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Clarification on the negotiations on the Interconnection Agreement between Vodafone Telecel and Oni Way

Contrary to what might be concluded from certain published
reports about an impasse in the negotiations between Vodafone Telecel and Oni
Way on the Interconnection Agreement between them, there has been no “refusal”
on the part of Vodafone Telecel to sign the agreement. Rather, the situation is
due to the fact that the two operators have not been able to reach agreement on
their respective proposals.

It is also not correct to claim, as stated in a press release by Oni Way, that
this is a “clear and repeated breach” of the decisions of the regulator,
ANACOM. In fact, following ANACOM’s decision on 20 June 2002 to impose a deadline,
subsequently extended to 1 July 2002, for completing the negotiations between
the three operators, several meetings have been held between Vodafone Telecel
and Oni Way with a view to concluding the Interconnection Agreement.

Since it was evident that the two companies had different interpretations of
the content and scope of ANACOM’s decisions on this matter, Vodafone Telecel
drew attention to the fact that those decisions could prejudice the multitude
of rules and principles on which the operation of networks and the supply of
telecommunications services is based.

On 27 June 2002, Vodafone Telecel put forward a draft Interconnection Agreement
providing for the immediate commencement of interconnection for GPRS services,
with interconnection for other services being dependent on the provision of
UMTS services under Oni Way’s UMTS Licence. Oni Way rejected the draft by Vodafone
Telecel, claiming that it did not reflect the content of ANACOM’s decisions,
and put forward a counter-proposal. Vodafone Telecel considered, however, that
the terms and conditions proposed by Oni Way for interconnection between the
two companies were unacceptable, in that the necessary conditions for the provision
of telecommunications services based on UMTS technology had not been met.

It should be stated that, in its counter-proposal, Oni Way was aiming to establish
an agreement under the aegis of Licences, registrations and decisions, without
specifying under which title it is authorised to provide the services for which
it wanted interconnection, a position with which Vodafone Telecel cannot agree.
Vodafone Telecel stated that its understanding was that the agreement had to
be made under Oni Way’s UMTS Licence, without prejudice to the possibility of
Vodafone Telecel signing, or not, another agreement under some other type of
regulatory framework.

Additionally, Vodafone Telecel sent a letter to ANACOM on 1 July 2002, requesting
ANACOM to clarify definitively what would permit Oni Way to operate GSM services
other than GPRS services – its UMTS Licence or some other regulatory instrument.
This is, in any case, an issue that has needed to be clarified since the beginning
of the process.

Vodafone Telecel, certain that it is right, awaits the decision of ANACOM on
this matter. It also has many questions about the authorisation given for the
use of the prefix code 95 for the provision of GPRS services, a code, which
is inseparable from the UMTS Licence, and about the possible discriminatory
and anti-competitive nature of the agreement between TMN and Oni Way. Vodafone
will use all legal means at its disposal to uphold its rights and interests,
and to prevent the principles of healthy competition in the market being distorted
in an unlawful manner.