South African Supreme Court of Appeal on Wednesday (1 October) found in his favour in a R250 million legal fight against the South African Reserve Bank in a case regarding exchange controls.

“I will put the returned funds of R250m plus interest into a trust, to underwrite constitutional court cases on behalf of those who’s circumstances deny them the ability to be heard where the counter-party is the State,” Shuttleworth said on his blog.

In July 2013, Shuttleworth’s bid to have South Africa’s entire exchange control system declared unconstitutional failed, with the judge dismissing his application to set aside the imposition of a R250 million levy he had to pay to get some of his assets out of the country in 2009 and for the Reserve Bank to return his money.

Shuttleworth launched an application to appeal the ruling in early September. He contended that many facets of the current exchange regime were unconstitutional.

The court ruling on Wednesday read:

“The SCA held that a founding principle of Parliamentary democracy is that there should be no taxation without representation and that the executive branch of government should not itself be entitled to raise revenue but should rather be dependent on the taxing power of Parliament. The Court stated that the levy raised revenue for the State in that it brought in ten per cent of the value of any capital in excess of R750 000 exported out of the country, into the National Revenue Fund. Whilst in force, it raised approximately R2.9 billion. The SCA found therefore that the levy thus fell within the category of ‘taxes, levies or duties’ contemplated by sections 75 and 77 of the Constitution.”

The court set aside the decision of the Reserve Bank to impose the 10% levy. The Reserve Bank was ordered to repay the appellant the amount of R250 474 893,50 with interest at the prescribed rate from 13 April 2012 to date of payment.

“Today’s ruling by the Supreme Court of Appeal found administrative and procedural fault with the Reserve Bank’s actions in regards to me, and returned the fees levied, for which I am grateful,” Shuttleworth said.

“This case, however, was not filed solely in pursuit of relief for me personally. We are now considering the continuation of the case in the Constitutional Court, to challenge exchange control on constitutional grounds and ensure that the benefits of today’s ruling accrue to all South Africans.”

“I will commit the funds returned to me to today by the SCA to a trust run by veteran and retired constitutional scholars, judges and lawyers, that will selectively fund cases on behalf of those unable to do so themselves, where the counterparty is the state. The mandate of this trust will extend beyond South African borders, to address constitutional rights for African citizens at large, on the grounds that our future in South Africa is in every way part of that great continent,” he said.

Shuttleworth’s comment can be found here.

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Shuttleworth to give R250 million away