Bond OTE Group 3.5% ( XS1086785182 ) in EUR

Issuer OTE Group
Market price 100 %  ▼ 
Country  Greece
ISIN code  XS1086785182 ( in EUR )
Interest rate 3.5% per year ( payment 1 time a year)
Maturity 08/07/2020 - Bond has expired



Prospectus brochure of the bond OTE PLC XS1086785182 in EUR 3.5%, expired


Minimal amount 100 000 EUR
Total amount 700 000 000 EUR
Detailed description OTE PLC is a Greek multinational telecommunications company providing fixed-line telephony, mobile telephony, broadband internet, television and other telecommunications services in Greece and internationally.

The Bond issued by OTE Group ( Greece ) , in EUR, with the ISIN code XS1086785182, pays a coupon of 3.5% per year.
The coupons are paid 1 time per year and the Bond maturity is 08/07/2020







BASE PROSPECTUS
OTE PLC
(incorporated with limited liability in England and Wales)
GUARANTEED BY
HELLENIC TELECOMMUNICATIONS
ORGANIZATION S.A.
(incorporated with limited liability in the Hellenic Republic)
6,500,000,000
GLOBAL MEDIUM TERM NOTE PROGRAMME
Under this 6,500,000,000 Global Medium Term Programme (the "Programme") OTE PLC (the "Issuer") may from time to time issue notes (the "Notes")
denominated in any currency agreed between the Issuer, the Guarantor and the relevant Dealer (each as defined below). The Notes will have the benefit of an
unconditional and irrevocable guarantee by Hellenic Telecommunications Organization S.A. (the "Guarantor" or "OTE").
The maximum aggregate principal amount of Notes outstanding at any time under the Programme will not exceed 6,500,000,000 (or the equivalent in other
currencies) (and, for this purpose, any Notes denominated in any other currency shall be translated into Euro at the date of the agreement to issue such Notes calculated
in accordance with the provisions of the Dealership Agreement (as defined under "Subscription and Sale")). The maximum aggregate principal amount of Notes which
may be outstanding at any time under the Programme may be increased from time to time, subject to compliance with the relevant provisions of the Dealership
Agreement.
The Notes may be issued on a continuing basis to one or more of the Dealers specified under "Overview of the Programme" and any additional Dealer appointed under
the Programme from time to time by the Issuer and the Guarantor (each a "Dealer" and together the "Dealers"), which appointment may be for a specific issue or on
an ongoing basis. References in this Base Prospectus to the "relevant Dealer" shall, in relation to an issue of Notes being (or intended to be) subscribed by more than
one Dealer, be to the lead manager of such issue and, in relation to an issue of Notes being intended to be subscribed by one Dealer, be to such Dealer.
This Base Prospectus constitutes a base prospectus in respect of non-equity securities within the meaning of Art. 22 6(4) of Commission Regulation (EC)
809/2004 of 29 April 2004, as amended (the "Prospectus Directive Regulation") and within the meaning of Article 5.4(a) of Directive 2003/71/EC of 4 November
2003, as amended (the "Prospectus Directive").
Application has been made to the Commission de Surveillance du Secteur Financier ("CSSF") in its capacity as competent authority under the Luxembourg Act dated
10 July 2005 relating to prospectuses for securities (the "Luxembourg Law on Prospectuses for Securities") to approve this Base Prospectus as a base prospectus.
Application has also been made to the Luxembourg Stock Exchange for Notes issued under the Programme to be admitted to trading on the Luxembourg Stock
Exchange's regulated market, which is a regulated market for the purposes of the Markets in Financial Instruments Directive 2004/39 EC (the "Luxembourg Stock
Exchange"), during the period of 12 months from the date of this Base Prospectus. Application has also been made for Notes issued under the Programme to be listed
on the official list of the Luxembourg Stock Exchange. Reference in this Prospectus to Notes being listed on the Luxembourg Stock Exchange (and all related
reference) shall mean that such Notes have been admitted to trading on the regulated market of the Luxembourg Stock Exchange and to the official list of the
Luxembourg Stock Exchange. The Programme also permits Notes to be issued on an unlisted basis or to be listed on such other or further stock exchanges as may be
agreed with the Issuer. The relevant Final Terms (as defined herein) in respect of the issue of any Notes will specify whether or not such Notes will be listed on the
Luxembourg Stock Exchange (or on any other stock exchange).
