OREANDA-NEWS. On 04 July 2008 Southern Telecommunications Company [(RTS: KUBN, KUBNP; MICEX: UTEL, UTELP; ADR OTC: STJSY, KUE FRA)], the largest fixed-line operator in the Southern Federal District of Russia, announced that judicial proceedings on a tax dispute were held at the Moscow Arbitration Court on June 16, 18 and 25 of June 2008 pursuant to a field tax audit carried out by Inspectorate # 7 of the Tax Ministry of the Russian Federation at STC.

An inspection of issues concerning compliance with tax and fee legislation was carried out in relation to the company’s activities from January 1, 2004 until December 31, 2006. Based on the results of the inspection, tax sanctions were imposed amounting to Rub 217.6 mln.

After lodging an objection to the decision of the tax authorities on imposing liability for alleged tax offenses, STC filed a lawsuit with the
Moscow Arbitration Court
requesting invalidation of a claim for Rub 216.4 mln .

The Moscow Arbitration Court on June 25, 2008 issued a verdict on the litigation between STC and Inspectorate # 7 of the Tax Ministry of the Russian Federation.  The company managed to prove the legitimacy of its position, which was upheld completely in a court of law.