Indonesian Taxation DebtCapital Restructure

and three members selected from Government institutions DGRE and Director of DGPIO and a government representative appointed by the Minister of Communication and Information.

3. C l a ss i f i c at i o n a n d L i ce n s i n g o f Telecommunications Providers

The Telecommunications Law organized telecommunication services into following three categories: i provision of telecommunication networks, ii provision of telecommunication services, and iii provision of special telecommunications services. Licenses issued by MoCI are required for each category of telecommunications services. MoCI Regulation No.12010 and MoC Decree No.KM.212001 dated May 31, 2001 regarding the Operation of Telecommunications Services, as last amended by MoCI Regulation No.82015 regarding the Fourth Amendment of Decree of the Minister of Communication No.KM.212001 regarding the Provision of Telecommunications Service, are the principal implementing regulations governing licensing. MoCI Regulation No.12010 classified network operations into fixed and mobile networks. MoC Decree No.KM.212001 categorized the provision of services into basic telephony services, value-added telephony services, and multimedia services.

4. Introduction of Competition in the Indonesian Telecommunications Industry

In 1995, we were granted a monopoly to provide local fixed line telecommunications services until December 31, 2010, and DLD services until December 31, 2005. Indosat and Satelindo which subsequently merged with Indosat were granted a duopoly for provision of basic international telecommunications services until 2004. As a consequence of the Telecommunications Law, the Government terminated our exclusive rights to provide domestic fixed line telephone and DLD services and Indosat’s and Satelindo’s duopoly rights to provide basic international telephone services. Instead, the Government adopted a duopoly policy to create competition between Indosat and us as comprehensive service and network providers.

5. DLD Services

To liberalize DLD services, the Government amended the National Telecommunications Technical Plan pursuant to MoCI Decree No.6PM.KOMINFO52005 dated May 17, 2005 “MoCI Decree No.62005” to assign each provider of DLD services a three-digit access code that would permit their customers to select an alternative DLD services provider by dialing the three-digit access number. MoCI Decree No.62005 did not provide for immediate implementation of the three-digit system for DLD calls, but as the first DLD service provider, we were required to gradually open our network to the three-digit access codes in all coded areas throughout Indonesia by April 1, 2010. We were assigned the “017” DLD access code, while Indosat was assigned “011”. The MoCI thereafter amended the National Telecommunications Plan as provided in MoCI Decree No.43PM.KOMINFO122007 dated December 3, 2007, “MoCI Decree No.432007”, which delayed the deadline for the implementation of three digit access code for DLD calls throughout all the area code in Indonesia until September 27, 2011. Pursuant to MoCI Decree No.432007, we opened our network to the “01X” three-digit DLD access service in Balikpapan by April 3, 2008. Since that date, our customers are able to make DLD calls from Balikpapan by first dialing Indosat’s “011”. As stipulated in MoCI Regulation No.432007, we have provided a nation-wide network for three-digit access code for fixed and fixed wireless DLD with “01X” that can be used by Indosat or other licensed operator starting September 27, 2011. To date, no other licensed operators have submitted a request to us to connect their networks and enable DLD access.

6. IDD Services

We received our IDD license in May 2004 and began offering IDD fixed line services to customers in June 2004 using the “007” IDD access code. The Indosat IDD access code is “001”. Our December 2005 interconnection agreement with Indosat enables Indosat’s network customers to access our IDD services by dialing “007” and our network customers to access Indosat’s IDD services by dialing “001”.

7. Limited Mobility Wireless Services

MoC Decree No.KM.352004 dated March 11, 2004 regarding Implementation of Fixed Wireless Networks with Limited Mobility, as amended by MoCI Decree No.16 PERM.KOMINFO062011 dated June 27, 2011, “MoC 145 2014 Annual Report PT Telkom Indonesia Tbk Persero