IN THE HIGH COURT OF SOUTH AFRICA
(WESTERN CAPE DIVISION, CAPE TOWN)
JUDGMENT
Reportable
CASE NO: 2025-209746
In the matter between:
OCEAN ARK SHIPPING LTD First Applicant
ASTRON ENERGY Second Applicant
and
THE COMMISSIONER FOR THE Respondent
SOUTH AFRICAN REVENUE SERVICE
Coram: HOLDERNESS J
Heard: 30 January 2026; 2 March 2026
Further submissions: 18 March 2026
Delivered: 24 April 2026
JUDGMENT
HOLDERNESS J
[1] On 22 September 2023, the MT Essien (the Vessel), owned by the first
applicant, Ocean Ark Shipping Ltd (Ocean Ark) and registered under the flag of
Singapore, entered South Africa’s territorial waters, under its own power.1
[2] Since September 2023, the second applicant has been using the Vessel for
coastwise transportation of certain fuel products in South African territorial
waters.
[3] On 22 September 2023 , t he respondent , the Commissioner for South
African Revenue Services (the Commissioner) after exercising its discretion to
deem the Vessel to be imported, detained and thereafter seized the Vessel.
[4] This urgent application is for the temporary suspension of the
Commissioner’s decisions pertaining to the detention, seizure, and deemed
importation of the Vessel belonging to the first applicant, and for the release of
such Vessel, subject to the provision by the second applicant of a guarantee in
respect of the value of the Vessel and any Valued-Added Tax (V AT), penalties
and interest claimed by the respondent.
1 The MT Essien is a 2013 built products motor tanker of 26827 gross tons which is duly registered on the flag
of Singapore and bears IMO number 9617454.
[5] The first applicant, Ocean Ark Shipping Ltd (Ocean Ark) and the second
applicant, Astron Energy (Pty) Ltd (Astron Energy) (collectively the applicants),
apply for an order directing that the one -month period as contemplated in
section 96(1 )(a) of the Customs and Excise Act 91 of 1964 (the Customs Act)
be reduced to the extent necessary in terms of section 96(1 )(c)(ii) of that Act ,
and that pending the outcome of an application to be instituted by the applicants
(within 30 days from the grant of interim relief), to review and set aside:
(i) The decision by the respondent, the Commissioner for the South
African Revenue Service (the Commissioner) to detain the MT Essien, as
communicated in the Commissioner’s letter dated 27 March 2025 (the
detention decision).
(ii) The decision by the Commissioner to seize the Vessel, as
communicated in the Commissioner’s letter dated 13 June 2025 (the
seizure decision).
(iii) The decision by the Commissioner to determine the date of deemed
importation, as communicated in its letter dated 22 September 2025 (the
deemed importation decision); and
(iv) The decision by the Commissioner not to release the Vessel, as
communicated in its letter dated 22 September 2025 (the section 93
decision); (collectively the administrative or the impugned decisions) and
directing that the Commissioner’s d etention decision; seizure decision,
deemed importation decision and section 93 decision are temporarily
suspended in terms of section 172(1)(b) of the Constitution.
[6] The applicants further seek an order d irecting the Commissioner to
release the Vessel from detention and seizure, together with all goods and cargo
onboard the Vessel, immediately upon payment by the second applicant, Astron
Energy, of any reasonable charges that have been incurred in connection with
the detention and seizure of the Vessel , an d p rovision by Astron Energy of a
guarantee in the amount of R398 378 772.60 , being the estimated value of the
Vessel, and R124 239 531.95 for any V AT, V AT penalty and interest that may be
charged in respect of the alleged importation of the Vessel, as set out by the
Commissioner in the correspondence to ST Shipping and Transport Pte Ltd (ST
Shipping) of 22 August 2025 issued by Lombard Insurance Company Limited
(Lombard Insurance) on behalf of Astron Energy in favour of the
Commissioner.2
[7] In the alternative, the applicants seek an order directing the
Commissioner to release the Vessel from detention and seizure, together with all
goods and cargo onboard the Vessel subject to the conditions in prayers 4.1 to
4.2 pending the outcome of an application to be made by the applicants, within
30 days from the grant of interim relief, to review and set aside the impugned
decisions.
[8] Mr. Mullins SC, Ms. Pillay SC, Mr . Cooke, and Ms. Muller appeared on
behalf of the applicants. Mr. Peter SC appeared for the respondent. I am
indebted to counsel for their comprehensive and meticulously researched heads
of arguments and additional notes , which have been invaluable to the court in
the preparation of this judgment.
2 On the terms as set out in Annexure X attached to the Notice of Motion . A revised guarantee was provided
after the hearing and is addressed below.
[9] As this is an application for interim relief pending the determination of
review proceedings already launched in the Gauteng Division , the court is not
required to decide, and d oes not decide, whether the impugned administrative
decisions are ultimately valid. The enquiry is the narrower one: whether the
applicants have established a prima facie right to the relief they seek in the
review, together with the remaining requirements for an interim interdict.
[10] The legal questions raised , including the proper interpretation of section
10(1)(e) of the Customs and Excise Act, read with General Note F, and the
lawfulness of the Commissioner's refusal to release the Vessel under section 9 3,
are genuinely complex and are more appropriately resolved at the hearing of the
review. Nothing in this judgment should be read as a definitive finding on any
of them.
Factual background
[11] Ocean Ark is the present owner of the Vessel. It bought the Vessel under a
contract of sale from Michael 5.
