Moscow, Russia – January 18, 2010 – “COMSTAR – United TeleSystems” JSC (“Comstar” or “the Group”) (LSE: CMST), the largest integrated telecommunications provider in Moscow and 69 Russian cities, today announced that Moscow City Telephone Network (“MGTS”), Comstar’s 69.93% owned subsidiary, will introduce new tariffs for the local connection services and line rental from February 1, 2010. MGTS’ tariffs^[1] will increase at an average rate of 10.3% in rubles. 

Per-Minute Tariff Plan 

	Residential Subscribers		Independent Corporate Subscribers		State-Funded Organizations
(RUB)	New	Current	New	Current	New	Current
Line Rental	155.00	135.00	175.00	160.00	160.00	145.00
Local connection fee per minute	0.36	0.30	0.36	0.30	0.36	0.30

Combined Tariff Plan 

	Residential Subscribers		Independent Corporate Subscribers		State-Funded Organizations
(RUB)	New	Current	New	Current	New	Current
Line Rental	155.00	135.00	175.00	160.00	160.00	145.00
Fee for basic limit of 400 minutes per month (currently the prepaid limit is 450 minutes)	140.00	120.00	140.00	120.00	140.00	120.00
Fee per additional minute	0.34	0.28	0.34	0.28	0.34	0.28

Unlimited Tariff Plan 

	Residential Subscribers		Independent Corporate Subscribers		State-Funded Organizations
(RUB)	New	Current	New	Current	New	Current
Line Rental	155.00	135.00	175.00	160.00	160.00	145.00
Fee for unlimited connection	250.00	245.00	350.00	342.00	350.00	331.00

As at September 30, 2009, MGTS had 3.6 million active residential lines and 763 thousand active corporate lines (of which 511 thousand lines are used by independent corporate subscribers, 252 thousand lines are used by state-funded organizations). As at September 30, 2009, 50% of MGTS residential subscribers were on the unlimited tariff plan, 29% were on the per-minute plan and the remaining 21% were on a combination of the two plans. 15% of MGTS independent corporate subscribers were on the unlimited tariff plan, 6% were on the per-minute plan and the remaining 78% were on a combination of the two plans as at the end of the third quarter of 2009. 13% of state-funded organizations using MGTS voice services were on the unlimited tariff plan, 6% were on the per-minute plan and the remaining 81% were on a combination of the two plans as at the end of the third quarter of 2009. 

Further information with regard to MGTS’s tariff increase is available on the MGTS corporate website at https://www.mgts.ru/.

^[1]Tariffs for residential subscribers include VAT; tariffs for corporate subscribers are indicated without VAT