Tilts, which is owned by the Finnish company Sonera, sued the Latvian government over the decision to deregulate the fixed-line market by 2003, 10 years earlier than was agreed when Tilts bought a 49 percent share in the state owned Lattelekom in 1994.
"I can publicly say that the Latvian state will not pay any compensation to Tilts and that the company will have to pay for any additional shares in Lattelekom it may be offered," Kalvitis told the newspaper Lauku Avize on Feb. 23. "The settlement suggests other arrangements, not compensation in money."
Tilts is claiming $400 million in damages from the government, which broke the agreement to satisfy the World Trade Organization and European Union communications laws.
Latvia countersued, claiming that Tilts did not fulfill promises to invest in the modernization of Lattelekom systems as it agreed to do in the 1994 contract.
The Latvian government has spent an estimated $6 million in legal fees on the case, according to local media reports.
The local press speculated that a settlement might include the sale of an additional 5 percent stake in the company to Sonera, which would give it a controlling share.
Kalvitis did not say when the settlement would be announced.
Opposition parties are calling for an emergency session of Parliament to lift the confidentiality order that has kept discussion of a possible settlement behind closed doors.
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