News / Local
Lithium mining company fined for smuggling
10 Mar 2024 at 06:51hrs | Views
BULAWAYO High Court judge Christopher Dube-Banda has fined local lithium mining company Silver Bern International (Private) Limited US$10 000 following its conviction for smuggling 96 000 metric tonnes of lithium disguised as manganese ore.
In addition, the lithium was forfeited to the state despite protests by the company which was represented by Simon Gamha.
Gamha appeared before the High Court in terms of section 385(3) of the Criminal Procedure and Evidence Act [Chapter 9:07], which provides that in any criminal proceedings against a corporate body, a director or employee shall be cited and be dealt with as if he were the person accused of having committed the offence in question.
He was charged with the crime of contravening section 3(1) of Statutory Instrument 213/22, the Base Minerals Export Control Act.
The court heard during the period extending from 21 December 2022 to 23 December 2022 and at Beitbridge Border Post, the accused, without lawful excuse unlawfully and intentionally exported 96 metric tonnes of lithium-bearing ore to South Africa without a written permit issued by the minister, in violation of the law.
The matter was first heard at the magistrates' court where Gamha pleaded guilty to the offence before it was referred to the upper court for sentencing purposes. The magistrate took the view that the circumstances of the case merited a sentence beyond her jurisdiction.
In determining an appropriate sentence, the judge took into account the circumstances of the accused, the nature and the gravity of this crime and the interests of the society.
The judge said the crime is very serious and a clear message should be sent to society that such offences will not be tolerated.
"It is aggravating that the agent who presented the declaration documents to the Zimbabwe Revenue Authority (Zimra) falsely indicated that the trucks were carrying manganese ore, hiding the fact that the trucks were loaded with lithium ore.
"This was intended to mislead Zimra and in the process export lithium ore under the guise that it was manganese ore.
"In this case the quantity of the lithium ore intended to be exported is aggravating, the company intended to export ninety-six (96) metric tonnes of lithium-bearing ore valued at USD$14 880.00.
"This is a huge amount of lithium ore. A deterrent sentence is merited in this case," he said.
The court also took into account the legislative penalty provision, section 6 of the Base Minerals Export Control Act.
Before the lower court, lawyers representing the company submitted that the accused was a first offender, and that he pleaded guilty.
It was submitted that this offence was committed a week after the Statutory Instrument 213 of 2022 came into effect, when arrangements had already been made to export the lithium-bearing ore to South Africa.
The lawyers further submitted further that the accused had no knowledge of this Statutory Instrument.
Counsel argued that the company suffered financial loss as a result of the commission of this offence in that the trucks that it had hired to transport the ore were detailed at Beitbridge Border Post for more than a month.
At the time the trucks were released, the court heard the company had incurred a hire bill of over US$15 000.
The lawyers also submitted that the company has ceased to operate and the court should not order the forfeiture of the lithium ore as such an order c lead to the liquidation of the company.
They also said the police were ordered to release 66 tonnes of lithium it is holding in connection with another matter.
The state argued that the lithium ore subject to this case must be forfeited as a measure of preventing the company from benefiting from an illegality.
The court noted that the legislative penalty provision of section 6 of the Base Minerals Export Control Act, which provides that any person who contravenes or fails to comply with any order or with the terms and conditions of any permit issued to him under an order, shall be guilty of an offence and is liable to a fine not exceeding level nine or twice the value of the base minerals in respect of which the offence is committed, whichever is the greater.
In cases involving individuals, imprisonment for a period not exceeding two years or to both fine and imprisonment may be considered.
"It is important to state that section 6(b) of the penalty provision is not applicable in this case by operation of law.
"In terms of section 385(3) of the CP & E Act if a person representing a corporate body is convicted, the court shall not impose upon him in his representative capacity a sentence of imprisonment.
"Therefore, the only sentence available to a representative of a company is a fine," said the judge. The level nine fine is US$600 and the recovered lithium-bearing ore in this case was valued at US$14 880.
"Twice the value of the lithium ore is US$29 760. Therefore, in this instance the highest fine permissible by law is US$29 760.
"This means this court has a discretion to impose a fine not exceeding USD$29 760.
"This court will factor into the sentencing equation the fact the accused is a first-time offender, and he pleaded guilty," said the judge.
Dube-Banda ruled that the argument that the company suffered a financial loss as a result of this case is not mitigating because it is the company that embarked on a criminal enterprise and must live with the consequences of such criminal conduct.
"The argument that at the material time the company did not know that its conduct contravened the law is not supported by the facts of this case.
"At the port of exit the company disguised lithium ore as manganese ore because it had knowledge of the unlawfulness of its conduct.
"In terms of section 62(1) CPEA, the court is given the discretion to order the forfeiture of certain items which have been used in connection with criminal activity therefore, the fact that s 6 of the of the Base Minerals Export Control Act does not provide for forfeiture is inconsequential," the judge said.
Justice Dube-Banda said this is a case where what is subject of forfeiture is the lithium ore through which the offence in question was committed.
He said notwithstanding its value, it cannot escape forfeiture.
"It is like in a case of armed robbery, the gun used in executing the robbery cannot escape forfeiture because of its value.
"So, in this case, the lithium ore subject of this crime cannot escape forfeiture because of its value.
"No weight can be attached to the fact that an order of forfeiture will lead to the liquidation of the company. It is the company that embarked on a criminal enterprise and it must live with the consequences of such criminal conduct.
"I take the view that the highest fine allowed must obviously be reserved for the most serious examples of the offence.
"Although this case cannot be described as the most serious example of a case of contravening the Base Minerals Export Act, it remains a bad case.
"The accused intended to export a huge quantity of lithium-bearing ore in contravention of the law. The sentence must reflect this phenomenon, and alert the accused that there can be no benefit from crime.
