Moscow, Russian Federation – Mobile TeleSystems OJSC (“MTS” – NYSE: MBT), the leading telecommunications provider in Russia and the CIS, announces that an international arbitration tribunal ( “Tribunal”) constituted under the rules of the London Court of International Arbitration (“LCIA”) has rejected application of MTS’ wholly owned subsidiary, MTS Finance S.A. (“MTS Finance”), to correct an award it issued on November 11, 2010 with regards to arbitration commenced by Nomihold Securities Inc. (“Nomihold”) in early 2007. Accordingly, the award stating that MTS Finance is required to honor Nomihold's option to sell MTS Finance the remaining 49% stake in Tarino Limited for $170 million, plus interest, $5.88 million in dividends that Tribunal ruled were payable to Nomihold under the option agreement, and to compensate it for related costs, is now a final award. MTS Finance is currently considering its legal options.

As previously disclosed by MTS, MTS Finance acquired a 51% stake in Tarino Limited from Nomihold at the end of 2005. Tarino Limited was believed at that time to be the indirect owner, through its 100% owned subsidiaries, of Bitel, a Kyrgyz GSM mobile phone operator. In March 2007, MTS wrote off the costs relating to the acquisition of Bitel in the amount of $150 million and a liability of $170 million was recorded with an associated charge to non-operating expenses to account for potential liability with respect to the option for the remaining 49% of Tarino, as noted in MTS annual financial statements for year ended 31 December, 2006.