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U.S. Commission Backs MTS in Uzbekistan

The United States is stepping up pressure on Uzbekistan after mobile operator MTS had its Uzbek license suspended and five of its local managers were jailed, the Financial Times reported.

The U.S. Commission on Security and Cooperation in Europe warned of "a deterioration in bilateral ties" and a "chilling effect on foreign investment" if the executives were not released from jail, and if an Uzbek investigation into Uzdunrobita, an MTS subsidiary, was not handled with more transparency, the newspaper said late last week.

The Financial Times cited a copy of the commission's letter to Uzbek President Islam Karimov.

MTS's difficulties began in June when Bekzod Akhmedov, head of MTS Uzbekistan, disappeared. Shortly thereafter, Uzbek authorities accused MTS of owing the state over $900 million in taxes.

The company's Uzbek license was canceled indefinitely by a Tashkent court earlier this month after the telecoms regulator ordered the company to shut down its network the same day.

Four Uzbek managers at MTS have been in jail since June.

More than a third of MTS' 47 percent free float is owned by U.S. funds.

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