Commercial court of Uzbekistan refused MTS’s daughter’s cassation

Business Materials 4 April 2013 18:56 (UTC +04:00)

The Supreme Commercial court of Uzbekistan refused to satisfy a cassation appeal of the wholly owned subsidiary of "Mobile TeleSystems" (MTS) "Uzdunrobita" Ltd. to the decision of the Commercial court of Tashkent city on revoking the telecommunication licenses of the company, a source in the court told Trend on Thursday.

According to him, the court's decision came into effect from the date of adoption.

As previously reported, in August 2012 by the Commercial Court, the company satisfied the application of the Uzbek Agency for Communication and Information's (UzACI) revocation orders against all licenses of "Uzdunrobita".

The regulator accused the company of operating subsidiaries without licenses.

According to the calculations of UzACI, the non-payment of licensing fees has caused damage to the state in the amount of 419 billion UZS, and the subsidiaries themselves illegally earned 306 billion UZS from selling services.

MTS did not agree with this decision, arguing that UzACI, being a shareholder "Uzdunrobita" until 2002, created the company's branch structure and was applying it until the conflict, in fact, confirming the acceptability of such a structure for licensing.

Since June last year, inspections by the regulatory agencies were initiated in relation to "Uzdunrobita" Ltd., the largest mobile operator in Uzbekistan.

Since July 17, the MTS network has been disconnected throughout the territory of Uzbekistan, obeying the demands of the State Communication Inspectorate.

The Prosecutor General's Office of Uzbekistan authorized the seizure of the original documents and inventory of property and conducted mass arrests and the questioning of employees. On September 17, Tashkent City Criminal Court passed sentences on cases of four managers of "Uzdunrobita", sentencing them to fines and different terms of correctional works, and decided to transfer the entire property "Uzdunrobita" to the state.

In early November, the Board of Appeals for Criminal Cases of Tashkent City Court partially satisfied the complaint of "Uzdunrobita", cancelling the decision on transferring its property to the state.

The Board has determined the amount of financial claims to "Uzdunrobita" to be $ 600 million with the possibility of payment by installments during an 8-month period.

Moreover, the Board recognized "Uzdunrobita" as the civil respondent in the criminal case against four of its employees and cancelled the property arrest imposed by the first instance court. The first instance verdict against the company's managers remained in force.

In January 2013, "Uzdunrobita" appealed to the Commercial Court of Tashkent with the petition on bankruptcy.

The meeting of creditors of "Uzdunrobita" held in early March decided to start the liquidation process, and to appeal to the court for recognizing the company bankrupt. The Court 11 refused the creditors' appeal and extended the temporary management of the operator until April 22.