Notes issued under the Programme may be rated or unrated. Where a Tranche of Notes is rated, such rating will not necessarily be the same as the rating(s) assigned to
Notes already issued. Where a Series or Tranche of Notes is rated, the applicable rating(s) will be specified in the relevant Final Terms. Whether or not each credit
rating applied for in relation to a relevant Series or Tranche of Notes will be (1) issued by a credit rating agency established in the European Economic Area ("EEA")
and registered under Regulation (EU) No 1060/2009, as amended (the "CRA Regulation"), or (2) issued by a credit rating agency which is not established in the EEA
but endorsed by a CRA which is established in the EEA and registered under the CRA Regulation or (3) issued by a credit rating agency which is not established in the
EEA but which is certified under the CRA Regulation will be disclosed in the Final Terms. In general, European regulated investors are restricted from using a rating
for regulatory purposes if such rating is not issued by a credit rating agency established in the EEA and registered under the CRA Regulation unless (1) the rating is
provided by a credit rating agency not established in the EEA but is endorsed by a credit rating agency established in the EEA and registered under the CRA
Regulation or (2) the rating is provided by a credit rating agency not established in the EEA which is certified under the CRA Regulation. A list of credit rating
agencies registered in accordance with the CRA Regulation is available on the website of the European Securities and Markets Authority ("ESMA") at
http://www.esma.europa.eu/page/List-registered-and-certified-CRAs. A rating is not a recommendation to buy, sell or hold securities and may be subject to revision,
suspension or withdrawal at any time by the assigning rating agency.
The Issuer and the Guarantor may agree with any Dealer that Notes may be issued in a form not contemplated by the Terms and Conditions of the Notes herein, in
which event (in the case of Notes intended to be listed on the Luxembourg Stock Exchange) a Drawdown Prospectus or, if appropriate, an updated Base Prospectus
will be made available, which will describe the effect of the agreement reached in relation to such Notes.
See "Risk Factors" for a discussion of certain factors to be considered in connection with an investment in the Notes.
Investors should note that the CSSF gives no undertaking as to the economic or financial soundness of any transaction contemplated by this Base Prospectus or the
quality or solvency of the Issuer in accordance with the provisions of Article 7(7) of the Luxembourg Law on Prospectuses for Securities implementing the Prospectus
Directive.
Arranger
HSBC
Dealers
Alpha Bank
Deutsche Bank
BofA Merrill Lynch
Eurobank Ergasias S.A
BNP PARIBAS
Goldman Sachs International
Citigroup
HSBC
Credit Suisse
Morgan Stanley
National Bank of Greece
10 April 2014


TABLE OF CONTENTS
TABLE OF CONTENTS .................................................................................................................................................... i
IMPORTANT NOTICES ................................................................................................................................................... ii
SUPPLEMENT TO BASE PROSPECTUS ....................................................................................................................... v
RISK FACTORS ................................................................................................................................................................ 1
GENERAL DESCRIPTION OF THE PROGRAMME ................................................................................................... 19
OVERVIEW OF THE PROGRAMME ........................................................................................................................... 20
INFORMATION INCORPORATED BY REFERENCE ................................................................................................ 25
FORMS OF THE NOTES AND TRANSFER RESTRICTIONS RELATING TO U.S. SALES.................................... 27
TERMS AND CONDITIONS OF THE NOTES ............................................................................................................. 36
FORM OF FINAL TERMS.............................................................................................................................................. 57
DESCRIPTION OF THE ISSUER................................................................................................................................... 66
DESCRIPTION OF THE GUARANTOR ....................................................................................................................... 68
TAXATION ..................................................................................................................................................................... 99
SUBSCRIPTION AND SALE ....................................................................................................................................... 104
GENERAL INFORMATION......................................................................................................................................... 107
i


IMPORTANT NOTICES
Each of the Issuer and the Guarantor accepts responsibility for the information contained in this document and the
Final Terms for each tranche of Notes issued under the Programme and, to the best of the knowledge and belief of each
of the Issuer and the Guarantor (each of which has taken all reasonable care to ensure that such is the case), the
information contained in this document is in accordance with the facts and does not omit anything likely to affect the
import of such information.
This Base Prospectus should be read and construed together with any supplements hereto and, in relation to any
Tranche (as defined herein) of Notes, should be read and construed together with the relevant Final Terms (as defined
herein).
The Issuer and the Guarantor, having made all reasonable enquiries, have confirmed to the Dealers named under
"Subscription and Sale" below that the information contained in this Base Prospectus (including for this purpose, each
relevant Final Terms) with regard to the Issuer, the Guarantor and the Guarantor's subsidiaries is true and accurate in
all material respects and is not misleading; that any opinions or intentions expressed herein with respect to the Issuer,
the Guarantor, the Guarantor and its consolidated subsidiaries and the Notes are honestly held; that this Base
Prospectus does not omit to state any other fact necessary to make such information, opinions or intentions (with
respect to the Issuer, the Guarantor or the Notes) not misleading in any material respect; and that all reasonable
enquiries have been made to ascertain all facts material for the purposes aforesaid.
