Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.  

(A free translation of the original in Portuguese)

01.01 – IDENTIFICATION

01.02 - HEAD OFFICE

01.03 - INVESTOR RELATIONS OFFICER (Company Mail Address)

01.04 - GENERAL INFORMATION/INDEPENDENT ACCOUNTANT

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(A free translation of the original in Portuguese)

01.01 – IDENTIFICATION

01.05 - CAPITAL COMPOSITION

01.06 – CHARACTERISTICS OF THE COMPANY

01.07 - COMPANIES EXCLUDED FROM THE CONSOLIDATED FINANCIAL STATEMENTS

01.08 - DIVIDENDS AND OR INTEREST ON CAPITAL APPROVED AND/OR PAID DURING AND AFTER THE QUARTER

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01.01 – IDENTIFICATION

01.09 - SUBSCRIBED CAPITAL AND CHANGES IN THE CURRENT YEAR

01.10 - INVESTOR RELATIONS OFFICER

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02.01 Parent Company Balance Sheet - Assets (in thousands of Reais)

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02.02 Parent Company Balance Sheet - Liabilities andshareholders’ equity (in thousands of Reais)

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03.01 Parent Company - Statements of operations (in thousands of Reais)

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03.01 Parent Company - Statements of operations (in thousands of Reais)

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08.01 CONSOLIDATED BALANCESHEET ASSETS (in thousands of Reais)

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08.01 CONSOLIDATED BALANCESHEET LIABILITIES (in thousands of Reais)

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09.01 CONSOLIDATED STATEMENTS OFINCOME(in thousands of Reais)

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09.01 CONSOLIDATED STATEMENTS OF INCOME (in thousands of Reais)

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10.01 CONSOLIDATED CASH FLOW STATEMENTS - INDIRECT METHOD (in thousands of Reais)

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10.01 CONSOLIDATED CASH FLOW STATEMENTS - INDIRECT METHOD (in thousands of Reais)

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05.01 CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITYFROM01/01/2010 a 03/31/2010 (in thousands of Reais)

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TIM PARTICIPAÇÕES S.A.

NOTES TO THE QUARTERLY INFORMATION
March 31, 2010
 (In thousands of Reais, unless otherwise stated)

1. Operations

TIM Participações S.A. (“TIM Participações” or the “Company”), is a publicly held company controlled by TIM Brasil Serviços e Participações S.A. (“TIM Brasil”) – a Telecom Itália Group company, which holds 77.14% of its voting capital and 66.27% of its total capital.

The Company's main operations comprise the control of companies operating telecommunication services, especially personal mobile and land line telephone services in its concession areas.

The Company fully owns the capital of TIM Celular S.A. (“TIM Celular”) and Intelig Telecomunicações Ltda. (“Intelig”). TIM Celular and Intelig operate as providers of Switched Fixed Telephone Service (locally STFC) of the following types: Local, Domestic Long Distance and International Long Distance in every Brazilian state. Additionally Tim Celular operates as a provider of Multimedia Communication Service (locally, SCM) and also as provider of Personal Mobile Service (locally SMP) in every Brazilian state.

The services provided by the subsidiaries are regulated by ANATEL - Brazilian Telecommunications Agency - in charge of regulating all Brazilian telecommunications. The authorization for operation of SMP STFC is valid for an indefinite period.

The authorizations for use of radio frequency granted to Tim Celular expire as follows:

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Despite the fact that the economic situation in Brazil remained stable in recent years, an increase in inflation indices and exchange rate variations could affect the Company’s operations. The variation of the Real (R$) against the U.S. dollar affects the individual and consolidated financial statements of the Company. The exchange rate of the Real to the U.S. dollar was R$1.7810: US$1.00 and R$1.7412: US$1.00 on March 31, 2010 and December 31, 2009, respectively. On these dates, U.S. dollar denominated loans represented 22.00% and 23.34% of the Company's total consolidated debt.

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2. Corporate restructuring

Acquisition of HOLDCO/Intelig

On April 16, 2009, at a meeting of the Board of Directors, the Company entered into a Merger Agreement with its controlling shareholder, TIM Brasil and JVCO Participações Ltda. (“JVCO”), with Docas Investimentos S.A. as intervening party, for the purpose of acquiring the indirect control of Intelig. This acquisition would occur through the merger into the Company of HOLDCO, a company controlled by JVCO, and which in turn, would control, following the conclusion of the merger, 100% of the share capital of Intelig.

