16 February 2012

Moscow, Russian Federation - Mobile TeleSystems OJSC ("MTS" - NYSE: MBT), the leading telecommunications provider in Russia and the CIS, announces that on February 9, 2012, MTS received a Request for Arbitration from Mobile TeleSystems Finance SA ("MTS Finance"), wholly owned subsidiary of MTS, which has initiated an arbitration process under a loan agreement ("Loan Agreement") between the parties dated January 28, 2005. Under the terms of the Loan Agreement, MTSF lent $400 million to MTS. MTS Finance seeks the payment of all sums due to it under the Loan Agreement. MTS agrees that arbitration is the correct forum for any dispute between the parties but strongly denies that any sum is still owed by it to MTS Finance.

The arbitration will be conducted under the Rules of the London Court of International Arbitration.

In disputing any liability to MTS Finance, MTS will rely on its redemption of a $400 million Eurobond issued by MTS Finance, which matured on January 28, 2012, by making a payment as guarantor under the terms of the Indenture. The sum lent to MTS by MTS Finance under the Loan Agreement constituted the proceeds of this Eurobond issue. In the ordinary course and under the circumstances, MTS Finance may have written off any sum it considered it was owed. However, the position between MTS and MTS Finance in relation to the Loan Agreement (including the availability of a off-set) needs formally to be resolved to understand what assets of MTS Finance could be available in the event a separate LCIA award in favor of Nomihold Securities Inc. (made on November 11, 2010 and declared final on January 5, 2011) is held to be enforceable against MTS Finance.

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For further information, please contact in Moscow:

Joshua B. Tulgan
Director, Investor Relations
Acting Director, Corporate Finance

Department of Investor Relations
Mobile TeleSystems OJSC
Tel: +7 495 223 2025
E-mail: ir@mts.ru

Learn more about MTS. Visit the official blog of the Investor Relations Department at www.mtsgsm.com/blog/

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Mobile TeleSystems OJSC ("MTS") is the leading telecommunications group in Russia, Eastern Europe and Central Asia, offering mobile and fixed voice, broadband, pay TV as well as content and entertainment services in one of the world's fastest growing regions. Including its subsidiaries, the Group services over 100 million mobile subscribers. The Group has been awarded GSM licenses in Russia, Ukraine, Uzbekistan, Turkmenistan, Armenia and Belarus, a region that boasts a total population of more than 230 million. Since June 2000, MTS' Level 3 ADRs have been listed on the New York Stock Exchange (ticker symbol MBT). Additional information about the MTS Group can be found at www.mtsgsm.com.

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Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of MTS, as defined in the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify forward looking statements by terms such as "expect," "believe," "anticipate," "estimate," "intend," "will," "could," "may" or "might," and the negative of such terms or other similar expressions. We wish to caution you that these statements are only predictions and that actual events or results may differ materially. We do not undertake or intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. We refer you to the documents MTS files from time to time with the U.S. Securities and Exchange Commission, specifically the Company's most recent Form 20-F. These documents contain and identify important factors, including those contained in the section captioned "Risk Factors" that could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, the severity and duration of current economic and financial conditions, including volatility in interest and exchange rates, commodity and equity prices and the value of financial assets; the impact of Russian, U.S. and other foreign government programs to restore liquidity and stimulate national and global economies, our ability to maintain our current credit rating and the impact on our funding costs and competitive position if we do not do so, strategic actions, including acquisitions and dispositions and our success in integrating acquired businesses, including Comstar-UTS, potential fluctuations in quarterly results, our competitive environment, dependence on new service development and tariff structures, rapid technological and market change, acquisition strategy, risks associated with telecommunications infrastructure, governmental regulation of the telecommunications industries and other risks associated with operating in Russia and the CIS, volatility of stock price, financial risk management and future growth subject to risks.

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