By ‘Majirata Latela
The government of Lesotho has successfully applied for postponement of legal cases involving German-Australian energy company Frazer Solar in South Africa, pending finalisation of a review application in the High Court of Lesotho.
This was disclosed this week by the Office of the Prime Minister, amid a series of protracted legal battles between Frazer and the Lesotho government, emanating from what the company claims to be a breach of contract by the government. The cases were due to be heard from May 16 to June 16 this year.
The country is facing the loss of revenue from water and power sales to South Africa and may see its share of an undersea communications cable seized after it breached the terms of a contract with solar power company Frazer Solar GmbH.
Under a global enforcement order, following the award of 50 million euros in damages in an arbitration case in South Africa, Frazer said it had taken legal action to seize royalties that would be paid to Lesotho’s government by the Trans-Caledon Tunnel Authority SOC as well as payments for power from Eskom Holdings SOC Ltd.
It had also had Lesotho’s share in the Mauritius-based West Indian Ocean Cable Co. provisionally seized.
In this case Frazer Solar was awarded damages by South African arbitrator Vincent Maleka for Lesotho’s alleged breach of a deal suspiciously struck between the government and the German company involving supply of solar energy and power equipment to Lesotho over four years. The deal was allegedly signed in 2018.
Reported claimed a binding agreement was sealed in 2018 between Frazer Solar and Lesotho for the provision of up to 40 000 solar water heating systems, 20MW of solar photovoltaic capacity, one million LED lights and 350 000 solar lanterns nationwide.
Subsequently, Frazer Solar in April last year applied to the high court in Gauteng petitioning it to endorse the arbitration award and allow the company to garnish Lesotho revenue from the water royalties from South Africa in terms of the treaty signed in 1986.
That prompted Majoro to request a reversal of the award to Frazer Solar as damages.
On November 4, lawyers representing the Lesotho government, noted that Frazer Solar had requested an urgent case management meeting “with His Lordship Mr Justice Matojane with a view of seeking a postponement of the Lesotho Stay Application, the TCTA Application and the SAG (South African Government) intervention application.”
The ENSafrica law firm’s Deon Lambert/Wandile Ndabambi wrote to SA high court Judge Matojane: “We will of course make ourselves available for an urgent case management meeting as Frazer Solar has requested should His Lordship convene one.”
The lawyers continued: “However, in an effort to and perhaps even avoid the need for a case management meeting, we record for the benefit of all parties that the Kingdom of Lesotho is willing to agree to Frazer’s request to postpone the matters set down for 10-12 November 2021.”
This was subject to all concerned parties agreeing to liaise with one another to find new dates for the hearing of the applications set down or November 10-12 with such dates suiting the parties.
The South African government also intervened in the matter. It argued in the application that granting Frazer Solar damages from Lesotho’s revenue due to it from the Lesotho Highlands Water Project (LHWP) would irreparably harm the diplomatic relations between the two countries.
The SA government also argued that the kingdom would retaliate by cutting water supplies to it in terms of the 1986 water treaty signed by the two countries.
Meanwhile, government’s energy experts have previously revealed that the government’s deal with Frazer Solar GmBH was never a good idea, looking at the M1.5 billion that Lesotho was to pay in 20 years.
Testimonies before parliament’s Public Accounts Committee last year revealed that that the signatures that appeared on the supply agreement documents were those of former minister in the Prime Minister’s Office, Temeki Tšolo and that of Robert Frazer of Frazer Solar, without the knowledge of the minister of finance and the minister of energy.
Majoro also assembled a commission of inquiry into the ‘purported’ supply agreement between German company Frazer Solar GmBH and the government of Lesotho.
According to a government gazette published last year, the commission was tasked with probing events that led to the signing of the agreement of supply between the government and the services of notices in respect of the matter before arbitration and subsequent arbitration award.
The commission was to be led by High Court Judge Justice Molefi Makara, while its other members are former government minister Mohlabi Tsekoa and Advocate Sekake Malebanye.
The commission would investigate how Frazer Solar GmBH was introduced to the government of Lesotho including the persons in the country who were involved in the events that led to the signing; and enabled the company to lodge claims against the government.
