Prospectus-Final (clean) - Malta Financial Services Authority

penalties of EUR 1.7 billion relating to the allegation that the agreement of the Federal Republic ofGermany was not sought prior to the execution of certain subcontractor agreements. As some of thecontractual penalties are time-related and further claims for contractual penalties have been assertedby the Federal Republic of Germany, the amount claimed as contractual penalties may increase.Daimler Financial Services AG, Deutsche Telekom AG and the Toll Collect consortium filed theiranswer to the claim on 30 June 2006 and to the subsequent counterplea of the Federal Republic ofGermany on 1 October 2007. The Federal Republic of Germany served further briefs on 7 January2008 and 16 February 2008, to which Daimler Financial Services AG, Deutsche Telekom AG and theToll Collect consortium answered by a further brief on 16 May 2008. The Federal Republic ofGermany has slightly modified its claims for damages, now amounting to approximately EUR 4.98billion plus interest. Further exchanges of briefs in this matter have occurred since then. Variouswitnesses and experts were heard at a hearing in December 2010. Deutsche Telekom expects theproceedings to continue in 2012.Deutsche Telekom and its consortium partner, Daimler Financial Services AG, have the obligation, ona joint and several basis, to provide Toll Collect GmbH, the operating company of the Toll Collectconsortium, with additional equity to ensure a minimum equity ratio of 15% (in the single-entityfinancial statements prepared in accordance with German GAAP. This obligation ends when theoperating agreement expires on 31 August 2015, or earlier if the operating agreement is terminatedearly.Additionally, in December 2006, Toll Collect GmbH initiated an arbitration proceeding seeking adetermination that the Federal Republic of Germany's basis for denying the issuance of the finaloperating permit is unfounded and claiming that additional remuneration is due to Toll Collect inaccordance with the operating agreement. The Statement of Claims of Toll Collect GmbH was servedon the Federal Republic of Germany on 25 May 2007. The answer of the Federal Republic ofGermany together with a counterclaim claiming overpayment of remuneration to Toll Collect GmbHwas received on 31 January 2008. In February 2012 the chairman of the arbitration tribunal hasannounced that he will resign from his position as chairman of the tribunal and a new chairman has tobe appointed now. The proceeding is ongoing.EutelsatOn 12 April 2011, Deutsche Telekom received a request from Eutelsat S.A. for the initiation of ICCarbitration proceedings against Deutsche Telekom AG and Media Broadcast GmbH, thecorresponding arbitration claim was filed 29 February 2011. In particular, Eutelsat requestsclarification regarding the right of use of a certain orbit position to which Eutelsat alleges it has a longstandingentitlement and the term of an agreement concluded between Deutsche Telekom AG andEutelsat S.A. on the use of this orbit position by Eutelsat satellites. Eutelsat is also asserting claims tovarious payments pursuant to its interpretation of this particular term of the agreement. In 2007,Deutsche Telekom transferred its satellite business to Media Broadcast GmbH, which DeutscheTelekom sold in 2008 and with which Deutsche Telekom is no longer associated. As part of thistransaction, Deutsche Telekom agreed to indemnify the purchaser of Media Broadcast GmbH againstcertain claims, some of which also relate to the agreements signed between Deutsche Telekom AGand Eutelsat. On 31 January 2012, the ICC arbitration court decided that the proceeding againstMedia Broadcast GmbH did not fall within its jurisdiction. Deutsche Telekom will defend itselvesvigorously against the claims. Eutelsat has filed an appeal against this decision.Reimbursement and Damages for Subscriber Data CostsFrom December 2004 to January 2009 a number of telephone directory service providers, includingamong others telegate, datagate, klicktel and Vodafone, who received from Deutsche Telekom datarelating to subscribers for voice telephony services for the purpose of providing their own directoryservices, filed lawsuits with the Regional Courts in Cologne and Bonn in the aggregate amount ofapproximately EUR 118 million, plus interest, claiming reimbursement for payments made to DeutscheTelekom since 1998. The plaintiffs, referring to a decision by the European Court of Justice (C-109\03;KPN vs. Onafhankelijke Post en Telecommunicatie Autoriteit), accused Deutsche Telekom of havingincluded inadmissible costs in Deutsche Telekom's charges for providing customer data.In a number of cases, the Regional Court in Cologne essentially ordered Deutsche Telekom toreimburse the plaintiffs. Except for the case involving Vodafone, the Court of Appeals in Dusseldorfessentially confirmed these decisions on appeal. Deutsche Telekom has appealed all decisions of theCourt of Appeals rendered against Deutsche Telekom to the Federal Court of Justice. The Federal114