[12] On 30 November 2022 Michael 5 ,3 as owner, entered into a time charter
agreement with ST Shipping (Singapore), 4 as charterer, in respect of the Vessel
for a period of between 12 and 18 months.
[13] On 29 August 2023, ST Shipping entered into a time charter agreement
with Astron Energy, as charterer, in respect of the Vessel, for an initial period of
between 7 and 11 months.
3 Michael 5 PTE Ltd, a company registered and based in Singapore (Michael 5).
4 ST Shipping and Transport Pte Ltd, a company based in Singapore (ST Shipping).
[14] The Vessel was first brought into South African territorial waters, under
its own power, in September 2023, to perform coastwise carriage of Astron
Energy’s goods. It carried no cargo onboard.
[15] On 22 September 2023, the Master of the Vessel submitted a DA1
(inward for ships) and DA4 requesting permission for the Vessel to arrive at the
first South African port of call.
[16] On 25 March 2024, ST Shipping and Astron Energy extended their time
charter agreement for a further 16 to 19 months.
[17] On 28 March 2024, Michael 5 and ST Shipping extended their time
charter agreement for a further 36 months. In terms of the extension, the
charterer agreed to cover the costs of additional crew for the Vessel, namely a
Deck Officer, Engineer and AB/Watchkeeper, while trading in the South
African coastal trade.
[18] On 27 September 2024, Michael 5 entered into a transaction with Ocean
Ark embodied in two written documents. The first document was a sale, in
terms of which Michael 5 sold the Vessel, then registered in Liberia, to Ocean
Ark for the sum of USD 14,560,000. The second was a bareboat charter 5, also
styled as a “finance charter”, in terms whereof Michael 5 would repay the USD
14,560,000 in 14 quarterly instalments - 11 instalments of USD 735,000 and 3
instalments of USD 285,000, together with interest , with the balance being paid
on termination of the agreement. Michael 5 had an obligation to purchase the
Vessel on maturity. The time charter arrangements remained intact.
5 ‘A bareboat or demise charter is a species of charterparty by which a shipowner grants the entire possession of
a ship to a charterer. The charterers are “ handed over the possession of the ship …to put his servants and crew
upon her and to sail her for her own benefit.” (Jones et al Bareboat Charters at 1.
[19] On 27 March 2025, the Commissioner detained the vessel and the fuel on
board in terms of section 88(1)(a) of the Customs Act.6
[20] It is not disputed that at no stage was due entry of the Vessel ever made
declaring the Vessel to be imported for home consumption, declaring its value ,
and that no payment of the VAT on the import value was made.
[21] On 13 June 2025, the Commissioner seized the Vessel in terms of section
88(1)(c) of the Customs Act, 7 on the basis that the Vessel is liable to forfeiture
as contemplated in section 87 of the Customs Act.
[22] The Commissioner has not raised a tax debt yet but has conveyed an
intention to hold ST Shipping liable for import VAT of approximately R94
million, to gether with interest and penalties of approximately R30 million
(totalling R124 million).
[23] The estimated value of the Vessel, for purposes of forfeiture, is
approximately R400 million. The total of taxes and the value of the Vessel is
therefore approximately R524 million.
[24] On 4 July 2025, both Astron Energy and Ocean Ark sought return of the
Vessel in terms of section 93 of the Customs Act which provides that:
‘(1) The Commissioner may, on good cause shown by the owner 8 thereof, direct that
any ship, vehicle container or other transport equipment, plant, material or other
goods detained or seized or forfeited under this Act be delivered to such owner,
6 Section 88 (1)(a) provides that: ‘An officer, magis trate or member of the police force may detain any ship,
vehicle, plant, material or goods at any place for the purpose of establishing whether that ship, vehicle, plant,
material or goods are liable to forfeiture under this Act.’
7 Section 88(1)(c) provides that: ‘If such ship, vehicle, plant, material or goods are liable to forfeiture under this
Act the Commissioner may seize that ship, vehicle, plant, material or goods.’
8 Own emphasis.
subject to — (a) payment of any duty that may be payable in respect the reof; (b)
payment of any charges that may have been incurred in connection with the detention
or seizure or forfeiture thereof; and (c) such conditions as the Commissioner may
determine, including conditions providing for the payment of an amount not
exceeding the value for duty purposes of such ship, vehicle container or other
transport equipment, plant, material or goods plus any unpaid duty thereon.’
[25] On 10 July 2025, the Commissioner requested further information from
Ocean Ark. Ocean Ark responded to the request on 23 July 2025.
[26] On 15 July 2025, the Commissioner advised Astron Energy that it would
not be appropriate for the Commissioner to engage further with Astron Energy
in terms of section 93 of the Customs Act as Astron Energy was not the owner
of the Vessel.
[27] On 31 July 2025 , Astron Energy sent a letter in which it accused the
Commissioner of refusing, without any basis, to engage meaningfully with
Astron Energy’s section 93 proposal. Astron Energy stated that in the absence
of a positive response by close of business on 5 August 2025, it would have no
alternative but to proceed with urgent court proceedings to protect its interests.
[28] On 14 August 2025, Astron Energy gave notice in terms of section 96 of
the Customs Act9 of its intention to institute legal proceedings, by way of
urgency to challenge the validity of the seizure and seek the release of the
Vessel. Astron Energy sought truncation of the one-month period to 10 days.
