The Yemeni government is holding back repairs on a key internet cable that’s been damaged in the Red Sea as it conducts a criminal investigation into the cable owners’ alleged ties to the Houthi militia.
The Iran-backed Houthis, designated as a terrorist organisation by the US and its allies, control much of Yemen’s telecommunications infrastructure, including a branch of the country’s only international carrier, TeleYemen. TeleYemen is part of a consortium of operators that owns the damaged AAE-1 cable, a 25 000km system that connects Europe to Southeast Asia.
The Yemeni government has notified about 20 members of the global group — which includes Emirates Telecommunications Group, Saudi Arabia’s Mobily, Italy’s Retelit, Oman Telecommunications and Djibouti Telecom — that they are being probed for their association with TeleYemen and may be providing material support to a designated terrorist group, according to documents seen by Bloomberg and two people familiar with the situation. While the investigation is ongoing, the government won’t give the all clear for repairs to start in its territory, the people said, asking not to be identified because the information isn’t public.
Representatives for the consortium and the individual companies didn’t respond to requests for comment. An official from Yemen’s internationally recognised government confirmed the authenticity of the documents but declined to comment.
The Houthi-controlled telecoms ministry said the investigation is baseless and that “any promulgation of such allegations contributes to the destruction of the Yemeni telecoms sector”, the spokesman added. “It will have negative and harmful effects on the interests of international companies and their investments in the region, something we have always warned about.”
The AAE-1 and two other cables that run through the Red Sea, a critical route for connecting Europe’s internet infrastructure to Asia’s, were knocked offline when the Houthis sunk a ship off of Yemen’s coast in late February, causing the vessel to drag its anchor across the lines. The incident affected lines that carry an estimated quarter of all internet traffic in the region and highlighted the vulnerability of a system that underpins the digital economy.
Permit
Cable operators need a government permit to make repairs in Yemeni waters. While the country’s internationally recognised government approved repairs to the other two cables earlier this month, it has so far refused to issue a permit to fix the AAE-1 cable.
TeleYemen signed up to the AAE-1 consortium in 2014, investing more than US$40-million to build the submarine cable, which went into operation in 2017. But since then, the country – and the company – split in two, with the internationally recognised government in Aden in the south, and a Houthi-controlled government, which is not recognised by the United Nations, in Sanaa in the north. The Houthi-controlled Sanaa part of TeleYemen has stayed in the AAE-1 consortium, despite repeated requests from the Aden side to swap them out.
Telecoms companies are a key source of revenue for the Houthi authorities, according to reports by the United Nations Security Council.
Last month, Yemen’s attorney-general Judge Qaher Mustafa Ali wrote to the AAE-1 consortium members, from countries including the UAE, China, Pakistan, India, Greece, Italy, Thailand and Saudi Arabia, that the government had initiated the criminal investigation “relating to allegations of money laundering and terrorism financing” and asking them to supply details including the consortium’s corporate transactions and ownership structure. The judge warned that failure to comply could expose AAE-1’s management committee to criminal legislation in Yemen and other countries.
The same judge sent letters to attorneys-general in the consortium members’ countries, as well as the US attorney-general, to notify them of the criminal investigation. The letters request assistance in the investigation, including compelling companies in their jurisdictions to hand over documents.
Each member of the consortium owns shares in the cable in return for having access to its bandwidth. The consortium members can also make money by selling excess capacity on the cable. The investigation centres on whether the Houthi-run TeleYemen has received payments through the consortium and whether that constitutes material support for a terrorist group.
A separate, civil lawsuit alleges that the consortium is in breach of its contract by allowing an illegitimate representative to act on behalf of TeleYemen.
TeleYemen is also in other international consortiums that control subsea cable systems that run through the Red Sea, including Falcon and Sea-Me-We5. — Olivia Solon and Mohammed Hatem, with Daniele Lepido, (c) 2024 Bloomberg LP