Annual Review & Notice of Meeting 2007

The 2007 Annual General Meeting of BT Group plc will be held at The Sage Gateshead, St Mary’s Square, Gateshead Quays, Gateshead NE8 2JR, at 10.30 am on Thursday 19 July 2007 to consider the following:

ORDINARY BUSINESS
Resolution 1
That the accounts and reports of the directors and the auditors for the year ended 31 March 2007 be received.
Legislation requires the directors to present to the meeting these accounts and reports contained in the Company’s Annual Report.

Resolution 2
That the directors’ remuneration report for the year ended 31 March 2007 be approved.
The directors have to ask shareholders to vote on this report on directors’ remuneration. It is summarised on the 'Summary report of directors' renumeration' section of this document. The full report, in the Annual Report, is on the Company’s website at www.bt.com/annualreport or is sent to shareholders if requested.

Resolution 3
That the final dividend of 10 pence per share recommended by the directors be declared payable on 17 September 2007 to holders of ordinary shares registered at the close of business on 24 August 2007.
The final dividend declared cannot exceed the amount recommended by the directors.

Resolutions 4-7: re-election of directors
Under the Company’s articles of association (‘articles’), in compliance with the Combined Code on Corporate Governance, all directors have to retire every three years at an Annual General Meeting. As a result, four directors must retire at this year’s Annual General Meeting and are proposed by the Board for re-election.

Resolution 4
That Sir Christopher Bland be re-elected as a director.
Sir Christopher Bland was appointed to the Board of British Telecommunications plc as Chairman on 1 May 2001. He became Chairman of the Company at the time of the demerger of O2 in November 2001. He chairs the Nominating and Community Support committees and is a member of the Pension Scheme Performance Review Group.
     He was chairman of the BBC Board of Governors from 1 April 1996 until 30 September 2001. From 1972 to 1979, Sir Christopher was deputy chairman of the Independent Broadcasting Authority and chairman of its Complaints Review Board. In 1982, he became a non-executive director of LWT Holdings and was chairman from 1983 to 1994, when LWT was acquired by Granada Group. From December 1994 to May 2000, he was chairman of NFC. From 1977 to 1985, he was chairman of Sir Joseph Causton & Sons.
     Sir Christopher, who was chairman of the Hammersmith and Queen Charlotte’s Hospitals Special Health Authority from 1982 to 1994 and of Hammersmith Hospital’s NHS Trust from 1994 to February 1997, was knighted for his work in the NHS in 1993. He was chairman of the Private Finance Panel from 1995 to 1996 and a member of the Prime Minister’s Advisory Panel on the Citizen’s Charter. He is senior advisor at Warburg Pincus and chairman of the Royal Shakespeare Company. Aged 68.

Resolution 5
That Andy Green be re-elected as a director.
Andy Green was appointed to the Board on 19 November 2001. He is a member of the Operating Committee. In October 2001 Andy was appointed as Chief Executive of BT Global Services, BT’s managed services and solutions provider, serving multi-site organisations worldwide. On 24 April 2007, he was appointed Chief Executive, Group Strategy and Operations. Since joining the Company in 1986, he has held a number of positions, including Chief Executive of BT Openworld and Group Director of Strategy and Development. Andy was a member of the former Executive Committee from February 1995. He is a board member of e-skills UK and ABESU, a charity with the objective of ‘making poverty history’, and a non-executive director of NAVTEQ Corporation (a US corporation). Aged 51.

Resolution 6
That Ian Livingston be re-elected as a director.
Ian Livingston was appointed Group Finance Director in April 2002 and became Chief Executive of BT Retail in February 2005. He is a member of the Operating Committee. Before joining the Company he was group finance director of Dixons Group, a position he held from 1997. He joined Dixons in 1991 after working for 3i Group and Bank of America International. His experience at Dixons spanned a number of operational and financial roles, both in the UK and overseas. He was also a non-executive director of Ladbrokes (formerly Hilton Group) and a director of Freeserve from its inception. Ian is a Chartered Accountant. Aged 42.

Resolution 7
That John Nelson be re-elected as a director.
John Nelson was appointed to the Board on 14 January 2002. He is a member of the Audit and Nominating committees and the Pension Scheme Performance Review Group. A Chartered Accountant, he retired as chairman of Credit Suisse First Boston Europe (CSFB) on 31 January 2002. He was a member of the executive board and chairman of the European executive committee of CSFB.
     Prior to joining CSFB in January 1999, John spent 13 years with Lazard Brothers. He was appointed vice chairman of Lazard Brothers in 1990. He was also chairman of Lazard S.p.A. in Italy and a managing director of Lazard Freres, New York. He is chairman of Hammerson, deputy chairman of Kingfisher, a member of the Board of English National Opera and a senior advisor to Charterhouse Capital Partners. Aged 59.

Resolutions 8-9: election of directors
The articles require any director appointed by the Board to retire at the Annual General Meeting following appointment.

Resolution 8
That Deborah Lathen be elected as a director.
Deborah Lathen was appointed to the Board on 1 February 2007. She is a member of the Remuneration Committee. She is a US attorney and is president of Lathen Consulting, which provides strategic, legal and management advice and counsel to senior executives of major US companies on policy and regulatory matters.
     Deborah was formerly chief of the Cable Services Bureau at the Federal Communications Commission from 1998 to 2001. She was responsible for policy and regulation covering the cable, satellite TV and broadcast industries.
     She was previously director of national consumer affairs and managing counsel at Nissan Motor Corporation USA, and prior to that, held legal positions at TRW Financial Systems and at the Quaker Oats Company.
     A US national, she is aged 54.

Resolution 9
That François Barrault be elected as a director.
François Barrault was appointed to the Board and became Chief Executive of BT Global Services on 24 April 2007. He is a member of the Operating Committee. He joined BT in April 2004 as President BT International, BT Global Services. François was formerly president, Lucent Technologies Inc and held other roles within Lucent including president and CEO Mobility International, and president and CEOEMEA (Europe, Middle East and Africa). Before this, François worked for Ascend Communications, where he held the position of senior vice president, EMEA and International until its acquisition by Lucent. He previously held executive positions with IBM, Computervision/ Prime and Stratus. He is a non-executive director of eServGlobal (an Australian corporation).
     A French national, he is aged 46.

Resolution 10
That PricewaterhouseCoopers LLP be reappointed auditors of the Company, to hold office until the conclusion of the next general meeting at which accounts are laid before the Company.
The resolution proposes the reappointment of PricewaterhouseCoopers LLP as the Company’s auditors.

Resolution 11
That the directors be authorised to decide the auditors’ remuneration.
This resolution follows standard practice. If passed, the directors will decide how much the auditors should be paid.

SPECIAL BUSINESS

The following resolution will be proposed as an ordinary resolution.

Resolution 12
That the authority and power conferred on the directors in relation to the Section 80 Amount by Article 74 of the Company’s articles of association be renewed until 18 October 2008 and for that period the Section 80 Amount shall be £136 million.
The articles give a general authority to the directors to allot unissued shares, which is subject to renewal by shareholders.
     The directors will be able to issue new shares up to a nominal value of £136 million (the Section 80 Amount), which is equal to approximately 33% of the issued share capital (excluding treasury shares) of the Company as at the date of this Notice.
     See the notes to Resolution 14 for more information on treasury shares.

The following three resolutions will be proposed as special resolutions.

Resolution 13
That the authority and power conferred on the directors by Article 74 of the Company’s articles of association be: