Big business muscles out SMME in Cape Town’s Formula bid for E-Movement

RECENTLY awarded bidder e-Movement may have not submitted documentation or proposals on the Cape Town Formula E track to the City of Cape Town, before being awarded the bid for the City’s first Grand Prix event.

This, after claims that the City was using the intellectual property of the sidelined Cape Town Grand Prix South Africa (CTGPSA), who were in the running for the same bid for 22 years.

E-Movement asked Independent Media’s Special Investigations Unit to hold back with a story on the Grand Prix bidding dispute, and to give them a few weeks to reveal their complete track intellectual property. “May I suggest that you wait a few weeks for the unveiling of the route,” reads the emailed communique sent to Independent Media’s investigations unit.

The City of Cape Town’s lack of support towards black-owned CTGPSA’s two-decade-old project to host Cape Town’s first Grand Prix event has raised concern as to whether this was done intentionally for the benefit of awarded bidder e-Movement, headed by Iain Banner – who has business links to businessperson Johann Rupert.

CTGPSA and their group of skilled professionals, who were in the running for 22 years to host the city’s first Grand Prix, recently spoke out about alleged unfair treatment from the City and their prompt reaction towards the recently established e-Movement, completely sidelining CTGPSA’s years of hard work on the concept.

CTGPSA is seeking legal counsel for their Grand Prix intellectual property, which they claimed the City was going to use for the event, questioning the awarded bidder’s business proposal. Banner confirmed last week that e-Movement had not submitted – to the City or Western Cape government – any documentation or proposals relating to a Formula E Grand Prix.

Banner said they met the City in 2018 to embark on the feasibility study with Formula E.

“Their (City) support was imperative, as FE races are predominantly street races worldwide and the City’s support for the potential use of the road infrastructure was imperative.

“We initiated the feasibility study in late 2018, after communicating our intent with the relevant departments in the City, to ensure that, in the event, e-Movement was successful in their bid to FEO and FIA, that the City would support the initiative, as it involves racing on roads owned and/ or controlled by the City,” said Banner.

Banner said, after receipt of a favourable feasibility study from Formula E, that the e-Movement bid was officially announced in May 2019.

However, Banner all but admitted that e-Movement was not B-BBEE compliant when it was awarded the bid, saying: “Since the inception of e-Movement in 2019, e-Movement has been undergoing multiple phases of formation to register the company, acquire the rights to bid and host the Formula E, garnering the support of key stakeholders, seeking sponsorship, and, importantly, seeking investors into the company.

“As such, a majority stake of e-Movement is now owned by an empowered entity, following the fulfilment of conditions agreed. e-Movement and the majority empowered entity are now concluding the transaction, and e-Movement is updating all the required CIPC records and applying for B-BBEE certification.

Interested parties, and Grand Prix fans alike, queried Rupert’s involvement and further highlighted how local small, medium and micro-sized enterprises (SMMEs), such as the CTGPSA, continued to be sidelined by the government allegedly to accommodate previously advantaged companies. The City, who ignored questions over Rupert’s involvement said: “The City was approached for support by e-Movement in 2018, more than a year before CTGPSA made contact with the City.”

Meanwhile, in 2012 and 2013, the City publicly rejected the concept and financial support towards the CTGPSA.

While Rupert and his family are known to have an interest in the sports industry, Rupert was rather hasty in his responses to Independent Media’s investigations unit and, when questioned about his involvement in the Grand Prix industry and the upcoming international ABB FIA Formula E World Championship, he shifted

the topic to his other matters, saying: “We have bigger priorities like creating jobs, education, health and feeding the hungry.”

He said he and his family had “no current involvement” in the Grand Prix industry and were not funding any projects related to it, including next year’s event. Asked if he participated in the bidding process for the ABB FIA championship, through any of his companies or partners, he simply responded, “no idea”.

Banner, according to https://www. bossentertainment.in/company, is a former director of sponsorship for Richemont International and reported directly to the chairperson Rupert.

CTGPSA’s Esther Henderson said, in the 22 years of tirelessly gaining ground with their bid, they had never taken any shortcuts. She questioned why the City had denied them the endorsement, financial support, and related processes and studies for the event, all of which they were now granting e-Movement.

“The City has missed an opportunity for both CTGPSA and e-Movement to come to the table, where an amicable joint effort could have been pursued towards a mutually beneficial collaboration,” she said.

The CTGPSA’s concept covered both Formula 1 and Formula E Grand Prix events, with the only difference being the type of cars used for the races. However, the City – in its defence – claimed that the CTGPSA’s discussions with them in 2019 centred around Formula 1 and not Formula E and, after having requested relevant documentation to host such an event, as per the legislation and City’s policy, it was not received. The City said funding for all events it supported were approved by the mayor, based on the recommendation of the special events committee. The committee only evaluates applications submitted through the events applications process.

The Western Cape Department of Cultural Affairs and Sport confirmed that it had engaged with the City regarding the information on this event, but did not commit any funding yet.

investigations@inl.co.za

Investigations Unit

• 'The City of Cape Town did not participate in the bidding process for Formula E'

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• Cape Town's Formula E bidding process called into question: 'What process was followed?'