Moscow, Russian Federation – Mobile TeleSystems OJSC (“MTS” – NYSE: MBT), the leading telecommunications provider in Russia and the CIS, announces that on December 15, 2010 it received a notice from the Ministry of Communications of Turkmenistan informing the Company of a decision to suspend licenses held by Barash Communications Technologies, Inc. (“BCTI”), MTS’ wholly-owned subsidiary in Turkmenistan, for a period of one month starting from December 21, 2010. MTS has been operating in Turkmenistan under a trilateral agreement¹ (“Agreement”) signed in November 2005 by BCTI, MTS and the Ministry of Communications of Turkmenistan, which expires on December 21, 2010, unless extended pursuant to its terms and conditions. The Company at all times had reasons to believe that the Agreement would be extended and had approached the Ministry of Communications within the required timeframe to formalize the extension. However, the Ministry of Communications failed to grant the extension in accordance with the terms of the Agreement.

MTS management is taking active steps to clarify the situation but no explanation, including in relation to the alleged breaches by MTS has been given by either the Government of Turkmenistan or its Ministry of Communications. The Company is currently considering all available options, including potential legal actions, and shall vigorously defend its legal rights and investment interests.

In any event, it is the Company’s opinion that the expiration of the Agreement does not preclude MTS from continuing its operations in Turkmenistan nor can any alleged termination of the Agreement serve as the basis for suspension of BCTI’s licenses, and that the notice must have been given as a result of misinterpretation of local laws and regulations by the Ministry of Communications of Turkmenistan. The Company has already approached the Ministry of Communications and will be making every effort to resolve the situation.

For the nine months of 2010, BCTI contributed to the MTS Group revenue and OIBDA of 1.9% and 2.7% respectively.

¹As has been disclosed in the Company’s 20-F filings for the years 2005-2007, in accordance with certain provisions of this agreement, BCTI shares net profit derived from its operations in the country with the Ministry of Communications of Turkmenistan. The amount of shared net profit is calculated based on the financial statements prepared in accordance with local GAAP subject to certain adjustments. Under the terms of the agreement, BCTI shared 49% of the net profit since the date of acquisition through December 21, 2005, and 20% of the net profit commencing December 21, 2005.