In accordance with the laws of the Republic of Uzbekistan, a petition to declare bankruptcy was filed due to Uzdunrobita’s inability to fulfill obligations pursuant to the verdict of the Tashkent City Criminal Court from September 17, 2012, in relation to the criminal case against Uzdunrobita's employees and to the decision of the Appeals Court of the Tashkent City Criminal Court from November 08, 2012, which determined the total amount of fines and penalties to be paid by Uzdunrobita to be at approximately $600 million.

In accordance with the court verdict of the Appeals Court of the Tashkent City Criminal Court from November 08, 2012, funds in the amount of approximately $150 million have already been recovered by law enforcement agencies from Uzdunrobita’s bank accounts.

Uzdunrobita continues to defend its rights in accordance with the laws of the Republic of Uzbekistan. MTS also reserves the right to use all legal options in the international arena in order to claim damages incurred as a result of an unwarranted attack on its subsidiary in Uzbekistan.

MTS has determined that a portion of its long-lived assets attributable to Uzbekistan was impaired and has recorded an impairment charge of $579 million in the consolidated statement of operations for the three months ended June 30, 2012. In addition, MTS has provided for tax, anti-monopoly and other liabilities that management believes are probable to result from the various legal proceeding currently ongoing in Uzbekistan in the amount of $500 million.

In July the wholly-owned subsidiary of MTS, Uzdunrobita, had its license withdrawn initially for 10 days and then permanently due to repeated and systematic major violations, with the way their cellular network was designed and noncompliance with the instructions of the controlling body.