MTS returns to Uzbekistan

Business Materials 30 June 2014 11:28 (UTC +04:00)

Tashkent, Uzbekistan, June 27
By Demir Azizov- Trend:

Uzbek authorities decided to resume business for the Russian "Mobile TeleSystems" OJSC (MTS) in the cellular market of the country, a source in government circles told Trend.

In accordance with the decision of the Uzbek government, adopted at a cabinet meeting on June 25, MTS will create a cellular "daughter" with Uzbek partnership, which will operate under the MTS brand, the source said.

He did not mention the conditions under which the Russian company will resume work in the country.

It is expected that the constituent documents on the establishment of the joint venture will be signed soon, according to the source.

As reported earlier, MTS ceased operations in Uzbekistan in 2012 after the local authorities raised multiple claims against the company and Uzdunrobita (a subsidiary of MTS in Uzbekistan) declared bankrupt.

Thus, in September 2012 the Tashkent city court on criminal cases delivered its verdict against four managers of Uzdunrobita, sentencing them to penalties and various terms of correctional labor, and made a decision on the transfer of the entire property of the Uzdunrobita to government revenue.

In early November, 2012, Tashgorsud Board of Appeals on criminal cases reversed the decision to transfer Uzdunrobita`s property to government revenue and removed the arrest of its property, determining the amount of financial claims against the company to be worth $600 million, with the possibility of payment of this amount in installments over a period of eight months.

The total amount of claims against the company by the Prosecutor General's Office, regulatory authorities, The Agency for Communication and Information and tax authorities amounted to over $1 billion, which is the amount of investment made by MTS in the development of business in Uzbekistan.

Two rounds of auctions were held on July, 2013 on the sale of both company's assets with starting price of $288 million, and property of 14 regional branches- total starting price of $ 224 million. All auctions were invalidated due to a lack of bids.
In late 2013 the property of "Uzdunrobita", including manufacturing equipment was transferred to the custody of JSC "Uzbektelecom" - monopoly fixed-line operator in Uzbekistan.

The network of the cellular operator was kept in working order and can be running in a short time, according to the "Uzbektelecom".

Before leaving the market "Uzdunrobita" was the leading mobile operator in the Uzbek market with a customer base of more than nine million subscribers.

Uzbekistan currently has four mobile operators- "Unitel" (" daughter" of the Russian " VimpelCom " brand "Beeline"), "Coscom" ( daughter of the Scandinavian "TeliaSonera", trademark "Usell"), working in standard GSM, and JV "Rubicon Wireless Communications" (RWC, trademark "Perfectum Mobile") and "Uzbektelekom Mobile" ( Uzmobile ) - branch of JSC "Uzbektelecom " working in standard CDMA. The number of mobile subscribers is about 25 million.

In February, 2014 Uzbekistan decided to establish a national mobile operator on the basis of the "Uzbektelecom" - "Uzmobile" branch. It will work in the GSM standard by using the LTE technology (network of fourth-generation 4G).

Edited by CN