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19-2018 Agreement on telecommunications access to the Orange Polska’s fibre network for T-Moblie

Current Report (19/2018)

Orange Polska S.A. – Warsaw, Poland

23 July 2018

 

Pursuant to Article 17(1) of the Regulation (EU) No. 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC, the Management Board of Orange Polska S.A. (“Orange Polska”, “ Company”) informs that with reference to the current report No 27/2017 dated 20th December 2017, the Company and T-Mobile Polska have signed today an agreement on telecommunications access to Orange Polska’s fibre network in the form of Bitstream Access (“BSA”).

 

The key terms and conditions of the agreement are as follows:

1.         Orange Polska will provide wholesale access to its network in order to provide BSA service on its own fibre infrastructure for T-Mobile’s clients in multi-family houses in deregulated areas. Co-operation covers households that will be in the range of the fibre services as of the end of 2018 (approximately 1.7 million households).

2.         In exchange, T-Mobile will pay to Orange Polska:

a.         Upfront fee of PLN 275 million for access to the network which is not refundable (except for the event that the access is not granted). It will be paid in two equal instalments: the first one, after signing of the agreement and the second one after the service will be ready for delivery;

b.         A monthly fee for each customer depending on the speed of the service and the year in which the relevant household was covered by the fibre network. After 10 years  they will be set at the level of regulated fees increased by a margin.

3.         T-Mobile will also cover various other fees e.g. related to installation of services and  technical interventions, as well as one-off costs related to integration of IT systems.

4.         The agreement was signed for 10 years but it will be automatically extended for another 5 years if T-Mobile reaches a certain number of customers connected to Orange Polska’s network. Afterwards the contract may be terminated by either party with 60 month notice period.

5.         The parties also defined the terms and conditions for use of the fibre network built or acquired by Orange Polska beyond 2018 which would require a conclusion of a separate agreement in that respect requiring a new upfront fee which will depend on the number of households.

This wholesale co-operation will contribute to faster monetization of Orange Polska investments in the fibre network and promote fibre as superfast broadband technology in Poland. It will also maximize usage of Orange Polska infrastructure while avoiding fibre network overbuilding by other operators and accelerate convergence of telecom services in the Polish market based on fibre. No exclusivity is granted under the transaction and Orange Polska is open to negotiate wholesale access to its fibre network with other operators.

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