Africa-Press – Namibia. THE fight between Trustco Group Holdings and the Johannesburg Stock Exchange (JSE) is not ending just yet, with Trustco approaching the courts to set aside the JSE’s decision to terminate its listing on the bourse.
The bone of contention remains accounting errors relating to N$2,1 billion which was passed through the profit and loss statement in 2019. According to an announcement made by Trustco on Monday, the 50 plus subsidiary group of companies said it had “filed and lodged an application for reconsideration of the decision taken by the JSE to suspend Trustco’s listing. Trustco simultaneously filed an application against the decision by the JSE to suspend Trustco’s listing, and Trustco seeks that the JSE’s suspension decision is itself suspended.”
The applications were made in terms of the Financial Sector Regulations (FSR) Act, 2017. Trustco is being represented by Norton Rose Fulbright South Africa Inc – a law firm headquartered in Sandton, Johannesburg.
According to Trustco’s announcement, there is no legal basis for the suspension decision to be enforced, pending the unresolved dispute (the difference in interpretation of international financial reporting standards) between Trustco and the JSE.
Last week, The Namibian reported that the JSE had confirmed Trustco’s suspension, pending a submission to the JSE that Trustco had approached the courts urgently to halt the JSE’s decision. Failing that, the suspension would come into force on 11 March.
Considering that Trustco has filed and lodged the application, the JSE had said it would “suspend the implementation of the suspension decision until 15h00 on 11 March 2022, to allow for these proceedings of first instance to run their course”.
This is what now needs to play out – the JSE and Trustco facing each other in court. Supplementing its decision to appeal the decision, Trustco said its auditors, which are JSE’s accredited auditors since listing in 2009, provided Trustco with unmodified (unqualified) audit reports. This is expected to serve Trustco well when stating its case that the financials are correct and there are no errors.
According to the application filed and lodged by Trustco, it would be “wholly inappropriate and significantly prejudicial to Trustco, its employees and shareholders if the suspension decision is enforced and given effect before the reconsideration application has been considered and finally determined”.
In the reconsideration application, Trustco is asking that the JSE’s decision to suspend Trustco’s listing on the JSE main board be set aside. Trustco is also citing in its application that those who decide that Trustco should be suspended have no authority to do so.
This decision was largely placed on the JSE’s director in the issuer regulation division, Andre Visser. “As a consequence Visser did not have the necessary authority to make the suspension decision, and the decision is therefore also ultra vires and of no force and effect,” argues Trustco.
Trustco further claims in its application that the suspension decision is premature. “The suspension decision is therefore premature and illegal as it seeks to enforce the award prior to the lapse of the review period, while the review application is pending and is therefore in contravention of the express provisions of section 236 of the FSR Act,” said Trustco.
The company further claims that the restatements as instructed to it would be impossible. “It is frankly impossible for it to be implemented in the period of time between the decision that the JSE purportedly decided that there was a breach of the listing requirements,” said Trustco. The full application as filed and lodged by Trustco is available on its website.
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