1 1 THE TRIBUNAL RESUMED ON THE 10TH NOVEMBER, 2005, 2 AS FOLLOWS: 3 4 OPENING STATEMENT 5 6 MS. O'BRIEN: In the course of these sittings, the Tribunal 7 intends to hear further evidence pursuant to paragraph G of 8 its Terms of Reference in relation to the second GSM mobile 9 telecommunications evaluation and licensing process. 10 11 With the exception of one other possible witness from whom 12 the Tribunal has not yet conclusively determined to hear 13 evidence, the evidence to be heard at these relatively 14 short sittings should complete the Tribunal's inquiries 15 into the process, save for any other matters that may 16 arise, either in the course of the evidence to be heard at 17 these sittings or otherwise, and which may render it 18 necessary for the Tribunal to hear additional evidence. 19 20 Before proceeding to outline briefly the matters into which 21 the Tribunal will be inquiring in these sittings, I should 22 indicate that the Tribunal had intended to hear this 23 evidence at sittings which commenced with an Opening 24 Statement on 15th September, 2004. It will be recalled 25 that the subject matter of that Opening Statement was the 26 Tribunal's inquiries in relation to the Doncaster Rovers 27 football club property. Those inquiries, had they 28 proceeded at that time, would have necessarily involved the 29 Tribunal hearing evidence from Mr. Denis O'Brien and from 30 Mr. Michael Lowry. In order to confine their further

2 1 attendances at public sittings of the Tribunal, it was 2 considered sensible and fairer to both Mr. O'Brien and Mr. 3 Lowry to hear the entire balance of their evidence on the 4 one occasion. 5 6 In the event, the Tribunal was unable to proceed with its 7 sittings at that time. While the Tribunal had hoped to be 8 in a position to take up the Doncaster Rovers Football Club 9 material and to complete substantially its inquiries into 10 the second GSM licence without further significant delay, 11 due to factors outside the control of the Tribunal, that 12 did not prove possible. 13 14 Following the decision of the Supreme Court in May of this 15 year in proceedings instituted by Mr. O'Brien which 16 enjoined the Tribunal from proceeding with public sittings 17 in connection with the Doncaster Rovers Football Club 18 matter until the completion of Mr. O'Brien's application 19 for Judicial Review, the Tribunal felt that it would not be 20 feasible to postpone hearing the balance of the evidence in 21 relation to the second GSM licence pending the final 22 disposal of those proceedings, and decided it should hear 23 the further evidence independent of the Doncaster Rovers 24 Football Club matter. By that time, the Tribunal had 25 already assembled material connected with other aspects of 26 its Terms of Reference involving decisions of the Revenue 27 Commissioners, and decided to proceed with public hearings 28 in relation to those matters in June and July last. 29 30 The Tribunal had scheduled the commencement of these

3 1 sittings for 20th September last. Prior to that date, on 2 the 13th September, the Tribunal heard submissions from 3 interested persons in connection with an issue which had 4 arisen from the nonavailability of Mr. Michael Andersen, 5 the managing director of Andersen Management International, 6 who had been the technical experts appointed by the 7 Department to assist the Project Group in its evaluation of 8 the second GSM licence as a witness to the Tribunal. As a 9 number of matters were raised in the course of those 10 submissions which were unrelated to the issue under 11 consideration, but which the Tribunal, nonetheless, felt 12 appropriate to comment on in the course of its ruling, it 13 was necessary to defer the commencement of these sittings 14 until after the Tribunal's ruling. The Tribunal delivered 15 its ruling on 29th September last. 16 17 In the course of these short sittings, the Tribunal intends 18 to hear some further evidence from Mr. Martin Brennan and 19 from Mr. Fintan Towey. It will be recalled that Mr. Martin 20 Brennan was the Chairman of the Project Group established 21 by the Department of Transport, Energy and Communications, 22 as it then was, to conduct the evaluation of the 23 applications for the second GSM licence. Mr. Fintan Towey 24 was a member of the Project Group and assumed much of the 25 responsibility for the operational aspects of the 26 evaluation and licensing process, and he reported to 27 Mr. Brennan. There, further evidence arises both from 28 material which came to the attention of the Tribunal after 29 the completion of their earlier evidence and from a matter 30 to which reference was made in evidence heard by the