9 In terms of s 96(1)(a)(i): ‘No process by which any legal proceedings are instituted against the State, the
Minister, the Commissioner or an officer for anything done in pursuance of this Act may be served before the
expiry of a period of one month after delivery of a notice in writing setting for th clearly and explicitly the cause
of action, the name and place of abode of the person who is to institute such proceedings (in this section referred
to as the “litigant”) and the name and address of his or her attorney or agent, if any.’
[29] On 4 September 2025, Ocean Ark gave notice in terms of section 96 of
the Customs Act of its intention to institute legal proceedings to challenge the
validity of the seizure and similarly sought a truncation of the one-month period
to 10 days, giving notice that it would be joining in the urgent a pplication
foreshadowed in Astron Energy’s section 96 notice.
[30] On 22 September 2025, the Commissioner decided not to release the
Vessel under section 93 of the Customs Act.
[31] The applicants launched these proceedings by way of urgency on 5
November 2025, seeking interim relief pending the final determination of a
review application in which, inter alia, the validity of the seizure would be
challenged in proceedings to be instituted within 30 days from the grant of the
interim relief.
[32] On 12 December 2025, the applicants launched their application for the
review and setting aside of the administrative decisions in the High Court,
Gauteng Division, Pretoria .10 In turn, the respondent delivered its notice of
intention to oppose and filed a rule 53 record on 15 January 2026.
[33] The applicants claim to have strong prospects of success in the review
and allege that they have met the requirements for interim interdictory relief,
pending the outcome of the review challenge against the administrative
decisions. In the alternative, the applicants seek an order temporarily
suspending the Commissioner’s administrative decisions in terms of section
172(1)(b) of the Constitution.
10 Under case number 245199/2025.
[34] The applicants say that despite their strong prospects in challenging the
respondent’s decisions, for purposes of these urgent proceedings, they have
crafted a remedy that permits the Commissioner to substitute its statutory
security (the detention and seizure of the vessel and its cargo) with a form of
liquid security in the form of a guarantee, on considerations of justice and
fairness.11
[35] For the purposes of this application, what matters most is this: the Vessel
entered South African waters in September 2023 under a foreign flag, operating
under its own power, and performed coastwise trade for Astron Energy's benefit.
No due entry was made, and no import V AT was paid.
[36] The Commissioner detained the Vessel in March 2025, seized it in June
2025, and declined to release it under section 93 in September 2025. The
applicants contest all four decisions in the review proceedings. Their case in
brief is that the Vessel was never lawfully imported for customs purposes, and
that even if it was, the Commissioner's enforcement response has been
disproportionate and procedurally flawed. The Commissioner's case is that the
Vessel was imported in September 2023 and that its continued detention is fully
justified. What remains to be worked out — by the review court, not this one —
is who is right.
Statutory framework
11 The applicants seek in prayer 4 of the notice of motion the release of the Vessel and cargo against payment by
Astron Energy of any reasonable charges that have been
incurred in connection with the detention and seizure of the Vessel, and a guarantee provided by Astron Energy
for an amount equal to the estimated value of the Vessel (+-R400 million) and the alleged V AT
penalty and interest payable in respect of the alleged importation (+ -R124 million), totalling an amount of + -
R524 million.
[37] In terms of section 38 of the Customs Act , every importer of goods is
required, within seven days of the date upon which such goods are, in terms of
section 10 deemed to have been imported, to make due entry of those goods as
contemplated in section 39 of the Customs Act.12
[38] An “importer” is defin ed in section 1 of the Customs Act to include any
person who, “at the time of importation”, (a) owns the goods imported; (b)
carries the risk of any goods imported, (c) represents that or acts as if he is the
importer or owner of the goods, (d) actually br ings the goods into the Republic,
(e) is beneficially interested in any way whatever in any goods imported; or (f)
acts on behalf of any person listed in (a) to (e).
[39] Section 13(1) of the Value-Added Tax Act 89 of 1991 (the VAT Act)
provides that ‘goods shall be deemed to be imported into the Republic on the
date on which the goods are in terms of the provisions of the Customs and
Excise Act deemed to be imported…’.
[40] A bill of entry in the prescribed form and payment of the duties on the
goods must be delivered 13, and a number of requirements for a valid entry,
including, inter alia, a declaration of the true value of goods and payment of the
correct duty must be complied with.14
[41] The Commissioner is empowered 15 to make rules , inter alia , as to the
importation and exportation, transit or coastwise carriage of goods, the entry of
goods and the payment of charges and fees.
12 Section 39(1) requires the delivery of a bill of entry in the prescribed form and payment of duties on the
goods.
13 Section 39(1) of the Customs Act.
14 Section 40(1) of the Customs Act.
15 Section 120 of the Customs Act,
[42] Rule 7.01 of the Customs Act Rules requires a report in terms of section
7(1) of the Customs Act of the arrival of a foreign going ship to be made on a
form DA 1.16
[43] Rule 8.01 defines “enter” in relation to the Republic in the case of the
Vessel as when the Vessel crosses into the territorial waters of the Republic.
[44] Section 87 of the Customs Act provides that goods imported or otherwise
dealt with contrary the provisions of the Act shall be liable to forfeiture.
[45] An officer of the Commissioner may detain goods for the purposes of
establishing whether such goods are liable to forfeiture17, and the Commissioner
is empowered 18 to seize goods liable to forfeiture under the Act and s ection
89(1) of the Customs Act provides that where proceedings are instituted to
claim goods that have been seized, such claim must be instituted by the person
from whom they were seized or the owner or the owner’s authorised agent.
