Financial statements

NOTE 1



COMPANY BACKGROUND

Andorra Telecom, S.A.U. (the Company) was incorporated in the presence of a notary on 23 June 2015 and was registered in the Companies Registry in accordance with the provisions of Law 33/2014 of 27 November.

The Company is a government-owned company governed by applicable private civil and commercial law and keeps its accounts in accordance with Law 30/2007 of 20 December on company accounts, without prejudice to the financial control established in the General Law on Public Finance.

The Company’s tax reference number is A-710646-J and it is listed in the Trade and Industry Register with trade registration numbers 925270N and 925350F.

In accordance with the first transitional provision of Law 33/2014, once the Company was incorporated and all the assets and liabilities had been transferred to it, the government-owned entity Servei de Telecomunicacions d’Andorra (STA) was legally extinguished. On the date of its registration in the Companies Registry, the Company automatically and by law took over the functions previously assigned to STA under the legal provisions which said Law repealed and was subrogated to STA’s rights and obligations to third parties and employees.

Under article 1.2 of Law 33/2014, the Company has two clearly differentiated corporate purposes:

  • First, the provision of an exclusive basis of universal public telecommunications services in Andorra, which necessarily include the activities listed in article 3 of Law 33/2014. These activities are stated in the Company’s bylaws and may only be modified by law.
  • Second, a variety of activities associated with electronic communications, which are not part of the universal public telecommunications service and which the Company may carry out on a non-exclusive basis in free competition with other providers. These activities are listed in article 4 of Law 33/2014. These activities are stated in the Company’s bylaws and may be modified and extended by agreement at the Company’s Ordinary General Meeting and with the authorisation of the Government.

Under article 5 of Law 33/2014 the Company may carry out the activities that constitute its corporate purpose both in Andorra and abroad:

  • In Andorra, it does so by ensuring general availability and use of the public electronic communications services in accordance with the available resources and the terms of service set out in applicable laws and regulations. It must ensure that the quality of the service is uniform for all customers and that its investment policy treats all parts of the Principality of Andorra equally. In particular, the Company must ensure that the universal telecommunications service is actually and effectively implemented throughout Andorra.
  • Outside Andorra, the Company must act in accordance with the principles of good management, ensuring that its activities result in diversified and balanced international growth that is beneficial to the Company.

In regulating the provision of the telecommunications services, the recommendations of the International Telecommunications Union (ITU) and other international bodies are taken into account, in accordance with the agreements and treaties to which the Principality of Andorra is a signatory.

Electronic communications services in the Principality of Andorra are designed to effectively guarantee the confidentiality of communications, in accordance with article 15 of the Constitution, except where there is a court order to the contrary.

According to article 12 of the bylaws of Andorra Telecom, S.A.U., the Company’s governing bodies are the Annual General Meeting of Shareholders and the Board of Directors, notwithstanding any posts which may be designated by the General Meeting or by legal order, such as the Director General.

Section a) of article 23 of the bylaws of Andorra Telecom, S.A.U. establishes that the Company’s Board of Directors is responsible for preparing the balance sheet and notes to the financial statements for submission to the General Meeting. The Directors are also responsible for preparing and signing the annual financial statements and proposed allocation of profit within six months of the end of the reporting period.

At 31 December 2017 the members of the Board of Directors of Andorra Telecom, S.A.U. were:

  • Mr. Jordi Torres Falcó, Chairman of the Board of Directors, Minister for Planning.
  • Mr. Jordi Cinca Mateos, Vice Chairman of the Board of Directors and Minister of Finance.
  • Mr. Jordi Nadal Bentadé, Director and Director General of Andorra Telecom, S.A.U.
  • Mr. Josep Maria Missé Cortina, Director designated by the Minister of Public Administration, Transport and Telecommunications.
  • Mr. Antoni Ambatlle Martin, Director designated by the General Meeting of Andorra Telecom, S.A.U.
  • Mr. Santiago Argelich Hesse, Director designated by the General Meeting of Andorra Telecom, S.A.U.
  • Mr. Cesar Marquina Perez de la Cruz, Secretary to the Board of Directors of Andorra Telecom, S.A.U.

The Board of Directors approves the annual draft budget and actions plans and submits them to the General Meeting for approval. In accordance with the third additional provision (“Budget regime and financial control”) of Law 33/2014, the Company will carry on its business and financial operations and execute the budget approved by the General Meeting irrespective of whether the general government budget has been approved or not, unless the Company requires State funding to cover possible deficits. This does not affect the Company’s obligation to submit its operating, investment and financing plans so that they can be incorporated into the general State budget for information purposes, as established in article 12.2 of the General Law on Public Finances.