b. On September 23, 2012, the Ministry of Communications published a hearing with respect to roaming during a state of emergency or during a significant continuous malfunction in which the Ministry of Communications considers determining that under certain conditions, upon the Minister of Communications instruction, cellular operators, that have their own network infrastructure, will be required to provide roaming services to the subscribers of other cellular operators that have network infrastructure, whose network has been rendered non-functioning for a significant amount of time following an event resulting from a state of emergency, a telecommunications crisis or during a significant continuous malfunction. The Company submitted its response to the hearing on October 31, 2012.

c. On October 16, 2012, the Ministry of Communications published a hearing with respect to exemptions from erection and operation permits of Wireless Local Access Network (WLAN) access points that operate on frequencies set forth in the Wireless Telegraph Ordinance, according to which the Ministry of Communications is considering to determine the following:

i. To allow the installation of WLAN access points anywhere and to remove the existing limitation regarding installations in bordered surroundings only (for example: cafes, airports, malls etc.).

ii. To allow general and exclusive general licensees for the provision of domestic fixed-line services to offer its services through the use of WLAN technology and not to allow Mobile Network Operators (MNOs) licensees or Mobile Virtual Network Operators (MVNOs) to provide their services through the same technology.

iii. To determine that the erection and operation of the said access points shall be exempt from the need to obtain a permit.

Business Developments

1. New Agreement with Apple Distribution International

The Company has entered into a new agreement with Apple Distribution International for the purchase and resale of iPhone handsets and accessories in Israel (the "Agreement").

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