Moscow, 6 July 2004 – CenterTelecom (RTS: ESMO, ESMOP; OTC: CRMUY) corporate governance rating has been reviewed.

Standard&Poor’s corporate governance rating service has upgraded the corporate governance rating of the Russian fixed communications operator Central Communications Company from 5,3 to 5,8 due to several positive changes in the corporate governance rating practice that has taken place since March 2003 when the company was first rated.

As Standard&Poor’s corporate governance rating service Director Yuliya Kochetygova pointed out, "CenterTelecom management team is ready to improve the company's corporate governance rating. Positive changes include the strengthening influence of the company’s minority shareholders and better understanding between them and Svyazinvest, the majority shareholder".

CenterTelecom corporate governance is overall rated using a 10-point scale with four analysis components with the valuation ranging from "Very weak" (1) to "Very strong" (10):

• Ownership structure and external influence – "Average" (5,8)
• Shareholders’ rights and relations with the related parties – "Strong" (7,0)
• Financial transparency, information disclosure and audit – "Average" (5,7)
• Board of Directors composition and efficiency – "Weak" (4,7).

Changes in Standard&Poor’s analysis methodology had a positive influence on the company’s corporate governance rating. The agency is now paying more attention to the auditor independence as well as Board independence and efficiency. "These methodological changes take into account the international corporate governance experience as well as higher investor’s interest to certain corporate governance issues ", - said Ms. Kochetygova.

"The company is paying a lot of attention to improving the corporate governance quality, - comments CenterTelecom General Director Ruben Amaryan. – We did a lot last year, and although it was not fully reflected in Standard&Poor's rating changes, it is just the beginning. We intend to make the company’s corporate governance rating match the world’s best standards".

CenterTelecom is the leading fixed telecommunications company providing the full range of telecom services in the Central Federal Region with 20% of Russia’s population.

CenterTelecom offers all telecom services, including telephone, Internet, IP telephony, data transfer, CCTV, wired and VHF broadcasting. The company is actively developing modern multiservice and SDH networks as well as new radio access systems.

The company is trading at RTS (ESMO, ESMOP), MICEX (CTEL, CTELP) and is enrolled in the common share ADR1 program (CRMUY).

Contacts:
Elena Sidorovich, ph: (+7 095) 793 23 19, esidorovich@centertelecom.ru
Andrei Kalinchenko, ph: (+7 095) 209 57 21, kalin@centertelecom.ru
Irina Kotenko, ph: (+7 095) 793 23 28