Court quashes CHRAJ findings on $2.25bn bonds
The Accra High Court has quashed certain findings by the Commission on Human Rights and Administrative Justice (CHRAJ) that the government breached financial laws in the issuance of the US$2.25-billion bonds in 2017.
In its judgement, the court, presided over by Mrs Justice Georgina Mensah-Datsa, held that CHRAJ had no jurisdiction to make those findings and also that it failed to give the government a hearing before coming up with those findings.
“The right to be heard or given an opportunity to be heard is so fundamental that a breach of it is always an opportunity to set aside or quash a decision,’’ Mrs Justice Mensah-Datsa said.
The decision of the court followed a judicial review application filed by the Attorney-General (A-G) challenging the adverse findings which formed part of the 140-page report by CHRAJ on the bond transaction.
The A-G prayed for an order of certiorari quashing the said findings by CHRAJ on the basis that the commission exceeded its jurisdiction.
In March 2017, the government, through the Ministry of Finance and the Bank of Ghana, issued five-year, sevenyear, 10-year and 15-year bonds.
According to the government, the proceeds of the bonds were to be used to re-profile the country’s domestic debt stock as part of its debt management strategy.
The issuance of the bonds was heavily criticised by the opposition National Democratic Congress (NDC).
On April 25, 2017, a member of the NDC, Mr Yaw Brogya Genfi, petitioned CHRAJ to investigate the bond transaction, alleging conflict of interest in its issuance against the Finance Minister, Mr Ken Ofori-Atta.
CHRAJ, in its decision on December 22, 2017, stated that Mr Genfi failed to substantiate his allegation. It, therefore, cleared Mr Ofori-Atta of conflict of interest in the issuance of the bonds.
The, commission, however, said the government breached Section 56 of the Public Financial Management Act, 2016 (Act 921) by failing to seek parliamentary approval before issuing the bonds.
Another finding was that the Finance Minister failed to disclose all his assets, as required by Article 286 of the 1992 Constitution.
Dissatisfied with CHRAJ’s findings, the A-G marched to court, seeking to have the finding that had to do with the breach of Act 921 annulled, while Mr Ofori-Atta too initiated a separate legal action to have the finding that bordered on assets declaration thrown out.
The High Court, on July 25, 2018, upheld Mr Ofori-Atta’s case and quashed CHRAJ’s decision that the Finance Minister ought to have declare all his assets.
With regard to the breach of Act 921, a Deputy A-G, Mr Godfred Yeboah Dame, argued in court that CHRAJ had no jurisdiction to make findings and recommendations in relation to the issuance of bonds.
He said by law such functions were reserved for the Securities and Exchanges Commission (SEC), which is clothed with the mandate to regulate the securities and markets industry and the issuance of bonds.
He further submitted that the functions of CHRAJ were clearly defined by the 1992 Constitution and, therefore, in the instant case, the commission had the jurisdiction to only establish whether or not there had been conflict of interest.
“The decision of the respondent (CHRAJ) is not only unlawful but has the real potential to bring uncertainty and in the financial and securities industry,’’ Mr Dame argued.
CHRAJ, in its response, submitted that it did not exceed its jurisdiction but merely interrogated the procedure through which the bonds were issued.
Counsel for CHRAJ, Mr Cosmas Anpengnuo, argued that the fact that the SEC was the regulator of the issuance of securities did not stop CHRAJ from making findings on the procedure adopted by the Minister of Finance in the issuance of bonds, especially if allegations of conflict of interest had been made.
“Even the SEC and the manner in which its officers carry out and apply regulations governing the issuance of securities can be a subject matter of investigations by the respondent (CHRAJ),’’ he averred.
Counsel, therefore, impressed on the court to dismiss the application for judicial review filed by the A-G.
The court, however, ruled in favour of the A-G and granted all of its reliefs.