The department of international relations has confirmed it is investigating allegations that the former ambassador to Iran, Yusuf Salojee, accepted payments from MTN.
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The statement by Minister Maite Nkoana-Mashabane, in reply to a parliamentary question released on Tuesday, adds a new twist to the controversy over MTN's operations in Iran.
The South African company stands accused of paying bribes to secure a mobile phone operating licence in Iran, but has denied any wrongdoing. It is alleged that MTN made a payment of US200,000 (R1.6 million) towards the purchase of a house for Salojee in South Africa.
Nkoana-Mashabane confirmed in her reply that Salojee did not have permission from the department to perform remunerated work outside his diplomatic functions.
Democratic Alliance MP David Maynier, who submitted the question, pointed out that a few months ago the minister had insisted there was no need to investigate Salojee.
"It is not clear why the department has done an about turn, but the institution of this investigation is nevertheless a welcome development."
He called on the department to release the findings of the investigation as soon as possible.
The Hawks announced last month they were investigating claims that MTN had obtained its operating licence in the Islamic republic through corrupt means.
The claims originated from Turkish mobile operator Turkcell, which won a tender in 2004 for the second private mobile operating licence in Iran. However, the licence was finally awarded to MTN Irancell, a consortium in which MTN holds a 49 percent stake.
MTN has said there was nothing untoward about the process, and that Turkcell was knocked out of contention because it failed to comply with Iranian legal and commercial requirements.
But Turkcell has alleged in a law suit filed in Washington that MTN bribed officials, arranged meetings for Iran with South African leaders, and promised Iran weapons and support at the United Nations nuclear watchdog on the Iran dossier, in exchange for the stake in Irancell.
International news agency Bloomberg has reported that the court documents include alleged MTN memos pointing to payments to Salojee and Iran's former deputy foreign minister, Javid Ghorban-Oghli.
In March, Nkoana-Mashabane said there was no need for an investigation into payments to the ambassador, adding she knew for a fact that nothing had swayed South Africa's stance on Iran's controversial nuclear programme.