Bugweri County Member of Parliament Abdu Katuntu has welcomed the ruling by Constitutional Court stripping of legal immunity from Bank of Uganda saying it was long overdue.
Mr. Katuntu is a seasoned legislator who chaired the Committee on Commissions, Statutory Authorities and State Enterprises (COSASE) of parliament that investigated Bank of Uganda on the issue of closure of commercial banks.
Yesterday, the Constitutional Court nullified sections 118 and 124 of the Financial Institutions Act that has been shielding Bank of Uganda and its employees from being sued.
The five justices of Constitutional court in their ruling said it was unconstitutional for BoU to hide under sections 118 and 124 to shield themselves from the law and yet under 21 of the same constitution, it gives powers of equal treatment before and under the law.
The justices were Muzamiru Kibeedi Elizabeth Musoke, Egonda Ntende, Irene Mulyagonja and Cheborion Barishaki
“This gives unjustified and arbitrary protection to the BoU, which is contrary to article 21 of the Constitution which provides that all persons are equal before and under the law in all sphere of political, economic, social and cultural life and every other respect and shall enjoy equal protection of the law. Given that BoU’s directives to freeze a person’s account have a bearing on the constitutional right to property, it is vital in safeguarding those rights that the courts retain the powers to scrutinize the actions of Bank of Uganda on their merits. This will ensure, not only freezing orders are not unjustly made but also that the BoU’s receives equal treatment as other persons who in similar circumstances will be amenable to legal proceedings”
The landmark ruling arose out of constitutional petition No 50 of 2013 of Peter Ssajabi and Swift Commercial Establishment Limited versus Attorney General and Bank of Uganda.
The petitioners challenged the constitutionality of provisions in certain acts of parliament and hence seeking court’s interpretation of the constitution so as to determine whether certain acts were allegedly done by the respondents in contravention of the constitution. The petition was brought in pursuant to articles 2,137 (1) (1) & (4) and 150 of the constitution and the constitutional court.
“The petition also succeeds regarding sections 118 and 124 of the FIA which when read together have an unconstitutional effect in that the provisions empower the BoU to make directives cannot be subject to court scrutiny for purposes of determining whether they are justified. This is unconstitutional in that it denies the account holder access to court and shields the BoU from scrutiny in court proceedings. The section gives the BoU favorable and unequal treatment which is contrary to Article 21 (1) of the Constitution.” Reads the judgement which was delivered by Justice Cheborion Barishaki on August 26, 2021.