The South African Canegrowers Association chairperson, Andrew Russell, applauded the Durban High Court’s recent judgement on outstanding levies that are due to be paid by Tongaat Hulett to the sugar industry.
Russell said the levies are essential to the economic survival of sugarcane farmers and the tens of thousands of livelihoods they support.
“Judge Rashid Vahed confirmed that the Sugar Industry Agreement (SIA) is statutory legislation and payments due under it are still required to be made during the business rescue process, that suspends many other payments.
“This development is significant for the South African sugar industry, providing clarity on contractual obligations and potentially safeguarding the interests of sugarcane growers and related stakeholders,” Russell said.
Sugar Industry Agreement stands
Russell said the December ruling found that Sugar Industry Agreement must be honoured during business rescue and the Companies Act that legislates business rescue, did not override it.
“This means payments due under this agreement were required to be paid by the millers, such as Tongaat, even as it was in business rescue,” he said.
The business rescue practitioners of Tongaat Hulett Limited (THL) had sought leave to appeal the December 2023 ruling by Judge Rashid Vahed. Russell said the application was opposed by a number of organisations including government.
“The purpose of the SIA is to ensure that growers, millers and refiners each receive an equitable share of the proceeds from local sugar production.
“It follows from the ruling that THL must honour the financial obligations under the SIA and pay the almost R526 million the new owners agreed to pay the industry, including growers, when the court battle came to an end,” he said.
While THL’s business rescue practitioners may still pursue appeals in higher courts, SA Canegrowers expresses hope that Judge Vahed’s clear ruling will bring closure to the matter.
ALSO READ: From bitter to sweet: Tongaat Hulett farmers feel at ease
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