Regulatory Approvals GVT

RAMIRO SÁNCHEZ DE LERÍN GARCÍA-OVIES

Secretario General y

del Consejo de Administración

TELEFÓNICA, S.A.

TELEFÓNICA, S.A. as provided in article 82 of the Spanish Securities Market Act (Ley del Mercado de Valores), hereby reports the following

SIGNIFICANT EVENT

Regarding the acquisition by Telefonica Brasil, S.A. of Global Village Telecom, S.A. and its holding company GVT Participações, S.A. (collectively "GVT"), it is reported that on March 25, 2015, the Administrative Council for Economic Defense of Brazil (CADE), has granted its authorization in connection with competition matters in Brazil.

It also reported that on December 22, 2014 and March 12, 2015, the National Telecommunications Agency of Brazil (ANATEL) granted the corresponding authorization in telecommunications matters in Brazil.

Madrid, March 26, 2015.