Mark Shuttleworth Commits Millions won in Legal Battle to help other South Africans

South African billionaire expat Mark Shuttleworth celebrated a landmark victory against the Reserve Bank today by making a hugely generous gesture to South Africans who can’t afford their own constitutional court cases against the State.

The South African Supreme Court of Appeal found in favour of the 41-year-old entrepreneur and ordered the Reserve Bank to pay back R250-million in a case about exchange controls which will resonate with many expats.

After his win Mark announced he will donate those millions being returned to him to a trust that will “selectively fund cases on behalf of those unable to do so themselves, where the counterparty is the state.”

His reason he said is that “it is expensive to litigate at the constitutional level, which means that such cases are imbalanced – the State has the resources to make its argument, but the individual often does not.”

In a statement today, Mark – who now lives on the Isle of Man – said this case has a “very strong personal element for me, because it is exchange controls which make it impossible for me to pursue the work I am most interested in from within South Africa and which thus forced me to emigrate years ago.

“I pursue this case in the hope that the next generation of South Africans who want to build small but global operations will be able to do so without leaving the country. In our modern, connected world, and our modern connected country, that is the right outcome for all South Africans.”

Shuttleworth, who lists “legalese” as one of his dislikes on his website, is the founder of Ubuntu, a popular free operating system for desktops and servers, and leads product design at Canonical.

Mark originally made his fortune after founding Thawte while studying finance and IT at the University of Cape Town. The company, which specialised in digital certificates and cryptography, was acquired in 1999 by VeriSign.

Of his many achievements, Mark is probably best known for being the first citizen from Africa to travel in space – in 2002 he flew as a cosmonaut to the International Space Station. This space station features as one of his many ‘likes’ on his website…along with various South African things like the African bush, Clifton, Durbanville, sundowners, skinny-dipping and leopards!

According to his website Mark lives on “the lovely Isle of Man along with 12 ducks, the equally lovely Claire, two black bitches and the occasional itinerant sheep.”

Here is the full press statement which Shuttleworth released today:

“Exchange controls may appear to be targeted at a very small number of South Africans but their consequences are significant for all of us: especially those who are building relationships across Southern Africa such as migrant workers and small businesses seeking to participate in the growth of our continent.

“It is more expensive to work across South African borders than almost anywhere else on Earth, purely because the framework of exchange controls creates a cartel of banks authorized to act as the agents of the Reserve Bank in currency matters.

“We all pay a very high price for that cartel, and derive no real benefit in currency stability or security for that cost.

“Banks profit from exchange controls, but our economy is stifled, and the most vulnerable suffer most of all. Everything you buy is more expensive, South Africans are less globally competitive, and cross-border labourers, already vulnerable, pay the highest price of all – a shame we should work to address.

“The IMF found that “A study in South Africa found that the comparative cost of an international transfer of 250 rand was the lowest when it went through a friend or a taxi driver and the highest when it went through a bank.” The World Bank found that “remittance fees punish poor Africans“.

“South Africa scores worst of all, and according to the Payments Association of South Africa and the Reserve Bank, this is “..mostly related to the regulations that South African financial institutions needed to comply with, such as the Financial Intelligence Centre Act (Fica) and exchange-control regulations.”

“Today’s ruling by the Supreme Court of Appeal found administrative and procedural fault with the Reserve Bank’s actions in regards to me, and returned the fees levied, for which I am grateful. This case, however, was not filed solely in pursuit of relief for me personally.

“We are now considering the continuation of the case in the Constitutional Court, to challenge exchange control on constitutional grounds and ensure that the benefits of today’s ruling accrue to all South Africans.

“This is a time in our history when it will be increasingly important to defend constitutional rights. Historically, these are largely questions related to the balance of power between the state and the individual. For all the eloquence of our Constitution, it will be of little benefit to us all if it cannot be made binding on our government.

“It is expensive to litigate at the constitutional level, which means that such cases are imbalanced – the State has the resources to make its argument, but the individual often does not.

“For that reason, I will commit the funds returned to me to today by the SCA to a trust run by veteran and retired constitutional scholars, judges and lawyers, that will selectively fund cases on behalf of those unable to do so themselves, where the counterparty is the state.

“The mandate of this trust will extend beyond South African borders, to address constitutional rights for African citizens at large, on the grounds that our future in South Africa is in every way part of that great continent.

“This case is largely thanks to the team of constitutional lawyers who framed their arguments long before meeting me; I have been happy to play the role of model plaintiff and to underwrite the work, but it is their determination to correct this glaring flaw in South African government policy which inspired me to support them.

“For that reason I will ask them to lead the establishment of this new trust and would like to thank them for their commitment to the principles on which our democracy is founded.

“This case also has a very strong personal element for me, because it is exchange controls which make it impossible for me to pursue the work I am most interested in from within South Africa and which thus forced me to emigrate years ago.

“I pursue this case in the hope that the next generation of South Africans who want to build small but global operations will be able to do so without leaving the country. In our modern, connected world, and our modern connected country, that is the right outcome for all South Africans.”