Turkey's Telecommunication Authority fines Turkcell 90.23 trillion Turkish Lira (US$64.1M) for "inadequate annual frequency usage fee payments"

December 29, 2003

1 Min Read

ISTANBUL -- Turkcell (NYSE:TKC, ISE: TCELL), the leading provider of mobile communications services in Turkey, today announced that the Telecommunication Authority ("TA") has fined Turkcell, claiming that Turkcell made inadequate annual frequency usage fee payments.

According to the related regulations, frequency usage fee claims should arise only for those subscribers who actively use their mobile phones. However, the TA claimed that Turkcell also should pay these fees for those subscribers whose inactivity may be temporary. The TA demands TL16,005.3 billion (US$11.3mn) for insufficient payment and an interest charge amounting to TL10,761.8 billion (US$7.6mn). Moreover, the TA ordered us to pay an additional amount of TL63,461.6 billion (US$45.1mn) as an administrative penalty. Turkcell believes that the TA's calculations of the required frequency fee payments are unfair and not balanced. Turkcell believes that the TA's decision is due to a misinterpretation of the applicable regulations and that the magnitude of the administrative penalty is surprising. The total amount demanded by the TA totals TL90,228.7 billion (US$64.1mn). Turkcell will take the necessary legal actions against the TA's ruling. Turkcell

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