DISCIPLINARY BOARD
24 April 2002
caution to Kyro corporation and Alfred Berg Finland Oyj Abp ON NEGLECTING the rules on acquisition of own shares
The Disciplinary Board of Helsinki Exchanges has issued a caution to Kyro Corporation on neglecting the rules on acquisition of own shares and ordered the company to pay a disciplinary charge of EUR 50.000. The Disciplinary Board has also issued a caution to the Stock Exchange Trading Member (“Member”) Alfred Berg Finland Oyj Abp, which took care of the acquisition, and ordered the Member to pay a disciplinary charge of EUR 20.000.
The Disciplinary Board has reviewed the acquisitions of own shares conducted by Kyro Corporation on October 22 and 23, 2001. On behalf of Kyro Corporation, Alfred Berg Finland Oyj Abp acquired on the 23th of October 2001, on one trade, shares that account for 3,3 per cent of total shares of the company. The Disciplinary Board considered that Kyro Corporation breached the rules on safeguarding the equality of shareholders by acquiring the shares from a specific shareholder.
The Disciplinary Board considered that Kyro Corporation breached following regulation:
- Kyro Corporation has, in breach of the Stock Exchange Rules A3.123, acquired on the 23th October 2001 own shares from a specific shareholder.
- By acquiring its own shares Kyro Corporation has attempted to influence the ownership structure of the company and therefore neglected the Stock Exchange Rule A3.123 and the Guideline complementing it, which oblige to take shareholder equality into consideration when acquiring shares.
- The acquisitions of Kyro Corporation’s own shares resulted into exceptional market movements due to the purpose, size and method of implementation. Kyro Corporation therefore neglected the Rules 3.1.1. and 3.1.2. of the Guideline complementing the Exchange Rule A3.123.
- Kyro Corporation also jeopardised the equal treatment of the shareholders by neglecting to implement the acquisition during a sufficiently long period, as required in the Rule 3.1.2 of the Guideline, at a minimum of one trading day.
Alfred Berg Finland Oyj Abp carried out the acquisitions and has therefore breached the Regulation on its own behalf. According to the Stock Exchange Rules A3.112 and A3.113 a Member shall carefully follow the principles and regulations pertaining to trading as well as good conduct of business. Member also has to maintain the confidence in markets through his activities. The Disciplinary Board regarded that Alfred Berg Finland Oyj Abp has breached this obligation.
For further information, please contact:
Timo Rintanen, Secretary of the Disciplinary Board and Senior Vice President Market Supervision and Enforcement,
tel. +358 9 6166 7640.
Background information on the Disciplinary Board
The Disciplinary Board of Helsinki Exchanges is an independent body that deals with violations of the Rules of Helsinki Exchanges and Finnish Central Securities Depository.
The members of the Disciplinary Board of Helsinki Exchanges are:
Supreme Court Justice Mikko Tulokas (Chairman), Professor Risto Nuolimaa (Deputy Chairman), LL.M. Simo-Pekka Helander and Professor Kalervo Virtanen. The Secretary of the Disciplinary Board is Senior Vice President Timo Rintanen from Helsinki Exchanges.
The Disciplinary Board may impose a sanction for an infringement, which can be a reprimand or a caution. As a sanction in connection with a reprimand or a caution, the Disciplinary Board may order the party in question to pay a disciplinary charge to the stock exchange. The disciplinary charge imposed on an organization shall be not less than EUR 10.000 and not more than EUR 200.000. For a natural person the minimum and maximum are EUR 1.000 and EUR 10.000. The decisions taken by the Disciplinary Board are generally available to the public, except for reprimands.