To implement the Federal Law 'On communications', North West Telecom starts informing its customers on the forthcoming introduction of the new tariff system for local telephone connections which will fulfil the right of the customer citizen to choose the payment system for local telephone connection from time rate, line rental and combined payment options.

On 5 September 2006, the Administration of the Federal Tariff Service of Russia adopted the Procedure of Tariff and Tariff Plan Calculation for Local Telephone Services. In accordance with the Procedure, OAO NWT has developed and submitted the following tariff plans for approval by the Federal Tariff Service of Russia:

1. Unlimited tariff (equivalent to the present system of line rental payment). The customer pays a fixed monthly sum and may talk for an unlimited time.
2. Time rate tariff . The customer pays a minimal fixed monthly sum and pays per minute of connection.
3. Combined tariff . The customer pays a fixed monthly sum that includes the cost of a certain connection time. Every minute over the included limit is paid for additionally.

The Procedure developed by the FTS and the tariff proposals by OAO NWT based on the Procedure aim to balance the interests of communications provider and its customers under the new legislation and to fulfil the right of the customer citizen to choose the tariff plan in accordance with the Law 'On communications'.

The implementation schedule for the new tariff system, as well as the tariff plans indicating the cost per minute for local connection and the line rental costs, will be published in the mass media and brought to the notice of the company's customers after their approval by the Federal Tariff Service of Russia.

The new tariff system will be introduced gradually in the regions of the North West Federal District. At the first stage, it will be introduced in the republican and region capital cities that have had the technical capacity for the SPUS (Time Charging System) from 1 July 2006. The second stage will involve the district centres of the town telephone network in the districts where the technical capacity for the SPUS will be provided by 1 January 2007. At the third stage, the new system will be extended to the rural telephone network, which will acquire the technical capacity for the SPUS gradually, but not earlier than in 2008.

In order to assist customers in their future choice of a tariff plan, so that they could make an informed choice of the most convenient tariff plan, from September this year OAO NWT will be indicating the number and total duration of local telephone calls on the customer's bill. The reverse of the bill will set out future changes and the payment options for local telephone connections. The first bills indicating the number and duration of local calls will reach customers between 10 and 20 September.

Information on the available tariff plan options is posted at all customer service centres of OAO NWT from 1 September 2006. All customer services of OAO NWT are ready to advise customers and answer their queries.