04 June 2004, Krasnodar. The Board of Directors of "UTK" PJSC approved the Code of corporate governance of "Southern Telecommunications Company" PJSC at its meeting held on May 25, 2004.

The corporate governance Code of "UTK" PJSC has been developed in order to ensure observance of the provisions of the effective legislation, as well as to form and introduce rules and principles of corporate conduct in the Company's day-to-day operations which will contribute to the Company's successful development and ensure favorable prospects of long-term development of the Company, growth of the Company's value, observance of legitimate interests and rights of all shareholders and formation of a positive view of the Company among its shareholders, employees, customers and other persons concerned.

The provisions of the Code of Corporate Governance of "UTK" PJSC have been developed on the basis of established Russian and foreign corporate governance practices, in particular, with due respect to Corporate governance principles developed by the Organization for Economic Cooperation and Development (OECD) and recommendations of the Code of Corporate Conduct suggested by the FCSM of Russia. Principles and rules set out in the Code imply a higher level of functioning of governing and controlling bodies, better business culture and adherence to higher ethical norms than those stipulated by the applicable legislation.

Procedure for approval of the Code of corporate governance of "UTK" PJSC included its consideration by the Corporate Governance Committee of the Board of Directors of "UTK" PJSC on January 22, 2004. According to the recommendations of the Committee the draft Code of corporate governance of "UTK" PJSC was examined for the purpose of its conformity with the best corporate governance practices, observance of the rights and interests of shareholders, ensuring openness and transparency of the Company's activity. The following leading organizations in the field of corporate management have been chosen expert companies: International financial corporation (IFC), Non-Commercial Partnership "Association of Independent Corporate Directors", Non-commercial partnership "Russian institute of Directors".

Corporate Governance Committee of "UTK" PJSC Board of Directors has discussed expert opinion on the draft Code at its meeting held on April 23, 2004. Suggestions and amendments of the experts have been inserted in the draft Code.

The approved Code of corporate governance of "Southern Telecommunications Company" PJSC can be viewed in the section 'Investor relations' of the corporate Internet site.