The MTN Group has informed shareholders of its plans to head for the Constitutional Court in South Africa over an issue facing the group’s activities in Iran.
The matter dates back to 2013, when Turkish telecoms operator Turkcell Iletisim Hizmetleri and its subsidiary, East Asian Consortium (EAC) took legal action against MTN at the High Court of South Africa.
Turkcell and EAC wanted MTN to pay damages, accusing it of impropriety in relation to the awarding of the first private mobile telecommunications licence in the Islamic Republic of Iran in 2004.
The Turkish company accused MTN of bribing Iranian government officials to win a significant stake in the license.
Thus, it approached the High Court, asking for roughly $4.2 billion in damages for lost business, revenue, and profits.
MTN’s independent special committee found no evidence of Turkcell’s allegations. The High Court ruled in MTN’s favour, with the matter coming down to jurisdiction.
However, MTN has been dealt a blow in the case after the Supreme Court of Appeal (SCA) set aside the High Court’s judgement, deciding that South African courts have jurisdiction.
The SCA also upheld the High Court ruling that Iranian law applies to key aspects of the dispute.
In a statement to shareholders, MTN said “The decision to uphold the appeal does not relate to the merits of Turkcell’s claims or the allegations made against MTN Group, which have not yet been tested in court.”
“We have always maintained that the Turkcell litigation was without merit and have expressed confidence that it we would successfully defend these proceedings,” it added.
MTN intends to appeal the SCA’s decision at the Constitutional Court, the highest court in South Africa.
Terrorism linkage saga
Meanwhile, recently when MTN Group former board chairman, Mcebisi Jonas was appointed South African Ambassador to the USA, there were media reports that the appointment had triggered a fresh lawsuit against MTN regarding its alleged support for a terrorist group in Iran between 2011 and 2016.
In an earlier federal lawsuit, more than 50 Americans claimed MTN and other technology companies did business with the Islamic Revolutionary Guard Corps (IRGC), even though they knew the transactions would help finance, arm, and support the Iranian group’s terror campaign in neighbouring Iraq. As a result, thousands of Americans were injured or killed between 2011 and 2016, LegalBrief Africa reported, citing the lawsuit.
“Notably, the judgment also highlighted that even after the IRGC was officially designated as a Foreign Terrorist Organisation in 2019, MTN retained its commercial ties with the group,” LegalBrief said.
But MTN has denied the allegation that it is facing a fresh lawsuit in the US as reported by LegalBrief Africa. It has since asked the media platforms which reported the matter to retract the report.
