Government, NetOne and Huawei Technologies given 14 days to pay $4 mn debt

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A telecommunications consultancy company based in South Africa, Megawatt, has threatened to sue government, NetOne and Huawei Technologies to recover US $4 million for the work it did in discovering that the Chinese company had overcharged the state owned mobile phone firm by $30 million in a contract.

Megawatt, through its lawyers, Bere Brothers, wrote to ICT and Cyber Security permanent secretary Sam Kundishora on April 30, 2018 advising him of the firm’s intention to sue in the High Court unless jointly or severally the government, NetOne and Huawei settle the debt within 14 days.

Bere Brothers alleged that the former NetOne chief executive, Reward Kangai, signed the agreement with Megawatt in 2014 to review if Huawei technologies had not overcharged the mobile operator in a $218 million expansion contract.

Megawatt, in their investigation, found out that the state-owned company was overcharged by more than $120 million.

“We are advised that our client was appointed by your ministry to conduct an investigation and if possible negotiate a rebate of refund for overcharged contracts between Net One Cellular and Huawei Technologies,” the lawyers wrote in part.

“Our client proceeded to conduct the investigations as assigned and indeed proved that NetOne Cellular had been overcharged. As a result of the work done by our client NetOne Cellular realized a saving of US30 million dollars on the NMBB Phase Two project which they had contracted to Huawei Technologies.

Our client further advises that in terms of the agreement between your Ministry, Net One Cellular and Huawei, our client was entitled to payment as follows: US 1 million as services fees and a further 10 percent commission of the total amount recovered or saved.

In view of the saving referred to above, our client was entitled to a commission of US 3 million dollars.”

The lawyers said, “Despite agreeing to resolve the matter in an amicable way, in view of the relations between China and Zimbabwe, our client was struggling to receive payment.

“Our client has on several occasions engaged NetOne Cellular in a bid to secure payment. An agreement was signed between NetOne Cellular and Megawatt in April 2017 wherein our client accepted a varied payment which was due on or before 31st July, 2017 failing of which the full amount of US 4million will be due again,” the lawyers stated.

The lawyers are now seeking the intervention of the Ministry to resolve the matter amicably within 14 working days’ failure of which Megawatt will institute recovery proceedings against the government, NetOne, Huawei and other involved parties without further notice.

The lawyers attached minutes of the meeting in which all parties agreed to resolve the matter amicably.

“Our client still desires to have this matter resolved amicably without resorting to the courts in order to avoid exposing the details of the contract to the public domain.”

Megawatt has, however, said it is willing to resolve the matter amicably without involving the courts.