“Hima Cement is a Non-Existent Entity” – High Court

By DailyNewsUG Correspondent
As of 2019, Hima Cement is the 2nd largest manufacturer of cement in Uganda, producing an estimated 2 million metric tonnes annually, accounting for 28 percent on national output. In 1994, the parastatal formerly known as Uganda Cement Industries was privatized by the government of Uganda. It was split into Tororo Cement and Hima Cement. The two companies were acquired by different investors. Tororo Cement eventually became Tororo Cement Limited. In 1999, the French conglomerate LaFarge acquired 100 percent shareholding in Hima Cement and re-branded the company into Hima Cement Limited.

Well the latest is that the future of Hima Cement Ltd is in doubt after the Court of Appeal upheld a decision by the High Court that conferred its mining rights to East African Gold Sniffing Company Ltd.

On March 26, 2013, Justice Eldad Mwangusya of the High Court, annulled Hima’s mining rights to limestone deposits in Kasese, where the company had commissioned a $120m (about Shs446b) cement manufacturing plant in 2011 on grounds that Hima Cement Ltd is nonexistent.

“The company, therefore, ceased to have legal rights and conversely could not be said to have suffered a legal grievance in the circumstances. In view of the finding that a non-existent entity was given audience, the decision cannot be allowed to stand and it is quashed. The respondent shall bear the cost of this application,” Justice Mwangusya ruled then.

Court of Appeal Justices Christopher Madama, Geoffrey Kiryabwire and Kenneth Kakuru have upheld the decision, dismissing an appeal that was filed by the Attorney General instead of Hima Cement’s legal team.

According to the judges, the Attorney General, legally, wasn’t the right party to appeal the decision by High Court since it wa snot an aggrieved party under Section 118 of the Mining Act.

The section concerns the right of any person aggrieved by a decision of the Commissioner Geological Survey and Mines to apply for administrative review.

Hima Cement’s troubles stem from 1994 when it was acquired by Lafarge Group, the French cement giant. After the acquisition, the company’s name was changed from Hima Cement 1994 Ltd to Hima Cement Ltd, but the changes were never registered with the Registrar of Companies in accordance to the law, and thereafter subsequently publish the name in the National Gazette.

East Africa Gold Sniffing, Hima Cement’s rival, contested a decision by the Ministry of Energy that restored Hima’s mining rights after the latter managed to secure an exploration licence over the same area.

Ms Irene Muloni, then minister of Energy and Mineral Development, revoked Gold Sniffing’s licence in April 2012 after an administrative review found that the Commissioner Geological Survey and Mines hurriedly issued the licence in disregard of procedure.

Furthermore, Gold Sniffing’s shareholding capital of $4m (Shs14b) was considered inadequate for the project.

Gold Sniffing capitalised on Hima’s change of name and argued that by failing to file a change of name and subsequently failing to secure an extension of its rights after the original licence expired, Hima had forfeited its rights to the area, which the High Court agreed with.

Submissions
On June 12, Justice Madrama, who wrote the Court of Appeal’s lead judgment, didn’t mince words, saying that since it’s a fact that Hima Cement Ltd is a nonentity, the submissions from the Attorney General’s legal team were simply academic.

“Was the government a proper party under Section 188 of the Mining Act when the decision for review by the Minister is that of the Commissioner under the Mining Act?” the judge asked.

“Ground 3 of the appeal is merely consequential to the finding that Hima Cement is a nonentity. By finding that Hima Cement Ltd is not an aggrieved person, it followed that it could not have obtained the remedies granted by the minister and therefore the decision of the Minister was consequentially quashed.”

One might argue, Justice Madrama observed, that the Attorney General would be interested in some questions of law. “However”, the judge ruled, “the Attorney General could only have represented the minister. This was not possible in this case as the minister was the adjudicator in the proceedings from which the application for judicial review had been made.”

According to Justice Madrama, the Attorney General did not purport to represent the commissioner who had initially issued the exploration license, but it was clearly challenging the decision declaring Hima Cement Ltd a nonentity.

“This is a question of fact based on the registration of URSB,” Justice Madrama ruled, referring to the Uganda Registration Services Bureau. “Secondly, it is not a question of general public importance. Last but not least, the Attorney General has no capacity to represent private limited liability companies or individual members of the public.”

The judgment means that Hima Cement’s operations of mining of limestone and processing of cement in Kasese must cease. The decision is appealable to the Supreme Court.

LafargeHolcim was born of the merger of equals by Lafarge and Holcim in 2015. With over 180 years of combined experience, our united Group aims to usher in a new era of leading-edge technologies and innovations in the building materials industry to address the challenges of the 21st century.
Holcim
● 1912: Holcim was born with the opening of a first cement plant in Holderbank (Switzerland) by Adolf Gygi, joined two years later by visionary industrial Ernst Schmidheiny.
● 1922-1931: Crossing borders. The company began investing in cement business in other European countries and in Egypt, Lebanon, and South Africa.
● 1942: Creation of the research and testing facility Technische Stelle Holderbank (Technical Center Holderbank).
● 1952-1961: A decade of increased expansion. In 1960, following the entry into the Canadian market, a large cement production facility was opened in Michigan (USA). Almost simultaneously, Ernst Schmidheiny invested in a small plant near São Paulo (Brazil).
● 1962-1991: One global Group. Holderbank began a phase of expansion in Latin America. In 1974, Holderbank made its first move in Asia with a participation in the Philippines. Later, Holderbank began scouting new markets: Spain in 1980 and Eastern Europe, China, India, and Southeast Asia in the early 1990s.
● 2001: The company’s name was changed to Holcim by a vote at the annual general meeting.
● 2014: Holcim and Lafarge announced their merger project.
● 2015: Closing of the merger, which gave birth to LafargeHolcim, the new leader of the building materials industry.
Lafarge
● 1833: The Lafarge company was born in Le Teil (Ardèche, France). Joseph-Auguste Pavin de Lafarge began regular extraction operations in the limestone quarries.
● 1864: First major project: the Suez Canal. Lafarge won the “contract of the century” in Egypt and delivered the 200,000 tons of hydraulic lime needed to build the piers of the Suez Canal.
● 1887: The world’s first research laboratory on cement. Following its commercial success, Lafarge opened a research laboratory near Le Teil, France. This laboratory was the first in the world to specialize in cement.
● 1950s-70s: International expansion in North and South America. Through plant constructions and acquisitions of firms, Lafarge established a good position in the United States, Canada, and Brazil.
● 1980s-90s: Going global. Lafarge led a significant International expansion with new operations in Sub-Saharan and East Africa as well as in China, India, and South Korea.
● 2008: Acquisition of Orascom Cement. Lafarge acquired Orascom Cement, the leading cement group in the Middle East and the Mediterranean Basin, with number one positions in the key markets of Egypt, Algeria, United Arab Emirates, and Iraq.
● 2014: Holcim and Lafarge announced their merger project.
● 2015: Closing of the merger, which gave birth to LafargeHolcim, the new leader of the building materials industry.

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