ANATEL, by means of Act 4.634, of August 11, 2009, which was published in the federal official gazette, (DOU), on August 14, 2009, approved the aforementioned merger, granting, furthermore, a period of eighteen (18) months for the elimination of the geographic overlap of STFC held authorizations by TIM Celular and Intelig, due to the relationship of affiliation of the two companies resulting from the aforementioned merger.

At December 30, 2009, during the Special Shareholders Meeting, the shareholders of TIM Participações approved the merger of Holdco Participações Ltda., an entity that held 100% of the share capital of Intelig, into TIM Participações. As a result of this trasaction, the Company issued 127,288,023 shares (43,356,672 common shares and 83,931,352 preferred shares) with a book value of R$516,725, in the name of JVCO.

This transaction was recorded at the book value of the shareholders' equity of HOLDCO at November 30, 2009 in the amount of R$516,725, on which date the Company also began to consolidate the results of HOLDCO and its subsidiary, Intelig.

Thus, TIM Participações became the controlling shareholder of Intelig, a company which held specific authorizations to render private fixed communication services with operations in the whole country, operating predominantly in the market for local, long distance and international calls and data transmission. The balance of the shareholders equity of Intelig at November 30, 2009, when the Company became the sole controlling shareholder of Intelig, was R$517,128.

The merger of HOLDCO has strategic and operational relevance for the Company, and its primary purpose is to enhance and enlarge the supply of services, as well as optimize available resources through synergy gains across its operations, since the two entities hold complementary networks. Intelig has a strong network of fiber optics in the metropolitan areas of the largest cities of Brazil as well as its own extensive backbone. This combination of own infrastructure will make it possible to improve the competitive positioning of the Company, mainly in the corporate segment, and the provision of data transmission, which will also help the Company generate savings with the costs of rental of means and the acceleration of the 3G network development.

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3. Basis for preparation of quarterly information

a. Preparation and disclosure criteria

The quarterly information was prepared in accordance with the accounting practices adopted in Brazil (“BR GAAP”), based on the Brazilian Corporate Law and CVM standards and procedures, including the new provisions introduced, amended and revoked by Law 11,638, of December 28, 2007, and Law 11,941, of May 27, 2009, the standards applicable to public telecommunication service concessionaires/authorized companies, and the accounting pronouncements issued by the Comitê de Pronunciamentos Contábeis – CPC (Committee on Accounting Pronouncements) issued until December 31, 2008 (note 3b).

The Company still has American Depositary Receipts traded on the New York Stock Exchange-USA. Because of this, the Company is subject to the rules of the Securities and Exchange Commission ("SEC"). In order to meet its market needs, it is the Company's principle to disclose information prepared in accordance with BR GAAP in Reais in the two markets, in Portuguese and in English.

Assets and liabilities are classified as current when their realization or settlement is estimated to occur within the next twelve months. Otherwise, they are shown as noncurrent. Monetary assets and liabilities denominated in foreign currencies were converted into Reais at the exchange rate in effect at the balance sheet date. The translation differences were recognized in the statement of income.

b. Recent accounting pronouncements

Continuing the process of convergence towards international accounting standards, the Committee on Accounting Pronouncements issued, and the CVM approved during 2009, several accounting pronouncements aligned with the International Financial Reporting Standards (IFRS) issued by the IASB – the International Accounting Standards Board. These pronouncements will be adopted in 2010, however, they will be applied retroactively for purposes of comparison. In the preliminary evaluation of the Company, the following accounting pronouncements , interpretations and technical guidance may affect its financial statements, which effects are still pending quantification:

- CPC 15 – Business Combination, approved by CVM Resolution 580. Company management will observe in 2010 all the impacts resulting from the business combination involving the acquisition of Intelig. As of this date, it is not possible to estimate the impact, if any, this may have on the financial statements for 2010 and 2009.

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- CPC 20 –Borrowing Costs , approved by CVM Resolution No. 577. Company management understands that this pronouncement should not generate significant effects on the financial statements, considering that the Company has already been adopting the aforementioned practice, as mentioned in Note 19.

