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Thomson Reuters launches investigation, halts work with South African partner

Thomson Reuters has suspended work with a South African subcontractor following a newspaper report that focused on an alleged conflict of interest related to a 225 million rand ($14 million) government IT contract.

South African newspaper The Sunday Times reported that Thomson Reuters, having won a contract from the Office of the Chief Justice (OCJ) to supply court software, subcontracted 30 per cent of the deal, as South African law requires, to a local company called ZA Square.


ZA Square had been created just five days after Thomson Reuters won the contract, and its three directors were all senior employees at the OCJ.


The OCJ told the paper the three directors played a role in the selection process, which led to the granting of the contract by the OCJ to Thomson Reuters.


As a result, the OCJ and Thomson Reuters have launched investigations into the paper's allegations that the three directors set up ZA Square and got a slice of the lucrative deal because of their knowledge of the contract.


In a statement on Monday Thomson Reuters said it "operates with the principles of trust and integrity" and was looking into the matter "with the utmost seriousness”.


"We ... have launched a formal investigation to understand the facts," it said. "During this investigation, all work with the subcontractor, ZA Square, has been put on hold.”


The OCJ said it was taking legal advice.


"We can assure the public that the State funds relating to this matter are safe," it wrote in a statement. "In view of this, the OCJ will not at this stage be making further comments or providing any additional information in this regard."


The Sunday Times report centred on the circumstances of a deal for a nationwide rollout of CaseLines - a Thomson Reuters court document and evidence management platform.


In South Africa, the law states that government procurement deals exceeding certain values must subcontract a minimum 30 per cent of the contract's value to boost local economic empowerment. ■