Editorial: Cellout

By Time of article published Feb 8, 2012

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VERY serious allegations of bribery have been levelled against SA cellphone giant MTN by a Turkish rival.

Turkcell, which lost out to MTN in a bid for a licence in Iran seven years ago, has said it will bring a case against MTN and its associate, Irancell, in a US court. Irancell, in which MTN has a 49 percent stake, was awarded the Iranian licence in 2005, and Turkcell claims that MTN bribed both an Iranian and an SA government official in 2004 and 2005 to get the licence.

Perhaps even more seriously, Turkcell also claims that MTN encouraged the SA government to favour Iran’s nuclear power programme at a meeting of the International Atomic Energy Association in 2005, and that the company enlisted support from the SA government for the supply of military equipment – including uranium – to Iran.

MTN chairman Cyril Ramaphosa has reacted swiftly to the allegations, appointing a special committee to look into Turkcell’s claims and make recommendations.

The committee is to be headed by an SA-born judge, Lord Hoffman, and made up of non-executive members of the MTN board.

The matter may or may not go to court in the US. Turkcell believes it has a case under US law; MTN thinks not.

In the meantime, though, it is essential that the SA government institute its own independent inquiry.

There may, of course, be no truth in the allegations, and it is quite possible, as some have suggested, that the Iranian cellphone contract award was mainly a response to a Turkish decision to allow landing rights to American aircraft at a time when the US was at war with Iraq and Afghanistan.

But the task of SA government officials is to represent the nation’s interests and not those of any company.

SA’s diplomacy, especially in a complex region such as the Middle East, cannot be dictated by corporate imperatives.

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