- CPC 26 - Presentation of the Financial Statements, approved by CVM Resolution No. 595. Company management understands that the adoption of the aforementioned pronouncement will not alter the balances of the financial statements, but only some items related to their presentation. The most significant change should be the preparation of the statement of income and other comprehensive income.

- CPC 27 –Property Plant and Equipment, approved by CVM Resolution No. 583 and Technical Interpretation ICPC 10, approved by CVM Resolution 619 on December 22, 2009. Company management will revise the estimated useful lives of its assets in 2010, but does not expect significant changes to the financial statements, considering that the estimated useful life adopted is that usually applied in the telecommunications industry.

- CPC 30 –Revenues, approved by CVM Resolution No. 597. Company management understands that the only material effect on the financial statements will be the presentation of net revenues.

- CPC 38 Financial Instruments: Recognition and Measurement, CPC 39 –Financial Instruments - Presentation and CPC 40 –Financial Instruments - Evidence, approved by CVM Resolution 604. Company management does not expect any significant effect on the financial statements, considering that it has already been adopting most of the aspects mentioned in these pronouncements, as shown in Note 35.

- Technical Interpretation (ICPC) 08, approved by CVM Resolution 601 on October 7, 2009, which deals with the accounting of the proposal for dividend payment. The effect of the adoption of the aforementioned ICPC will be the recognition of the amount of the minimum mandatory dividend, as stated in Note 25.

ICPC 09, approved by CVM Resolution 618 on December 22, 2009, for the purpose of clarifying matters related to the application of CPC 15, 18, 19, 35 and 36 on the preparation of the individual financial statements, separate statements, consolidated statements and on the application of the equity method, especially regarding the preparation of the consolidated financial statements.

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The early adoption of the aforementioned Pronouncements was made optional for companies based on CVM Resolution 626 issued by the Brazilian Securities Commission on March 31, 2010. The Company decided not to adopt these pronouncements in advance. These Pronouncements will be adopted by the Company at the end of 2010, for comparison with 2009. Due to such analyses still in course, the Company has not been able to estimate the possible impacts of such pronouncements and eventual effects on stockholders equity and the profit and loss of the Company.

c. Consolidated quarterly information

The consolidated quarterly information includes the consolidated assets, liabilities and the results of the Company and its subsidiaries, TIM Celular and Intelig, respectively, as follows:

The quarterly information for consolidated subsidiaries coincides with that of the parent company and the accounting policies were consistently applied in the consolidated companies in relation to the previous period.

The principal consolidation procedures are as follows:

I. Elimination of the balances of the asset and liability accounts between the consolidated companies; II. Elimination of investiment in the capital, reserves and retained earnings of the subsidiaries.

III. Elimination of the balance of revenues and expenses resulting from business transactions between the consolidated companies

The reconciliation of the differences between the results of the parent company and the consolidated companies in the period is shown as follows:

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d. Comparability of the Quarterly Information

The Company and its subsidiaries seek to continually improve the presentation of the quarterly information, while complying with generally accepted accounting principles. The adoption of new accounting practices and the application of the best accounting classifications, in accordance with the accounting practices adopted in Brazil, resulted in the reclassification of the balance of revenues from "Fines for termination of contracts" in the amount of R$23,827, previously classified under " other operating revenues," , which were reclassified to "gross operating revenues".

4. Summary of the main accounting practices

a. Cash and cash equivalents

All highly-liquid short term investments maturing in up to 90 days from the balance sheet date are considered as cash and cash equivalents.

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b. Financial investments

Financial investments maturing within more than three months from balance sheet date are recorded at fair value, as current and noncurrent assets, on the balance sheet date.

c. Financial Instruments

The financial instruments are only recognized from the date the Company and its subsidiaries become part of the financial instrument contracts. Upon being recognized, they are initially recorded at fair value plus the transaction costs directly attributable to acquisition. An exception occurs in the case of financial assets and liabilities stated at fair value through income, where such costs are directly charged to income for the year.

