Notice regarding legal matters concerning AS Tallinna Vesi The Legal Chancellor of Estonia has issued a proposal to the Tallinn City Government to bring its 30.09.2009 decree nr 75 establishing water and wastewater tariffs in Tallinn from 01.01.2010 into compliance with the Public Water and Sewerage System Act and the Constitution. The Legal Chancellor has stated that the City as a regulator have failed to analyse and itemise the costs of providing water and wastewater services in Tallinn and have not accounted justified profitability in accordance with the law, which contravenes the constitutional legality principle. AS Tallinna Vesi at this stage has no official information about Tallinn City Government's position on the matter and therefore cannot predict any future course of action. The Company will undertake to inform the shareholders and the public of any developments in this field as soon as more information becomes available. The Parliament of Estonia is currently reviewing the Anti-Monopoly Bill, which passed its first reading on 09.03.2010 and was distributed for consultations, requesting comments from the industry by 23.03.2010. AS Tallinna Vesi was not formally approached in the consultation round. Nevertheless, the Company submitted its position and proposed amendments via the representative body of the Estonian water industry, EVEL. EVEL submitted consolidated comments for the industry to the Parliament on 22.03.2010. At present there is no clear information about what effect this bill would have on the Company's tariff mechanism, as there are no references to price methodology in the Bill itself. Priit Koff Head of Communication AS Tallinna Vesi Tel. + 372 6262 209 priit.koff@tvesi.ee