A judge in Johannesburg has ordered the Gupta brothers to ground their Bombardier jet after Export Development Canada filed an application saying the brothers violated terms of a loan provided to help purchase the jet.handout
A judge in Johannesburg has ordered the controversial Gupta brothers to ground their Canadian-financed luxury jet after Canada’s export agency expressed fears that the Bombardier plane could be used for criminal activities.
The federal government’s export bank, Export Development Canada, provided US$41-million in financing to the Guptas in 2015 to help them purchase the US$52-million Bombardier jet. But now the Guptas are fugitives from justice, evading South African arrest warrants on corruption charges, and the Canadian bank says it has no idea where the plane is located.
The export bank, EDC, has been criticized for making the loan to the Guptas at a time when corruption allegations against them had been widely reported.
Related: Questions mount over Bombardier’s deals with notorious Gupta family
The Canadian bank filed a court application in Johannesburg to ground the plane, arguing that the Guptas had violated the conditions of the loan. The bank said it urgently needed to “decouple” from the Guptas because of the risks to its reputation. “There is a very real concern that the aircraft may be used to escape justice or for some other unlawful means,” it said in its application.
The Guptas fought the application, denying any default on the loan. Their lawyers said EDC had always been aware of the corruption allegations and was engaging in a last-minute “face-saving exercise” to “salvage its rather shaky reputation.”
The Guptas have reportedly been flying the jet between Dubai, Russia and India in recent weeks, but EDC says the Guptas have switched off the public tracking device on the plane to make it impossible for the bank to know where it is.
Judge Fayeeza Kathree-Setiloane, issuing her decision on Monday, ordered the Guptas to return the jet to South Africa and place it in safekeeping at Lanseria airport in Johannesburg under EDC’s custody, pending a final decision on the case.
She also ordered the Guptas to cease their use of the plane. And she ordered South Africa’s civil aviation authority to cancel the plane’s registration. This would prevent it from being legally flown anywhere in the world. The aviation authority has previously said that it would comply with the court’s decision.
In her ruling, Judge Kathree-Setiloane said there was a “pungent possibility” that the Guptas switched off the tracking device so that the airplane could be used for unlawful purposes.
The Gupta lawyers had dismissed this as speculation, but the judge noted: “They conspicuously do not say that the aircraft is not being used for unlawful purposes and they do not give an undertaking that the aircraft will not be used for unlawful purposes in the future.”
The Canadian export bank welcomed the judge’s decision. “EDC is pleased with the favourable ruling and expects an orderly handover of the aircraft pursuant to the court order,” said EDC spokesman Phil Taylor.
The Guptas are expected to fight the court order, setting the stage for a prolonged legal battle. The Guptas can file an appeal against the order.
The Guptas are business tycoons who built a huge financial empire in South Africa after forming a partnership with Duduzane Zuma, a son of former president Jacob Zuma. There have been corruption allegations against them since 2010, including a government inquiry in 2013 and a detailed report by an independent ombudsperson in 2016, but they appeared to be protected from the law as long as Mr. Zuma was president.
The Guptas fled the country after Mr. Zuma lost power in the ruling party late last year. He was forced to resign from the presidency last month. A judicial inquiry has been appointed to investigate his relationship with the Guptas and the corruption allegations that surround them.
Geoffrey York