OWN CORRESPONDENT and HILARY GUSH, Johannesburg | Tuesday
LOSING bidder Nextcom has cleared the way for Communications minister Ivy Matsepe-Casaburri to award South Africa’s third mobile phone licence after dropping some of its objections in its court interdict – but has refused to say whether this is in exchange for a strategic stake in the winning bid company.
Hong Kong-backed NextCom has abandoned certain clauses in a July interdict to prevent the minister from acting on the regulator’s recommendations and awarding the lucrative licence, but is still said to be seeking a judicial review of a process it has described as ”deeply flawed.”
However, sources close to the process said NextCom could now be looking to take a strategic stake in its rival Cell-C. Neither firm would comment on this.
The regulator had originally recommended Saudi-backed consortium Cell-C for the right to provide mobile telephony in the fast-growing subscriber market dominated by local groups Vodacom and MTN.
The ministry said judgment had been delayed in hearing into Matsepe-Casaburri’s application for leave to appeal against the interdict.
”We need clarity on what is being abandoned and the effect this has on the rest of the action. We are just waiting to get the notice and will take legal advice on that,” said an adviser.
The delays in the award, initially scheduled for July 1999, has dented investor confidence in the government’s ability to manage large projects efficiently.
The process has been bogged down by legal wrangles and allegations of corruption and inept decision-making by the regulator.
In July the high court blocked the government from making the award, pending a review of the process, which was due in the first week of October. The court ruled there were grounds to suspect the tender process for the permit was flawed.
In its application to freeze the licence award, NextCom alleged flaws in the process, including conflicts of interest and political intervention. NextCom is backed by Hong Kong telecoms group Distacom. – Reuters