The French telecommunications giant, Orange on Thursday announced decision to end its brand licensing deal with the Israeli firm Partner Communication and quit its operations in the country.
The decision comes a day after the chairman of Orange, Stephane Richard said in Cairo that he wished to end the agreement, even though there was a huge risk of financial penalties from doing so, and that the decision was in part due to the firm’s relations with Arab countries.
In his statement, the CEO said: “I would cancel contract with Israel tomorrow if I could”
“We didn’t renew the contract, we wanted to change the terms of the contract and include a termination date, as there previously wasn’t a termination date, and gave us no possibility of leaving the deal,” he said.
Orange’s official explanation of the act denied any political relations, as the official statement on the company’s website said that “It has NOT intended to take part, in any form, in a political debate.”
The official explanation said that the decision was only about brand licensing.
“The Orange Group is not an operator in Israel. It has a brand licensing agreement with the operator, Partner Communications. The Orange group is not a shareholder in Partner and thus has no influence on the strategy or the operational development of the latter.”
The statement also said that “The agreement, which was signed before the acquisition of Orange by France Telecom in 2000, is the only long-term brand licensing agreement with the Group. In line with its branding policy, Orange does not wish to maintain the brand presence in countries where the Group is not or is no longer an operator. In this context, while strictly respecting existing agreements, Orange wishes to end this brand licensing term.”
Israeli leaders voiced their anger regarding the act. Israeli prime minister, Benjamin Netanyahu described it as an “absurd play in which Israeli democracy defends itself against rocket attacks and terror tunnels and takes automatic condemnation and boycott attempts will not be forgiven,” according to Ynet Israeli news outlet.
Netanyahu called on the French government to “publicly renounce the unfortunate remarks and actions of a company partly owned by the French government.” and that Israel’s friends “say out loud that they oppose every kind of boycott against the Jewish state.”
Partner CEO Haim Romano warned that Orange would pay a price if it cancelled the arrangement. “We have not received anything official,” he said. “For now we will demand an apology and clarifications of what their CEO said,” Ynet reported.
Some Israeli leaders were too furious about the decision, as the Israeli culture minister Miri Regev who called on French President Francois Hollande to fire Ricahrd, and show him “zero tolerance.”
Partner firm quickly issued a letter to its employees following the recent events calling it a violation of its rights, demanding compensation by paying hundreds of millions of euros that [Partner] invested with great effort over the years. “