Subsequently they are measured at each balance sheet date, in accordance with the rules applicable to each classification of financial assets and liabilities.

c.1) Financial assets: the principal financial assets recognized by the Company and its subsidiaries are: cash and cash equivalents, short-term investments, unrealized gains from derivative transactions and trade receivables. The following assets are classified under the categories below, according to the purpose for which they were acquired or issued.

(i) Financial assets shown at fair value through income: this category includes financial assets held for trading, and those initially stated at fair value through Income. If their original purpose is short-term sale or repurchase, they are classified as items held for trading. Derivatives are also classified as held for trading. At each balance sheet date they are measured at their fair value; the interest, monetary restatement, exchange variation and variations arising from measurement at fair value are recognized in income as incurred, under financial revenues or expenses.

(ii) Loans and receivables: these are non-derivative instruments with fixed or determinable payments, though not quoted in an active market. Upon initial recognition, they are measured at the amortized cost, according to the effective interest rate method. The interest rate, monetary restatement and exchange variation less, where applicable, impairment, are recognized in income as incurred, under financial revenues or expenses.

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(iii) Investments held to maturity: these are non-derivative financial assets with fixed or determinable payments and defined maturity, which the Company and its subsidiaries have the positive intention and the capacity to hold until the maturity date. Upon initial recognition, they are measured at the amortized cost, according to the effective interest rate method. The interest rate, monetary restatement and exchange variation less, where applicable, impairment, are recognized in income as incurred, under financial revenues and expenses.

c.2) Financial liabilities: the main financial liabilities recognized by the Company and its subsidiaries are: trade payables, unrealized losses from derivative transactions and loans and financing. They are classified under the following categories, according to the nature of the contracted financial instruments:

(i) Financial liabilities measured at fair value through income: these are financial liabilities usually traded before maturity, liabilities usually measured at fair value through income upon initial recognition and derivatives. At each balance sheet date they are measured at their fair value. The interest rate, monetary restatement, exchange variation and variations arising valuation at fair value, where applicable, are recognized in income as incurred, as financial revenues and expenses.

(ii) Financial liabilities not measured at fair value: these are non-derivative financial liabilities not usually traded before maturity. Upon initial recognition they are measured at the amortized cost, according to the effective interest rate method. The interest rate, monetary restatement, exchange variation and variations arising from valuation at fair value, where applicable, are recognized to income as incurred, as financial revenues and expenses.

d. Accounts receivable

Accounts receivable from telecommunications service customers are calculated at the rate ruling on the date of service rendering, and also include credits for services rendered but not billed until the balance sheet date, receivables from network use and receivables from sales of cell phone sets and accessories.

e. Allowance for doubtful accounts

The allowance for doubtful accounts is shown as a reduction from accounts receivable and is recorded based on the customer portfolio profile, the aging of past due accounts, the economic scenario and the risks involved in each case. The allowance amount is considered sufficient to cover eventual losses on receivables.

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f. Inventories

Inventories are stated at the average acquisition cost. A provision is recognized to adjust the cost of phone sets and accessories to net realizable value.

g. Prepaid expenses

Prepaid expenses are shown at the amount actually disbursed and not yet incurred.

The Company offers subsidies in the sale of phone sets and mini modems for postpaid subscribers, and such subsidies are deferred and amortized for a minimum 12-month period. The exit penalties for clients who cancel their subscriptions or migrate to a prepaid system prior to the end of the contract are invariably greater than the subsidy granted on the sales of phone sets and mini modems.

h. Investments

The investments in subsidiaries are valued at the equity method.

i. Property, plant and equipment

Property, plant and equipment are shown at acquisition and/or construction cost, net of accumulated depreciation, which is calculated by the straight-line method over the useful life of assets involved. Any repair and maintenance costs incurred representing improvements, higher capacity or longer useful life are capitalized, whereas the others are charged to income.

Interest and other financial charges on financing taken for funding construction work in progress (assets and facilities in progress) are capitalized up to the startup date and depreciated over the useful life of the corresponding assets.

The estimated costs to be incurred on disassembly of towers and equipment at rented sites are capitalized and depreciated over the useful lives of these assets.

Company management examines possible impairment of property, plant and equipment whenever events or changes in circumstances indicate that the book value of an asset or group of assets may not be recovered, based on uncounted future cash flows. The examinations are conducted through the lowest assets group level to which management is capable of attributing future identifiable cash flows. The Company analyzes the net book value of the assets and adjusts it when the sum of the expected future cash flows is less than the net book value. These examinations did not identify the need to recognize any impairment loss.

