The new “Rules for Providing Local, Intra-Zone, National and International Telephone Services” effective from January 1, 2006 on the basis of Resolution of the RF Government No. 310 of May 18, 2005 were commented on in a number of recent publications. These publications mislead our subscribers, claiming that charging penalty to subscribers for the late payment for communications services is a new measure. In this connection, OJSC “NWT” deems it necessary to give some explanations.

The current contracts entered into by various branches of OJSC “NWT” also provide a penalty for the late payment for communications services (the maximum penalty rate is 1 % ). Such clause was incorporated into the contract in order to remind the subscribers of the possible consequences of the late payment for the services provided.

In practice, the branches of the company use their right to charge penalty only in respect of very persistent defaulters. Based on the understanding that various problems with payment may occur, North-West Telecom developed such mechanism of payment for communications services, which in full measure may be called a credit plan. The communications services must be paid before the 20th day of the month following the month paid. If no payment is received by this date, a robot calls the subscriber to inform him of the arrears. After that, a written notice of the arrears is delivered. The access to telephone services is suspended only in case the subscriber fails to effect payment within 10 days after the notice was delivered.

In connection with amendments made to communications legislation with effect from January 1, 2006, OJSC NWT developed new forms of telephone service contracts which also provide for a penalty for the late payment for communications services (in accordance with clause 146 of the new Rules*), namely: “In case of non-payment, incomplete or late payment for Services the Communications Operator shall have the right to charge the Subscriber a penalty at the rate of 1% of the cost of unpaid Services or Services paid incompletely for each day past due, the maximum penalty being equal to the amount payable”.

The late payment for the services which were already provided (where labor and technical resources were involved) results in the accrual of debts. These funds could have been invested for the network modernization and improvement of the quality of services for you. The accrued indebtedness damages not only the company, but also you subscribers, as you become unable to get new communications services in the full.

North-West Telecom hopes its clients will be conscientious and will understand that any services provided must be paid for on time. For your convenience, we provide an opportunity to make advance payments (for example, in the amount of the subscription fee for one or several months). Any subscriber may either pay the bill, or make a payment, filling out the receipt form available in the place of payment.

* "In case of non-payment, incomplete or late payment for telephone services, the subscriber pays the communications operator a penalty at the rate of 1% of the cost of the telephone services unpaid or paid incompletely, unless a lower rate is specified in the contract, for each day past due until the indebtedness is paid in full, the maximum penalty being equal to the amount payable”.