Tajikistan's ruling family extends control over telecoms
A company known to be controlled by the president's brother-in-law has bought VEON's local Beeline subsidiary.
The utter control wielded by Tajikistan’s ruling family over business in the country has become yet more complete with the acquisition by the president’s brother-in-law of a mobile phone company.
VEON, the Amsterdam-headquartered company that operated the Beeline brand, announced on April 5 that its mobile services subsidiary in Tajikistan has been bought by ZET Mobile Limited, a vehicle known to belong to Hasan Asadullozoda, the brother of President Emomali Rahmon’s wife.
The Beeline brand is to be retained, as required in the sale agreement. No specific details on the transaction have been disclosed.
Asadullozoda is understood to maintain a vast portfolio of commercial interests, including in aviation, banking and the cotton industry. His most choice asset, however, is the TALCO aluminum plant.
VEON’s divestment of the Beeline subsidiary is part of a broader effort to shed noncore assets and follows similar sales in Laos and Georgia. And Tajikistan has, in any case, proven an utterly poisonous environment in which to operate, despite the strong demand for mobile services.
Beeline, like other mobile companies, has been on the receiving end of some highly aggressive — not to say dubious — complaints from the tax service. In January 2017, the Tax Committee declared it was fining Beeline around $18 million for vague filing violations. But the company a few days later said it had in fact been slapped with two fines, amounting to a total of $45 million. Tax officials have not publicly updated their figures. This incongruity has not to date been clearly explained.
A source at Beeline has told Eurasianet that the company still has around $6 million in outstanding fines to pay off. Those liabilities will now be assumed by ZET Mobile Limited, which is in turn affiliated with TALCO, the aluminum giant at the head of Asadullozoda’s business empire.
TALCO has been on something of an acquisitive run of late.
At the start of 2017, following long and convoluted wrangling, the company bought the Hyatt Regency hotel and the Sozidanie business center, two valuable pieces of real estate in Dushanbe.
While foreign and domestic investors can usually expect to face considerable bureaucratic challenges in Tajikistan, members of Rahmon's extended family have prospered. Countless businesses in the country are officially or otherwise owned by the president's close relatives.
And success for family members can often translate into trouble for industry peers. The most recent illustration of that trend has been recorded in the banking sector, where the heads of flourishing banks have been seemingly squeezed out of their positions just as other newly formed lenders, which happen to be controlled by Rahmon's relatives by marriage, seek to boost their market position.
VEON is not the first international telecommunications to scramble for the exit in Tajikistan. Last year, Sweden-based mobile phone company TeliaSonera sold its 60 percent stake in Tcell to the Aga Khan Fund for Economic Development, giving the latter whole control over the company.