Energy2.08.2024

Eskom hit with R3-million warning

The Johannesburg Stock Exchange (JSE) has censured Eskom and fined it R3 million for failing to comply with the JSE’s debt listing requirements.

However, the fine is wholly suspended for three years, provided Eskom isn’t found to be in breach of similar provisions of the Debt Listings Requirements during the suspension period.

According to the JSE’s announcement, the state-owned power utility is required to publish policies relating to board member and prescribed officer dealings, loans, and procurement.

“Eskom failed to comply with the provisions of the Debt Listings Requirements after its promulgation in 2020,” it said.

“Consequently, in September 2021, Eskom applied to the JSE for an extension to finalise the relevant policies and registers, and the JSE granted Eskom an extension to 28 February 2022.”

Eskom notified the market via a SENS announcement in November 2021 that its policies and registers would be published on its website by 28 February 2022.

“However, Eskom failed to abide by the terms of their own extension request and after confirming such to shareholders in the SENS announcement,” the JSE said.

It then submitted a further extension request in December 2022, asking for a deadline of 31 July 2023, which it also missed.

The JSE says this shows an apparent disregard for the provisions of the Debt Listing Requirements, and it found Eskom to be in breach of paragraphs 7.9, 7.10, 7.15, and 7.16 of the requirements.

“For these reasons and with reference to the JSE’s findings of breach, the JSE has decided to impose on Eskom a public censure and a fine of R3 million,” it said.

Eskom responded to the sanction via a separate SENS announcement, acknowledging its non-compliance.

It notes that it isn’t permitted to advance loans to directors or prescribed officers; therefore, no such transactions have taken place. Similarly, it is restricted from doing any business with directors.

“Accordingly, no such transactions have taken place or would have needed to have been recorded in a register,” it added.

“In conjunction with the above, and when considering the period in review from 31 August 2020, there would have been no need for any disclosure in relation to loans to directors or prescribed officers.”

Eskom acknowledged the importance of effective governance and transparent disclosure, adding that it has taken steps to rectify the non-compliance and ensure compliance going forward.

“The outstanding policies and registers (or appropriate statements) are now largely finalised and were published on the Eskom website on Friday, 12 April 2024 (policies) and Friday, 28 June 2024 (registers),” it said.

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