[46] In terms of s ection 89(2) , notice must be given in terms of section 96
within 90 days after the date of seizure , before the service of any process for
instituting legal proceedings. Section 89(3) of the Customs Act requires that the
proceedings must be instituted within 90 days of such notice.
[47] In certain instances, including where proceedings as contemplated in
section 89 have not been instituted, the goods concerned are deemed to be
condemned and forfeited.19
16 Rule 00.05 replaced, with effect from 1 October 2006, the various bills of entry forms DA 500 – DA 614 and
CCA1 with an appropriate SAD form. The first of which is the SAD 500 customs declaration form, to be
completed as prescribed for the clearance of goods for different purposes.
17 Section 88(1)(a) of the Customs Act.
18 Section 88(1)(c) and (d) of the Customs Act.
19 Section 89(4) of the Customs Act.
[48] The Commissioner has a discretion, in terms of Section 93 of the
Customs Act, on good cause shown by the owne r, to direct that goods detained,
seized or forfeited be delivered to such owner.
[49] When goods are seized and, in consequence of the seizure, delivery under
section 93 is refused, and no proceedings are instituted challenging the seizure
(or have been instituted and have been dismissed in a final judgment of the High
Court or the Supreme Court of Appeal) the goods concerned shall, in terms of
section 89(4), ‘be deemed to be condemned and forfeited’.
[50] Section 96(1)(a) of the Customs Act provides that no process by which
any legal proceedings are instituted may be served before the expiry of one
month after delivery of a notice in writing setting forth clearly and explicitly the
cause of action and certain other details.20
[51] Nowhere in the Customs Act is the court vested with a power or
discretion to condone non-compliance with the mandatory provisions in section
96. The express provisions of section 96(1)(c) empower the court to reduce the
time period of one month that commences from the giving of the notice . The
applicant cannot however ask for reduction of the period, where no notice was
given.
[52] The Commissioner referred the court to the decision of the Supreme
Court of Appeal (the SCA) in Commissioner for the South African Revenue
Service and Others v Dragon Freight (Pty) Ltd and Others (Dragon Freight),21
where the court reiterated that section 96(1)(a)(i), on its plain language,
20 In terms of section 96(1)(c) of the Customs Act, the State, Minister or Commissioner is permitted, on good
cause shown, to reduce the period by agreement with the litigant. Only in the event of a refusal to reduce the
period is the High Court given the power to reduce such period where the interests of justice so require.
21 Commissioner for t he South African Revenue Service and Others v Dragon Freight (Pty) Ltd and Others
[2022] 3 All SA311 (SCA).
proscribes the institution of any proceedings unless one -month’s written notice
is given,22 to allow the Commissioner to investigate and review the merits of the
intended legal proceedings and decide what position to adopt in relation thereto
before the institution of legal proceedings, so as to avoid unnecessary and costly
litigation at the public expense.23
[53] This is aimed at promoting the economic use of resources in accordance
with the basic values and principles set out in section 195 of the Constitution.24
[54] The court in Dragon Freight found that the giving of such notice and the
period of one month, or a reduction of such period by either the Commissioner
or the court are jurisdictional conditions precedent for the giving of relief, and
that there is no power in the Customs Act to condone the non -compliance with
this provision requiring the giving of notice.25
[55] A court will ultimately have to decide whether any contraventions of the
Customs Act have occurred (as alleged by SARS and denied by the applicants);
whether any import VAT, interest and penalties are payable (and the amount
thereof); whether forfeiture (i f at all) is justified and , if justified, the
proportionality thereof, and, whether SARS’ decision not to release the Vessel
in terms of section 93 is liable to be set aside. This court is to make a finding in
the interim, regarding the urgent relief sought.
Astron Energy’s standing
[56] Turning briefly to Astron Energy's standing. Section 93 of the Customs
Act allows the Commissioner to release detained or seized goods to the owner,
22 Ibid para 31.
23 Ibid para 33.
24 Ibid para 34.
25 Ibid para 38.
and section 89(1) confines the right to institute proceedings to the person from
whom the goods were seized, the owner, or the owner's authorised agent.
[57] Astron Energy is none of these things, strictly speaking, and the
Commissioner was correct to decline to engage with it under section 93. But
that does not mean Astron Energy has no standing in these proceedings. As the
time charterer of the Vessel, it has a direct contractual interest in its availability
and suffers ongoing monthly losses as a consequence of the detention.
[58] These interests are sufficient to ground locus standi in terms of the
general principles applicable to any litigant with a direct and substantial interest
in the subject matter of the dispute. Its participation in this application —
including its provision of the guarantee — is consonant with that interest. I
proceed accordingly.
The requirements for an interim interdict
[59] The requirements for an interim interdict are trite. An applicant must
establish (a) a prima facie right, even if open to some doubt; (b) a reasonable
apprehension of imminent and irreparable harm if the interdict is not granted;
(c) the balance of convenience must favour the grant of the interdict; and (d) the
applicant must have no other remedy.
