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Russia’s MTS dismisses all employees in Uzbekistan


Today the staff of MTS-Uzbekistan, a 100%-subsidiary of the Russian mobile company MTS, have been notified of their dismissal.

The news about the dismissal of the mobile operator MTS-Uzbekistan’s staff, who had waited for a chance to resume their work since last summer, points to the fact that the Russian telecom giant will not be able to resume its business in Uzbekistan.

On 25 December 2012, the head of the Sistema corporation, Vladimir Yevtushenkov, the actual owner of MTS, said that his company will manage to return to Uzbekistan the following year, but on new terms and conditions.

The businessman said that talks were underway between the sides on a government level, on the level of intergovernmental committee and between the foreign ministries.

Yevtushenkov noted that “a regular negotiations process is going on which, it looks like, may stretch into the beginning of [2013]”.

The dismissal of the staff that numbers 300-400 people, which maintained the company’s equipment, means that it will be hard to reach an agreement with Uzbek authorities.

The majority of the company’s dismissed employees will most likely have to leave Uzbekistan as it is not easy to find jobs in the telecoms sphere.

Russia’s MTS worked in Uzbekistan since 2004 after purchasing the Uzbek company Uzdunrobita from unnamed “private individuals” (according to well-informed sources, from Gulnara Karimova, the Uzbek president’s elder daughter).

In June 2012, Uzbek authorities brought a standard set of accusations against MTS: misuse of funds, tax evasion, lack of licences and so on.

On 13 August 2012, the Tashkent economic court ruled to suspend the company’s licence for providing services to population, designing, construction and operation.

The mobile phone operator, which served every other grown-up Uzbek citizen (or over 9 million subscribers), was deprived of its licence while its subscribers had to use the services of other mobile phone companies (in which the very same Karimova has shares).

Soon the Prosecutor-General’s Office, anti-monopoly bodies, the Uzbek Agency for Communication and Information Technology and other supervising and fiscal agencies alleged Uzbekistan lost over $1bn because of the Russian company’s business.

As a result, it was decided to nationalise MTS-Uzbekistan.

Though Russia’s Foreign Ministry, the Association of Russian Managers, the Trade and Industry Chamber of Russia came to defend the company, observers could see from the beginning that the Russian side tried to defend its company rather behind-the-scene than openly and out of principles.

Nevertheless, on 8 November the board of appeals of the Tashkent criminal court reversed the decision to nationalise the property of MTS-Uzbekistan, but demanded $600m to be transferred into the national budget instead and allowed for this amount to be paid by instalments within eight months.

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