4 1 Tribunal from Mr. Owen O'Connell, solicitor to Esat 2 Digifone Limited. 3 4 Those further matters on which the Tribunal expects to hear 5 evidence are as follows: 6 7 Firstly, following the completion of Mr. Denis O'Brien's 8 evidence on 11th December, 2003, and in response to a 9 request made by the Tribunal on the 4th November, 2003, 10 prior to the commencement of his evidence, Mr. O'Brien's 11 solicitors, William Fry, notified the Tribunal, by letter 12 of 29th January, 2004, that they had concluded a lengthy 13 process of reviewing their client's documents in order to 14 comply with the Tribunal's request, and that, as a result 15 of that review, they had identified further relevant 16 documents of which they had previously been unaware. 17 18 These documents included a copy fax dated 5th April, 1995, 19 from Mr. Denis O'Brien to Mr. Massimo Prelz of Advent 20 International. It will be recalled that Advent 21 International, a venture capital company based in London, 22 was a shareholder in Esat Telecom Limited, the company 23 which was ultimately a member of the Esat Digifone 24 consortium which bid for the licence. The Tribunal has 25 already heard evidence that negotiations between Esat 26 Telecom and Datacom and Southwestern Bell did not come to 27 fruition, and that, as of April 1995, Esat Telecom had yet 28 to secure a partner or partners to form a consortium to bid 29 for the licence. 30

5 1 Now, the fax which was produced by Mr. O'Brien reads as 2 follows: 3 4 It's dated the 5th April, 1995. It's from Mr. Denis 5 O'Brien to Mr. Massimo Prelz, Advent International, and it 6 states: 7 8 "Dear Massimo, 9 10 "Here is the up-to-date position regarding GSM partners. 11 12 "1. Bell South cannot move in the time frame we want them 13 to as they are bidding on the Belgian licence. There 14 is a long-shot chance that they will come in at some 15 stage. 16 17 "2. France Telecom - the Minister spoke to me yesterday 18 and suggested I contact France Telecom as they have no 19 partner and I am meeting them tonight in Paris for 20 dinner. 21 22 "3. Mannesmann - still no reply. Decision with their 23 Chairman. 24 25 "4. Airtouch - they think operation is too small in 26 Ireland. 27 28 "We expect to hear from Barbara Manfrey tomorrow re written 29 proposal. I will be in Prague all day and can be contacted 30 there" at the number given.

6 1 2 "Best wishes, 3 Denis O'Brien." 4 5 It appears from what was stated by Mr. O'Brien to his 6 partner, Mr. Prelz, on the 5th April, 1995, that, on the 7 previous day, the 4th April, 1995, Mr. Denis O'Brien had 8 discussed the formation of his consortium to bid for the 9 second GSM licence with the Minister, Mr. Michael Lowry. 10 It also appears that Mr. O'Brien had informed Mr. Lowry 11 that he did not yet have a partner or partners with whom to 12 form a consortium. It further appears that the Minister 13 informed Mr. O'Brien that France Telecom had no partner, 14 and finally, it appears that the Minister had suggested to 15 Mr. O'Brien that he contact France Telecom. 16 17 It will be recalled from evidence already heard that on 2nd 18 March, 1995, the Minister had formally announced the 19 competition; that on the same date, the Request For Tenders 20 document had been issued; that on 6th March, 1995, the 21 Project Group had adopted a protocol to regulate contact 22 with potential bidders, and that Mr. John Loughrey brought 23 that protocol to the attention of the Minister. 24 25 It does not appear to the Tribunal that the contact 26 suggested by the fax of 5th April, 1995, constituted other 27 than, perhaps, a technical breach of the protocol adopted 28 by the Project Group. Contacts and exchanges of this type 29 might well have been inevitable at that time, that is 30 during the period after the announcement of the competition