No person has been authorised to give any information or to make any representation not contained in or not consistent
with this Base Prospectus or any other document entered into in relation to the Programme or any information supplied
by the Issuer or the Guarantor or such other information as is in the public domain and, if given or made, such
information or representation should not be relied upon as having been authorised by the Issuer, the Guarantor or any
Dealer.
No representation or warranty is made or implied by the Dealers or any of their respective affiliates, and none of the
Dealers and any of their respective affiliates makes any representation or warranty or accepts any responsibility as to
the accuracy or completeness of the information contained in this Base Prospectus. Neither the delivery of this Base
Prospectus or any Final Terms nor the offering, sale or delivery of any Note shall, in any circumstances, create any
implication that the information contained in this Base Prospectus is true subsequent to the date hereof or the date
upon which this Base Prospectus has been most recently amended or supplemented or that there has been no adverse
change, or any event reasonably likely to involve any adverse change, in the condition (financial or otherwise) of the
Issuer or the Guarantor since the date thereof or, if later, the date upon which this Base Prospectus has been most
recently amended or supplemented or that any other information supplied in connection with the Programme is correct
at any time subsequent to the date on which it is supplied or, if different, the date indicated in the document containing
the same.
The distribution of this Base Prospectus and any Final Terms and the offering, sale and delivery of the Notes in certain
jurisdictions may be restricted by law. Persons into whose possession this Base Prospectus or any Final Terms comes
are required by the Issuer, the Guarantor and each of the Dealers to inform themselves about and to observe any such
restrictions. For a description of certain restrictions on offers, sales and deliveries of Notes and on the distribution of
this Base Prospectus or any Final Terms and other offering material relating to the Notes, see "Subscription and Sale"
and "Form of Notes and Transfer Restrictions relating to U.S. Sales". In particular, Notes have not been and will not
be registered under the United States Securities Act of 1933 (as amended) (the "Securities Act") and are subject to
U.S. tax law requirements. Subject to certain exceptions, Notes may not be offered, sold or delivered within the United
States or to U.S. persons. Notes may be offered and sold outside the United States in reliance on Regulation S under
the Securities Act ("Regulation S") and in the United States to qualified institutional buyers (as defined in Rule 144A
under the Securities Act ("Rule 144A")) in reliance on Rule 144A. Prospective purchasers of Notes are hereby notified
that a seller of Notes may be relying on the exemption from the registration requirements of Section 5 of the Securities
Act provided by Rule 144A.
Neither this Base Prospectus nor any Final Terms constitutes an offer or an invitation to subscribe for or purchase any
Notes and is not intended to provide the basis of any credit or other evaluation and should not be considered as a
recommendation by the Issuer, the Guarantor, the Dealers or any of them that any recipient of this Base Prospectus or
any Final Terms should subscribe for or purchase any Notes. Each recipient of this Base Prospectus or any Final
Terms should determine for itself the relevance of the information contained in this Base Prospectus and shall be taken
to have made its own investigation and appraisal of the condition (financial or otherwise) of the Issuer and the
Guarantor.
The maximum aggregate principal amount of Notes outstanding and guaranteed at any time under the Programme will
not exceed 6,500,000,000 (or the equivalent in other currencies) (and, for this purpose, any Notes denominated in
ii


another currency shall be translated into Euros at the date of the agreement to issue such Notes, calculated in
accordance with the provisions of the Dealership Agreement). The maximum aggregate principal amount of Notes
which may be outstanding and guaranteed at any one time under the Programme may be increased from time to time,
subject to compliance with the relevant provisions of the Dealership Agreement, as defined under "Subscription and
Sale".
In this Base Prospectus, unless otherwise specified, references to "U.S.$", "U.S. dollars" or "dollars" are to United
States dollars, references to "£" are to pounds sterling and references to "EUR", "" or "Euro" are to the currency
introduced at the start of the third stage of European economic and monetary union, and as defined in Article 2 of
Council Regulation (EC) No 974/98 of 3 May 1998 on the introduction of the euro, as amended.
Certain figures included in this Base Prospectus have been subject to rounding adjustments; accordingly, figures
shown for the same category presented in different tables may vary slightly and figures shown as totals in certain tables
may not be an arithmetic aggregation of the figures which precede them.
