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Nevertheless, trade payables maturing within less than one year with no contractual interest rate, as well as called-up payments on shares the amount of which is expected in the short term are carried at nominal value, both in the initial recognition and in the subsequent recognition, when the efect of not discounting cash fows is not signifcant.

a.2) Financial liabilities held for trading:

A fnancial liability is considered to be held for trading when:

a) It is issued primarily for the purpose of being repurchased in the short term.

b) It forms part of a portfolio of identifed fnancial instruments that are managed together and for which there is evidence of a recent pattern of short-term proft taking, or

c) It is a derivative fnancial instrument, providing that is not a fnancial guarantee contract and has not been designated as a hedging instrument.

Financial liabilities are initially measured at fair value, which, unless there is evidence to the contrary, is equivalent to the fair value of the consideration received. Directly attributable transaction costs are directly recognized in the income statement.

After initial recognition, these assets are measured at fair value including any transaction costs relating to their sale. Changes to fair value are recognized in the income statement for the year. The Company maintained no investments of this type at year-end 2010 and 2009.

a.3) Other fnancial liabilities at fair value through proft or loss

This category includes hybrid fnancial instruments, when it is not possible to separately measure the value of the embedded derivative or to reliably determine its fair value, either at the time of acquisition or at a subsequent date, or, when so elected, at the time of initial recognition, because the fnancial instrument has been measured at fair value.

This category also includes all fnancial liabilities that the Company has designated, at the time of initial recognition, for inclusion. This designation is only made when it results in more relevant information, because:

a) It eliminates or signifcantly reduces inconsistencies in recognition or valuation that otherwise would exist due to the measurement of assets or liabilities or due to the recognition of losses or gains thereon by applying diferent criteria.

b) A group of fnancial liabilities or fnancial assets and liabilities is managed and the return thereon is evaluated on the basis of its fair value, according to a documented investment or risk-management strategy, and, in addition, information regarding the Group is provided on a fair-value basis to the key management personnel.

After initial recognition, these assets are stated at fair value including any transaction costs relating to their sale. Changes to fair value are recognized in the income statement for the year. The Company maintained no investments of this type at year-end 2010 and 2009.

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GESTEVISION TELECINCO, S.A.