[60] The court has a general and overriding discretion to grant or refuse an
application for interim relief.26
[61] The court, in considering whether to grant an interim interdict, seeks to
ensure that, insofar as it is reasonably possible, the party who is ultimately
26 Knox D 'Arcy Ltd and Others v Jamieson and Others 1996 (4) SA 348 (A) at 361H-362E.
successful w ill receive effective relief. The court should seek to protect the
integrity of the proceedings in the main case.27
Prima facie right
[62] The applicants must show that they have a prima facie right that warrants
protection pending the outcome of the review, even if ‘open to some doubt.’28
[63] This court is not called upon to determine the merits of the review at the
interim stage . However, there must be a reasonable probability that the
applicant’s legal position is both valid and enforceable.
[64] The applicants must accordingly adduce credible evidence to persuade
the court that their review has a strong chance of success, and that they are
entitled to temporary relief until a final determination of the review
proceedings.
[65] At the interim stage, it is neither necessary nor appropriate to resolve the
competing interpretations of section 10(1)(e) and General Note F. I have noted
that the Commissioner's argument, that General Note F only specifies a time of
importation once the vessel acquires South African nationality under the Ship
Registration Act, and that the third limb of General Note F is unfulfilled here,
leaving the residual seventh time specification operative , is a textually strong
one.
[66] The applicants' contrary argument, ty ing importation exclusively to the
registration trigger and thereby excluding the Commissioner's residual
27 Pikoli v President of the Republic of South Africa 2010 (1) SA 400 (GNP) (Pikoli) at 404A-E.
28 Eskom Holdings S OC Limited v Vaal River Development Association (Pty) Ltd and Others 2023 (5) BCLR
527 (CC) para 253.
discretion, is less compelling on the text, but it cannot be dismissed as
unarguable. The question is genuinely difficult, and the answer will have
significant implications beyond this case.
[67] Both constructions merit serious consideration at the review. That is
sufficient for present purposes: the applicants have cleared the prima facie
threshold, even if their case on this point is open to more than a little doubt. I
add that the prima facie right is not carried by the importation argument alone.
[68] The lawfulness of the Commissioner's refusal to release the Vessel under
section 93 , including whether adequate security was tendered and refused
without proper consideration , raises its own arguable basis for review. So too
does the proportionality of the forfeiture in circumstances where the V AT
liability is approximately R124 million, but the asset seized is worth
approximately R400 million.
[69] In Eskom Holdings SOC L imited v Vaal River Development Association
Ltd and Others , the Constitutional Court affirmed that whether an applicant is
entitled to interim relief ‘is decided upon a consideration of the applicant ’s
prospects of success in obtaining final relief’.29
[70] The Constitutional Court in National Treasury v Opposition to Urban
Tolling Alliance 30 held that a prima facie right ‘is a right to which, if not
protected by an interdict, irreparable harm would ensue ’ (the so -called OUTA
test).
[71] The applicants assert that they enjoy strong prospects on review of
showing that the Commissioner acted unlawfully and irregularly.
29 Ibid para 67.
30 National Treasury and Others v Opposition to Urban Tolling Alliance and Others 2012 (6) SA 223 (CC)
(“OUTA”) para 50.
[72] Ocean Ark contends that it has the right, in terms of section 25 of the
Constitution, not to be deprived of its property arbitrarily.
[73] Astron Energy relies on the right to trade, in terms of section 22 of the
Constitution as well as its proprietary interests in the time charterparty. 31 It
contends that in the absence of a decision by the Commissioner on forfeiture
and mitigation of forfeiture, it will continue to suffer the substantial losses, and
that the interdict will serve to secure the Commissioner’s interests, whilst also
mitigating damages for Astron Energy.
[74] For the purposes of the current proceedings, nothing much turns on this.
In any event, in my view, it is doubtful whether, in these circumstances, Astron
Energy enjoys the guarantee provided by section 22 of the Constitution. 32
[75] The applicants further argue that Ocean Ark should be protected as an
“innocent owner” and refer in this regard to a letter dated 22 September 2025
addressed by the Commissioner to Bowmans, the attorney’s acting for Ocean
Ark, stating that it refuses to release the Vessel, without affording Ocean Ark an
opportunity to make submissions in respect of its intended action.
[76] The Commissioner does not contend that Ocean Ark was involved in any
of the alleged contraventions. Relying on Secretary for Customs and Excise v
Tiffany’ s Jewellers (Pty) Ltd (Tiffany’ s Jewellers),33 the applicants argued that an
owner who acquired property legally and for value, without knowing or having
reason to suspect it would be used in a contravention of a statute, may avail
31 The dispute regarding the VLSFO (the cargo which was aboard the Vessel) has been resolved by the parties
and was discharged on mutually acceptable terms. It no longer needs to be dealt with in these proceedings.
32 Section 22 guarantees the right to freedom of trade exclusively to a citizen of the Republic. If one reads citizen
as used in sections 19 and 20 of the Constitution, it appears that the term speaks specifically to a natural person
who is legally recognised as a citizen of the Republic.
33 Secretary for Customs and Excise v Tiffany’ s Jewellers (Pty) Ltd 1975 (3) SA 578 (A) (Tiffany’ s Jewellers).
itself of the innocent owner defence, including under the Customs Act, as a
defence against forfeiture.34
[77] Whether Ocean Ark enjoys what might loosely be called an innocent
owner defence under the Customs Act is doubtful. The current section 87(2)
does not carry the knowledge -or-consent qualification that was present in the
version of the section considered in Tiffany's Jewellers. As the provision now
reads, goods are liable to forfeiture regardless of the owner's knowledge or
involvement.
[78] Whether the constitutional proportionality requirement imports such a
qualification by the back door is a matter for the r eview court. I am not able to
decide it here, and I do not attempt to.