This Base Prospectus has been prepared on the basis that any offer of Notes in any Member State of the European
Economic Area which has implemented the Prospectus Directive (each, a "Relevant Member State") will be made
pursuant to an exemption under the Prospectus Directive, as implemented in that Relevant Member State, from the
requirement to publish a prospectus for offers of Notes. Accordingly any person making or intending to make an offer
in that Relevant Member State of Notes which are the subject of an offering contemplated in this Base Prospectus as
completed by Final Terms in relation to the offer of those Notes may only do so in circumstances in which no obligation
arises for the Issuer, the Guarantor or any Dealer to publish a prospectus pursuant to Article 3 of the Prospectus
Directive or supplement a prospectus pursuant to Article 16 of the Prospectus Directive, in each case, in relation to
such offer. Neither the Issuer, the Guarantor nor any Dealer have authorised, nor do they authorise, the making of any
offer of Notes in circumstances in which an obligation arises for the Issuer, the Guarantor or any Dealer to publish or
supplement a prospectus for such offer. The expression "Prospectus Directive" means Directive 2003/71/EC (and
amendments thereto, including the 2010 PD Amending Directive, and includes any relevant implementing measure in
the Relevant Member State and the expression "2010 PD Amending Directive" means Directive 2010/73/EU.
IN CONNECTION WITH THE ISSUE OF NOTES IN ANY SERIES OR TRANCHE UNDER THE
PROGRAMME, A DEALER OR DEALERS (IF ANY) ACTING AS THE STABILISING MANAGER(S) (OR
PERSONS ACTING ON BEHALF OF ANY STABILISING MANAGER(S)) MAY OVER-ALLOT NOTES OR
EFFECT TRANSACTIONS WITH A VIEW TO SUPPORTING THE MARKET PRICE OF THE NOTES IN
SUCH SERIES AT A LEVEL HIGHER THAN THAT WHICH MIGHT OTHERWISE PREVAIL.
HOWEVER, THERE IS NO ASSURANCE THAT THE STABILISING MANAGER(S) (OR PERSONS
ACTING ON BEHALF OF A STABILISING MANAGER) WILL UNDERTAKE STABILISATION ACTION.
ANY STABILISATION ACTION MAY BEGIN ON OR AFTER THE DATE ON WHICH ADEQUATE
PUBLIC DISCLOSURE OF THE TERMS OF THE OFFER OF THE RELEVANT SERIES OF NOTES IS
MADE AND, IF BEGUN, MAY BE ENDED AT ANYTIME, BUT IT MUST END NO LATER THAN THE
EARLIER OF 30 DAYS AFTER THE ISSUE DATE OF THE RELEVANT SERIES OF NOTES AND 60 DAYS
AFTER THE DATE OF THE ALLOTMENT OF THE RELEVANT SERIES OF NOTES.
ANY
STABILISATION ACTION OR OVER ALLOTMENT SHALL BE CONDUCTED IN ACCORDANCE WITH
ALL APPLICABLE LAWS AND RULES.
iii


NOTICE TO NEW HAMPSHIRE RESIDENTS
NEITHER THE FACT THAT A REGISTRATION STATEMENT OR AN APPLICATION FOR A LICENCE
HAS BEEN FILED UNDER CHAPTER 421-B OF THE NEW HAMPSHIRE REVISED STATUTES WITH
THE STATE OF NEW HAMPSHIRE, NOR THE FACT THAT A SECURITY IS EFFECTIVELY
REGISTERED OR A PERSON IS LICENSED IN THE STATE OF NEW HAMPSHIRE CONSTITUTES A
FINDING BY THE SECRETARY OF STATE THAT ANY DOCUMENT FILED UNDER CHAPTER 421-B IS
TRUE, COMPLETE AND NOT MISLEADING. NEITHER ANY SUCH FACT NOR THE FACT THAT AN
EXEMPTION OR EXCEPTION IS AVAILABLE FOR A SECURITY OR A TRANSACTION MEANS THAT
THE SECRETARY OF STATE HAS PASSED IN ANY WAY UPON THE MERITS OR QUALIFICATIONS
OF, OR RECOMMENDED OR GIVEN APPROVAL TO, ANY PERSON, SECURITY OR TRANSACTION.
