MORIARTY TRIBUNAL:DERMOT DESMOND'S taking of a 20 per cent shareholding in Esat Digifone in 1996 was described as a "slight" change in its shareholding at the Moriarty tribunal yesterday.
Civil servant Fintan Towey, who was a senior member of the team that selected Esat Digifone as the winner of the competition for the State’s second mobile phone licence, said Mr Desmond’s shareholding, by way of his company IIU Nominees Ltd, only concerned the issue of equity capital and not technological expertise.
The tribunal has been hearing evidence about the awarding of the licence to Esat Digifone in May 1996. When Esat entered a competition for the licence in 1995, it said it would be 40 per cent owned by Denis O’Brien’s Communicorp and 40 per cent owned by Norwegian company Telenor. The remaining 20 per cent was to be placed by Davy with four named financial institutions.
However, as the time for the issuing of the licence approached in April 1996, the Department of Transport, Energy and Communications was told that Mr Desmond’s IIU Ltd had replaced the four named financial institutions.
Mr Towey said he believed that legal advice received on May 9th from Richard Nesbitt SC, “implicitly” stated that the change in ownership was not a legal impediment to the issuing of the licence.
Responding to Jim O’Callaghan SC, for Mr O’Brien, he said there was no “sinister plot” to grant the licence to Esat despite the appearance of IIU as a shareholder. Asked was such a plot “orchestrated by Minister [Michael] Lowry with you being a puppet at the end of a piece of string?” Mr Towey said: “Absolutely not. Minister Lowry had no role in the matter.”
The tribunal has formed the opinion that the legal advice from Mr Nesbitt did not address the ownership issue, something which is contested by Mr Towey and his colleague in the department at the time, Martin Brennan. Both have said they believe the advice was to the effect that the department could go ahead and award the licence.
John O’Donnell SC, for the department, said that if the tribunal chairman Mr Justice Michael Moriarty would call Mr Nesbitt, he would say the issue was raised during meetings with Mr Towey and others.
He said Mr Nesbitt “specifically recalls” a meeting with Mr Towey on May 14th, 1996, where he “asserted that the change was not a matter that the Minister or the department should concern itself with”.
Mr Justice Moriarty said he would prefer not to call a barrister to give evidence about legal advice he had given, something he had not seen in the course of his career.
Jacqueline O’Brien SC, for the tribunal, said the contents of documents shown at the tribunal indicated the department had already decided the IIU issue wasn’t an impediment to the licence being given to Esat, prior to Mr Nesbitt’s written legal advice being received on May 9th.
This explained why the legal advice didn’t deal with the ownership issue, she said. “I understand your hypothesis,” said Mr Towey. “But I don’t agree with it.”
The tribunal resumes today, with evidence from Mr Brennan.
