In April 2009 the EU Acquisition Directive (44/2007/EC), on the procedural rules and evaluation criteria for the prudential assessment of acquisitions and increase of holdings in the financial sector, was implemented in Finland through amendments to the Act on the Finnish Financial Supervisory Authority, the Act on Credit Institutions, the Act on Insurance Companies and several other acts regarding entities supervised by the Finnish Financial Supervisory Authority. According to the implementing legislation, a person intending to acquire, directly or indirectly, a qualifying holding in a Finnish credit institution, investment firm, insurance company, fund management company or its depository or an insurance or financial holding company (a so-called ‘supervised entity’) must notify the authority in advance. A similar notification must also be made if a holding in a supervised entity falls below a threshold constituting a qualified holding. A ‘qualified holding’ in respect of supervised entities may be defined as a holding of 10%, 20%, 30% (previously 33%) or 50% of either the voting rights or the total number of shares of the relevant supervised entity.
The implementing legislation also provides for detailed regulations on the assessment of the fitness and propriety of a person intending to acquire a qualifying holding in a supervised entity. When determining whether the criteria set forth for the acquisition are fulfilled, the authority will consider, among other things:
the reputation and financial soundness of the proposed acquirer;
whether the acquirer is able to comply with the regulations regarding the relevant regulated entity; and
whether there are reasonable grounds to suspect that the proposed acquisition is in some way connected with money laundering or the financing of terrorism.
The information that is to be contained in the notification submitted to the authority is further provided for by an administrative decree.
The procedural rules included in the Acquisition Directive are implemented in the Act on the Finnish Financial Supervisory Authority, according to which the authority must, within 60 days of filing the notification in respect of the intended acquisition, oppose the investment if it is probable that the investment will jeopardize prudent business principles of the supervised entity. Should the authority not oppose the acquisition within the set timeframe, it is deemed to have approved the acquisition.
The implementation of the Acquisition Directive has not led to major changes in the regulatory regime, but has rather provided for more detailed regulation in respect of certain aspects of acquisitions within the financial sector. Moreover, the Finnish Securities Market Act, which contains similar provisions on intended acquisitions in stock exchanges and clearing houses, was not affected by the implementing legislation and, therefore, such entities would appear to be subject to somewhat different rules.
For more information, please contact *#Mr. Lauri Peltola#* or *#Mr. Tom Fagernäs#*.