Turkcell Expects a Conclusion on the 4.2 Billion Dollar Lawsuit Against MTN This Year
April 19 2019 - 8:36AM
Business Wire
The following is a statement from Turkcell.
Turkcell (NYSE: TKC) (BIST: TCELL) took legal action against
South African telecoms group MTN related to the disputed mobile
license in Iran in 2004 and a conclusion on the $4.2 billion
lawsuit in South Africa is anticipated this year.
“We don’t have any doubt about our claims,” says Serhat Demir,
Turkcell Executive Vice President of Legal and Regulation.
“Turkcell is determined to pursue this rightful case and confident
that the judge will rule in Turkcell’s favor. The seizure of
documents during the investigation, the criminal case, the arrest
and suspicious death of Ambassador Saloojee proves Turkcell’s
claims. We expect solid developments and a fair conclusion from
South African police and judiciary about the lawsuit by the end of
this year – MTN’s continuous denial and lack of a tangible
statement will no longer prolong and trivialize the case. This
lawsuit for compensation represents a global precedent case for
companies investing in international markets under fair competition
and legal justice, and recognized and followed globally as a case
seeking for legal remedy.”
About Turkcell’s lawsuit against MTN
Turkcell was the highest bidder in the tender for the first
private GSM license of Iran in 2004 and despite Turkcell met all
the requirements before and after the tender, the license was given
to South African telecoms group MTN. Turkcell claimed that MTN
bribed former ambassador to Iran and filed a $4.2 billion lawsuit
in South Africa in 2013 over the disputed Iranian license. The
judiciary decided to go on a trial involving allegations that MTN
bribed Iranian and South African government officials four years
late in June 2017, delayed by MTN’s objections.
Simultaneously HAWKS, South Africa’s special unit against
organized crime, were running an investigation on MTN and a number
of government officials since 2004, based on Turkcell’s
international bribery claims. Within the scope of the investigation
Yusuf Saloojee, the former South Africa ambassador to Iran was
arrested in the last February and later he was released on
bail.
The allegations on Saloojee included receiving bribe from MTN
during the process of giving the Irancell tender to MTN after
taking it unlawfully from Turkcell. The South African police
announced that Saloojee, now a retiree, had received 1.4 million
rands (approximately $100.000) and used it to buy a house in
Pretoria. Saloojee was suspiciously pronounced dead on March
18th.
Phuthuma Nhleko, Irene Charley and a number of high level MTN
executives were the main actors in the company’s expansion
strategy, including Iran during early 2000s. Therefore the claims
are, they played a part in the approval and implementation of
decisions during the Iran tender process. Other allegations are
being involved in illegal actions such as supporting Iran’s nuclear
program, supply of high tech defense equipment and bribing Iranian
and South African officials in exchange for the GSM license. It’s
claimed that all these activities including illegal ones, run by
MTN to secure the tender after the announcement of Turkcell’s win,
were implemented under the code name “Project Snooker”.
MTN faces problems not only in South Africa but also Uganda and
Nigeria. The company’s Uganda CEO was deported over national
security concerns and in recent years a number of disagreements
arose in Nigeria because of unregistered SIM cards and corruption
allegations concerning dividend payments. The Nigerian
Communication Commission had fined MTN 5.2 billion USD for
unregistered SIM card records in 2015. After negotiations the
amount was reduced to 1.7 billion USD and Nigerian government
agreed on a payment plan. This time in 2018 The Central Bank of
Nigeria claimed that MTN had repatriated dividend 8.1 billion USD
out of the country and demanded the money be brought back. Nigerian
officials also claimed that MTN had approximately 2 billion USD
unpaid taxes. MTN reached an agreement with Nigerian officials
about the dispute on dividends and filed a lawsuit about the
taxes.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190419005092/en/
Ali KarakayaTurkcell Corporate Communications
Managerali.karakaya@turkcell.com.tr
Bugra KayaTurkcell Corporate Communications
Expertbugra.kaya@turkcell.com.tr
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