"The sentence must show that such crime committed by corporate bodies will not be tolerated. Companies must act and conduct business within the confines of the law. A deterrent fine will meet the justice of this case. Again, the lithium ore must also be forfeited to show that crime committed by corporates will not be tolerated by the courts," he ruled.
In addition, the lithium was forfeited to the state despite protests by the company which was represented by Simon Gamha.
Gamha appeared before the High Court in terms of section 385(3) of the Criminal Procedure and Evidence Act [Chapter 9:07], which provides that in any criminal proceedings against a corporate body, a director or employee shall be cited and be dealt with as if he were the person accused of having committed the offence in question.
He was charged with the crime of contravening section 3(1) of Statutory Instrument 213/22, the Base Minerals Export Control Act.
The court heard during the period extending from 21 December 2022 to 23 December 2022 and at Beitbridge Border Post, the accused, without lawful excuse unlawfully and intentionally exported 96 metric tonnes of lithium-bearing ore to South Africa without a written permit issued by the minister, in violation of the law.
The matter was first heard at the magistrates' court where Gamha pleaded guilty to the offence before it was referred to the upper court for sentencing purposes. The magistrate took the view that the circumstances of the case merited a sentence beyond her jurisdiction.
In determining an appropriate sentence, the judge took into account the circumstances of the accused, the nature and the gravity of this crime and the interests of the society.
The judge said the crime is very serious and a clear message should be sent to society that such offences will not be tolerated.
"It is aggravating that the agent who presented the declaration documents to the Zimbabwe Revenue Authority (Zimra) falsely indicated that the trucks were carrying manganese ore, hiding the fact that the trucks were loaded with lithium ore.
"This was intended to mislead Zimra and in the process export lithium ore under the guise that it was manganese ore.
"In this case the quantity of the lithium ore intended to be exported is aggravating, the company intended to export ninety-six (96) metric tonnes of lithium-bearing ore valued at USD$14 880.00.
"This is a huge amount of lithium ore. A deterrent sentence is merited in this case," he said.
The court also took into account the legislative penalty provision, section 6 of the Base Minerals Export Control Act.
Before the lower court, lawyers representing the company submitted that the accused was a first offender, and that he pleaded guilty.
It was submitted that this offence was committed a week after the Statutory Instrument 213 of 2022 came into effect, when arrangements had already been made to export the lithium-bearing ore to South Africa.
The lawyers further submitted further that the accused had no knowledge of this Statutory Instrument.
Counsel argued that the company suffered financial loss as a result of the commission of this offence in that the trucks that it had hired to transport the ore were detailed at Beitbridge Border Post for more than a month.
At the time the trucks were released, the court heard the company had incurred a hire bill of over US$15 000.
The lawyers also submitted that the company has ceased to operate and the court should not order the forfeiture of the lithium ore as such an order c lead to the liquidation of the company.
They also said the police were ordered to release 66 tonnes of lithium it is holding in connection with another matter.
The state argued that the lithium ore subject to this case must be forfeited as a measure of preventing the company from benefiting from an illegality.
In cases involving individuals, imprisonment for a period not exceeding two years or to both fine and imprisonment may be considered.
"It is important to state that section 6(b) of the penalty provision is not applicable in this case by operation of law.
"In terms of section 385(3) of the CP & E Act if a person representing a corporate body is convicted, the court shall not impose upon him in his representative capacity a sentence of imprisonment.
"Therefore, the only sentence available to a representative of a company is a fine," said the judge. The level nine fine is US$600 and the recovered lithium-bearing ore in this case was valued at US$14 880.
"Twice the value of the lithium ore is US$29 760. Therefore, in this instance the highest fine permissible by law is US$29 760.
"This means this court has a discretion to impose a fine not exceeding USD$29 760.
"This court will factor into the sentencing equation the fact the accused is a first-time offender, and he pleaded guilty," said the judge.
Dube-Banda ruled that the argument that the company suffered a financial loss as a result of this case is not mitigating because it is the company that embarked on a criminal enterprise and must live with the consequences of such criminal conduct.
"The argument that at the material time the company did not know that its conduct contravened the law is not supported by the facts of this case.
"At the port of exit the company disguised lithium ore as manganese ore because it had knowledge of the unlawfulness of its conduct.
"In terms of section 62(1) CPEA, the court is given the discretion to order the forfeiture of certain items which have been used in connection with criminal activity therefore, the fact that s 6 of the of the Base Minerals Export Control Act does not provide for forfeiture is inconsequential," the judge said.
Justice Dube-Banda said this is a case where what is subject of forfeiture is the lithium ore through which the offence in question was committed.
He said notwithstanding its value, it cannot escape forfeiture.
"It is like in a case of armed robbery, the gun used in executing the robbery cannot escape forfeiture because of its value.
"So, in this case, the lithium ore subject of this crime cannot escape forfeiture because of its value.
"No weight can be attached to the fact that an order of forfeiture will lead to the liquidation of the company. It is the company that embarked on a criminal enterprise and it must live with the consequences of such criminal conduct.
"I take the view that the highest fine allowed must obviously be reserved for the most serious examples of the offence.
"Although this case cannot be described as the most serious example of a case of contravening the Base Minerals Export Act, it remains a bad case.
"The accused intended to export a huge quantity of lithium-bearing ore in contravention of the law. The sentence must reflect this phenomenon, and alert the accused that there can be no benefit from crime.
"The sentence must show that such crime committed by corporate bodies will not be tolerated. Companies must act and conduct business within the confines of the law. A deterrent fine will meet the justice of this case. Again, the lithium ore must also be forfeited to show that crime committed by corporates will not be tolerated by the courts," he ruled.
Source - newshawks
