The South African Revenue Service (SARS) has expressed approval of the recent decision by the North Gauteng High Court to dismiss an urgent application from Shauwn Mkhize. The application sought an order compelling the curator to provide the National Soccer League (NSL) with a letter confirming that her soccer club, Royal AM FC, was financially capable of participating in its league games. This ruling follows a series of challenges faced by the club since the start of the soccer season, including its inability to compete in both the Betway Premiership and Nedbank Cup tournaments.
On January 29, the club filed an urgent application at the North Gauteng High Court in Pretoria, addressing the curator, SARS, and the NSL. However, on February 5, the court dismissed the application, citing a lack of urgency and ordering the club to cover the costs. SARS Commissioner Edward Kieswetter welcomed the court’s ruling, viewing it as a reminder that taxpayers must fulfill their tax obligations. He emphasized that it is perplexing how some taxpayers pursue legal action while neglecting their financial responsibilities. According to Kieswetter, SARS must uphold the law impartially, ensuring all taxpayers meet their obligations.
Despite multiple attempts to contact Mkhize and Royal AM’s general manager, Richard Makhoba, for comment, neither party has responded to questions raised regarding the case. The club’s application aimed to force the curator to issue a letter of comfort to the NSL, reassuring the league of the club’s ability to meet its financial obligations for the remainder of the season. Alternatively, the club sought to compel the NSL to allow it to participate in upcoming league and cup games. The court, however, rejected the application, as it was deemed to lack urgency, especially since the club had been aware of its financial troubles for some time before resorting to legal action.
The situation has been compounded by previous legal battles, with the Durban, Pietermaritzburg, and Pretoria high courts ruling against Mkhize and another of her businesses, Shandi Trust, over unpaid debts. Shandi is reportedly facing a significant tax liability of approximately R37 million to SARS. Recent court judgments related to preservation orders against the club have further strengthened SARS’s position, reinforcing its efforts to enforce compliance with tax laws.
The North Gauteng High Court’s ruling now leaves Royal AM suspended from the NSL, and the court did not address the merits of the case. This judgment may have additional consequences, potentially affecting the club’s sponsorship agreements. In 2023, the Msunduzi Municipality entered into a three-year sponsorship deal worth R27 million with the club, which was meant to run until 2026. The sponsorship was intended to boost tourism by filling the Harry Gwala Stadium with soccer fans. However, the municipality has already withheld the second installment of R9 million, citing the club’s failure to meet its contractual obligations, including submitting a financial report on how the funds were utilized.
The situation has also attracted attention from political figures, with the Democratic Alliance (DA) planning to challenge the sponsorship agreement in the Pietermaritzburg High Court. The DA has questioned the legality of the contract, pointing to concerns over Mkhize’s ongoing tax investigations. A court hearing scheduled for February 28 will address these issues, with DA councillor Ross Strachan urging the municipality to reconsider its support for the club. Strachan believes that the club is no longer contributing positively to the city’s tourism or its image, suggesting that the negative publicity surrounding the club could be tarnishing the reputation of Msunduzi.
The DA has also pushed for the council to review the sponsorship contract and explore options for terminating it, given the mounting legal and financial concerns. As the case progresses, Strachan remains hopeful that the court will provide clarity and accountability regarding the sponsorship deal and the club’s future.
