…as LCA argues Matela acted outside her powers in awarding the tender in 2020
Moorosi Tsiane
THE Court of Appeal will on 15 May 2026 determine the validity of a controversial spyware contract awarded to a South African company by the Lesotho Communications Authority (LCA).
The spyware will enable the telecoms regulator to snoop on mobile network subscribers’ private conversations.
The judgement follows the LCA’s decision to seek self-review. It argued that its former chief executive officer, Advocate (Adv) Mamarame Matela, had no powers to award the M500 million spying tender to the company, Global Voices Group.
The LCA argued before the Court of Appeal yesterday that Adv Matela had acted beyond her legal powers in awarding the contract.
The latest move marks a continuation of a protracted legal tussle between the communications regulator and the international technology company, which it awarded the Compliance Monitoring and Revenue Assurance (CMRA) system in 2020.
The system—widely criticised as a “spy tool”—is designed to monitor telecommunications traffic and mobile money transactions, raising concerns over privacy and state surveillance.
The LCA approached the Court of Appeal after suffering a major setback in September last year, when High Court Judge, Moneuoa Kopo, upheld the validity of the M500 million contract.
In his ruling, Justice Kopo found that although there may have been irregularities in internal procedures, the appointment of GVG did not violate procurement laws.
“The appointment of GVG as the preferred bidder is not contrary to the procurement laws of this country. The erstwhile CEO (Matela) may have not complied with a number of internal rules to the effect that a bystander may feel that something was amiss. However, no procurement laws were broken,” Justice Kopo said.
He further warned that nullifying the contract would undermine the country’s credibility in commercial dealings.
“The need for the procurement of the system was accepted even from the ministerial level. The appointment of GVG was approved by the highest governing body of the LCA. It will be a travesty of justice if the GVG appointment can be ruled unlawful, as it would highly compromise the integrity of this country in commercial dealings.”
Although the court acknowledged that certain aspects of the agreement—such as a clause exempting GVG from paying tax—were against public policy, it held that these did not go to the root of the contract.
“For this reason, therefore, the entire Master Service Agreement and the Arbitration Agreement cannot be declared null and void. Since there is an arbitration clause, parties should ventilate the said clause through arbitration. The freedom of contract must be respected,” the judge ruled.
He subsequently dismissed the application with costs.
Not satisfied with the ruling, the LCA escalated the matter, arguing that Justice Kopo misdirected himself by concluding that the alleged illegalities should be dealt with through arbitration.
The appeal was heard yesterday before a panel of three judges—Petrus Damaseb, Phillip Musonda and ’Maliepollo Makhetha—with LCA represented by Adv Motiea Teele KC, while Adv Kaizer Selimo appeared for GVG.
Adv Teele maintained that Adv Matela had no authority to enter into the agreement, including the arbitration clause embedded in the contract.
“The former CEO was not authorised to enter into an arbitration agreement. She was not entitled to enter into any arbitration contract at all—she acted out of her powers. The public procurement processes were not followed,” Adv Teele submitted.
He further argued that Adv Matela acted ultra vires by assuming multiple roles in the procurement process, including involvement in the evaluation stage and influencing the final award of the tender.
On the other hand, Adv Selimo countered that the LCA’s case was misplaced and based on non-existent grounds.
“The decision that is sought to be reviewed by the appellants, there is no such decision as a matter of fact. This application is brought to the court simply to discredit the former CEO (Matela) because the facts raised here are not correct,” he argued.
He added that the LCA’s failure to join Adv Matela in the proceedings had weakened its case.
“These issues would have been long resolved if the former CEO had been joined in the matter. The court would have directed her to produce the record of proceedings leading to the decision, but she is not here to respond to these allegations,” said Adv Selimo.
He also dismissed claims that Adv Matela single-handedly awarded the tender, insisting that the LCA Board was responsible for the final decision.
“It is also not correct to say that the LCA board has no role to play in procurement processes, and it is not correct to say that Matela made any awards because the awarding of the tender was made by the board,” he said.
Adv Selimo further pointed out that there was no fully constituted tender panel at the LCA at the time, as later confirmed by the Auditor General, with such structures only put in place in 2021.
He urged the court to dismiss the appeal with costs.
Meanwhile, in the earlier High Court proceedings, the LCA had argued that the procurement process was flawed on several fronts, including the exclusion of electronic bid submissions and violations of internal financial regulations.
Attorney Monaheng Rasekoai had contended that the decision to procure the system originated from Adv Matela herself rather than the user division, and that she improperly sat as a member of the Evaluation Committee—contrary to procurement regulations.
He also argued that Adv Matela prematurely informed GVG that it was the preferred bidder before obtaining board approval, in breach of financial rules requiring board consent for procurements exceeding M2 million.
The LCA further raised concerns about the financial implications of the deal, particularly the tax exemption granted to GVG, which it said could negatively affect national revenue collection.
However, GVG has consistently maintained that the contract was lawfully concluded and should be upheld under the principle of pacta sunt servanda—that agreements must be honoured.
Adv Selimo argued that both parties freely entered into the agreement and that it does not violate public policy.
Judgment in the matter has been reserved for 15 May 2026.
