The Ministry has not improperly interfered with the operational activities of Finavia

The legal evaluation by the National Audit Office of Finland raises some views, on the basis of which the ownership steering of Finavia in autumn 2015 is regarded as problematic. The report does not claim that the activities were against the law but deals with the question of whether or not the actions of the owner have been improper in terms of good governance.

The Ministry of Transport and Communications stresses that the ownership steering of Finavia has not included any improper interference with the operational activities of the state-owned company. The Ministry has not required Finavia to bring or not to bring any legal proceedings or to give them up. The owner had a justified reason and was within its rights to issue instructions to the company in order to make sure that careful consideration was given to an exceptional matter.

- The experts and the Ministry seem to have a different understanding than the National Audit Office about the meaning of the active approach required of the state owner as set out in the governance guidelines. Therefore, the need to clarify the guidelines must be considered. If the company is a state-owned company with a special assignment, the importance of an active approach is emphasised, says Ms Anne Berner, Minister of Transport and Communications.

The decisions on the legal proceedings regarding the derivative contracts have been legally complex and difficult. This can be seen in, for example, the partially contradictory decisions and votes made at different times by the company's Board of Directors. The experts have also had different opinions on the matter. For example, the National Audit Office has not considered the importance of the fact that the Board of Directors had in March 2015 unanimously decided not to bring legal proceedings in a certain matter.

- The derivative issue was also dealt with in cooperation with the National Audit Office in autumn 2015. At that time the Audit Office took the view that there was some flexibility regarding the decisions on the legal proceedings. We trusted this expert opinion, Ms Berner says.

Concerning the exceptional derivative issue, the only instructions given by the owner to the Board of Directors of the company it owns in full was that careful preparation must be ensured. It is the Ministry's view that the owner is fully entitled to do that in accordance with the law and the governance guidelines.

The Ministry refers to an expert opinion by Mr Pekka Merilampi, attorney-at-law and senior judge specialising in ownership steering and legislation on limited companies. He states that issuing such instructions does not constitute any improper interference with the operational activities of the company.

The National Audit Office report questions whether the government ownership steering has enabled the best possible end result in the civil matter between the company and the finance auditors. The grounds for this view were not set out. On the contrary, it was stated that the National Audit Office will not take a stand on whether there were grounds for making a claim for compensation. The report does not take any view at all of, for example, the fact that in a matter that may last for several years the legal costs alone would be very high. If the company was not successful in the matter, it would have to reimburse the legal costs of the opposing party too.

- All in all, it is too early to assess which activities have been appropriate in the derivative contracts issue in terms of the state and the company, because the process is not yet completed. The recent decisions of the prosecutor, the police and the Financial Supervisory Authority provide the company's Board of Directors with adequate information to assess whether to bring civil proceedings against the former management and Board of Directors of the company. The decision must be made by the end of the year, Ms Berner says.

Appendices:

Ministry of Transport and Communications opinion on the legal evaluation of the National Audit Office concerning liabilities in the examination of the derivative contracts issue, 7 June 2016 (available in Finnish)

Report by Pekka Merilampi, senior judge, on the ownership steering of the Ministry of Transport and Communications in Finavia Corporation (available in Finnish) 24 May 2016

Inquiries:

Ms Anne Berner, Minister of Transport and Communications; interview requests: Ms Taina Pieski, Communications Director, tel: +358 50 535 1574