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04 April 2006

The promise to cancel liabilities resulting from the license for rendering local telecommunications services

WARSAW, Poland – April 4, 2006 – Netia SA (“Netia” or the “Company”) (WSE: NET), Poland’s largest alternative provider of fixed-line telecommunications services, announced that on April 3, 2006 Regionalne Sieci Telekomunikacyjne El-Net SA (“El-Net”), Netia’s subsidiary, received a decision of the Minister of Transport and Construction, dated March 28, 2006, in reply to its application filed on October 28, 2004.
By the above decision the Minister of Transport and Construction granted the promise to cancel the outstanding license fees obligations, resulting from licenses for rendering local telecommunications services, in the amount of EUR 28.9 million based on investments to be incurred from January 1, 2007 to October 28, 2008. The above cancellation shall occur upon the verification of incurred investments documented pursuant to provisions of article 8 of the act dated November 23, 2002 on the conversion of license fees of fixed line public telecommunications operators.
The above decision is the second one, following the decision of the Minister of Infrastructure dated July 12, 2004 cancelling EUR 75.7 million of license fee obligations and PLN 37.7 million of prolongation fees, with regard to granting the promise to cancel outstanding license fee obligations of El-Net (see Netia’s press release dated August 17, 2004). The current decision concerns all remaining outstanding license fee obligations of El-Net that were not covered by the decision of July 12, 2004.