Uganda awarded Officials, Lawyers $1.65M After winning Heritage Oil Tax Dispute

A new expose by Ugandan Daily Chimp Reports newspaper has revealed that 39 government officials were awarded cash bonanzas equaling Ush6 billion (equivalent $1.65M) after winning the protracted Heritage/Tullow oil Capital Gains Tax (CGT) case.

In the case, where the Uganda Revenue Authority (URA) was fighting to have Heritage oil pay $405M in capital gains tax following the $1.5B sale of assets to its partner Tullow Oil, the URA is said  to have paid 39 government officials and lawyers including its Chief Executive Doris Akol $66,700 Ministry of Energy and Minerals Development permanent secretary Kabagambe Kaliisa $36600, the then Deputy Attorney General, Fred Ruhindi received $25600 and the late former Permanent Secretary Finance Ministry, Chris Kassami who received $108,000 after he had passed on.

The case which dragged through the Uganda High Court and the United Nations Commission on International Trade Law (UNCITRAL) in London saw Heritage lose both litigations. The UNCITRAL Tribunal in the Heritage arbitration against Uganda issued a unanimous award dismissing all claims and also ordered the oil explorer to pay more than $4 million of costs incurred by Uganda in connection with the case.

Prior to the win Uganda had threatened not to consent the deal until Tullow Oil paid 30 percent of the disputed tax with the remaining amount being secured by a bank guarantee. Later the government arm twisted to releasing another amount for the renewal of the license renewal. Heritage had also logged a suit against Tullow Oil which it also lost.

In the recently released leaked ‘Panama Papers’ emails between the company and its lawyers show that Heritage Oil knew about the capital gains tax before they were imposed by the URA and instructed its lawyers to aggressively fight them.

Others on the list include:

  1. Former AG Peter Nyombi received $62300
  2. Lawrence Kiiza, official in the Ministry of Finance $28000
  3. Martin Mwambutsya, Attorney in the Ministry of Justice and Constitutional Affairs $63900
  4. Ernest Rubondo, Head Directorate of the Petroleum Authority of Uganda, received $73300.
  5. Solicitor General, Francis Atoke $64500
  6. URA lawyer, Ali Ssekatawa got $66700.
  7. The Director of Legal Affairs at the Solicitor General’s office, Christopher Gashirabake $66700
  8. Honey Malinga Vice Director of the Petroleum Exploration & Production Department (PEPD) $72175
  9. Moses Kaggwa, a Member Commissioner for Tax Policy Ministry of Finance $64500
  10. Moses Kibumba, a private tax expert and former URA tax auditor, received $25600
  11. Moses Kajubi a former URA Commissioner, Domestic Taxes $62300
  12. Peter Muliisa, a URA lawyer $64500
  13. Rodney Golooba and Samuel Kahima lawyers with URA, received $61500 and $61700
  14. Harriet Lwabi Musoke an official at Ministry of Justice and Constitutional Affairs, bagged $61700 while Harriet Tukamushaba in the same office received $27300
  15. KCCA Director Jenifer Musisi and former head of the legal department at URA, was given $33300
  16. Robinah Nakakawa a commissioner at URA $66700
  17. Elizabeth Nakkungu from the Justice Ministry received Shs 238m.
  18. Principal State Attorney George Kallemera got $65600
  19. Syson Ainembabazi of URA legal department $59500
  20. Assistant Commissioner Tax Investigations, Irene Bashabe Kyomuhendo $57850
  21. URA Manager Customs Audit, Agnes Nabwire.

The amounts were released by authority of the Auditor General, John F.S Muwanga in November last year. A number of members of parliament have vowed to probe the transaction.