Negotiations for ArmenTel Problem Fail

YEREVAN (Noyan Tapan)–An Armenian government delegation conducted negotiations recently with the Greek OTE company which holds 90 percent of the shares in the telecommunications market in Armenia–the "ArmenTel" company.

However–the sides failed to reach any agreement. According to reliable–but unofficial information–the reason why the negotiations failed is the lack of coordination between the members of the Armenian delegation.

The Armenian side is known to accuse the OTE company of failing to meet its investment commitmen’s.

Under the agreement on the sale of ArmenTel’s shares signed between the Armenian government and the OTE company–the latter was to make investmen’s totaling $100,000,000 by March 2000.

The investment made to date do not exceed $50-60 million. In its turn–the Greek side demanded that the Armenian side observe the points of the agreement concerning minute-by-minute paymen’s–monopoly rights–etc..

Experts say that if the dispute is considered by International Arbitration–Armenia will have to pay a penalty which may be equal to the value of ArmenTel’s share package held by the OTE company ($1,142 million) and to the real investmen’s made in Armenia by ArmenTel.

During the new director of ArmenTel–Manasis’ September visit to Yerevan–an agreement was reached on settling disputes by means of negotiations–without applying to international resolution.

By the president’s order–Armenian Minister of Justice David Harutiunian was to represent Armenia’s interests at the negotiations.

Among the proposals of the OTE was fixing minute-by-minute payment for telephone communication (three drams per minute)–a 50 percent reduction of the cost of installation of telephone communication–expansion of cellular network in Armenia.

The Minister of Transport and Communication of Armenia Eduard Madatian also arrived in Athens.

During the negotiations Madatian was asserting the right of the "Elinet" company (formerly the government communication service) to further activities.

ArmenTel intended to suspend the "Elinet" company’s activities in November. (According to some information–Madatian is a holder of part of shares of the company).

The negotiations failed–but during the Armenian president’s visit to Greece no new draft contract is expected to be elaborated.

The Greek company wishes to be clearly informed of who will be its partners during the further negotiations. In particular–it may be a specially formed structure authorized by the government.

According to some information–the OTE company does not rule out the possibility of restricting its monopoly in Armenia–specifically–in the sphere of alternative external communication–for several years.


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