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Uzbek Court Cancels All MTS Licenses

The logo of MTS, Russia's largest mobile operator, is seen at a telecoms exhibition in Moscow.
The logo of MTS, Russia's largest mobile operator, is seen at a telecoms exhibition in Moscow.
A court in Uzbekistan has canceled all operating licenses for the country's largest mobile-phone provider, a decision that the Russian-controlled company is vowing to appeal.

The Tashkent Economic Court backed a request from the Uzbek Agency for Communications and Information to cancel operating licenses owned by Uzdunrobita, the Uzbek subsidiary of Russian telecommunications giant MTS.

The company said it would appeal the ruling within 10 days and is preparing other legal challenges.

MTS also said it had received the results of Uzbek tax audits, which contained claims against the company in excess of $900 million.

Uzdunrobita had a 40 percent share of the Central Asian country's growing, 25 million-subscriber mobile-phone market before it was hit by charges of fraud and a slew of other financial crimes last month.

Uzbek authorities had previously suspended its license on a temporary basis.

Speaking to RFE/RL from Moscow, Michael Hecker, MTS's vice president for strategy, called the court session a "20-minute show" that represented a "clear violation of the basic rights to a fair trial and due process."

"We invested over $1 billion into the company. We believe somewhere in this area is also the equity value of the company. And it becomes very clear that all the fabricated amounts that we are due to pay according to those statements of the Uzbek authorities -- that they equal, more or less, the equity value, because then [the government] will just simply expropriate the company," Hecker said.

"They will basically say, 'We'll take the company and that's it.'"
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