The US has waded into the row between MTS and Uzbekistan, warning the central Asian nation that it risks a diplomatic incident unless it eases its hard-line stance on the New York-listed Russian operator.

MTS has alleged that the Uzbek government is attempting to seize its assets in the country. The government has revoked MTS’ licence and shut down its network, and imprisoned several of the operator’s local managers.

According to the Financial Times, the US Commission on Security and Co-operation in Europe has written to Uzbek President Islam Karimov on the matter.

The letter warns of “a deterioration in bilateral ties” and a “chilling effect on foreign investment” if the MTS executives are not released from jail, and if an Uzbek investigation into the firm’s local subsidiary is not handled with more transparency.

MTS Uzdunrobita, the country’s largest mobile operator, had its licence suspended by the Uzbek authorities in July, ostensibly for non-payment of taxes and licence violations. A court this week backed the local regulator, terminating Uzdunrobita’s licences and effectively cutting-off service to its 9.5 million customers.

The Uzbekistan tax authorities have filed a total claim of US$900 million against the operator, though MTS disputes this and intends to appeal.

“Since June 2012, MTS Uzbekistan has been the target of blatant harassment by Uzbek government authorities with the thinly-veiled purpose of destroying the business and expropriating its assets,” the operator said this week.

MTS entered Uzbekistan in 2004, buying a 74 percent stake for US$121 million. It acquired the remaining 26 percent stake for US$250 million three years later. It claims to have invested an additional US$750 million over the course of its ownership.