7 1 on 2nd March, 1995, and the publication of the RFP document 2 and before the receipt of applications on 4th August, 1995. 3 4 However, this may underline a distinction that should, 5 perhaps, be drawn between contact and interaction prior to 6 4th August, 1995, and contact or interaction between 4th 7 August, 1995, and 25th October, 1995, when the result of 8 the process was announced, and which period was 9 characterised by civil servants from whom the Tribunal has 10 heard evidence as the "closed period". 11 12 In the course of its private investigations, the Tribunal 13 raised queries with both Mr. O'Brien and Mr. Lowry in 14 connection with this matter, and Mr. O'Brien has informed 15 the Tribunal as follows: 16 17 "Mr. O'Brien believes, based on the contents of a fax dated 18 5th April, 1995, from Mr. O'Brien addressed to Mr. Massimo 19 Prelz of Advent International, and a perusal of his diary, 20 that he did have a conversation with Mr. Michael Lowry at 21 Comms 95 on 4th April, 1995. 22 23 "2. Mr. O'Brien's diary shows an entry for 4th April 24 marked '10.30 Comms 95 Lowry'. 25 26 "Mr. O'Brien has a recollection of attending Comms 95 on 27 behalf of Esat Telecom. Contemporaneous news reports 28 confirm that Mr. Michael Lowry made a speech at Comms 95 29 relating to the liberalisation of the telecommunications 30 industry in Ireland.

8 1 2 "Mr. O'Brien accepts, based on his fax to Massimo Prelz, 3 that he must have had a conversation with Mr. Lowry and 4 that Mr. Lowry must have made some mention of France 5 Telecom. Mr. O'Brien does not recall the conversation. 6 7 "Mr. O'Brien has no notes of this conversation, other than 8 the diary entry referred to above. 9 10 "Communicorp's relationship with Southwestern Bell 11 Telecom/DETECOM, terminated in mid-March 1995. Mr. O'Brien 12 immediately took steps to identify a list of approximately 13 ten potential international Telecom partners for the GSM 14 project. These included France Telecom. Mr. O'Brien made 15 arrangements to meet the various potential partners at this 16 time. Such arrangements would have been in mid to late 17 March, and certainly prior to 4th April, 1995. 18 19 "Mr. O'Brien recalls meeting with representatives of France 20 Telecom for dinner in Paris, which he believes (based on 21 his diary entries) took place on the evening of 5th April, 22 1995. Although he cannot be certain at this remove, he 23 believes that Lucy Gaffney and John Callaghan may have been 24 present for this dinner. A perusal of his diary shows two 25 relevant entries for 5th April, 1995. These entries are 26 "4pm EI to Paris" and "8pm dinner." Mr. O'Brien travelled 27 to Prague from Paris the following morning. He has no 28 notes of this dinner engagement. 29 30 "Mr. O'Brien believes that he had a subsequent lunch

9 1 meeting with France Telecom representatives at a later date 2 in April 1995. He understands that John Callaghan and 3 Massimo Prelz may have attended at this meeting. He has no 4 notes of this meeting. There are no diary entries in his 5 diary which assist his recollection in this regard." 6 7 Mr. Lowry, in response to the Tribunal's inquiries, has 8 informed the Tribunal that he has no recollection of ever 9 having met Mr. O'Brien and suggesting to him that he should 10 contact France Telecom. Furthermore, Mr. Lowry does not 11 believe that he would have ever made any such suggestion to 12 Mr. O'Brien. 13 14 In addition to Mr. O'Brien's diary which records the 15 Communications Exhibition 95 on 4th April, 1995, the 16 Tribunal has noted that both Mr. Lowry's official diary and 17 his personal diary also contain entries for "Communications 18 95 Exhibition RDS", for 4th April, 1995. 19 20 In the course of its private investigations, the Tribunal 21 has also made inquiries of both Mr. Brennan and Mr. Towey 22 regarding dealings between the Department and France 23 Telecom in relation to the second GSM process, dealings 24 between departmental officials and Mr. Lowry in connection 25 with France Telecom's interest in the licence, and details 26 of their knowledge of any contact between Mr. Lowry and 27 Mr. O'Brien on 5th April, 1995. 28 29 In response to these queries, Mr. Martin Brennan has 30 informed the Tribunal that he has no particular