IT IS UNLAWFUL TO MAKE, OR CAUSE TO BE MADE, TO ANY PROSPECTIVE PURCHASER,
CUSTOMER OR CLIENT ANY REPRESENTATION INCONSISTENT WITH THE PROVISIONS OF THIS
PARAGRAPH.
iv


SUPPLEMENT TO BASE PROSPECTUS
The Issuer and the Guarantor have undertaken, in connection with the listing of the Notes on the Luxembourg Stock
Exchange and pursuant to Article 13 of the Luxembourg Law on Prospectuses for Securities, that if there shall occur a
significant factor, material mistake or inaccuracy relating to the information included in this Base Prospectus, the Issuer
will prepare or procure the preparation of a supplement to this Base Prospectus or, as the case may be, publish a new
Base Prospectus, for use in connection with any subsequent issue by the Issuer of Notes to be listed on the Luxembourg
Stock Exchange and in accordance with Article 13 of the Luxembourg Law on Prospectuses for Securities.
v


RISK FACTORS
The following factors may affect the ability of the Issuer and the Guarantor to fulfil their obligations in respect of Notes
issued under the Programme. All of these factors are contingencies which may or may not occur and neither the Issuer
nor the Guarantor is in a position to express a view on the likelihood of any such contingency occurring. Prior to
making an investment decision, prospective purchasers of the Notes should carefully consider, along with the other
matters referred to in this Base Prospectus, the following risks associated with an investment in securities issued by the
Issuer specifically, which could be material for the purpose of assessing the market risks associated with Notes issued
under the Programme.
Prospective investors should note that the inability of the Issuer or the Guarantor, as the case may be, to pay interest,
principal or other amounts on or in connection with any Notes may occur for unknown reasons other than those stated
below and neither the Issuer nor the Guarantor represents that the risks of holding any Notes are exhaustive.
Prospective investors should also read the detailed information set out elsewhere in this Base Prospectus and reach
their own views prior to making any investment decision. Prospective investors should also consult their own financial
and legal advisers about risks associated with an investment in any Notes issued under the Programme and the
suitability of investing in such Notes in light of their particular circumstances, without relying on the Issuer, the
Guarantor or the Dealers. Investors are advised to make, and will be deemed by the Dealers, the Issuer and the
Guarantor to have made, their own investigations in relation to such factors before making any investment decisions in
relation to the Notes.
Risks relating to the Issuer
The Issuer is a 100% subsidiary of the Guarantor, and its principal activity is to borrow and raise funds from the market
for the benefit of the Guarantor, which is incorporated in Greece, as well as other subsidiaries of the Guarantor. The
Issuer's profits stem from the difference between interest received from the Guarantor and its consolidated subsidiaries
(the "Group") and interest paid to the bondholders and other lenders. Accordingly, the Issuer is dependent on the
creditworthiness standing of the Guarantor and its subsidiaries and, consequently, any risk factors affecting the
Guarantor's and its subsidiaries' ability to meet their respective financial obligations also affect the Issuer and should be
read accordingly.
Risk Factors relating to the Guarantor
If the Guarantor does not respond promptly and efficiently to increased competitive pressures, its market share in
Greek fixed-line services may decline further.
Since the liberalisation of the Greek telecommunications market in 2001, the Guarantor has faced, and continues to
face, competitive pressures in the provision of domestic and international fixed-line services. As a result of the
migration of certain of the Guarantor's customers to its competitors, the Guarantor has experienced, and continues to
experience, a gradual decline in its share of the Greek market for fixed-line services, in terms of both numbers of
subscribers and voice traffic. The Guarantor expects competition in the Greek telecommunications market to continue
to intensify as a result of a number of factors, including regulatory developments, improvements to competitors'
infrastructure and continuing consolidation of market shares, including planned and potential efforts of the Guarantor's
competitors (in particular, Vodafone) to strengthen their position in the fixed-line market.
The competitive landscape in the market has continued to evolve following a number of mergers and acquisitions and
strategic alliances between fixed-line and mobile operators. Such evolution has lead to the creation of a number of
strong market players to compete with the Guarantor on equal or better terms. In particular, in 2009, Vodafone Greece
acquired an 18.5% interest in the share capital of Hellas OnLine ("HOL"), the second largest alternative fixed-line
operator in Greece. Wind Hellas is also one of the Guarantor's major competitors in the fixed-line services market and
is the only fully converged fixed and mobile operator in Greece. Both Wind Hellas and Vodafone (with HOL) promote
combined fixed-line and mobile services, and Vodafone has announced its strategy to further strengthen its position in
the fixed-line market. Furthermore, Forthnet, the largest alternative fixed-line operator in Greece, which is 32.3%
owned by Wind Hellas and 6.5% owned by Vodafone, has also developed a competitive advantage following its
acquisition of Nova and, until the launching of OTE TV in 2009, offered the only subscription TV service in Greece
and continues to maintain a strong market share. Cyta Hellas, a subsidiary of the Cyprus Telecommunications
Authority, entered the Greek fixed-line telephony market in 2009 and has established a strong presence in recent years,
extending its offering to include Internet Protocol Television ("IPTV") products in 2013. There are also a number of
players with smaller market shares, including, among others, On Vivodi (formed following the acquisition by On
Telecom of Vivodi), and Cosmoline.
