Turkcell sues S.Africa’s MTN for $4.2 billion over Iran deal

Turkish mobile operator Turkcell has filed a $4.2 billion lawsuit in a US court against South African rival MTN over alleged corruption in a deal in Iran, the companies said Thursday.

Turkcell said in a statement that it had filed the lawsuit in a US federal court in Washington, accusing MTN of violating international law. Both companies have business dealings in the United States.

MTN said in a separate statement that the case could seek up to $4.2 billion in damages.

Turkcell said that it was awarded Iran’s first private GSM license in 2004 through an international tender.

“Subsequently Turkcell was barred from concluding its license arrangement, and Iran entered into a license agreement with the South Africa-based operator MTN, instead of Turkcell,” it said.

MTN now owns a 49-percent stake in the Iranian mobile telecoms company Irancell, which holds the operating licence. MTN’s 33 million clients in Iran make up 21 percent of its total subscriber base.

Turkcell did not disclose the details of its lawsuit, but has previously accused MTN of bribing government officials and pressing Pretoria to endorse Iran’s nuclear programme in exchange for rights to the GSM licence.

“MTN continues to believe that there is no legal merit to Turkcell’s claim and no basis for such claim to be brought before a US court,” the South African firm said.

“MTN will accordingly oppose the claim. MTN further notes the South African government’s denial of the allegations that MTN exercised influence over it.”

The Turkcell dispute comes as Washington is pressuring allies to cut business ties with Tehran.