Can RDB Still Assure Protection to Foreign Investment in Rwanda?

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Can RDB Still Assure Protection to Foreign Investment in Rwanda?
Can RDB Still Assure Protection to Foreign Investment in Rwanda?

Africa-PressRwanda. Rwanda Development Board may have possibly not foreseen an ugly dispute of such magnitude coming between two foreign investors operating on Rwandan territory.

The dispute which stems from one shareholder accusing its partner of stealing shares in broad daylight is a matter that is curving out precedence in the country’s young commercial law.

Refad Group AG and Omnicane Ltd are both shareholders of Omnihydro Ltd formerly Refad Rwanda Ltd. The initial capital structure was 51% Omnicane 49% REFAD Group AG.

However, something weird happened, the capital structure was tampered with and later Refad Group AG realised its shares in the company were significantly chopped to only 1.52%.

According to Refad Group AG representative Dr. Jacques Ntogue, a Franco-Cameroonian entrepreneur, there was never a board meeting and not a shareholders meeting held to revise the capital structure.

Rwanda Development Board was contacted twice to use its powers and mandate (of which it has) to fix this corporate dispute. RDB had directed for reinstatement of the original capital structure but its orders were ignored.

Dr. Ntogue took matters to Rwanda commercial court and no date has been set for hearing. “They (court) keep extending the date claiming requirement to adhere to measures aimed at preventing further spread of Covid-19.”

Taarifa early this week contacted Omnicane from its home in Mauritius. Omnicane did not answer Taarifa emails directly but prefered to respond via a sponsored presser via The New Times Publication.

“A court case was lodged by Refad Group AG, one of Omnihydro shareholders. We are currently awaiting a court hearing on the matter which has been delayed,” Omnicane said in a statement.

The statement adds, “The court case pertains to the challenge of some corporate decisions in relation to share capital increase. We need to highlight that all shareholders were made aware of the increase in share capital. The directors representing all shareholders were duly present at the board meetings authorising the increase of the share capital, and such action was approved by the shareholder(s) of Omnihydro in accordance with its Articles of Association and the law governing companies. All shareholders were given the opportunity to subscribe for the new shares in proportion to their existing shareholding.”

“This case has nothing to do with operational matters. This can be supported by the fact that the urgent application for interim measures filed by REFAD Group AG was rejected by the Commercial Court,” Omnicane said.

However, Dr. Ntogue in response to Omnicane’s statement, “This article (Published in The New Times) is full of lies,” he said without further details.

Clare Akamanzi, the CEO of RDB told Taarifa in an email on Friday, “it is important to await the outcome of the court process and avoid any undue influence on the adjudication of such cases.”

“Given that the matter has been referred to the courts by the shareholders, RDB cannot prevent the shareholders from exercising their rights to civil action. As a matter of civil procedure, any interim order request regarding a matter that is the subject of the main case pending before the court, should be made to the same court for consideration,” Akamanzi said.

Despite the matter still pending before court, Dr. Ntogue is up in arms again accusing Omnicane of soliciting for a loan and conducting other businesses before court pronouncement on the dispute.

“Whenever an energy project is up and running, it is not allowed to solicit for funding. But here we are and Omnicane has requested for a loan from an unidentified bank,” Dr. Ntogue told Taarifa.

He said that this money is allegedly to be injected in the same power project which is already operational.

“How can Omnicane dare to ask for a loan without board meeting, board resolution, shareholder meetings….. All that while we are in court and waiting for our case ( that keeps being delayed) to be judged,” Dr. Ntogue wondered.

According to RDB’s Akamanzi, “RDB is not aware of any information pertaining to one of the shareholders requesting for a bank loan. We have not received any request for a mortgage registration or any other documentation pertaining to this purported transaction.”

This project according to independent experts (www. Stucky.com expert) should not cost more than U$12 Millions.

“With all the fakes, loan and Capital increase we are above the U$30 Millions. Since Omnicane is given a loan to themselves this is only a way to suck money from the company and avoid paying company Taxes,” Dr. Ntogue told Taarifa.

Mauritian Company Omnicane Disregards Rwandan Court, RDB Directives

Mauritian Company Omnicane Disregards Rwandan Court, RDB Directives

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