Uzans Take Turkish Government to European Court of Human Rights.

Business Editors

ISTANBUL, LONDON & NEW YORK--(BUSINESS WIRE)--July 9, 2003

The Illegal Seizing of the Uzan's Power Utility Business is Merely

an Attempt to Hinder the Growth of a Successful Political Opponent

The Uzan Family, which heads one of Turkey's largest industrial groups, is claiming damages of $12.5bn against Turkey's AKP Government in the European Court of Human Rights in Strasbourg following the illegal confiscation, without compensation, of the Uzan's CEAS and KEPEZ electricity generation and distribution businesses.

The AKP Government arbitrarily seized these assets without justification, using the Police and the physical removal of property, and without any form of Court Order or due process. Such a flagrant breach of the laws of property ownership has not been seen in Europe since the dark days of the 1930s and 1940s.

It is clear that the action by the AKP Government (formed by the Justice and Development Party which has a strong Islamic fundamentalist base) was provoked by the increasing popularity of the Genc Party, of which Cem Uzan is chairman and leader. The Genc Party won 7.5% support in last year's General Election and the polls now indicate Genc has 22% support and is Turkey's second largest political party. Turkey's Prime Minister, Tayyip Erdogan, has admitted that Cem Uzan is his only serious political rival.

The AKP Government's action risks causing untold damage to the Turkish economy and suffering to the Turkish people. Turkey aspires to being a member of the European Union. But domestic and international investors will note the low regard for property ownership rights and the subsequent high risk of investing. The Uzan Group and Imar Bank recently funded the construction of the huge $1bn Berke Hydro Electric Dam in southern Turkey. This started operations last year but has now been seized. Who would ever risk repeating such a massive investment in the Turkish economy?

The seizure has had a damaging knock-on effect on the utility companies' bank, Imar Bank, which is also part of the Uzan Group, and which has been deprived of millions of dollars of income. As a result there has been a run on deposits and the Board of Directors of Imar Bank applied to the BDDK (the Turkish Banking Regulator) for its assistance to release some of the reserve funds held in the Central Bank, in order to fulfil obligations to depositors. However the BDDK refused and instead took control of Imar Bank.

In the days after the seizure of the power utility the AKP Government shamelessly started proceedings against Cem Uzan in an attempt to ban him from politics. In addition last week the Prime Minister's office prompted the Turkish Broadcast Supervisor to close down the TV and radio stations which broadcast Cem Uzan's recent speech in full, a speech which was critical of the Government.

Cem Uzan commented:

"By using its position in Government to attack the family assets of a political opponent the AKP party shows it has no confidence in winning the political debate. And so the recent polls show.

"It is scandalous to cause such collateral damage to the Turkish economy simply in order to hinder political opponents. It is vital for the future of Turkey and the Turkish people that this behaviour by a fundamentalist government against a modern, free market European party does not succeed."

The Uzan Group of companies is one of Turkey's largest industrial and commercial groups, with major businesses in construction, media, banking, telecommunications and energy.