Court Gag on South Africa 'oilgate' Report

South Africa's leading investigative newspaper has been banned by the courts from publishing a report detailing how a state oil company secretly paid public funds to the ruling party, the African National Congress (ANC).

Police surrounded the presses of the Mail & Guardian (M&G) on Thursday night to prevent publication of new allegations of what has become known as the "oilgate" corruption story.

"We have been gagged," the newspaper's editor, Ferial Haffajee, told the Guardian. "Our biggest concern is press freedom. We believe the public has a right to know what happens with public funds, but we will respect the court's hearing."

The paper scrapped its front page and instead ran a banner stating: "Gagged".

The court interdict on the story was denounced yesterday as "an extraordinarily dangerous precedent" to South Africa's press freedom, by the press watchdog, the Media Institute for Southern Africa.

The banned story was a follow-up to last week's exposé alleging that the state-owned oil company, PetroSA, channelled 11m rand (£1m) to the ANC just months before the 2004 parliamentary elections.

It described how PetroSA paid the money to Imvume, a firm with close ties to the ANC, ostensibly to purchase oil. Imvume, however, gave the money to the ANC election campaign fund in December 2003, according to the report. PetroSA then paid again for the order of oil products, according to the story.

The ANC has denied any wrongdoing. ANC spokesman Smuts Ngonyama said the party was not aware of, or concerned by, the origins of the funds donated by Imvume.

Mr Ngonyama cited a recent court ruling that political parties did not have to make public the donations they receive.

The Media Institue for Southern Africa (Misa) yesterday expressed "deep concern that this judgment may open the way for others seeking to prevent newspapers from publishing articles about their questionable or irregular conduct". Misa's deputy chairman, Raymond Louw, said the court order could lead to " legal censorship of the media".

He said: "One of the fundamental services that media in a democratic society fulfil is that of a public watchdog. It would seem that not only has the ruling muzzled this essential function, but it has set an extraordinarily dangerous precedent."

"This is a setback to media freedom," said Ms Haffajee from the M&G's offices yesterday.

"But judged by the public outcry and the support we have received from colleagues far and wide, we believe it will be only a temporary one."

She said South Africa's political environment is "relatively transparent, but unfortunately that does not apply to the area of party-political funding.

"It seems that much corruption stems from this legal and policy lacuna. We are determined to keep highlighting the urgent need for reform."

The M&G is South Africa's leading investigative newspaper.

In the apartheid years it carried numerous accounts of human rights abuses and corruption by the regime. It defied censorship rules designed to suppress news of the ANC's struggle against white rule and the brutality used by the apartheid government to hold on to power.

The new gagging order is the first time the paper has been muzzled since the apartheid state banned the M&G under emergency regulations in the late 1980s, according to a statement from the paper.

Since South Africa reached majority rule, the paper has held the new ANC government accountable for its actions. The paper broke the stories about Winnie Mandikizela Mandela's questionable ventures, which eventually saw the former wife of Nelson Mandela convicted of fraud.

The Guardian once held controlling shares of the M&G but sold them three years ago.

Thursday's ban came after the oil company Imvume charged that the M&G had gathered the information for the "oilgate" story illegally and violated its right to privacy.