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27 June 2006

Partial cancellation of outstanding local license fees of Netia’s subsidiary El-Net

WARSAW, Poland – June 27, 2006 – Netia SA (“Netia”) (WSE: NET), Poland's largest alternative provider of fixed-line telecommunications services, announced that Regionalne Sieci Telekomunikacyjne El-Net SA, Netia’s subsidiary, received today the decision of the Polish Minister of Transportation, dated June 26, 2006, cancelling part of outstanding local license fee obligations along with the prolongation fees owed in connection with the prior deferrals of the license fee installments, in exchange for investments in the telecommunications infrastructure incurred in years 2004 and 2005.
The total amount of the local license fees cancelled was EUR 9,174,413.93. The total amount of the prolongation fees cancelled was PLN 3,561,131.76.
The above decision is the next one, following the decision of the Polish Minister of Transportation and Construction dated March 21, 2006 cancelling EUR 20.9 million of license fee obligations and PLN 8.6 million of prolongation fees, with regard to cancellation of outstanding license fee obligations of El-Net (see Netia’s press release dated March 22, 2006).