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Morris Mpala, MoB Capital Ltd
Zimbabwe’s economic challenges have brought in some unscrupulous tendencies and perennial offenders on the commercial front.

So many commercial disputes between parties have emerged since adoption of the multiple-currency system in 2009.

The biggest challenge is the remedy to these commercial shenanigans. The costs involved in settling commercial disputes are huge too, both in terms of resources and time.

Some disputes take years to conclude and business can’t be sustained on such protracted legal disputes.

The legal processes are moving slowly while affected persons are bleeding their balance sheets. When recourse is finally granted it will be too late to salvage anything.

Look at the time it takes to liquidate companies, judicial management, seek redress and investigations take forever. Individual businesses and corporates can’t afford this.

The law is an ass for real, hence the argument that it does not favour the aggrieved.

MoB makes the following observations and recommendations.

We advocate the establishment of the ‘Office of Financial Public Protector’ to resolve disputes against financial institutions and their customers.

This procedure will be done through negotiation, mediation, conciliation or determination, which will be informal, fair and cost-effective.

This will allow disputes to be resolved within the sector and outside the court system. It will also involve resolving disputes between financial institutions themselves.

One major challenge involves complex illicit financial flows, which have siphoned capital out of Zimbabwe and Africa at large.

A well trained and robust central bank should tackle the vice and ring-fence capital for local development and realisation of financial freedom.

The Deposit Protection Corporation (DPC) has the shock-absorbing effect to the smaller depositor by paying $500 in case a banking institution falls.

To increase confidence, financial institutions need to partner with international re-insurance companies to be able to compensate adequately when institutions fall.

The same principle could be extended to DPC to help increase amounts paid out in case any institution shuts down.

This is because in terms of confidence $500 is on the low side.

The Credit Reference Bureau would offer a preventive measure to commercial crimes. It goes a long way to prevent future disputes by analysing a credit seeker fully in their character before being availed credit.

The establishment of insurance credit bureau also aides in minimising organised and opportunistic fraud and crime in the insurance industry.

The police need to establish a crack unit with inclination towards understanding commercial crimes investigation.

Some cases are lost at investigation stages and thus cause business to fall. A deliberate training programme that targets new recruits to be well versed with business transactions that will involve industrial attachment in all facets of commercial crimes is crucial.

These are specialised police commercial units to combat business crime. This will equip such units with necessary modern resources and techniques to combat petty commercial crimes to elaborate money laundering schemes.

Small claims courts: There is a need to revise the limits from the maximum $250. Surely if an amount of $251 has to be taken up the courts it clogs the system above. Or it makes one forgo redress as the process is tedious.

In addition the $10,000 claim at the High Court also clogs the legal system given the lean resources at the courts.

These could be revised with a maximum for small claims court at $10,000 and only refer to High Court cases above $1 million.

We also need to have commercial lawyers who are trained in commercial litigation issues.

This is one area that if I wasn’t already in another field I would have considered investing in.

Commercial disputes are on the rise and the need for sharp commercial law experts is just overwhelming.

This will also expedite disputes as legal counsel will better understand commercial transactions.

We recommend establishment of commercial courts dedicated to these disputes. These will just be express courts solely to resolve any commercial transactions disputes in the shortest possible time so that business can move on quickly.

During World Cup 2010 there were courts strictly dedicated to tournament related cases and we are happy to report that it was a success. We do not see any reason not to replicate the same in our commercial disputes.

It saves time, saves money, creates jobs, creates revenues, we enjoy economies of scale and everyone is happy besides the perpetrators of such crimes, of course.

The need to empower and equip the ‘chiefs’ to understand business transactions to resolve such is also encouraged.

The chief has to have advisors that understand such for them to carry out their mandates diligently, fully without compromising financial justice.

This gives a holistic approach to solving this challenge by touching all areas that could be a source of discord.

Above all these processes have to be simplified, cost effective, fair and efficient and mustn’t be time consuming for it to be a win – win situation.

Business is looking forward to an autonomous, fair, free, robust and fast commercial resolutions platform so that they concentrate on production or provision of services, which is their core business.

These legal challenges are diverting their human capital and financial focus thus urgent resolutions are what business is advocating for.

Needless to say, the government has to create that conducive environment.

This is important considering that a majority of businesses are now run informally.

As they say financial justice delayed is financial justice denied and everyone has the right to remain financially viable and attain financial freedom. It has to be financial justice khonapho khonapho!!

If you live in Bulawayo please conserve water

If you live in Zimbabwe please use electricity sparingly: SOS (switch off switches)

If you live on planet earth please preserve the environment

Morris Mpala is managing director of MoB Capital (Pvt) Limited, a microfinance institution offering loans, micro-insurance and advisory services to small to medium enterprises as well as individuals.