[79] This does not mean that Ocean Ark's evident lack of any involvement in
the alleged contravention counts for nothing. It has a bearing on two issues:
(a) First, to the Commissioner's exercise of discretion under section
93: the refusal to release is a discretionary decision, and the
owner's good faith — or absence of bad faith — is plainly a
relevant consideration in that exercise.
(b) Second, and relatedly, to the proportionality enquiry under section
25 of the Constitution: permanently depriving a party of a R400
million asset when that party did not know of and was not involved
in the alleged contravention, and when the underlying tax liability
is approxim ately R124 million, raises a serious question about
whether the resulting deprivation is arbitrary.
34 Fazenda NO v Commissioner of Customs and Excise 1999 (3) SA 452 (T) at 462.
[80] I return to these considerations in the balance of convenience analysis
below. I do not use them to shortcut the forfeiture question itself.
Irreparable harm
[81] In relation to irreparable harm, the applicants highlight the critical
financial and operational consequences of the ongoing detention of the Vessel
by the Commissioner, and that the ensuing harm is not merely theoretical but
represents an ongoing and irreparable loss for multiple parties across a complex
maritime chartering chain.
[82] The applicants emphasised the disproportionate nature of this h arm when
compared to the regulatory infraction, specifically focusing on the massive
capital at risk and the potential for a wider economic impact.
[83] Ocean Ark, as the registered owner of the Vessel, faces the most
significant potential loss, with the Vessel’s value estimated at approximately
R400 million. The ownership of the Vessel by Ocean Ark functions as a form of
real security within a financing arrangement, a common practice in maritime
law (according to the applicants).
[84] If the Vessel is forfeited, Ocean Ark would be permanently deprived of
this asset. Furthermore, the forfeiture would trigger a domino effect of financial
defaults across the chartering hierarchy, causing Michael 5, ST Shipping, and
Astron Energy to lose their respective hire payments and contractual benefits.
[85] The complexity of these interlinked agreements makes it impossible to
predict the full extent of the financial fallout, but the risk of such harm is
described by the applicants as catastrophic.
[86] For Astron Energy specifically, the continued detention and seizure
results in direct monthly losses of approximately R31 million.
[87] These costs are broken down into several categories, including the
continued payment of charter hire for a vessel it cannot use, the necessity of
hiring expensive substitute vessels on the volatile spot market to keep its
refinery operational, and the costs associated with maintaining safety standards
for the detained fuel.
[88] The applicants’ irreparable harm argument extends beyond what is
mentioned above and highlights a severe threat to public infrastructure and
regional energy security, as Astron Energy’s refinery supplies roughly 75 % of
the jet fuel required by Cape Town International Airport.
[89] According to the applicants’, the detention of the Vessel disrupts refinery
operations, creating a tangible risk of fuel shortages that could cripple aviation
in the region.
[90] The applicants contend that these losses cannot be recove red. The
ongoing seizure is described as a direct hindrance to Astron Energy’s right to
trade, creating a burden that far outweighs any prejudice the fiscus might suffer
if the Vessel were released against the proposed security.
[91] In the circumstances I am satisfied that on a balance the applicants have
shown that irreparable harm will ensue if the interim relief is not granted.
Balance of convenience
[92] The balance of convenience inquiry, in the context of this application,
resolves largely into a question about the guarantee.
[93] The Commissioner's genuine and legitimate concern is one of
enforcement: if the Vessel is released, it sails under a foreign flag, and once it
clears South African waters, the Commissioner's practical ability to enfo rce a
judgment is significantly diminished. That is a real risk, and I do not minimise
it. It is, however, a risk that the revised guarantee is designed to address. I have
found the guarantee adequate.
[94] With that finding in place, the Commissioner's enforcement exposure if
interim relief is granted materially reduces its claim against the Vessel is
exchanged for a claim against Lombard Insurance in an equivalent amount.
[95] On the other side of the scale, the prejudice to the applicants is ongoing,
quantified, and irrecoverable. Astron Energy loses approximately R31 million
each month as a direct result of the detention.
[96] Ocean Ark faces the potential permanent loss of an as set valued at R400
million, an asset it acquired from Michael 5 without, on the evidence before me,
any knowledge that the Vessel's customs status was disputed.
[97] The disruption to Astron Energy's refinery operations carries a broader
public dimension . T he supply of approximately 75% of the jet fuel to Cape
Town International Airport is linked to the Vessel's availability , though I am
careful not to overstate this as the shortage has not yet materialised, and the risk
should not be treated as a certainty. I t is, however, a genuine risk that adds
public-interest weight to an already compelling private-interest case.
[98] These losses, once incurred, cannot be unwound. A favourable outcome
for the applicants in the review will not reimburse the monthly charter c osts
already paid, nor repair the commercial relationships strained by the detention.
[99] An unfavourable outcome for the Commissioner in the review, with an
adequate guarantee in place, leaves it fully protected. For these reasons, the
balance of convenien ce firmly favours the applicants, provide d, and this
qualification is important , the guarantee is adequate. Since I have found that it
is, the balance of convenience requirement is satisfied.
No alternative remedy
[100] I am satisfied on the evidence placed before me, specifically the
correspondence exchanged between the parties prior to the launching of this
application, that the applicants have exhausted all attempts to resolve the
disputes with the Commissioner and there is no other suitable remedy available.
Has the Vessel been forfeited?