Recent adverse economic conditions, which have affected corporate and individual expenditure on fixed-line services,
as well as recent trends in the electronic communications sector of bundling services to make them more attractive in
1


line with the decreasing average income in Greece, has fostered further consolidation in the market. In particular, Wind
Hellas and Vodafone have recently acquired 32.3% and 6.5% interests in Forthnet, respectively. Press reports also
suggest that there may be further consolidation in the Greek market among the Guarantor's competitors.
The development of broadband services and offerings of television subscription, cloud and machine-to-machine
services have also become, and the Guarantor expects to them to continue to be, an increasingly important part of
telecommunications operators' offerings in the mid-term future. In addition, local loop unbundling lines have also
increased in recent years (reaching 1,908,000 as at 31 December 2013, a 6% increase as compared to 31 December
2012), demonstrating the effect of such offerings on the market.
As the Guarantor's competitors expand or converge their business operations in fixed, mobile, broadband and television
services, they may benefit from a larger customer base, increasing economies of scale and opportunities for synergies
which could enhance their ability to compete effectively with the Guarantor in the Greek telecommunications market.
At the same time, the Guarantor is subject to certain regulatory restrictions, which may limit its ability to offer fixed
services on the same competitive terms. See "Regulatory and competitive pressures affect the Guarantor's ability to
set competitive retail and wholesale tariffs". In addition, the fixed-rate market continues to experience migration of
telephony traffic and customers from fixed-line to mobile services, especially as mobile operators offer competitive
products, including bundles of minutes at attractive rates.
As a result of the above, the Guarantor's market shares in both the business and residential market sectors may decline
further over the next few years. The Guarantor also expects to face increasing pressure to further reduce prices, further
enhance the quality of its network, adopt more efficient technologies, improve the level of its services, reduce costs (to
the extent permitted (see "Regulatory and competitive pressures affect the Guarantor's ability to set competitive
retail and wholesale tariffs") and promote customer satisfaction. If the Guarantor does not respond to these pressures
promptly and efficiently, its market share may decline more dramatically, which could have a material adverse effect on
the Guarantor's business, results of operations, financial condition and prospects.
Macroeconomic conditions in Greece and the fiscal position of the Greek government have deteriorated markedly.
The Group derives the great majority of its revenues from Greece (73.0% in 2013 and 73.8% in 2012) and the great
majority of its operations are located in Greece. Since late 2008 and, in particular, since early 2010, the economy of
Greece has deteriorated markedly. See "Description of the Guarantor--Recent Macroeconomic Events Affecting
Greece". Greece is facing a severe economic crisis resulting from significant government fiscal deficits and high levels
of government borrowing. The political, economic and budgetary challenges faced by the Greek government with
respect to the public debt burden and weakening economic prospects led to sequential ratings downgrades during 2010,
2011 and 2012 by Standard & Poor's Credit Market Services Europe Limited ("S&P") of Greece's sovereign credit
ratings to SD (selective default), as well as a downgrade by Moody's Investors Service Limited ("Moody's") in March
2012 to C. S&P has since upgraded Greece's sovereign credit rating to B and Moody's upgraded Greece's sovereign
credit rating to Caa3 in November 2013.
According to statistics published by the Hellenic Statistics Authority, gross domestic product ("GDP") declined by
2.3% in the fourth quarter of 2013, as compared to the fourth quarter of 2012 and, according to statistics published by
the International Monetary Fund (the "IMF"), GDP is estimated to have declined by 4.2% in 2013 and is expected to
increase by 0.6% in 2014. According to statistics published by the Hellenic Statistics Authority, the unemployment rate
was 27.8% as at 30 September 2013. The Group's business is sensitive to reductions in its customers' disposable
income and discretionary consumer spending, which may be affected by the deterioration in macroeconomic conditions
in Greece, including levels of unemployment, interest rates, levels of inflation, rates of taxation and levels of GDP
growth. In addition, the continuing restricted ability of Greek banks to provide business and retail financing on
attractive terms, resulting from the current conditions, is expected to exacerbate these conditions.
In March 2012, a second economic adjustment programme (which replaced the former IMF/Eurozone stabilisation and
recovery programme) was introduced, jointly supported by the IMF and members of the Eurozone. This programme
was extended until 2016 in November 2012 and is intended to cover Greece's expected funding needs until 2016.
Pursuant to the programme, Greece has agreed to certain fiscal and reform targets. There can be no assurance that
Greece will be able to successfully meet these targets and implement the programme, and the Greek economy continues
to face substantial macroeconomic challenges. In particular, the magnitude of fiscal adjustments to which Greece has
agreed, as well as any further measures that may be required, are likely to continue to have a significant negative effect
on economic activity in Greece.