10 1 recollection of such dealings, but that the Department's 2 records show that the then Secretary General of the 3 Department, Mr. John Loughrey, and Mr. Martin Brennan, met 4 with a delegation from France Telecom at the French Embassy 5 in Dublin on the 30th March, 1995. Mr. Brennan prepared a 6 report of that meeting, which is dated 30th March, 1995, 7 and it's headed "Report of meeting" and it states: 8 9 "The Secretary, accompanied by the undersigned, met with 10 Madame Brigitte Bourgoin, Director General, France Telecom 11 Mobile; Mr. Pierre Jandot, Area Manager, France Telecom 12 International, responsible for a group of countries, 13 including Ireland; and Mr. Charles B. Jeanlot of the French 14 Embassy. 15 16 "Their purpose in coming to Ireland was to outline the 17 strengths of France Telecom Mobile in the context of their 18 interest in the Irish GSM second licence. Madame Bourgoin 19 went through a brochure of slides for that purpose which is 20 on file. She had a copy of the GSM documentation and 21 raised a number of questions of detail. It was made clear 22 to her that even though they were not in in time for the 23 closing date of the information round, that the memorandum 24 which would flow therefrom would be made available to all 25 who had formally joined the competition by purchasing the 26 documentation. She will certainly purchase the 27 documentation in the next few days. She was assured that 28 it seemed to us that all possible questions had been raised 29 in one way or another by the various consortia who had sent 30 in long lists of questions. It was made clear by the

11 1 visitors that France Telecom had no interest in direct 2 equity investment in PTOs in Europe. They were only 3 interested in alliances on individual services. They saw 4 themselves as a bidder for the GSM2 with no conflict of 5 interest in the Telecom Eireann race. 6 7 "The Secretary made it clear that their being late coming 8 into the GSM operation was of no disadvantage and that we 9 welcomed the French interest in the emerging Irish Telecom 10 situation." 11 12 And it's signed Martin Brennan, and it's dated 30th March, 13 1995. 14 15 Mr. Brennan has noted from his handwritten annotation at 16 the top of the page that he forwarded a copy of this report 17 to Mr. Fintan Towey, and he has informed the Tribunal that 18 he cannot rule out that he sent a copy to Mr. Loughrey as 19 the other participant at the meeting. 20 21 Mr. Towey has informed the Tribunal that he has no 22 particular recollection of interest expressed by France 23 Telecom in bidding for the second GSM licence or in forming 24 a consortium to bid for the licence. Neither Mr. Brennan 25 or Mr. Towey have any recollection of any dealings between 26 the departmental officials and Mr. Lowry in connection with 27 the France Telecom interest, nor have they any knowledge of 28 any contact between Mr. Lowry and Mr. Denis O'Brien on 5th 29 April, 1995. 30

12 1 The Tribunal would intend taking these matters up with 2 Mr. Brennan, Mr. Towey, Mr. Lowry and Mr. O'Brien during 3 their evidence in the course of these sittings. 4 5 The second matter which the Tribunal intends to raise with 6 both Mr. Brennan and Mr. Towey is a document entitled 7 "Possible questions arising at press briefing on second GSM 8 licence, Friday 19th April, 1996," and in particular the 9 contents of the 7th bullet point on the second page of the 10 document. 11 12 Now, the document which is on the overhead screen is headed 13 "Possible questions arising at press briefing on 2nd GSM 14 licence - Friday, 19 April, 1996." 15 16 "These points have struck me on a totally random basis and 17 are not listed in any particular order of priority. 18 19 " -- How many times did Denis O'Brien meet a) the Minister, 20 b) the Secretary c) senior officials before the award 21 of the licence? 22 23 " -- Was Padraig O'hUiginn at any of these meetings? 24 25 " -- Were any other board members from Esat at these 26 meetings? 27 28 " -- Did any of the Semi-state Bodies involved in the 29 consortia lobby the Department? 30