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The estimated useful lives of all property, plant and equipment items are regularly reviewed to reflect technological advances.

j. Intangible assets

Intangible assets reflect: (i) the purchase of authorizations and radio frequency band licensing, shown at the acquisition cost; (ii) goodwill and (iii) software in use and/or under development.

The amortization expenses are calculated by the straight-line method over the useful life of assets, as follows: five years for radio frequency bands and software; fifteen years for authorizations. The goodwill was amortized until December 2008 according to the useful life of 10 years, with no amortization from 2009 on.

The estimated useful lives of intangible assets are regularly reviewed in order to reflect technological changes.

The goodwill on TIM Cellular was recorded based on the expected future profitability and is subject to periodical reviews concerning its recoverability.

k. Deferred charges

The deferred charges comprise pre-operating expenses and financial costs for maintenance of required working capital for subsidiaries in the pre-operating stage, which are amortized on a straight-line basis in ten years from the date the subsidiaries become operational.

l. Liabilities

These are recognized in the balance sheet when the Company has a legal obligation or one arising from past events, the settlement of which may probably require disbursement of economic resources. Some liabilities involve uncertainties concerning term and value, and are estimated as incurred and recorded by means of a provision. The provisions are recorded based on the best estimates of the related risks.

m. Income and social contribution taxes

The provision for income and social contribution taxes is calculated in accordance with the legislation in force at the balance sheet date. Income tax is calculated at 15% on taxable income, plus a 10% surtax on portions exceeding R$240 in a 12-month period. Social contribution tax is calculated at 9% on taxable income.

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Prepaid or offsettable amounts are shown as current or noncurrent assets, depending on the expected of realization.

The deferred income and social contribution taxes on accumulated tax losses and temporary differences are evaluated based on the expected taxable income generation in the future, and adjusted to the recovery value through a provision set up in accordance with CVM Instruction 371/02.

Pursuant to Constitutive Reports 0144/2003 and 0232/2003 issued by ADENE (Agency for Development of the Northeast) on March 31, 2003, TIM Celular became a beneficiary of a fiscal incentive consisting of: (i) 75% reduction of income tax and non-reimbursable additional taxes, for a 10-year period from 2002 through 2011, calculated based on the income from operation of its installed capacity for digital mobile cell telephone services; and (ii) 37.5%, 25% and 12.5% reduction of income tax and non-reimbursable additional taxes for the fiscal years 2003, 2004-2008 and 2009-2013, respectively, calculated based on the income from operation of its installed capacity for analogical mobile cell telephone services.

n. Provision for contingencies

This provision is set up based on the opinion of the Companies´ internal and external lawyers and management, in an amount deemed sufficient to cover probable losses and risks. Possible losses and risks are disclosed, while remote losses are not.

o. Asset retirement obligations

The Company records provisions for asset retirement obligations and estimated costs brought to present value, which will be incurred on disassembly of towers and equipment on rented sites. The counterpart of this provision is recognized as property, plant and equipment, and depreciation is calculated based on the useful lives of the corresponding assets.

p. Revenue recognition

Revenue from mobile telephone services basically includes monthly subscriptions, the use of minutes, roaming charges and long distance calls. Revenue from cell telephone services is recognized based on the minutes of use, net of credits and adjustments related to discounts granted on services. Billing are recognized monthly, and the unbilled revenues between the date of the billing and the end of the month are identified, processed and recognized in the month in which the services were rendered. Revenues from services in the pre-paid system are recognized when the services are rendered to clients. Revenues and expenses related to the sale of cell phone sets and accessories are recognized as these products are delivered to, and accepted by, consumers or distributors.

