TEE: TeliaSonera AB: Statement by the Board in respect of the External
Review of TeliaSonera's investments in Uzbekistan
UK Regulatory Announcement
In September last year, serious allegations were directed at TeliaSonera in
relation to the company's investments in Uzbekistan. The law firm Mannheimer
Swartling was assigned to get to the bottom of facts and make an outside
assessment of these allegations. This review has now been finalized and has
not found substance to the allegations that TeliaSonera has been involved in
bribery or money laundering.
On October 3, 2012, the Board of Directors of TeliaSonera assigned the law
firm Mannheimer Swartling, led by its Chairman Biörn Riese, to investigate
whether TeliaSonera's investment in a 3G license, frequencies and number
blocks in Uzbekistan in 2007 involved corruption or money laundering. Later,
the investigation was expanded to include more recent investments in
connection with TeliaSonera's operations in Uzbekistan.
Following the report presented by Biörn Riese on Friday February 1, 2013, the
Board has issued the following statement.
The Board concludes that Mannheimer Swartling has not found any substance to
the allegations that TeliaSonera committed bribery or participated in money
laundering in connection with its investments in Uzbekistan. Mannheimer
Swartling also makes the natural observation that the suspicions of crime
expressed by the Swedish Prosecution Authority cannot be dismissed by this
investigation. Mannheimer Swartling also acknowledges that business ethics, as
well as OECD and UN regulations and national legislation, have been
strengthened significantly in recent years.
Mannheimer Swartling directs serious criticism at TeliaSonera for shortcomings
in the investment process and concludes that not enough effort was made to
investigate neither the local partner in Uzbekistan, nor how the local partner
could hold the rights which were later transferred. Mannheimer Swartling says
that the internal controls were not sufficient to ensure that it did not risk
becoming involved in any unethical business, and that thereby the company’s
internal ethical guidelines were not followed completely.
The Board's conclusion is that the investments were not carried out in a
satisfactory manner. Overall, the internal information and control at
different levels (owners, directors, management and line management) was not
sufficient to pick up warning signs that there were ethical risks. In
hindsight, it is evident that a more stringent investigation of the
counterparties should have been conducted. One consequence of this was that
subsequent investments were also not subjected to proper examination. The
Board concurs with and shares Mannheimer Swartling’s criticism.
The Board would, at the same time, like to emphasize that behind TeliaSonera
investments there was a broad consensus among major shareholders and the Board
of directors for expansion into Eurasia. This business has contributed
significantly to the Group's growth and profitability, and foreign investment
in infrastructure has been an important element in modernizing countries
following the collapse of the Soviet Union.
When Sweden’s Telia and Finland’s Sonera merged in 2002, the newly formed
group had a total of 20 million customers, primarily in Sweden and Finland.
Today, TeliaSonera has over 70 million customers in majority-owned operations
in 15 countries and sales have almost doubled from SEK 59bn to the current SEK
When considering TeliaSonera's conduct and its consequences, it cannot be
ignored that many key people in the company were changed during 2007, both in
the business area and at the Board and executive management level. This may
have contributed to a loss of information and that there was lacking
The Board and management now want to increase its efforts in developing
principles and processes that respect human rights and protect the company
from corruption. We will continue to develop our action plan initiated in
April last year, where human rights are at the core. We have also started to
work with Transparency International Sweden as advisors, with the goal of
ensuring that our anti-corruption efforts attain high standards and stand up
to a stringent international comparison.
We have developed new processes and stringent risk assessment procedures for
future investments. For example, sustainability risks have been incorporated
in the assessment, counterparty risk and valuation data is analyzed both by us
and qualified independent experts, to name just a few areas.
Sweden exports more than half its GDP. As a country we are entirely dependent
on exports to the world's countries, the majority of which are characterized
by non-democratic systems and widespread corruption.
The Board believes that few tools are better for transparency and democracy
than mobile telecommunications, which enable people to communicate with each
other and the outside world. TeliaSonera has millions of customers in Eurasia
and we are very proud of the developments the management and thousands of
employees have achieved over the years. The Board is committed to the strategy
of being a leading telecom operator in the Nordic, Baltic as well as Eurasian
markets and takes full responsibility for the company’s investments. The Board
will work to ensure that TeliaSonera will become a model for managing the
risks associated with our operations. We therefore welcome a dialogue with
owners and organizations on how our sustainability work can be further
TeliaSonera AB discloses the information provided herein pursuant to the
Swedish Securities Markets Act and/or the Swedish Financial Instrument Trading
Act. The information was submitted for publication at 10.10 CET on 01.02 2013.
For more information, please contact the TeliaSonera press office +46 771 77
58 30, firstname.lastname@example.org, visit our Newsroom
(http://www.teliasonera.com/en/newsroom/) or follow us on Twitter @TLSN_Media
Forward-Looking Statements Statements made in the press release relating to
future status or circumstances, including future performance and other trend
projections are forward-looking statements. By their nature, forward-looking
statements involve risk and uncertainty because they relate to events and
depend on circumstances that will occur in the future. There can be no
assurance that actual results will not differ materially from those expressed
or implied by these forward-looking statements due to many factors, many of
which are outside the control of TeliaSonera.
TeliaSonera provides network access and telecommunication services in the
Nordic and Baltic countries, the emerging markets of Eurasia, including Russia
and Turkey, and in Spain. TeliaSonera helps people and companies communicate
in an easy, efficient and environmentally friendly way. Our ambition is to be
number one or two in all our markets, providing the best customer experience,
high quality networks and cost efficient operations. TeliaSonera is also the
leading European wholesale provider with a wholly-owned international carrier
network. In 2012, net sales amounted to SEK 105 billion, EBITDA to SEK 36.1
billion and earnings per share to SEK 4.59. The TeliaSonera share is listed on
NASDAQ OMX Stockholm and NASDAQ OMX Helsinki. Read more at
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