•  the timing and distribution of dividends;  •  the election of a majority of our directors and supervisors; and  •  our business activities and direction.  We cannot assure you that our largest shareholder will not take actions that impair our ability to conduct our  business competitively or conflict with the best interests of our public stockholders.  According to some published reports, the electromagnetic signals from mobile handsets and cellular base  stations may pose health risks or interfere with the operation of electronic equipment. Although the findings  of those reports are disputed, actual or perceived risks of using mobile communications devices or of cellular  base stations could have a material adverse effect on mobile service providers, including us. For example,  our customer base could be reduced, our customers may reduce their usage of our mobile services, we could  encounter difficulties in obtaining sites for additional cellular base stations required to expand our network  coverage or we may be requested to reduce the number of existing cellular base stations. As a result, our mobile  services business may generate less revenues and our financial condition and results of operations may be  materially and adversely affected. In addition, we could be exposed to potential liability for any health problems  caused by mobile handsets and base stations.  We are from time to time involved in litigation, arbitration or administrative proceedings in the ordinary  course of our business. See “Item 4. Information on the Company—B. Business Overview—Legal Proceedings.”  We cannot predict the outcome of these proceedings, and we cannot assure you that if a judgment is rendered  against us in any or all of these proceedings, our financial condition and results of operations would not be  materially and adversely affected.  We are subject to the reporting requirements of the SEC. The SEC, as directed by Section 404 of the U.S.  Sarbanes-Oxley Act of 2002, adopted rules requiring U.S. public companies to include a report of management  on our internal control over financial reporting in their annual reports that contain an assessment by management  of the effectiveness of our internal control over financial reporting. The effectiveness of internal control over  financial reporting has been audited by Deloitte & Touche, an independent registered public accounting firm, who  has also audited our consolidated financial statements for the year ended December 31, 2010. Deloitte & Touche  has issued an attestation report on the effectiveness of our internal control over financial reporting in accordance  with the standards of the Public Company Accounting Oversight Board (United States). See “Item 15. Controls  and Procedures—Attestation Report of the Registered Public Accounting Firm.”  While the management report included in this annual report concluded that our internal control over  financial reporting was effective, we cannot assure you that our management will be able to conclude that our  internal control over financial reporting is effective in future years. If in future years we fail to maintain effective  internal control over financial reporting in accordance with the Sarbanes-Oxley Act, we could suffer a loss of  investor confidence in the reliability of our consolidated financial statements, which in turn could negatively  impact the trading price of our ADSs, result in lawsuits being filed against us by our stockholders or otherwise  harm our reputation.  11 Investor confidence in us may be adversely impacted if we or our independent registered public accountants are  unable to attest to or express an unqualified opinion on the effectiveness of our internal control over financial  reporting.  We are subject to litigation that could expose us to substantial liabilities.  Actual or perceived health risks related to mobile handsets and base stations could lead to decreased mobile  service usage and difficulties in increasing network coverage and could expose us to potential liability.  PART I