[101] I turn briefly to consider the issue of whether the Vessel has ex lege been
forfeited.
[102] The Commissioner submits that forfeiture is a self -executing event that
occurs by operation of law in terms of section 89(4), requiring no decision by
SARS. I am not persuaded that this is so.
[103] Section 89(4) deems goods 'condemned and forfeited' only in two
circumstances: where no proceedings have been instituted to claim them, or
where such proceedings have been instituted but dismissed in a final judgment.
Neither condition is met here.
[104] The applicants instituted review proceedings in the Gauteng Division on
12 December 2025. Those proceedings are before the court and are alive. Until
they are finally determined, the deeming provision in section 89(4) has not been
triggered, and the Commissioner's discretion under section 93 to release the
Vessel on good cause shown remains available.
[105] The Vessel has not been forfeited, and the Commissioner cannot treat it as
though it has.
Is the revised guarantee adequate?
[106] The issue that effectively determines this application is whether the
revised guarantee, provided by the applicants after the Commissioner ’s note to
the Court set out its objections to the first guarantee , provides equivalent
security, in all material respects, to the continued physical detention of the
Vessel.
[107] If it does, the Commissioner's central concern , that releasing the Vessel
may put it beyond the reach of enfor cement, is met, and the balance of
convenience falls squarely in the applicants' favour.
[108] If it does not, the application cannot succeed regardless of the merits of
the underlying review.
[109] The Commissioner advanced three objections to the first guarantee. I deal
with them in turn.
[110] The first objection is that the guarantee is not a true on -demand
instrument but is conditional: payment is triggered only by a final court order in
SARS's favour or by a settlement between the parties. This is factually accurate.
The guarantee is not payable on demand alone, without qualification. But the
conditionality does not make it inadequate. SARS could not, in any event,
access the proceeds of the Vessel before the dispute is resolved , either by
judgment or settlement.
[111] The trigger conditions in the revised guarantee replicate the position
SARS already occupies with respect to the detained Vessel. There is no
diminution in SARS's substantive entitlement. The guarantee substitutes liquid
security for a physical asset, but the moment the security becomes available to
SARS is the same in both cases.
[112] The second objection is that Astron Energy gives the guarantee as the
named Customer, and Astron Energy is not the importer and may not be the
party ultimately liable to SARS.
[113] The concern is that if the wrong party is the Customer, the guarantee may
not properly cover SARS's claim. In my view there is no merit to this objection.
The applicable principle is the autonomy principle applicable to demand
guarantees, confirmed by the SC A in First Rand Bank Ltd v Brera Investments
CC.35
[114] Lombard Insurance's obligation is determined by the terms of the
guarantee itself, and not by the underlying dispute between SARS and the
parties to the transaction. Lombard cannot refuse to pay on the ba sis that Astron
Energy is not the importer.
[115] What matters is whether a valid Demand can be made and honoured
under the revised guarantee's own terms, irrespective of who ultimately bears
the liability.
35 First Rand Bank Ltd v Brera Investments CC 2013 (5) SA 556 (SCA).
[116] In the revised definitions, the Forfeiture Claim is defined by reference to
SARS's claim 'arising from the forfeiture of the Vessel', with no reference to
Astron Energy's liability. Clause 4 requires only a valid Demand from SARS.
The Customer's identity does not defeat the guarantee.
[117] A related point arises from clause 5, which permits SARS to make
multiple demands for amounts that the Customer has conceded. The
Commissioner raised the prospect that Astron Energy, not being the liable party,
might concede nothing, leaving clause 5 empty and restricting SARS's ability to
make successive demands. This reading does not persuade me.
[118] Clause 5, read in context with clause 4, governs the mechanics of how
demands may accumulate up to the guaranteed cap. It does not condition
Lombard's payment obligation on Astron Energy's formal acceptance of any
liability. Clause 4's irrevocable and unconditional undertaking is the operative
provision; clause 5 regulates the arithmetic of successive demands within the
cap. The clause should not be read to detract from clause 4.
[119] The third objection goes to quantum. The Commissioner did not seriously
press the point that the monetary cover is insufficient, and rightly so.
[120] The guarantee covers the estimated value of the Vessel at R398 378
772.60 and the full amount of alleged V AT, penalties, and interest at R124 239
531.95, for a total of R522 618 304.55. This exceeds the Commissioner's own
stated exposure.
[121] Having carefully worked through the revised guarantee, I am satisfied
that it provides the fiscus with security that is equivalent, in all material
respects, to continued physical possession of the Vessel. The Commissioner's
objections are properly raised but ultimately do not render the guarantee
inadequate. Release against the guarantee appropriately and adequately protects
the Commissioner's position.
Does the OUTA ‘clearest of cases’ test apply?
[122] The applicants contend, correctly in my view, that the OUTA test, in terms
of which interdicts against public power should only be granted in the ‘clearest
of cases’ does not apply to the present matter, as it involves a standard
application of statutory discretion, a high-level, polycentric policy decision.
[123] The applicants emphasise that the impugned administrative decisions are
the type of ‘stock standard’ administrative decisions which fall outside the
ambit of the OUTA ‘clearest of cases’ or ‘exception al circumstances’ principle,
which applies to cases which lie ‘in the heartland of executive -government
function and domain ’36 and inevitably involves ‘policy laden and polycentric
decision making’.37
[124] In Precision Meters (Pty) Ltd v South African National Accreditation
System and Another, 38 a recent decision of this division, Hofmeyr AJ found 39
that on a proper reading of OUTA (as later interpreted by the Constitutional
Court in Eskom), for an organ of State to bring itself within the “clearest of
cases” test in OUTA, it should, at a minimum, set out the following:
(a) What aspect of executive or legislative power will be impacted by
the interim interdict sought.
