By Edwin Mauluka

The Supreme Court of Malawi has upheld the forfeiture of US$269,970 from one Muhammad Jawad, confirming his 2015 conviction for attempting to illegally externalise foreign currency.

Jawad was arrested in August 2015 at Chileka International Airport as he attempted to leave the country with the money without the required authorisation. He later pleaded guilty to two Exchange Control offences before a Senior Resident Magistrate, who convicted and fined him and ordered the forfeiture of the full amount under Regulation 36 of the Exchange Control Regulations.

The matter escalated after the State appealed a subsequent High Court ruling that declared Regulation 36 unconstitutional and ordered that the confiscated money be returned to Jawad. The High Court judge described the Magistrate’s decision as excessive.

On Tuesday, the Supreme Court of Appeal overturned the High Court decision, faulting the judge for unilaterally declaring Regulation 36 unconstitutional. The panel held that such a ruling was “procedurally improper and a nullity,” as constitutional matters can only be determined by a panel of at least three judges under section 9(2) of the Courts Act.

“The Supreme Court, having set aside the High Court’s decision, upheld the Senior Resident Magistrate’s USD 269,970.00 forfeiture order,” reads part of the judgement.

The Court further clarified that deciding whether delegated legislation “substantially and significantly” affects fundamental rights, such as those referenced under section 58(2) of the Constitution, requires a proper constitutional interpretation process, which the High Court did not follow.

On the issue of sentencing, the Supreme Court found no error in the original forfeiture order. It noted that the High Court had intervened without showing that the Magistrate misdirected himself, applied the wrong principles, or imposed a sentence so excessive that it amounted to an injustice.

“The judgment that the forfeiture was excessive ignored Regulation 36’s purpose, the considerable amount involved, and the absence of mitigating factors. The High Court applied the wrong legal principles and standards and substituted the Magistrate’s opinion with its own,” the Court ruled.

The Supreme Court’s decision restores the original 2015 forfeiture order and reaffirms the authority of Regulation 36 in managing foreign exchange offences.

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