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Hi,
If I understand you correctly, no contacts appear if you import them? I suggest that you check the filter via Contacts > Menu button (three dots) > Filter.
Does the phone restart completely so you need to enter the PIN-code (if you have one)? Are there any error messages before the phone restarts? Perhaps you could clear data for the phone application via Settings > Apps > Swipe to the tab "All" > Phone > Clear data > Restart the phone and try to place a call.
I have the same problem with Z1 Compact - updated the OS this morning as prompted and now have no contacts, won't let me import a stored VCF contacts file, and I can't make calls!!!
HELP.
Please
Had exactly the same problems: No contacts and no phone function, but evertything fine after repair with PC companion. Does seem to be a problem with this update.