Subscribe
About
  • Home
  • /
  • Wireless
  • /
  • All set for Turkcell’s appeal in R74bn MTN lawsuit

All set for Turkcell’s appeal in R74bn MTN lawsuit

Admire Moyo
By Admire Moyo, ITWeb news editor.
Johannesburg, 21 Aug 2024
The upcoming hearing is before the Supreme Court of Appeal and is the appeal of the Gauteng High Court’s 2022 decision.
The upcoming hearing is before the Supreme Court of Appeal and is the appeal of the Gauteng High Court’s 2022 decision.

A court battle that has raged since 2013, between mobile operator MTN and Istanbul-based Turkcell, will return to South Africa’s courts at the Supreme Court of Appeal (SCA) in Bloemfontein on 26 and 27 August.

The case involves allegations of bribery and corruption against MTN, with Turkcell alleging MTN paid off Iranian and South African officials to overturn a public tender that it lost for a multibillion-dollar opportunity to run the Iranian GSM telecoms licence.

In December 2022, the High Court of South Africa dismissed the $4.2 billion (R74 billion) Turkcell lawsuit against MTN, saying the Iranian courts have jurisdiction over the case, rather than the South African courts.

That court decision was part of an ongoing case between Turkcell, through its affiliate EAC, and MTN in connection with a GSM licence in Iran.

Turkcell then appealed the ruling at the SCA, saying South African law should be applied and the South African courts should also have jurisdiction over the matter since MTN’s headquarters is located in South Africa and the alleged unlawful acts were planned in this location.

Over the years, MTN has consistently maintained the Turkcell litigation was without merit, arguing it had no provisions or contingent liabilities with regards to the lawsuit.

The upcoming hearing is before the SCA and is the appeal of the Gauteng High Court’s 2022 decision.

The ‘untouchables’

Cedric Soule and David Farber, Turkcell global counsel, tell ITWeb via e-mail: “No court of law has ever examined the merits of EAC’s claim against MTN; ie, whether MTN did indeed commit acts of bribery and corruption to overturn the tender for the Iranian GSM telecoms licence that it had lost to Turkcell.

“If MTN wins before the SCA, it is unlikely that any court of law ever will examine MTN’s conduct. Moreover, if the lower court is not reversed, not only will MTN escape any hearing on the merits, but those bribing foreign government officials from South Africa will be immune from suit based upon sovereign immunity and Act of State principles.

“In turn, South Africa will become a haven for international bribery of foreign governments because companies and individuals engaged in such bribery and corruption will become ‘untouchable’ – they will be able to rely on the defences raised by MTN based on sovereign immunity principles and the ‘Act of State’ doctrine to argue that South African courts cannot hear bribery and corruption claims against them.”

‘Fabric of lies’

Responding to the latest developments, MTN Group tells ITWeb via e-mail that the High Court judgement issued in December 2022 dealt only with the preliminary issues raised by MTN and the other defendants, resulting in the dismissal of EAC’s case with costs.

It points out that EAC has appealed to the SCA, and at this stage, MTN is only required to address the preliminary legal points, not the underlying allegations.

“Our legal strategy is fully aligned with the current procedural requirements, and we remain confident in our position. Addressing the merits of the allegations at this stage would be both inappropriate and irrelevant.”

When the allegations were first raised in 2012, MTN appointed an independent special committee under the chairmanship of the eminent international jurist, Lord Leonard Hoffmann, to investigate, says the mobile operator.

“Lord Hoffmann conducted a thorough and exhaustive analysis of the allegations. He found that Turkcell’s allegations, which rested entirely upon the evidence of [former Turkcell employee] Mr Christian Kilowan, were all ‘a fabric of lies, distortions and inventions’ and that Mr Kilowan was shown to be ‘a fantasist and a conspiracy theorist’.”

According to MTN, Lord Hoffmann was also clear in finding that he was entirely satisfied that there was no conspiracy between MTN and Iranian officials to remove Turkcell from the licence process in Iran.

The full Hoffman Committee report is available on MTN’s website.

“We maintain our position that all claims brought against the company by Turkcell are without merit. MTN has zero tolerance for corruption and unethical business practices,” MTN adds.

“We respect the ongoing judicial process and remain committed to following it through to its conclusion. MTN’s position on the correct forum for this case is set out in our heads of argument for the appeal and was accepted by the High Court, leading to the dismissal of the case.

“We trust in the legal processes of the jurisdictions involved and believe the appropriate forum for this case has already been determined. MTN is confident in its legal strategy and remains committed to adhering to all legal standards,” it concludes.

Share