Iran Telecoms Minister Says Turkcell Claim Against MTN Unfounded

EghtesadOnline: The minister of communications and information technology rejected a claim by Turkish mobile phone operator Turkcell against South Africa’s MTN, a 49% owner of MTN-Irancell, saying MTN has not broken any laws when starting its deal with Iran Electronic Development Company (IEDC) in 2005.

News ID: ۷۴۲۰۷۱

12 June 2017

Mahmoud Vaezi, who was not the minister when the agreement between Iran and MTN was reached more than a decade ago, underlined that all relevant documents have been inspected and nothing was found to prove Turkcell’s claim, according to ICTNA.

The majority stakeholder in MTN-Irancell, Iran Electronic Development Company (IEDC) which comprises of two state-owned entities, Mostazafan Foundation, and Iran Electronics Industries (IEI), had not broken any deal with Turkcell, the minister noted.

Turkcell sued MTN “for damages and the amount of profits, plus interest,” alleging  that MTN unlawfully acquired the Iranian mobile phone operating license that Turkcell won more than a decade ago, Financial Tribune reported.

The Turkish company said it would have received Iran’s first private mobile phone license had it not been taken away from it and given to MTN allegedly through unfair means.

“Turkcell and IEDC had held negotiations on launching the second mobile phone services in Iran but lack of final understanding led Turkcell to withdraw,” the telecoms minister has been quoted as saying.

In a lawsuit originally filed in South Africa in 2013, Turkcell alleged that “MTN bribed officials in Iran” to transfer the license to their control after it was awarded to the Turkish firm.

Turkcell has revived its claim for $4.2 billion in damages against MTN after a court in Johannesburg agreed to hear the lawsuit launched over the loss of its license to operate in Iran, Reuters reported.

The litigation was repeatedly delayed until a South African high court judge two weeks ago allowed the case to go to trial after MTN, which has 240 million subscribers worldwide, dropped objections.

Iran has been a bright spot for MTN. The South African company also owns stakes in both Iran’s biggest ecommerce operator and Snapp, the domestic answer to Uber.

The South African firm also recently agreed on investing over $350 million into IranianNet, a state-owned fiber optic network facilitator, which will work with local Internet service providers to roll-out super-fast web access.

IranianNet was founded in 2011 to provide broadband Internet services to cities in Iran but has missed several deadlines on the project due to a lack of capital, it is said.