Mobile TeleSystems asks Uzbek government for help

Tashkent, Uzbekistan (UzDaily.com) -- Mobile TeleSystems OJSC, the leading telecommunications operator in Russia and the CIS, has submitted official complaints to certain top government officials of Uzbekistan articulating gross violations of criminal process law and other regulations in connection with on-going government investigations of the financial and operating activities of Uzdunrobita FE LLC, MTS’s wholly owned subsidiary in Uzbekistan, and the activities of the Uzdunrobita's management.

Outlined in the Company’s official complaints are a number of gross violations of applicable laws of the Republic of Uzbekistan carried out by various Uzbek government bodies against Uzdunrobita and its employees.

Among other things these include:

• the arrest and detention of top managers of the Company, one of whom holds Russian citizenship, without proper evidence;
• the interrogation of company employees without providing access to legal counsel;
• unsubstantiated allegations of personal financial impropriety in an amount, exceeding $520 million;
• extraordinary and unjustifiable governmental audits of the financial and operational activities of the company, despite the recent conclusion of a tax audit of the company’s financial activities from 2007 – 2010;
• the conduct of audits by the Office of the Prosecutor General in absence of any official documentation presented to the Company and its employees confirming that a criminal case has been initiated, and without permission of the Republic's Council On Coordination of the Activities of the Regulatory Bodies; and
• the seizure and review of company documents in connection with and under cover of an on-going criminal investigation by an unidentified group of people, which MTS assumes may be a due diligence exercise for illicit purposes.

MTS notes that recently different regulatory bodies have simultaneously initiated synchronous audits of and investigations into the financial and operating activities of Uzdunrobita in areas related to currency control, construction, sanitary-epidemiological control, as well as antitrust activity. Audits of financial and operating activities of Uzdunrobita are being conducted in direct violation of local and international regulations and may significantly impede Uzdunrobita's on-going operations.

Since its acquisition of 'Uzdunrobita' in 2004, MTS has operated lawfully in Uzbekistan. We continue to press for the release of our employees and defend our rights under the laws of Uzbekistan and international investment protection norms.