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07 June 2004

The Supreme Court’s ruling on a loan granted to Millennium

WARSAW, Poland – June 7, 2004 – Netia SA (“Netia”) (WSE: NET), Poland's largest alternative provider of fixed-line telecommunications services, today announced that: In February 2003 the Regional Court in Warsaw adjudicated that Millennium Communications SA (“Millennium”) must pay Netia PLN 11.5 million plus contractual interest for delay since November 23, 2000 as a repayment of a loan granted on August 31, 2000 (see release of December 17, 2003). Until today, the total amount of interest accrued on this loan exceeded PLN 22.8 million. In its appeal, Millennium claimed that the Regional Court made a mistake rejecting Millennium’s counterclaim. While answering the question of the Appellate Court in Warsaw, the Supreme Court ruled now that a counterclaim in commercial matters can be filed on general terms, provided however that it does not contravene with the defendants’ duty to submit all existing objections in the first replay to the claim. In Netia’s management opinion, the ruling of the Supreme Court reaffirms Netia’s original position in this case and removes the last obstacle from pronouncing a final ruling by the Appellate Court.

Some of the information contained in this news release contains forward-looking statements. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those in the forward-looking statements as a result of various factors. For a more detailed description of these risks and factors, please see Netia's filings with the Securities and Exchange Commission, including its Annual Report on Form 20-F filed with the Commission on June 27, 2003, as well as Current Reports on Form 6-K it has furnished to the Commission since filing its Annual Report. Netia undertakes no obligation to publicly update or revise any forward-looking statements.