Mr Kessel (“Applicant”) was a non-executive director of Mbada Diamonds Ltd (“Mbada”), which was a joint venture with the Zimbabwean Government. The Applicant relinquished his position as a non-executive director of Mbada on 8 October 2014. Thompson Reuters (“Respondent”) has an international database of Politically Exposed Persons (“PEPs”) and provides a service to subscribers called World-Check, whereby the subscribers have access to the database of PEPs.
PEPs are described as persons who enjoy or have enjoyed high office performing public functions within the state and its institutions. PEPs include, inter alia, heads of state or government, senior government, judicial and military officials and senior executives of state-owned corporations.
World-Check listed the Applicant as a PEP N (designating National Government), because of the Applicant being a former senior official of a state-owned enterprise. The listing also indicated that the Applicant was a member of the board of directors of Mbada, as a representative of Grandwell Holding, and executive chairman of The New Reclamation Group (Pty) Ltd, a subsidiary of the Zimbabwe Mining Development Corporation. The Applicant’s listing referenced three sources on the World-Check database, one of which linked the Applicant to “Chiadzwa- gang-individuals and fugitives” (“Chiadzwa Link”). The Chiadzwa Link could however not be accessed by subscribers, as the link was broken.
There was a dispute between the Applicant and Respondent as to whether the reference to the Chiadzwa Link was defamatory or not. The court did not however make a ruling on this dispute, as the Respondent had removed the Chiadzwa Link from World-Check.
The Applicant argued that his listing as a PEP, by the Respondent on World-Check, was defamatory. The principal question the court needed to consider was whether the listing of the Applicant as a PEP did in fact constitute defamation, and, if so, if the Applicant had a right to prevent the Respondent from listing his name as a PEP.
The Applicant also argued that his continued listing as a PEP, after his resignation from Mbada, was defamatory. The Applicant believed that his listing as a PEP created a higher degree of scrutiny, as being a former senior official of a state-owned enterprise carried a greater risk of involvement in transactions linked to money laundering and the financing of terrorism. The Applicant further argued that this enhanced risk was defamatory in circumstances where an individual had resigned from the office which gave rise to their political exposure, unless there was some valid reason to assume that the risk remains.
The Applicant maintained that he had vacated his office and while no negative information about him was published by the Respondent, his continued listing as a PEP conveyed the defamatory insinuation that the Applicant was involved in money laundering and the financing of terrorism.
The Applicant further argued that defamation had occurred as the Respondent failed to adhere to the editorial guidelines in respect of PEPs, as contained in the Wolfsberg Group Editorial Guidelines (“Editorial Guidelines”), which provides as follows:
“In the case of a former PEP, continued treatment as a PEP may not be warranted if there has been no sufficiently adverse or derogatory information widely published for a period of time that is long enough to conclude that: Taking into account the susceptibility of the former position to corruption, their source of wealth is legitimate, and the individual has not abused such remaining influence as he or she may have.”
The court held that the analysis must begin with the ordinary meaning of statements made in the listing which referenced the Applicant. In order to determine what the ordinary meaning is, one must look at a statement from the viewpoint of a “reasonable reader”, as statements are interpreted in terms of what is expressly stated and what is implied.
Considering the above, the reasonable reader of World-Check is presumed to be persons who are somewhat informed about the regulatory purpose for which individuals are listed as PEPs and that the Applicant’s listing as a PEP was due to his former position.
The court held that the Applicant’s listing as a PEP on World-Check did not amount to defamation for the following two reasons:
- Firstly, a PEP listing does not imply that the person abused their office or is otherwise corrupt. It is the office that gives rise to the risk because of the influence that is attached to the position; and
- Secondly, that the Applicant had been placed in a class of PEPs with many outstanding individuals, and that the reasonable reader would have no reason to have any ill-conceived notions about the Applicant, as even the Queen of England is listed as a PEP in the very same class.
As such, the Respondent’s continued listing the Applicant on the World-Check database as a PEP did not amount to defamation. The court also held that the Editorial Guidelines were merely guidelines and only provided a “possible” approach, and that the Respondent had in fact abided by the guidelines.
The listing of an individual as a PEP does not amount to defamation, due to the fact that the individual earns this listing as a PEP due to the position or office that they hold.
In circumstances where an individual is listed as a PEP because of the position or the office they hold, and they resign from the position or leave the office which earned them the listing, this status as a PEP does not fall away, and their continued listing as a PEP does not amount to defamation.
Written by Loyiso Bavuma and Simone Jansen van Rensburg