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NetOne in trouble over an unlawful deal


Oct. 13, 2019

NetOne in trouble over an unlawful deal. NETONE Cellular is now seeking High Court’s intervention after an unlawful deal between the company and Formula Telecom Solutions (FTS) Limited, an Israel company which produces billing and call centre equipment for telecommunication services, went sour.
The mobile telecommunications company has approached the High Court seeking favour as it is set to appear before a London court in two weeks after parties failed to agree on an out of court settlement.
Through its lawyer, Nobert Muhlolo, NetOne says it has no means to attend the hearing and fears an arbitration award will be made in favour of FTS.
“The arbitration hearing is scheduled for 23rd and 24th October in London. The applicant does not have the means to attend that hearing, and given the previous awards made by the sole arbitrator, there is a very real fear that arbitration will be made in favour of FTS against NetOne,” said Muhlolo in his founding affidavit.
“Such an award would not be enforceable in Zimbabwe due to the unlawfulness of the agreement, but the applicant (NetOne) would be forced to extend large sums of money defending FTS claims and attempts to enforce an award.
“Applicant has sought an out of court resolution of the dispute but this has failed,” he added. According to Muhlolo, NetOne and FTS entered into an unlawful agreement in December 2016 as approvals were not obtained from the exchange control authorities and the procurement regulatory authorities.
FTS then declared a dispute and instituted arbitration proceedings in the London Court of International Arbitration as provided for in the lawful agreement.
According to the application, the sole arbitrator has already made findings against NetOne. In terms of Article 9 (C) and (D) of the United Nations Commission on International Trade Law (UNCITRAL) Model Law, Muhlolo said the High Court is empowered to grant an interdict or any other interim order to ensure that any award which may be made in arbitral proceedings is rendered ineffectual.
The lawyer said the situation has far-reaching implications hence the need for the case to be heard urgently.
Source – Bulawayo 24 News
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