GMB maize monopoly challenged

Source: GMB maize monopoly challenged – The Zimbabwe Independent July 19, 2019

BRIDGET MANANAVIRE

TWO local businesspeople have approached the High Court seeking the invalidation of Statutory Instrument (SI) 145 of 2019 which gave the Grain Marketing Board (GMB) a monopoly over the importation and sale of maize in the country.

Through the legislation, the government last month made GMB the sole trader of maize in Zimbabwe after fixing the floor price at ZW$1 400 per tonne. The legislation also makes it illegal for people to trade in maize among themselves.

It also bans the transportation of more than five bags of maize except when making deliveries to the GMB and empowers police to seize any grain they suspect is being moved without authority and compliance with the law.

“No person who is not a producer of maize (farmer) or who is not a contractor shall sell maize to the GMB … No person or statutory body or entity shall buy or otherwise acquire any maize from any farmer or producer otherwise than through the GMB,” the SI reads.

Grain dealer Allan Markham, who is also MDC legislator for Harare North and pig farmer Clever Rambanapasi filed a joint application at the High Court on Monday, seeking the court to declare SI 145 unconstitutional.

Markham and Rambanapasi argued that the legislation is ultra vires the constitution in that it denies them the freedom of profession and trade and also stifles competition.
The rights are enshrined in 56, 58, 64 and 71 of the Constitution of Zimbabwe.
Lands, Agriculture, Water, Climate and Rural Resettlement minister Perrance Shiri and GMB are cited as the first and second respondents.

Zimbabwe is experiencing a shortage of maize, following drought-induced poor harvests in the 2018/19 farming season.

Markham says he has extensive interests in the agriculture and commercial sector where he buys and sells maize in communities. He is also buys maize from communal farmers which he uses to feed vulnerable communities particularly the urban poor in places like Hatcliffe, Highfield and Glen View.
Rambanapasi said he was a communal farmer who runs a small piggery project in Murewa, which regards maize as an essential ingredient in stockfeed. He also buys maize from rural communities in various villages in rural Murewa to feed his pigs.

“What this therefore means is that the agriculture minister has set up a monopoly and indeed a dangerous monopoly in respect of which anyone who trades in grain whether is a buyer or seller can only do so through the GMB and can only do so at a fixed price of ZWL1 400,” the application reads.
“The regulations, restate the re-monopolisation of maize sold to the GMB in Section 5 and 6 of the same. The consequences and effect of the regulations and indeed the consequences and effect of declaring a product a controlled one is therefore drastic.”

The applicants said the legislation affects the contractual right of farmers and traders to buy grain from any party or individual.

“In rural communities where communal farmers produce subsistence maize, it means that it has a serious effect on livelihoods. A peasant farmer in Muzarabani must theoretically travel miles away to a GMB depot. Equally his neighbour who is starving must travel miles to that GMB depot to buy grain because the two of them can’t simply exchange,” the court papers read. “Further in these communities, people do barter trade that is to say chickens or goats for maize. This can’t happen now. Apart from affecting the freedom to contract, the move affects freedom to trade. Professional millers, retailers and other organisations and individuals, including myself who had the right to buy maize everywhere can no longer do so except from GMB.

“At GMB the challenge is that there is a controlled price. The market is excluded. The declaration has an effect on due process rights protected under Section 56 of the Constitution of Zimbabwe. Both procedural and substantive due process requires that one has notice, and one has choices and opportunities. Those have been taken away by the Statutory Instrument.”

The two also argue that the declaration has the effect of depriving one of his property and appropriating the same to the GMB at a price that is already fixed. And that it does not make economic sense.

According to the application, the regulations breach section 64 of the constitution which provides for freedom of profession or trade, as it forces an individual only to deal with the GMB at a fixed price.
“They do not meet any legitimate test or policy and therefore they should be struck down.”