Brasília, 5/4/2004 (Agência Brasil) - Minister of Communications, Eunício Oliveira, has confirmed that the Brazilian government will have so-called "golden shares" in the Embratel satellite transmitting company, Star One, which will handle Brazilian Armed Forces communications traffic.The possession of golden shares means veto power.

Embratel was recently purchased by Telmex of Mexico. Minister Oliveira said that as a result of talks with the general director of Telmex, Jaime Pardo, not only were golden shares guaranteed, but a promise was made for investments in Brazil. "Telmex told me they had three objectives in Brazil: increase the competition, make investments and improve Embratel," said the minister, adding that a visit by the head of Telmex, Carlos Slim, is expected shortly to confirm the details of the understanding regarding the golden shares (which Oliveira revealed will not cost the Brazilian government anything).

The control of Embratel by Telmex still has to be approved by the sector regulatory agency (Agência Nacional de Telecomunicações) (Anatel) and the Brazilian consumer watchdog council (Conselho Administrativo de Defesa Econômica) (Cade).

Translator: Allen Bennett