SSA.L Regulatory News (SSA)

FOR IMMEDIATE RELEASE

Sistema announces list of candidates for Board of Directors

Moscow, Russia - May 23, 2016 - Sistema JSFC ("Sistema" or "the Company") (LSE: SSA, MOEX: AFKS), a publicly-traded diversified holding company operating primarily in Russia and the CIS, announces the resolutions adopted at a meeting of the Board of Directors of JSFC Sistema that took place on May 21, 2016.

The Board of Directors approved the list of 11 candidates for election to the new Board of Directors of JSFC Sistema at the Annual General Meeting of shareholders (AGM) of JSFC Sistema to be held on June 25, 2016. Six of the 11 candidates fulfil the criteria for independent directors as set out in the Federal Law on Joint-Stock Companies, and by Moscow Exchange and the Russian Corporate Governance Code.

The list of candidates for the Board of Directors of JSFC Sistema comprises:

1) Vladimir Evtushenkov

2) Sergei Boev

3) Andrey Dubovskov

4) Felix Evtushenkov

5) Patrick Clanwilliam (independent director)

6) Robert Kocharyan (independent director)

7) Jeannot Krecké (independent director)

8) Peter Mandelson (independent director)

9) Roger Munnings (independent director)

10) Mikhail Shamolin

11) David Yakobashvili (independent director)

The Board of Directors also elected Artem Zasursky, Vice President and Head of Strategy of JSFC Sistema, to the Company's Management Board.

Biography

Artem Zasursky has worked in the JSFC Sistema Group of Companies since 2011. He has served as development director of Stream LLC, vice president for development of SMM LLC and CEO of Stream LLC. From 2007 to 2011 he was CEO of LLC Dragonara, from 2005 to 2006 served as acting director of LLC Territoriya Igr, and from 20023 to 2003 was head of developments at Crossmedia Solutions. He is a graduate of Moscow State University in social and economic geography.

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Sistema is a publicly-traded diversified holding company in Russia and the CIS, which is a major shareholder of companies serving over 100 million customers in the sectors of telecommunications, high technology, radars and aerospace, banking, retail, mass-media, tourism and healthcare services. Founded in 1993, the Company reported revenues of RUB 708.6 billion for 2015, and total assets of RUB 1.3 trillion as at December 31, 2015. Sistema's global depositary receipts are listed under the symbol "SSA" on the London Stock Exchange. Sistema's ordinary shares are listed under the symbol "AFKS" on the Moscow Exchange. Website: www.sistema.com

Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of Sistema. You can identify forward looking statements by terms such as "expect," "believe," "anticipate," "estimate," "intend," "will," "could," "may" or "might", the negative of such terms or other similar expressions. We wish to caution you that these statements are only predictions and that actual events or results may differ materially. In addition, there is no assurance that the new contracts referenced above will be completed on the terms contained therein or at all. We do not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, general economic conditions, our competitive environment, risks associated with operating in Russia, rapid technological and market change in our industries, as well as many other risks specifically related to Sistema and its operations.