Despite certain signs of improvement, the negative macroeconomic trends are expected to continue in the near future
and to affect the levels of disposable income and spending of corporations and individuals in Greece. It remains
uncertain whether the fiscal consolidation programme adopted by the Greek government in response to these conditions
will be successful in the long term. If the Greek government is required to adopt further restrictive fiscal measures, this
2


may have a further adverse impact on prospects for economic growth and disposable income in Greece and no
assurance can be given that a sovereign debt restructuring or default will be avoided.
Further reductions in disposable income and consumer spending as a result of the deterioration of macroeconomic
conditions may result in (i) the Guarantor's corporate clients further restricting technology and telecommunications
spending and (ii) its residential customers of telecommunications services (such as, fixed-line and mobile telephony,
internet and television) further reducing spending for these services or turning to lower price alternatives that may be
offered by the Guarantor's direct and indirect competitors. This could have a material adverse effect on the Guarantor's
business, including on the Guarantor's market share.
The Guarantor may decide to respond to such pressures by reducing its rates in order to remain competitive, which
would, in turn, also negatively affect its revenues. The Guarantor may, however, be restricted from taking such
mitigating action, as there can be no assurance that the national regulatory authority, the Hellenic Telecommunications
and Post Commission ("HTPC") will permit it to reduce its rates, which could cause the Guarantor to experience a
significant competitive disadvantage and, in turn, exacerbate its market share losses. See "Regulatory and
competitive pressures affect the Guarantor's ability to set competitive retail and wholesale tariffs".
The Greek government has, and may continue to, adopt fiscal measures that adversely affect the Guarantor.
In response to the deteriorating macroeconomic conditions, the Greek government adopted a range of fiscal measures,
aimed at reducing state expenditure (including reductions in public investments and the income of employees in the
public sector and pensions) and at increasing tax revenues, including the introduction of significant increases in direct
and indirect taxes, intended to improve the Greek government's fiscal position.
Pursuant to Greek Law 3845/2010 "Measures for the application of the support scheme of the Greek Economy by the
Members of the Euro Zone and the International Monetary Fund" a special contribution by way of a tax was imposed
on profitable Greek entities. This contribution was calculated on the basis of the company's total net income for the
2009 fiscal year on a progressive scale up to 10% of total net income. Pursuant to this law, the Guarantor was obliged to
pay 69.3 million, which was recorded in its 2010 consolidated income statement but paid in 12 monthly instalments
during 2011. This amount contributed to the Group's income tax expense in 2010.
In addition, in January 2013, Greek Tax Law 4110/2013 came into force, which increased the corporate tax rate in
Greece from 20% to 26%, and decreased the tax on dividends from 25% to 10%. In July 2013, the Greek government
introduced a new income tax code (Law 4172/2013), as well as a new code on tax procedures (Law 4174/2013), which
came into force in January 2014. These laws comprise the basic principles of the government's efforts to reform the tax
system, to improve efficiency and reduce instances of tax evasion. To this end, the new tax code on tax procedures
introduced a scale of increasing penalties for differing types of tax evasion and the imposition of interest on overdue tax
payments.
It remains unclear when, or whether, the fiscal measures adopted by the Greek government will have the expected
results, whether they will be sufficient to comply with the targets set forth in the second economic adjustment
programme and whether the Greek government will be required to adopt further restrictive fiscal measures in the future.
There can be no assurance that the Greek government may not seek to impose further extraordinary taxes, or take other
fiscal measures aimed at raising funds, which could have a material adverse effect on the Guarantor's financial results
and financial condition.
The Greek government is a major customer of the Guarantor.
The Greek government is the Guarantor's largest customer for telecommunications services (see "Description of the
GuarantorControl of the Guarantor--The Greek State"). The weak fiscal position of the Greek government may
have a negative impact on the Guarantor's ability to maintain current revenue levels and customer spending from the
Greek government or to recover amounts owing to it from the Greek government, which, in turn, could have a material
adverse effect on the Guarantor's financial results and financial condition.
The Guarantor and the Group are exposed to credit risk.
Credit risk is the risk of financial loss to the Group and the Guarantor if a counterparty fails to meet its contractual
obligations. The carrying value of financial assets at each reporting date is the maximum credit risk to which the Group
and the Guarantor are exposed in respect of the relevant assets.
Defaulted payments of trade receivables could potentially adversely affect the liquidity of the Group and the Guarantor.