36 OUTA para 67.
37 Ibid para 68.
38 Precision Meters (Pty) Ltd v South African National Accreditation System and Another (2025/135243) [2025]
ZAWCHC 500 (28 October 2025).
39 At paras 55-56.
(b) How the exercise of that power involves policy -laden or polycentric
decision-making.
(c) What specific constitutional or statutory obligations or powers of the
organ of State will be compromised if the interdict is granted; and
(d) How those obligations or powe rs will be impacted by the temporary
relief sought.
[125] The respondent here did not seek to make out such a case. What the
Commissioner did here is different in kind to OUTA. He applied specific
provisions of the Customs Act to a specific vessel to reach specific conclusions
about detention, seizure, and deemed importation. The administrative decisions
are neither polycentric nor policy laden.
[126] It therefore appears that the a pplicants do not have to meet the OUTA
threshold and that the ordinary requirements for an interim interdict apply.
Section 172 – Just and equitable relief
[127] As the same conclusion would follow under this claim for relief, it is not
necessary to make a separate determination in this regard.
Urgency
[128] The Commissioner argues that the urgency is self -created, pointing out
that the applicants first threatened urgent proceedings in August 2025 but did
not launch until 5 November 2025 — a period of some ten weeks.
[129] I accept that there was a delay, and it requires explanation. The
explanation is, however, in the papers.
[130] During the period from August to October 2025, the applicants
maintained sustained correspondence with the Commissioner, seeking an
accommodation that would avoid litigation altogether.
[131] The Commissioner's final and definitive refusal to release the Vessel was
communicated on 22 September 2025. From that date, the applicants gave
notice under section 96 of the Customs Act, finalised their papers, and launched
on 5 November 2025, approximately six weeks later.
[132] Given the legal complexity of the matter and the volume of
documentation required, I do not regard this as unreasonable. I also consider
that in the law of admiralty, the detention of a commer cial vessel is, by its
nature, treated as a matter carrying some inherent urgency.
[133] The financial consequences of immobilising a ship of this kind compound
with every passing day. Astron Energy cannot recover the charter costs it
continues to pay for a ve ssel it cannot use, and Ocean Ark watches a R400
million asset depreciate while sitting idle. The urgency is not self -created. The
matter could not have obtained substantial redress at an ordinary hearing on the
roll.
Costs
[134] Costs ordinarily follow the result, and there is nothing here that would
justify departing from that rule. The applicants have succeeded in obtaining the
interim relief they sought.
[135] The question is whether Scale C is appropriate. I think it is, for the
following reasons.
[136] The matter raised genuinely novel questions of customs and maritime
law. The interaction between section 10(1)(e) and General Note F has not, to my
knowledge, been considered in a reported judgment in the context of foreign
flag vessels engaged in coastwise trade.
[137] The constitutional dimensions of the forfeiture question added further
complexity. Counsel on both sides produced comprehensive heads of argument
and detailed supplementary notes following the hearing, at the court's request.
Two hearings were required. The matter proceeded with teams of two senior
counsel on each side.
[138] In all the circumstances, the novelty of the issues, the volume of the
work, and the financial magnitude of the dispute, Scale C is warranted. The
respondent is accordingly ordered to pay the applicants' costs, including the
costs consequent upon the engagement of two counsel on Scale C.
Order
[139] The following order shall issue:
(a) The application is heard as one of urgency in terms of Rule 6(12)
of the Uniform Rules of Court, dispensing with the ordinary forms
and service provided for in these Rules.
(b) Pending the outcome of the review application instituted by the
applicants in the High Court Gauteng Division (Pretoria) under
case number 245199/2025, it is directed that the respondent's
detention decision; seizure decision, deemed importation decision
and section 93 decision (as defined in paragraph 3 of the notice of
motion) are temporarily suspended.
(c) Pending the final determination of the review application, and
subject to any directives by the review court in respect of the
control of the Vessel, the respondent is directed to release the
Vessel, the MT Essien, to the applicants subject to the following
conditions:
(i) Payment by the second applicant of any reasonable charges that
have been incurred in connection with the detention and seizure
of the Vessel.
(ii) Provision by the second applicant of a guarantee in the amount
of R398 378 772.60, being the estimated value of the Vessel,
and R124 239 531.95 for any VAT, VAT penalty and interest
that may be charged in respect of the alleged importation of the
Vessel, as set out by SARS in the correspondence to ST
Shipping and Transport Pte Ltd of 22 August 2025 issued by
Lombard Insurance on behalf of the second applicant in favour
of the respondent (on the terms as set out in Annexure X1
hereto).
(d) The respondent is to pay the costs of this application, such costs to
include the costs occasioned by the employment of two counsel on
Scale C.
__________________________
M HOLDERNESS
JUDGE OF THE HIGH COURT
Appearances
Applicants: Adv S Mullins SC, Adv K Pillay SC, Adv D Cooke,
Adv E Muller
Instructed by
First Applicant: Bowman Gilfillan Inc.
Second Applicant: Webber Wentzel
Respondent: Adv J Peter SC
Instructed by: MacRobert Attorneys