Armenia Greece Vow to Settle Telecom Row

YEREVAN (RFE/RL)–The Armenian government and the Hellenic Telecommunications Organization (OTE) pledged on Wednesday to sort out disputes over the Greek-owned ArmenTel monopoly in the coming months without resorting to legal action. They said they agreed to begin negotiations that could result in a revision of some key terms of OTE’s 1998 purchase of a 90 percent stake in ArmenTel. Differing interpretations of mutual obligations stemming from the $205 million deal have led to serious disagreemen’s between the two parties on issues such as phone tariffs and investmen’s in Armenia’s telecom sector.

The agreement to deal with all the sticking points out of court was signed in Yerevan at the end of two-day talks between Armenian Justice Minister David Harutiunian–Greece’s Deputy Minister for Post and Telecommunications Vulgaris Alexandros and OTE’s recently appointed chairman–Niklos Manasis.

Harutiunian told Armenian state television that Yerevan will insist that the operational license granted to ArmenTel’s Greek owner be "re-negotiated in full." He indicated that the upcoming negotiations may lead to certain changes in provisions of the license that grant OTE 15-year exclusive rights to all forms of telecommunication in Armenia.

ArmenTel’s monopoly is one of the obstacles to Armenia’s long-standing bid to join the World Trade Organization–with the United States being the most vocal advocate of its abolition. The Armenian authorities are understood to be pushing for the lifting of the monopoly on cellular phone connection and Internet services.

Harutiunian added that the two parties will try to clarify OTE’s investment commitmen’s–another bone of contention. Under the terms of its purchase of ArmenTel–the Greek firm was supposed to invest $100 million in Armenia’s telephone network by last March. Less than one third of that amount was actually invested by that time–according to official estimates.

The government decided on March 2 to file a lawsuit to the International Court of Arbitration in London–seeking compensation from OTE. It later backed away from court action. Officials argued that the Greeks would counter that the government prevents them from introducing new phone tariffs in Armenia–something which was envisaged by the takeover agreement.

OTE’s Manasis was quoted as telling President Robert Kocharian on Wednesday that "different perceptions of a free market and national legislation" is the root cause of the disputes. Manasis said the parties will seek to settle them before Kocharian’s official visit to Greece–due in November–the presidential press service reported. He told Prime Minister Andranik Markarian earlier in the day that they will look for solutions "through mutual understanding and respect of interests."

The Armenian president–for his part–said his country continues to view OTE as "a serious partner" and stands for closer economic ties with Greece.

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