13 1 " -- Have you leaned on any Semi-State to back off? 2 3 " -- How can the Department issue a licence when Esat are 4 flaunting the law with these auto-diallers? 5 6 " -- Surely Esat's financial standing was dependent on 7 their own corporate business plan predicated on these 8 auto-diallers? 9 10 " -- Did the unilateral action taken by the Department 11 instructing Telecom Eireann to calm down on the 12 auto-dialer arise from a desire to maximise the price 13 of Telecom Eireann? 14 15 " -- What involvement had the Minister in the whole 16 process? 17 18 " -- Did any other Minister make any lobby or preparation 19 to the Department's team or officials? 20 21 " -- Did the IDA lobby on behalf of America, US 22 multinationals and others who would be existing or 23 potentially important investors in Ireland? 24 25 " -- Why did the Department spurn 'the pot of gold' up the 26 more than £100 million which could have bid for this 27 licence? 28 29 " -- Why not admit that this is just a mere skin-deep 30 beauty contest and, at best, it was a flip of the coin

14 1 between the leading contenders? 2 3 " -- Has the Department warned Esat that its licence was at 4 risk if it pursued an aggressive stance on 5 auto-diallers? 6 7 " -- If the Department advice was always for the lowest 8 possible entry fee, who decided to seek a larger 9 cheque which was subsequently struck down by the 10 Commission? 11 12 " -- Is it true, as reported in the papers, that the 13 Secretary met with SBC? 14 15 " -- Why did the Secretary give an undertaking for feedback 16 which was subsequently countermanded by Martin 17 Brennan? 18 19 " -- All the consortia have made it quite clear that they 20 are waiving any confidential clauses, why not publish 21 the final report on that basis? 22 23 " -- Given Dermot Desmond's checkered history in the 24 telecommunications area, surely the Department would 25 have reservations about this investment? 26 27 " -- Has the Minister, secretary -- any official -- had 28 contact with Dermot Desmond on this matter? 29 30 " -- What sort of process is this that you didn't know who

15 1 the identity of some elements of the consortia? 2 3 " -- When did DG IV first initiate action against 4 Belgium/Italy? 5 6 " -- Who nobbled DG IV to reduce the price? 7 8 " -- How much does the Department think/believe we could 9 have received for the licence on an auction basis? 10 11 " -- How would this have affected Eircell? 12 13 " -- Surely the Department had nobody to blame but itself, 14 having sat on the fence when genuine feedback should 15 have been given long ago? 16 17 " -- What sort of process would allow Esat, a company of, 18 at best, very thin resources and very shallow pockets, 19 to perhaps carry out perhaps one of the most important 20 developments in the history of Irish infrastructure? 21 22 " -- The Department obviously lives in an ivory tower when 23 so many important jobs and other benefits were 24 associated with some of the other bids? 25 26 " -- How much contact/pressure came from a) Telecom b) 27 Alfie Kane c) Department of Finance to bid up the 28 entry fee? 29 30 "Strengths to be used in the press statement, the only

16 1 process that has the full stamp of approval from the 2 Competition Commissioner, Karel van Miert. 3 4 "Further questions which could be thought about: 5 6 " -- questions planted by say Persona in general and Tony 7 Boyle of Sigma in particular. 8 9 " -- questions suggested by John Riordan and The Irish 10 Independent in general. 11 12 " -- any other possible wild card entries." 13 14 "NB, we are all very familiar with concepts and process. 15 Let's not assume others are. Statement should revisit 16 essential settlements of the competition notably the 17 criteria for completeness and journalistic ease of 18 reference." 19 20 It will be recalled that Mr. Brennan stated in evidence 21 that he was not aware of the Glackin Report or its 22 conclusions and he had no recollection of any discussion of 23 the report in the context of the licensing process, and in 24 particular in the weeks between the receipt of a letter 25 dated 17th April, 1996, from Mr. Owen O'Connell of William 26 Fry solicitors, notifying the Department of the involvement 27 of IIU/Mr. Dermot Desmond on the 16th May, 1996, the date 28 on which the second GSM licence was issued to Esat Digifone 29 Limited. 30

