PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
Brasília, D.F., 71.215-000
Federative Republic of Brazil
annual reports under cover Form 20-F or Form 40-F.
Form 20-F ___X___ Form 40-F ______
in paper as permitted by Regulation S-T Rule 101(b)(1)__.
in paper as permitted by Regulation S-T Rule 101(b)(7)__.
Indicate by check mark whether the registrant by furnishing the
information contained in this Form is also thereby furnishing the
information to the Commission pursuant to Rule 12g3-2(b) under
the Securities Exchange Act of 1934.
Yes ______ No ___X___
registrant in connection with Rule 12g3-2(b):
| Investor Relations | |
| (+55 61) 3415-1140 | |
| ri@brasiltelecom.com.br www.brasiltelecom.com.br/ir/ |
|
| Media Relations | |
| (55 61) 3415-1378 | |
| cesarb@brasiltelecom.com.br |
Free Translation
| BRASIL TELECOM S.A. | BRASIL TELECOM PARTICIPAÇÕES S.A. | |
| Publicly Held Company | Publicly Held Company | |
| Corporate Taxpayer Registration | Corporate Taxpayer Registration | |
| 76.535.764/0001-43 | 02.570.688/0001-70 | |
| Board of Trade 53 3 0000622 9 | Board of Trade 53 3 0000581 8 |
MATERIAL FACT
BRASIL TELECOM PARTICIPAÇÕES S.A. (NYSE: BRP; BOVESPA: BRTP3/BRTP4) and BRASIL TELECOM S.A. (NYSE: BTM; BOVESPA: BRTO3/BRTO4), hereby collectively referred to as the Companies, in compliance with Paragraph 4 of Art. 157 of Law 6,404/76, as amended, and Brazilian Securities and Exchange Commission – CVM Instruction 358/02, inform to the market in general that BRASIL TELECOM S.A. (“BrT”) intends to book provisions in its financial statements relating to the fiscal year ended on December 31st, 2005 in the amount of R$ 622 million, with an impact on the Companies financial statements.
The provisions which are intended to be booked, on extraordinary basis, refer to the following items:
| R$ million | ||
1. Contingencies related to probable risks in 2005 due to labor and social security legal proceedings, in particular regarding BrT’s subsidiary liability, as well as administrative proceedings. |
198 | |
2. Adjustments in the actuarial calculation of retirement plan obligations of Fundação BrT Prev (“Fundação BrT”), by virtue of the adjustment of its mortality table. Fundação BrT will adopt table UP94, segregated by sex and set forward in 2 years, replacing table UP84, based on a recommendation from its independent actuarial consultant. |
171 | |
3. Write-off of tax credits, in particular of the ICMS (Value Added) tax levied on supplies used in the maintenance of BrT’s fixed telephone plant and on electric energy consumption. |
127 | |
4. Risks of losses in client’s bills subject to co-billing procedures of other fixed and mobile telephone operators. |
74 | |
5. Provisions due to the deduction of interconnection costs, in compliance with Law 9,998, dated August 17, 2000, Law 10,052, dated November 28, 2000, and the decision rendered on December 15, 2005 by ANATEL - Agência Nacional de Telecomunicações, in which the calculation basis of the FUST – Fundo de Universalização de Serviços de Telecomunicações (Universalization of Telecommunications Services Fund) was altered. |
52 | |
BrT will continue to take measures, when applicable, in order to discuss its rights in all available levels of jurisdiction.
The Companies clarify that the amount for such provisions intended to be booked will not generate immediate impacts in BrT’s cash in the short term and will disclose to the market any and all additional information related to this Material Fact.
Brasil Telecom Participações S.A. and Brasil Telecom S.A. reassure its commitment to keep its high standards of transparency and corporate governance, as well as to continue to value its investors, clients, employees and partners.
Brasília, January 5th, 2006.
Charles Laganá Putz
Investor Relations Officer
Brasil Telecom Participações S.A.
Brasil Telecom S.A.
BRASIL TELECOM PARTICIPAÇÕES S.A. |
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By: |
/S/ Charles Laganá Putz
|
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Name: Charles Laganá Putz
Title: Chief Financial Officer |
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