MTS loses legal challenge in Turkmenistan

Details: James Barton; Category: Operators; 20 June 2023; 9097 views

Russia’s Mobile TeleSystems (MTS) has lost its longstanding legal battle against Turkmenistan after it was allegedly forced to abandon its operations in the market in 2017.

MTS claims that state-owned Turkmentelecom blocked its access to various interconnection points, resulting in it shuttering operations and incurring losses worth “up to US$1.5 billion.” The operator filed a case with the World Bank’s International Centre for Settlement of Investments Disputes (ICSID) in July 2018.

Turkmenistan’s legal team Squire Patton Boggs reacted to ICSID’s decision with a press release claiming a “significant victory” for the nation, noting that the body has “unanimously rejected…all claims on the merits” with “a finding of no liability for any of the alleged complaints asserted.”

CommsUpdate notes that the tribunal found that MTS’ operating contract for Turkmenistan expired as per the terms of its five-year licensing period, and that MTS had no basis for expecting a renewal. Additionally, it exonerated Turkmenistan of any wrongdoing regarding MTS’ operations in the market, noting that the operator had been allocated a proportionally larger amount of capacity than its local rival Atlyn Asyr.

The tribunal noted that Atlyn Asyr had been just as badly affected by data quality issues as MTS, as well as observing that there was no evidence to indicate that MTS had been overcharged for any channels. The tribunal awarded Turkmenistan over US$11 million to cover legal fees and arbitration costs.