Korek Telecom's chair bribed regulators to strip his partners — a $1.65B award followed

Korek Telecom is Iraqi Kurdistan's largest mobile operator. In 2011 Orange and Agility put a combined US$810 million into the company through a holding structure: Iraq Telecom Ltd took 44% of the holding company International Holdings, with a call option over a further 7% that would take it to 51% control. Chair Sirwan Saber Mustafa Barzani retained majority voting control through his own vehicles.

By late 2013 the partners were in dispute. Rather than honor the shareholders' agreement, Barzani's side went to the Iraqi Communications and Media Commission. On 2 July 2014 the CMC declared its own 2011 approval of the Orange-Agility investment 'void, null and invalid', stripping the partners of their stake with no compensation. The ICC tribunal later found the decision was procured: cash paid to senior CMC officials disguised as legal and consulting fees, plus London property purchases for their benefit.

The concealment ran deep. When a 2015 loan from Byblos Bank needed collateral, bank records obtained in later arbitration showed US$150 million moved from Barzani's personal HSBC Dubai account to the bank in Beirut on the eve of signing — security he denied existed. The tribunal also found self-dealing, diverted corporate assets and sham loans breaching the shareholders' agreement.

In a unanimous final award dated 20 March 2023, the ICC tribunal found the unlawful-means conspiracy made out and awarded US$1.012 billion to International Holdings, US$228.8 million to Iraq Telecom, US$388.7 million in pre-award interest and about US$20 million in costs — over US$1.65 billion in total. Korek and Barzani denied everything and moved to set the award aside.

US$1.65B ICC award: $1.012B to IH, $228.8M to IT, $388.7M pre-award interest, ~$20M costs — plus a worldwide asset freeze and loss of control

The partners held contractual levers — a 51% call option, shareholder-loan security and DIFC-seated arbitration — so any forced exit would eventually face scrutiny they could trigger.

Bribing a regulator leaves a paper trail: consulting-fee payments, London real estate transfers and a $150M overnight bank transfer were all reconstructable from ordinary banking records.

Korek's leadership treated the CMC ruling as final, but a DIFC-seated tribunal only had to find the bribery as fact — not overturn the Iraqi decision, which blunted the act-of-state defence.

UAE public policy and its anti-bribery commitments barred courts from letting the act of state doctrine blindfold arbitrators where a party's own corruption caused the loss.

A controlling shareholder who corrupts a regulator to expel an investor doesn't keep control — tribunals follow the money, find the bribery, and award the partner damages plus the optioned shares.

Justice Sir Jeremy Cooke imposed a worldwide freezing order over the defendants' assets in May 2023. The set-aside application was dismissed in August 2024, and on 16 June 2025 the DIFC Court of Appeal dismissed the final appeal, holding the act of state doctrine did not preclude findings of bribery and that UAE public policy stands firmly against it. Enforcement against Barzani's assets continues, and Korek still operates under Iraqi licence while the award binds.