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q. Pension plans and other post-employment benefits

The Company and its subsidiaries record the adjustments connected with the employees’ pension plan obligations according to the rules established by IBRACON’s NPC 26, approved by CVM Resolution No. 371.

r. Transactions in foreign currency

Transactions in foreign currency are recognized at the exchange rate in force on the date of the transaction. Assets and liabilities in foreign currency are converted into Reais at the exchange rate in force on the date of the balance sheet, as disclosed by the Central Bank of Brasil. Exchange gains or losses are recognized in the statement income when they occur.

s. Employees profit-sharing

The Company and its subsidiaries monthly record a provision for employees´ profit-sharing, based on the relevant targets disclosed to its employees and approved by the Board of Directors. These amounts are recorded as personnel expenses and allocated to profit and loss accounts considering each employee’s cost center.

t. Earnings per share

These amounts are calculated based on the number of outstanding shares at the balance sheet date.

u. Use of estimates

Estimates are used for measuring and recognizing certain assets and liabilities in the Company’s Quarterly Information. In determining these estimates, the Company considered past experiences and current events, premises related to future events and other objective and subjective factors. Significant items subject to estimates include: the choice of useful lives of property plant and equipment, intangible assets, the provision for doubtful accounts, the provision for losses on inventory, the analysis of the realizable value of property plant and equipment and intangible assets, deferred income and social contribution taxes, the rates and time frame for determining the adjustment to present value of certain assets and liabilities, the provision for contingences and actuarial liabilities, the measurement of the fair value of financial instruments, the considerations regarding recognition and measurement of development costs capitalized as intangible assets and the estimate for the disclosure of the sensitivity analysis data for derivative financial instruments, in accordance with CVM Instruction No. 475/08.

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The settlement of transactions involving these estimates may result in amounts that significantly differ from those recorded in the quarterly information due to the inaccuracy inherent in their determination.

v. Adjustment to present value

In compliance with Law No. 11.638/07, the subsidiaries recognize that the assets and liabilities arising from long-term transactions and significant short-term transactions, if considered material to working capital and the quarterly information as a whole, are adjusted to present value. The present value discount is based on the basic interest rate prevailing in the Brazilian market (generally the Inter-bank Certificate of Deposit –(CDI).

5 Cash and Cash equivalents

6 Marketable securities

The average return on TIM Participações’ consolidated investments was 100.34% of the CDI variation.

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These investments are redeemable at any time, with no significant loss of recorded earnings, except in the case of long-term investments earmarked in connection with legal suits.

7 Trade accounts receivable

The changes in the allowance for doubtful accounts can be summarized as follows

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8 Inventories

9 Taxes and contributions recoverable

The parent company’s long-term portion basically refers to income and social contribution taxes recoverable, whereas the consolidated figure also includes ICMS on the subsidiaries´ acquisition of property, plant and equipment items.

The Company and TIM Celular have filed suits against the alleged unconstitutionality of Law 9.718/98 regarding the expansion of the basis for calculation of taxes addressed therein, and preventing collection of PIS and COFINS on revenues other than those arising from the Company’s sales. However, as they have not had a final favorable sentence, no PIS and COFINS credits have been recorded. According to Management, the chances of a favorable sentence to the Companies is probable. The amounts involved are respectively R$18,426 and R$42,830, monetarily adjusted.

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10 Deferred income and social contribution taxes

Below is the breakdown for deferred income and social contribution taxes:

According to CVM Instruction No. 371/02, Art 2, II, based on the expectation of future taxable income generation, as foreseen by a technical study approved by Management and reviewed by the fiscal council, TIM Celular recognized deferred tax assets on tax losses and temporary differences to which no statute of limitation applies.

Based on this technical study of future taxable income generation, TIM Celular expects to recover these deferred tax assets as follows:

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The estimates for deferred tax recovery were based on projections of taxable income, which in turn relied on financial and business forecasts made at the end of 2009. Given the uncertainties usually surrounding forecasts, these estimates may not be realized in the future.

Tax losses

The consolidated income tax and social contribution losses give rise to deferred tax assets which are recognized only if their prospects of realization are consistent, and they are not barred by statute of limitation. These deferred tax asstes credits can be summarized as follows:

11 Prepaid expenses

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12 Escrow Deposits

(*) In April 2008, Federal Law No. 11.652 was published related to the payment of the contribution for Development of the Public Radio Service to EBC (Empresa Brasil de Comunicação). It is the understanding of the company that this Law is unconstitutional since the contribution instituted lacks the necessary characteristics for the valid creation of any taxes in accordance with the Federal Constitution. An injunction was filed in court to protect the interests of TIM Celular and in March 2010 court deposits were made related to the contribution for 2010 in the amount of R$56,086. The writ of mandamus is awaiting a court decision at the lower court, and, in the opinion of the Company's internal and external legal counsel, the risk of loss is probable.