17 1 Mr. Fintan Towey, in his evidence, stated that he had a 2 general familiarity with the Glackin Report, and, while he 3 did not recall discussing it with colleagues in the context 4 of the licensing process, he could not rule out that such 5 discussions might have taken place. 6 7 This document came to the attention of the Tribunal 8 following a further review of the files produced to the 9 Tribunal by the Department of Transport, Energy and 10 Communications. It is clear that the document was 11 generated for the purposes of the press briefing convened 12 by the Department on 19th April, 1996, and attended by the 13 Departmental officials. The contents of the document 14 suggest that the person who prepared the document was aware 15 of the conclusions of the Glackin Report, and was live to 16 the possibility that the media might quiz the Department on 17 the appropriateness of the granting a licence to a 18 consortium of which Mr. Desmond was a member. 19 20 In the course of its private investigations, the Tribunal 21 has asked both Mr. Brennan and Mr. Towey to comment on this 22 document. Mr. Brennan has informed the Tribunal that he is 23 virtually certain that the document was not prepared by him 24 and that he did not contribute to its preparation. He has 25 observed that the copy of the document available to him has 26 some manuscript annotations and that they are not in his 27 handwriting, nor does he recognise the handwriting. He is 28 not in a position to speculate as to who might have 29 prepared the document. 30

18 1 Mr. Fintan Towey has informed the Tribunal that he recalls 2 Mr. John Loughrey, then Secretary General, saying at some 3 point that he had dictated a number of questions for the 4 purposes of preparing for a press conference or perhaps a 5 Dail statement. Mr. Towey cannot say whether the document 6 in question is the output of that exercise, but that may be 7 the case. He has no specific recollection of preparing any 8 such questions himself, or of the document being produced 9 by any other person. 10 11 The Tribunal will wish to pursue its inquiries into this 12 matter, and in particular in the light of the evidence 13 which has already been heard. 14 15 The third matter which the Tribunal wishes to raise with 16 Mr. Brennan and Mr. Towey relates to evidence given by 17 Mr. Owen O'Connell on the 24th November, 2003, when he was 18 responding to inquiries raised with him regarding the 19 deletion from a draft letter dated 10th May, 1995 prepared 20 by him in response to a request made by the Department on 21 the 3rd May, 1996, for an explanation for the substitution 22 of IIU Limited and Mr. Dermot Desmond for Davy Stockbrokers 23 and the institutions named in the Esat Digifone bid 24 documents. The letter, as finalised and dated 13th May, 25 1996, contained no explanation for the substitution. 26 27 In his evidence to the Tribunal, Mr. O'Connell stated that 28 he had no recollection of why the explanation for the 29 substitution of IIU/Mr. Dermot Desmond was deleted from the 30 draft letter, but that his supposition was that such

19 1 deletion was made either at the request of, or with the 2 agreement of, the Department. 3 4 The Tribunal has raised this matter with both Mr. Brennan 5 and Mr. Towey in the course of its private investigations. 6 Mr. Brennan has informed the Tribunal that he does not 7 believe that he either requested or acquiesced in any 8 omission or deletion from one draft to the next. He has 9 informed the Tribunal that it is clear and it has been 10 acknowledged by Mr. O'Connell that he was not directly 11 involved in the detailed interface with Mr. O'Connell and 12 his clients around that time, and that it is clear from 13 other evidence to the Tribunal that Ms. Regina Finn from 14 the Regulatory Division, and Mr. Towey from Mr. Brennan's 15 division were involved in the details. 16 17 It appears to Mr. Brennan, from reading Mr. O'Connell's 18 evidence, that the question of whether the Department 19 requested or agreed the deletions from the letter is 20 speculative, and he has observed that Mr. O'Connell, in his 21 evidence, appears to have acknowledged that either 22 Mr. O'Connell or his clients, or both, may have had valid 23 reasons for not wanting to put an explanation about the IIU 24 involvement on record at that time. 25 26 Mr. Towey has informed the Tribunal that he has no specific 27 recollection of having previously seen the draft letter 28 dated 10th May, 1995. He believes that he did not see it, 29 as he thinks that he would recall if he had, and, as there 30 is no copy of the letter on the Department files, it is

