LONDON, September 23 /PRNewswire/ --

The Georgian National Communications Commission (GNCC) announced a fine of more than US$360,000 against the Russian telecom company Megafon for operating without a license within Georgian territory. Officials claim that despite previous administrative sanctions against Megafon, the company persists in illegal use of the Georgian radiofrequency spectrum to provide mobile telecommunications services.

"We believe that what Megafon is doing in Georgia is akin to an economic occupation and annexation," said Giorgi Arveladze, Chairman of the GNCC. "Our spectrum surveys indicate that this company dramatically expanded coverage before, during, and after the war, potentially making them a war profiteer and an active participant in Russia's military operations inside the sovereign territory of Georgia."

Previously, Megafon only covered part of the former Autonomous Republic of South Ossetia, namely, Tskhinvali and Java regions. In August of 2008, during the Russian intervention on Georgian territory, the company expanded its coverage zone and exceeded the conflict area to include the regions of Gori and Kareli. A report issued by the GNCC on August 23 details this unauthorized use of radiofrequencies, adding to existing violations by Megafon dating back to 2004.

As a result of these illegal activities, Megafon caused technical problems for Magticom and Geocell, both licensed companies operating in Georgia.

"It appears that we are not dealing with a normal, law-abiding commercial entity here, but rather a group which may have found itself working as a political and military instrument of the Russian state," said Mr. Arveladze. "As the national regulatory authority, we are obliged to address this extraordinary issue of extra-legal business operations supporting a military invasion."

Evidence concerning Megafon's unauthorized activities, documented since June 2008, has been sent to the Georgian Prosecutor General's office. The GNCC will exercise its legal rights in order to terminate this infringement. Commissioner Chairman Giorgi Arveladze is available for comment on the issue at pr@gncc.ge.

Alya Shakir for The Georgian National Communications Commission, +44(0)779-539-6726, media@eastwestpr.co.uk