Published in D.R. number 212 (Series I-A) of 13 September 1995

Ministério das Obras Públicas, Transportes e Comunicações (Ministry for Public Works, Transport and Communications)

Decree-Law

CN - Comunicações Nacionais, SGPS, S.A. hereunder abbreviated to CN, was set up by Decree Law no. 88/92, of 14 of May with the objective of managing the company holdings owned by the State in the communications sector. In setting up this company, the aim was above all to provide the State with an ideal auxiliary tool for the task of finalising the restructuring and reorganisation of the communications sector, this task being concluded, in particular, by the operations of splitting up the CTT - Correios e Telecomunicações de Portugal, S.A. legislated by Decree Law no. 277/92, of 15 of December and the merger-constitution of Portugal Telecom, S.A. legislated by Decree Law no. 122/94, of 14 of May and subsequent privatisation of part of its share capital, authorised by Decree Law no. 44/95, of 22 of February.

On the 20th March of this year, the State as regulator and holder of the rights and obligations belonging to the public telecommunications service authorised the concession of this public service to Portugal Telecom S.A. by executing Decree Law no. 40/95, of  15 of February. This concession also defined the main technical instruments and other instruments such as the framework for the evolution of prices for the services provided by the company, already permitting normal development of Portugal Telecom S.A., becoming more and more independent in an open competitive market environment on a global scale.

With the ending of the first phase of privatisation of Portugal Telecom S.A., the specific participation of the State through CN in the above-mentioned privatisation process was for the time being concluded. This did not mean that other stages in the privatisation of Portugal Telecoms share capital might not occur in the future, in the sense of reducing the role of the State in the economy and gradually withdrawing from the relevant decision centres as soon as the necessary legal instruments are defined guaranteeing that companies can already develop by themselves and that the interests of the users of the services are in all events properly safeguarded.

With the legislative framework complete and with the possibilities, emphasised within the scope of privatisation and already provided for in the concession contract for Portugal Telecom S.A., of consolidating all the telecommunications pubic service in this company, the intervention of the State in this sector is becoming more and more residual in nature.

The holdings of share capital by the State in the communications sector must therefore be restructured, there no longer being any justification for a specific holding company for the sector with the characteristics of CN. What is more justifiable has become the management of such holdings to be assigned to a body one of whose generic functions is to manage the States interests in companies where it is still a shareholder. It is important, for this purpose, to take all the necessary measures to implement this restructuring, emphasising that the State will take over CNs legal relationships.

Thus:

Under the terms of paragraph a) of no. 1 of article 201 of the Constitution, the Government decrees as follows:

Article 1

1 - CN - Comunicações Nacionais, SGPS, S.A. hereunder abbreviated to CN set up by Decree Law no. 88/92, of 14 of May is dissolved.

2 - The dissolution of CN does not need a public deed, the appropriate registration having to be instituted officially within five working days from the date of this decree law entering into force.

Article 2

1 - The company holdings belonging to CN are returned to the State's ownership with effect from the date of the registration of the dissolution, being deposited at the head department of the Exchequer.

2 - The rights of the State as shareholder of Correios e Telecomunicações de Portugal, S.A. and of Portugal Telecom S.A. hereunder designated as CTT and PT are, under the terms of the previous paragraph, immediately capable of being exercised irrespective of the corresponding entry made in the register of shares of the company or transferable securities and deeds, this decree law being sufficient authorisation for this purpose.

Article 3

1 - The dividends to be paid by CTT and PT to the State shareholder will be applied in accordance with the joint ministerial order of the Ministers of Finances and Public Works, Transport and Communications with the possibility of part of these being allocated to reduce existing liabilities with regard to the CTT Pension Fund.

2 - The building of CN's headquarters will be returned to the CTT.

3 - Without prejudice to the provisions of the previous numbers, the remaining assets belonging to CN will be returned to the State.

4 - Demands and outstanding claims of personnel who are rendering service at CN under this system are considered terminated.

Article 4

CTT and PT will establish the necessary protocols for resolving questions relating to the Fundação das Comunicações (Communications Foundation) and company works taking into consideration in particular what has been established regarding the splitting up of the CTT and the merger-constitution of PT.

Article 5

1 - Once the term referred to in no. 2 of article 1 has expired, the members in office with executive functions on the board of directors of CN will act as liquidators.

2 - The liquidation of CN must be terminated by 31st December 1995.

Article 6

1 - All notary deeds and registrations necessary for the implementation of the provisions of this decree law are exempt from any fees or emoluments.

2 - Alterations which will be introduced by the end of this year to the articles of association of CTT or PT are also exempt from any fees or emoluments for notary deeds or registrations.

Seen and approved at the Cabinet Meeting of the 13th July 1995. - Aníbal António Cavaco Silva - Eduardo de Almeida Catroga - Álvaro José Brilhante Laborinho Lúcio - Joaquim Martins Ferreira do Amaral.

Enacted on the 24th August 1995 and hereby published.

The president of the Republic, MÁRIO SOARES.

Ratified on the 28th August 1995. The Prime Minister, Aníbal António Cavaco Silva.