Shocking Details in the UGX6 Billion Handshake Report Emerge, Beneficiaries to Cough the Money

Shocking Details in the UGX6 Billion Handshake Report Emerge, Beneficiaries to Cough the Money


By Serestino Tusingwire


The probe committee chaired by Abdul Katuntu that was constituted by parliament to investigate the UGX6Billion Handshake saga has this afternoon released its findings.

We bring you the committee’s recommendations on the saga.

The committee therefore recommends as follows;

(a) That all funds paid out of URA account to the beneficiaries of the “handshake” should be refunded.

(b) AU officers who flouted the law should be held accountable and in this vein, the 100 should institute investigations with a view to establish the culpability and possible offences.

(c) The Executive should come up with a Bill within 90 days to regulate and streamline the Presidential Donations Budget.

(d) The supplementary request of the UGX 6 Billion currently before Parliament should be rejected because the virement created a liability infringing section 22 of the PFMA.

(e) Parliament should revisit Section 8 of the Petroleum (Exploration, Development and Production) Act, 2013 with a view to amending it and provide for technical people1to be signatories to the PSAs.

(I) All recoverable costs incurred by oil companies should be submitted to Parliament quarterly.

(g) The Attorney General should take immediate steps and measures to recover the costs amounting to USD 4,083,840 awarded by the International Arbitration Tribunal and report to Parliament within 90 days.

(h) URA should take immediate steps and measures to recover the costs awarded by the TAT and High Court in application numbers 26 of 2010, 28 of 2010, 6 of 2011,8 of 2011 and High Court Civil Appeal Civil Appeal No. 14 of 2011 as well costs in the High Court Appeal.

(i) The Auditor General should, as soon as possible, carry out a special audit into deductions of Withholding Tax on fees paid to the external lawyers; Curtis, Mallet-Prevost, Colt & MosIe LLP by URA and report to Parliament within 90 days.

(g) The Attorney General should take immediate steps and measures to recover the costs amounting to USD 4,083,840 awarded by the International Arbitration Tribunal and report to Parliament within 90

(h) URA should take immediate steps and measures to recover the costs awarded by the TAT and High Court in application numbers 26 of 2010, 28 of 2010,6 of 2011,8 of 2011 and High Court Civil Appeal Civil Appeal No. 14 of 2011 as well costs in the High Court Appeal.

(i) The Auditor General should, as soon as possible, carry out a special audit into deductions of Withholding Tax on fees paid to the external lawyers; Curtis, Mallet-Prevost, Colt & Mosle LLP by URA and report to Parliament within 90 days.

The Committee observes therefore:

  1. That it is true that USD 157 million, which would have accrued as part of the Capital Gains Tax, was waived.
  2. The contention arose out of a clause in the PSA which provided for waiver of tax signed by the then minister Hon. Syda Bbum ba.
  3. That the dispute would not have arisen jf the PSA did not have a waiver of
  • The then Minister of Energy, Hon. Syda Bburnba, did not have authority to waive tax in that transaction and her action of not having read the agreement before signing was irregular.
  1. All the then Ministers of Energy who signed PSAs with a similar clause acted ultra vires the law.
  2. The funds paid out were for activities budgeted for under the U 1<A

This ‘(handshake” expenditure was not a budgeted URA activity and therefore, a diversion of the UGX 6 Billion without lawful authority was con trary to the PFMA.

  1. The payment of the UOX 6 Billion “handshake” from URA budgeted for activities without Board knowledge and/ or approval was in contravention of section 16 of the Uganda Revenue Authority Act, 1991.
  2. E. The President’s approval of this “handshake” was bonafide. However, it was an error of judgemen t.
  3. The Committee concludes that the argument of the beneficiaries that the paymen t was rooted in Articles 98 and 99 of the Constitution was unfounded and misleading.

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