Cimentos da Beira: Bankruptcy or the story of a coup? (1)

By Luis Nhachote

Since March 2022 – for about three years – a process of appropriation of the Beira Cement
Factory (FCB) has been underway in the port city of Beira, through an administrative
insolvency process, with criminal nuances. The evidence suggests that we are facing the
tentacles of an intricate web infiltrated from the justice sector to the local commercial sphere.
Around November 2021, the Provincial Prosecutor's Office of Sofala received two reports,
the first being anonymous and the second linked to well-known figures in the business and
social fabric of the city of Beira, with command coming from an Italian source.

Since December 2024, the Center for Investigative Journalism (CJI) has been following this
delicate case and has delved into its investigation, the contours of which it now shares with
the public so that they can understand the details of a case that seems to require the so-called
"independence of the judiciary" to save a hundred workers, penalize and prosecute internal
and external actors who appear to have a clear agenda: the appropriation of a relatively new
industrial unit according to a Machiavellian logic, the ends justifies the means.

An egg of Columbus

The Public prosecutor (MP), as is known, is the guardian of legality and the owner of
criminal action. In early 2022, it received several reports regarding an alleged unprecedented
crisis at the cement factory. In light of these complaints, some supposedly coming from the
workforce, the MP decided to intervene and requested that the competent courts declare an
insolvency action. This occurred last year, after the original whistleblower had revealed their
identity.
However, to declare insolvency, it was necessary for the company to be unable to meet its tax
and salary obligations, which was clearly not the case for Cimentos da Beira, as it continued
to honor its commitments and even deposited a guarantee in court during the ongoing
process.
The special insolvency action registered under number 25/TJPS/SC/2022 was requested by
the Public Ministry following an "anonymous report," allegedly submitted by workers of
FCB.

Documents from the "anonymous report" obtained by the CJI revealed that the complainants,
who ultimately were identified as we will see later, told the Attorney General’s Office that
the FCB had a negative balance of 2,000,000,000.00 Mts (two billion meticais) and that the
factory "owes various state institutions and also has debts with the workers."
Notified by the Court to exercise its right to contradict, the company submitted substantial
documentation and proved its financial situation. The CJI accessed a copy of the dossier sent
to the court, and nothing indicated that the company was in a state of insolvency.

Even so, the provincial prosecutor opted to pursue the claims of the "anonymous report," and
the Judicial Court of the City of Beira decided to grant it. Neither conducted any investigation
into the entity in question to confirm or deny the reports.
What is strange is that the cement factory is placed in a straitjacket due to an alleged debt of
7,000,000,000.00 Mts (seven million meticais), when it has monthly energy consumption
bills exceeding that amount. "It doesn't make sense for a company that pays energy bills of 10
million meticais monthly to be subjected to insolvency proceedings due to a debt of 7
million," a source in the city of Beira told us, where the CJI was conducting checks in
December and January.
The "anonymous report" indicated that Cimentos da Beira had a negative capital of two
billion meticais and that it owed several institutions, including the Mozambican state. It
further stated that the company had accumulated debts with workers, suggesting that it was
on the brink of bankruptcy.

Act One: Acquittal of the Company

For lack of grounds, the judicial authorities acquitted the company, according to a ruling
issued by Luis Charles, then the judge in the case and currently the president judge of TJPS.
We have in our possession a copy of the mentioned ruling, which summarizes the points
made in it.
On August 11, 2022, five months after the "anonymous report" was accepted by the MP –
which by law is exempt from paying court fees – António Mario Romão Charles, a judge of
Law "A," issued a ruling, where, among other things, he requested CDB to submit the
following documents within ten days: accounting statements, balance sheets, accumulated

profit and loss statements, cash flow reports, a nominal list of creditors, a list of assets, and a
list of administrators. CDB responded to the ruling in a timely manner.

From the Decision

On November 24, 2022, the same judge – who would later be promoted to the position of
president judge of TJPS – issued a ruling emphasizing the unnecessary declaration of
insolvency requested by the MP.
"In our understanding, unless stated otherwise, the MP, representing the State-
Administration, holder of the control of revenues of the National Treasury, has the legitimacy
to request insolvency under the terms of paragraph d) of article… therefore, the exception of
active illegitimacy cannot proceed, in which case it is judged unfounded…"

Regarding the arguments of the cement factory after exercising the right to contradict and
presenting the required documentation, the judge wrote that "it happens that in the opposition
and subsequent acts, the defendant submitted evidence that it does not owe the National
Treasury, nor has any overdue debts, the validity of which is valid until October 5, 2022, see
documents on page 214 of the records."
It was based on the arguments and documents presented in the proceedings that the judge
decided to: a) grant the dilatory exception of inappropriateness for lack of cause of action, b)
not declare the requested insolvency, and consequently: c) acquit the defendant Cimentos da
Beira, Lda from the present instance. (The emphasis is the responsibility of CJI).
Shortly thereafter, a new request for insolvency re-emerged, this time with names and faces,
as we will outline in the following article.