ANNOUNCEMENT 01 Jun 2012In June 2012, the government of Finland announced changed rules for foreign investors.
NUMBER OF INTERVENTIONS
Ministry of Employment and the Economy, 'Monitoring of Foreign Corporate Acquisition', including links to the current Act: http://www.tem.fi/index.phtml?l=en&s=4969
Repealed Act no. 1612/1992: http://www.finlex.fi/en/laki/kaannokset/1992/en19921612.pdf
On October 4, 2012, the Finnish Ministry of Employment and the Economy issued a press release explaining the new Act on the Monitoring of Foreign Corporate Acquisitions in Finland (no. 172/2012). Any foreign party wishing to acquire a 10 per cent or larger ownership in a so-called 'monitored entity' based in Finland is no longer obliged to register at the Ministry, except for stakes in defence sector firms. In organisations / firms that 'are considered critical in terms of securing functions fundamental to society on the basis of their field, business, or commitments' (Press Release), registration has become optional.
The application - although free of formal requirements - must be submitted in Finnish or in Swedish, but appendices to the application in English are accepted. The Ministry will accept the application except when it has potential for conflict with a key national interest (sic).
Foreigners from EU and EFTA countries are generally exempt from the provisions of the Act - i.e., no registration is required for them - unless a third-country foreigner holds a 10 per cent or larger stake in the entity wishing to acquire the stake in the Finnish firm or organisation.
Under the previously applicable law (Act no. 1612/1992), the term 'monitored entity' was defined in a much broader way, including for instance all companies with more than 1,000 persons on the payroll or with a turnover of more than one billion Finnish Markka. Furthermore, it did not exempt EU/EFTA foreigners in the way the new Act does. Registration was mandatory for all acquisitions of more than one-third of the voting power.
Sectors and trading partners affected
For this measure, data on foreign ownership as issued by the Finnish national statistics bureau (Statistics Finland) was used, identifying the top five sectors by turnover for 2011. These were defined as:
Likewise, the affected trading partners were identified as those countries that appear in the Statistics Finland database under their own heading rather than as 'other'.