13 Other assets

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14 Investments

(a) Interest in subsidiaries

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(*) The special premium reserve recorded by TIM Celular represents the parent company's rights in future capitalizations. These tax benefits are connected with the goodwill paid in the privatization of Tele Celular Sul Participações S.A. (currently TIM Participações). This premium was recorded against the special premium reserve under "Shareholders' Equity". Based on the projected future income and the term of the concession, in the first two years amortization was at 4% per p.a., and the remainder was fully amortized in 2008.

The equity pickup for Intelig, in the negative amount of R$16,701, on December 31, 2009, represents the result of the subsidiary between December 1, 2009 and December 31, 2009.

(b) Changes in investments in subsidiaries:

15 Property, plant and equipment

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Construction work in progress basically refers to the construction of new transmission units (Base Transceiver Station or “ERB”) for network expansion.

In the quarter ended March 31, 2010, the subsidiaries capitalized property, plant and equipment in the amount of R$1,262 (R$2,145 at December 31, 2009), relating to financial charges on loans taken to finance the construction.

Operating technologies

The subsidiaries operate their service network using TDMA, GSM and 3G technologies. On March 31, 2010, no provision for loss on recovery of property, plant and equipment was deemed necessary. The assets related to TDMA technology are fully depreciated.

16 Intangible assets

The authorizations for SMP operation rights and radio frequency licensing, as well as software, goodwill and other items, can be shown as follows:

Acquisition of authorizations - 3G technology

In April 2008 TIM Celular signed the instruments of authorizations for use of Radio frequencies at the F, G, and I (1.9GHz/2.1GHz) radio-frequency sub-bands referring to the 3G (UMTS) standard and corresponding to all the Brazilian states, except the “Triângulo Mineiro” municipalities in the state of Minas Gerais. These authorizations are valid for 15 years and renewable for another equal period.

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As a consequence of this purchase, the subsidiaries assumed coverage commitments to be met using the acquired frequencies (1.9GHz/2.1GHz) in several municipalities, including 460 municipalities with less than 30,000 inhabitants.

17 Deferred charges

18 Suppliers – Trade payable

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(a) This refers to the use of the networks of other fixed and mobile cell telephone operators, with calls being initiated from TIM network and ending in the network of other operators.

(b) This refers to calls made by customers outside their registration area, who are therefore considered visitors in the other network.

(c) This refers to calls made by a customer who chosses another long-distance operator.

19 Loans and financing

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The syndicated loan taken out by the subsidiary TIM Celular contains restrictive contractual clauses under which that company has to comply with certain financial indices that are calculated on a half-yearly basis. The following financial institutions are party to this loan agreement: HSBC Bank Brasil S.A. – Banco Múltiplo, Banco BNP Paribas Brasil S.A., Banco Bradesco S.A., Banco do Brasil S.A., Banco Itaú BBA S.A., Banco Santander Brasil S.A., Banco Société Générale Brasil S.A. and Banco Votorantim S.A.

The foreign currency loan that was taken out with Banco BNP Paribas, with a guarantee provided by the SACE group and CCB (Bank Credit Schedules) for Working Capital contracted with Banco ABN AMRO Real S.A., which is now called Banco Santander Brasil S.A., has fundamentally the same restrictive clauses as the syndicated loan regarding the financial indices. The subsidiary company TIM Celular is in compliance with all the required financial indices.

The loan that TIM Celular S.A. has taken out from the BNDES (Brazilian National Bank for Economic and Social Development), for the purpose of expanding the mobile telephone network, also has restrictive clauses under which the company has to comply with certain financial indices that are calculated on a half-yearly basis. The subsidiary has been complying with all the required financial indices.

The Company’s subsidiaries entered into swap transactions as a hedge against any devaluation of the Brazilian currency (“Real”) vis-à-vis foreign currencies and changes in the fair value of their loans that were pegged to fixed interest rates and the TJLP (Long-Term interest Rate).

The long-term portions of loans and financing as at March 31, 2010 mature as follows:

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