MTN allegedly enmeshed in bribery scandal, asked to pay $4.2bn

Posted on June 2, 2017 by Bode Dolu

Telecoms giant MTN has been dragged to court for alleged bribing scandal and is being asked to pay $4.2bn in damages. The case, by Turkish telecoms company Turkcell, is heading for trial at the High Court in Johannesburg after years of delays, according to South Africa's Business Day.

"Turkcell is accusing MTN of corruption by bribing officials, arranging meetings between Iranian and South African leaders and promising Iran weapons and UN votes in exchange for a licence to provide cellphone services in Iran," the report said.

"MTN maintains that there is no legal merit in the claim and it will defend the matter."

The report explained that Turkcell originally filed its lawsuit against MTN in the US in 2012, but withdrew the case after the US Supreme Court ruled in another case that US courts did not have jurisdiction in cases involving foreign companies in disputes outside the US. In 2013, Turkcell lodged its lawsuit in the High Court in Johannesburg.

MTN owns a 49% stake in Iran's mobile network operator, Irancell. Iran Electronic Development Company owns the remaining 51%. Turkcell said it was initially awarded the licence, which was then given to MTN in 2005.

Turkcell said its lawsuit had been delayed by objections from MTN and amended particulars of the claims by Turkcell as it sought to accommodate these objections.

"We believe we have a very strong claim. The South African courts will be able to evaluate the huge amount of evidence we have to support our claim that MTN went to extraordinary lengths to unlawfully take Turkcell's rights to the Iranian GSM licence," said Serhat Demir, legal and regulation executive vice-president at Turkcell.

MTN said that recent developments were procedural in nature and they had nothing to do with the merits of the case. (Business Day)

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