SyriaTel hit with trading ban over tax dispute

SyriaTel hit with trading ban over tax dispute

UPDATE: A court ruling will see SyriaTel placed under judicial custody after the firm continued to dispute its outstanding tax bill.

In a statement reported by regional news agency Zawya, the court said that the ruling was aimed at guaranteeing “the rights of the public treasury and the rights of shareholders in the company.”

The development follows swiftly on from the Damascus Securities Exchange (DSE) suspending all trading of shares in SyriaTel, in what appears to be a surprisingly high profile manoeuvre by President Bashar Al-Assad’s government against a former member of its elite, SyriaTel majority owner – and Assad’s cousin - Rami Makhlouf.

ORIGINAL STORY: The Damascus Securities Exchange (DSE) has indefinitely suspended trading shares in the Syrian mobile operator SyriaTel.

In a statement, the DSE offered little detail beyond claiming that the move was aimed at protecting shareholders in the operator, although local media infers that there may be an ulterior motive related to the firm’s owner.

SyriaTel is majority owned by one of Syria’s wealthiest and most influential businessmen, Rami Makhlouf, who is the cousin of Syrian President Bashar Al-Assad. According to local news outlet Al-Monitor, Makhlouf is also the subject of an ongoing crackdown.

Earlier this year, SyriaTel (along with rival operator MTN) was hit with a demand for SYP233.8 billion (US$1.09 billion) of back taxes by the country’s regulator SyTRA (Syria Telecommunications Regulatory Authority).

While MTN agreed to enter talks with the regulator to determine how this amount would be repaid, SyriaTel has challenged the tax claims and refused to discuss a payment mechanism.

The operator’s noncompliance has prompted government action against Makhlouf, with the business being placed under a travel ban and his assets under “precautionary hold” as a “guarantee of repayment” of SyriaTel’s alleged tax bill.

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