20 1 clear that the draft letter was not sent to the Department. 2 Mr. Towey does not accept that there is any possibility, as 3 speculated upon in the evidence of Mr. Owen O'Connell, that 4 the Department, or Mr. Towey in particular, either 5 requested or agreed to the deletion of this information 6 from the letter finally sent to the Department. 7 8 Mr. Towey cannot think of any possible reason why 9 Mr. O'Connell might speculate that the Department might 10 have an interest in such information being deleted. 11 12 The Tribunal will wish to pursue these inquiries with both 13 Mr. Brennan and Mr. Towey in the course of their evidence. 14 15 The final matter which the Tribunal intends to raise with 16 Mr. Brennan and Mr. Towey is a press release which appears 17 to have been issued by the Department on 5th December, 18 1996. The terms of the press release are similar in 19 content to the terms of a letter dated 6th December, 1996, 20 from the then Minister, Mr. Alan Dukes, to Mr. Bobby 21 Molloy, TD. 22 23 If I refer, firstly, to the press release and then to the 24 letter. 25 26 "1. The Esat Digifone application was on behalf of a 27 consortium owned as to 50% each by Telenor Invest AS and 28 Communicorp Group Limited (the holding company for Esat 29 Telecom). The application disclosed that, if successful, 30 20% would be placed with financial investors. A list of

21 1 potential investors was submitted, all 'blue chip' 2 institutions whom we are specifically precluded from 3 naming. There was no room for doubt as to either their 4 bona fides or their financial capacity. 5 6 "We can state that the names now being speculated upon in 7 media coverage were not on this list. 8 9 "2. At the licensing stage, several months later, Esat 10 Digifone was in a position to announce that it had placed 11 the 20% with IIU Nominees Limited and it was certified to 12 the Department that Mr. Dermot Desmond was the sole 13 beneficial owner of the 20%. Adequate evidence of his 14 capacity was disclosed." 15 16 And below that "Ends -- 5/12/96." 17 18 Then the letter on which the Tribunal has already heard 19 evidence was dated the 6th December, 1996, from the then 20 Minister, Mr. Alan Dukes, TD, to Mr. Robert Molloy, TD. 21 22 "Dear Bobby, 23 24 "There appears to be considerable confusion abroad about 25 the precise situation regarding ownership and investment in 26 Esat Digifone. I hope the following information will 27 clarify the matter for you. 28 29 "The Esat Digifone application was on behalf of a 30 consortium owned as to 50% each by Telenor Invest AS and

22 1 Communicorp Group Limited (the holding company for Esat 2 Telecom). The application disclosed that, if it was 3 successful, 20% would be placed with financial investors. 4 A list of potential investors was submitted, all of whom 5 are 'blue chip' institutions. The Minister and Department 6 are specifically precluded from naming these, but there was 7 no room for doubt as to either their bona fides or their 8 financial capacity. 9 10 "I can, however, confirm that the names being speculated 11 upon in the last few days were not on this list. 12 13 "At the licensing stage, several months later, Esat 14 Digifone was in a position to announce that it had placed 15 the 20% with IIU Nominees Limited, and it was certified to 16 the Department at that time that Mr. Dermot Desmond was the 17 sole beneficial owner of the 20%. Adequate evidence of his 18 capacity was disclosed. Mr. Desmond is still the exclusive 19 beneficiary of the IIU shareholding. 20 21 "On 19 April, when the Department held a press briefing, 22 the fact that it was not in a position to give final 23 definitive information on the placement of the 20% minority 24 shareholding may have reduced the clarity of the exchanges. 25 My information is that when the licence was issued shortly 26 thereafter, the precise situation was clearly stated. 27 28 "If I can be of any further assistance to you, within the 29 constraints of the binding confidentiality agreements, I 30 would be delighted to do so.