However, due to the large number of customers and the diversification of the Group's customer base, there is little
concentration of credit risk with respect to these receivables. Concentration of risk does however exist in respect of
amounts receivable from other telecommunication service providers, due to their relatively small number and the high
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level of transactions they have with the Group and the Guarantor. The Group and the Guarantor assess credit risk in
accordance with established policies and procedures and have made appropriate provisions for impairment.
Nevertheless, the failure of one or more telecommunications service providers to meet its obligations to the Group
could have a material adverse effect on the financial condition of the Group.
Cash and cash equivalents are also exposed to a high level of credit risk in light of the macroeconomic conditions in
Greece, which places significant pressure on domestic banks. Most of the Group's cash is invested in highly rated
counterparties and with a very short term tenor. Nevertheless, a failure of one or more counterparties to meet its
contractual obligations could have a significant impact on the Group's cash reserves and financial condition.
Any future ratings downgrade may impair the Guarantor's ability to obtain financing and increase its cost of debt.
As of the date of this Base Prospectus, the long-term credit ratings assigned to the Guarantor are BB- by S&P (stable
outlook) and B2 (stable outlook) by Moody's. There is no guarantee that the ratings assigned to the Guarantor will not
be downgraded or that any future downgrades of Greece's sovereign credit ratings will not result in downgrades to the
Guarantor's credit ratings. Any future ratings downgrades may impair the Guarantor's ability to obtain financing and
increase its cost of debt and could have a material adverse effect on its business, results of operations, financial
condition and prospects.
Financial market conditions may impair the Guarantor's ability to obtain financing and increase its cost of debt.
Financial market conditions, in particular, adverse financial market conditions associated with macroeconomic
conditions in Greece, may affect the Guarantor's ability to obtain financing and increase its cost of debt. The Group's
net debt as at 31 December 2013 was 1,495.6 million, as compared to 2,879.3 million as at 31 December 2012.
Although net debt decreased in 2013, the Group repaid a 0.9 billion loan facility and certain series of Notes issued
under the Programme matured in 2013, the Group has significant financial commitments that will come due in the
coming years. If there are not sufficient funds to meet such commitments from the Group's own funds, the Guarantor
will need to consider refinancing alternatives, such as accessing the international capital markets, bank financing or a
shareholder loan and an asset disposals programme.
If the capital and credit markets deteriorate and the availability of funds becomes limited, the Guarantor may incur
increased interest rates and other costs associated with debt financing and its ability to access the capital markets or
borrow money may be impaired, which could have a material adverse effect on its financial condition.
Regulatory and competitive pressures affect the Guarantor's ability to set competitive retail and wholesale tariffs.
Under applicable laws, regulations and related HTPC decisions, the HTPC has the jurisdiction to assess the Guarantor's
tariffs for fixed-line services. Tariffs for certain categories of the Guarantor's services should be cost-based. With
respect to these tariffs, the HTPC uses the Guarantor's enterprise costing and profitability system ("ECOS"), in order to
determine whether they reflect the cost of providing the relevant services. The HTPC conducts an annual audit of the
Guarantor's ECOS system through external auditors. Based on the findings of this audit, the HTPC may object to the
Guarantor's application of ECOS and related cost methodologies in the calculation of its tariffs and may require the
Guarantor to make certain adjustments. These adjustments may also have a retroactive effect. There can be no
assurance that future audits of the Guarantor's ECOS system will not result in further recommendations for changes to
tariffs and costing methodologies.
In addition, with respect to tariffs that are not regulated on a cost basis, the HTPC determines whether such tariffs allow
alternative operators to realise sufficient profit margins and, to that effect, they are assessed using both data from the
Guarantor's ECOS system and other methodologies approved by the HTPC (such as a retail-minus pricing
methodology, pursuant to which the HTPC requests data from relevant service operators and calculates a retail-minus
price to define wholesale tariffs based on proposed retail tariffs). However, even though a simplified model used for the
calculation of retail margins for different services and service bundles has recently been made known to the Guarantor,
the precise parameters, model and inputs used by the HTPC are not known and therefore it cannot accurately predict
their effect on its tariffs.
Regulatory limitations imposed on the Guarantor's ability to set tariffs often require it to charge tariffs which are higher
or, in certain cases, significantly higher than those charged by its competitors for the same services, as its competitors
do not have such a significant market share and are, accordingly, not subject to the same pricing constraints. Given that
an important factor for the determination of the Guarantor's tariffs is its cost for providing the relevant services, the
Guarantor must make efforts to increase the efficiency of its operations, in order to reduce such costs, and, therefore, be
able to reduce the cost-based tariffs it charges, in order to make them more competitive. There can be no assurance that
if the Guarantor continues to be required to charge tariffs higher than those of the competition, its market share and its
revenues will not be materially adversely affected.
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