Court Upholds Fine Against Russian Mobile Operator

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A court in the nation of Georgia has rejected a motion by Russian mobile carrier Megafon seeking to dismiss a fine for operating in Georgian territory without a license.

The Tbilisi City Court last week upheld a fine of about US$350,000 imposed on Megafon after an August report from the Georgian National Communications Commission (GNCC) found that Megafon was illegally using radio spectrum inside Georgian borders, the GNCC said Tuesday.

Megafon has been operating in disputed territories along the border of Georgia and Russia, including South Ossetia, since 2005, said James Kimer, a U.S.-based spokesman for the GNCC. After the Russian military's strikes against Georgia in August, Megafon began operating in Georgian territories not under dispute, including the regions of Gori and Kareli, Kimer said.

Megafon officials weren't immediately available for comment on the court decision. Georgia opened a criminal case against Megafon in October.

Giorgi Arveladze, the GNCC's chairman, appealed to Swedish company TeliaSonera, which owns nearly 44 percent of Megafon.

"Megafon's ongoing unlicensed presence in Georgia, which is akin to an economic occupation and annexation, is unacceptable and should not be tolerated by its European ownership," Arveladze said in a statement. "This illegal seizure of the radio spectrum, which played a significant role in the August invasion of Georgia by the Russian military, poses a serious international legal problem that we are determined to address."

Megafon could attempt to ignore the court's decision, but its decision to file the appeal indicates it believes Georgian courts have authority in the case, Kimer said.

Megafon has denied using Georgian spectrum, but said it would not stop customers from using Russian mobile-phone towers in nearby territories. GNCC's attempts to get the company to pay the fine or vacate the spectrum "have been ignored," Kimer said. "They have not ceased operations."

The GNCC has also accused Megafon of providing secure communications to the Russian military during the August attacks on Georgia.

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