Embratel Participações S.A. is one of the New Holding Companies formed on May 22, 1998 as part of the Breakup of Telebrás. Embratel was founded in 1965 to provide domestic and international long-distance telephone service and was the only provider of such services in Brazil until January 23, 2000. Our business consists principally of providing domestic long-distance, Internet, data and international communication services in Brazil to businesses and consumers. Our service products include high-speed data transmission, Internet, frame relay, satellite and packet-switched data communication, 800 service and switched and dedicated long-distance service.

We operate under a domestic long-distance concession and an international concession, known as the Concession, granted by Anatel on May 26, 1998. Our Concession has been granted under the public regime. For a description of the public regime, see "Concessions and Authorizations". Together with the three regional fixed-line companies, we are one of four companies in Brazil operating under public regime concessions. Under the public regime, we are required to perform certain obligations, including principally obligations concerning the continuous provision of service throughout the country, referred to in this annual report as universal service, quality of service, and network expansion and modernization. If certain of these obligations are not met, Anatel has the power to impose penalties including revocation of our Concession. See "- B. Business Overview - Regulation of the Brazilian Telecommunications Industry - Regulatory Agency - Anatel".

Our network consists of the largest long distance telecommunications network in Latin America providing both national and international connections to thousands of businesses. The network connects all of the regional fixed-line and cellular operators throughout Brazil. It is the main provider of high-speed data transmission and Internet in Brazil, with the largest network of broadband fiber optic transmission systems. The domestic long-distance and international transmission facilities extend to all 26 states of Brazil and the Federal District. In 2000, our network carried 19,342.6 million minutes of domestic long-distance traffic and 1,775.5 million minutes of international long-distance traffic. Of the 1,775.5 million minutes of international traffic, 1,132.4 million minutes were incoming international calls and 643.1 million minutes were outgoing international calls. Compared with 1999, our incoming international traffic increased by 35.1% and outgoing international traffic increased by 8.8% in 2000.

Following the privatization, the competitive environment in which we operate changed. We now face new competitors and are authorized to offer certain services, which were prohibited from providing before. Following the privatization, Anatel issued two new licenses to a single new entrant for the provision of interregional long-distance and international long-distance service in competition with us. In addition, Anatel authorized us to compete with the three regional fixed-line companies in the provision of full intra-regional long-distance service within their regions, including the provision of certain services that had exclusively been provided by the fixed-line companies. See "- B. Business Overview - Competition" and "- B. Business Overview - Regulation of the Brazilian Telecommunications Industry - Regulatory Agency - Anatel".

Our headquarters are located at Rua Regente Feijó, 166, Sala 1687-B, Rio de Janeiro, RJ, 20060-060, Brazil and our telephone number is 55-21-519-8182.