23 1 2 "Yours sincerely, 3 4 Alan Dukes, 5 Minister for Transport, Energy and Communications." 6 7 It will be recalled that, in the course of evidence, Mr. 8 Martin Brennan stated that, while he had no recollection of 9 the letter of 6th December, 1996, he believed that, in all 10 probability, he would have drafted the letter to Mr. Molloy 11 and he would have then passed the draft to the then 12 Secretary General of the Department, Mr. John Loughrey. 13 The Tribunal has also raised this matter with Mr. Brennan 14 and Mr. Towey in the course of its private inquiries. 15 Mr. Brennan has informed the Tribunal that he has no idea 16 who prepared the press release. 17 18 It seems to him that the proposal for 25% shareholding by 19 IIU Nominees was one which only had a short life, was 20 excluded by the Department on the basis that it was not in 21 accordance with the original application, and that no 22 significance whatsoever was attached to it by the 23 Department after that event. In his considered opinion, 24 there was no conscious decision by anyone to omit a 25 reference to that 25% proposal. It was simply that it had 26 no ongoing relevance in the minds of the people concerned 27 after it had been disallowed. 28 29 Similarly, Mr. Towey has no recollection of the press 30 release, and he has informed the Tribunal that he imagines

24 1 that it was intended to provide clarification of the 2 investors in Esat Digifone following exchanges in the Dail 3 on the question. 4 5 The Tribunal will wish to further its inquiries with both 6 Mr. Brennan and Mr. Towey in relation to the press release, 7 and, in particular, the matters which prompted the 8 exclusion of any reference to IIU's entitlement to a 25% 9 shareholding in Esat Digifone Limited arising from the 10 agreements of 29th September, 1995, or to the fact that IIU 11 Limited was not within the list of potential investors 12 referred to in the Esat Digifone bid. 13 14 The Tribunal also intends to hear further evidence from 15 Mr. Tony Boyle, who was Chairman of the Persona Digital 16 Telephony Limited, one of the other consortia that entered 17 the competition for the second mobile phone licence. Mr. 18 Boyle gave evidence to the Tribunal on 24th March, 2004. 19 His examination by counsel for certain parties was deferred 20 at the request of those parties, and Mr. Boyle will be 21 attending for the purposes of the completion of such 22 examination. 23 24 The Tribunal will also be hearing further evidence from Mr. 25 Denis O'Brien in connection with matters which are 26 outstanding from his earlier examination and which he 27 wished to have time to consider. These matters include the 28 following: 29 30 1. Sponsorship of £4,000 for Esat Digifone of a Fine Gael

25 1 Golf Classic held in the K Club on 16th October, 1995. 2 3 2. Mr. O'Brien's dealings or contacts, if any, with Mr. 4 Mark FitzGerald regarding such sponsorship. 5 6 3. The letter dated 13th July, 1995, from Commissioner van 7 Miert addressed to Mr. Michael Lowry, setting out the terms 8 which had been agreed between the Department and the 9 Commission to resolve the Commission's intervention in the 10 licensing competition and a copy of the second page of 11 which was found within the files of Mr. Jarlath Burke, 12 legal and regulatory counsel to Esat Telecom. 13 14 As indicated earlier, the Tribunal also intends taking up 15 with Mr. O'Brien the contents of the fax of 5th April, 16 1995, from Mr. O'Brien to Mr. Massimo Prelz, and to which I 17 have already referred, and finally, there may be a small 18 number of matters arising from evidence heard by the 19 Tribunal after Mr. O'Brien completed his evidence in 20 December 2003. 21 22 Counsel on behalf of other interested parties, including 23 Mr. O'Brien's own counsel, may wish to examine him in 24 connection with all of the evidence which he has given to 25 the Tribunal in the context of the Tribunal's inquiries 26 into the second GSM process. 27 28 Finally, the Tribunal will also be hearing evidence from 29 Mr. Michael Lowry in relation to all of the matters which 30 the Tribunal wishes to raise with him regarding its

26 1 investigations of the second GSM process pursuant to 2 paragraph G of its Terms of Reference. Mr. Lowry has 3 furnished the Tribunal with a considerable body of 4 information which has all been referred to in the course of 5 previous Opening Statements. 6 7 And that completes the Tribunal's Opening Statement, Sir. 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30