Companies

Ex-Nokia CEO wanted in Nairobi over KRA tax leakage

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The head office of communication and information technology company Nokia in Espoo, Finland. AFP PHOTO

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Summary

  • TechnoService reckons that Nokia obtained the tax records from the Kenya Revenue Authority (KRA) and used the information in a case that was pending before the International Court of Arbitration pit-ting the two firms.
  • The case was later withdrawn and its details not made public, according to court documents.
  • The former Nokia CEO and the lawyers are to appear before the virtual court on March 16 at 2 p.m., setting the stage for a diplomatic spat.

A Nairobi court has summoned a former CEO and a top executive of the global telecoms firm Nokia Corporation to answer to charges of illegally obtaining tax information of a Kenyan tech company.

Milimani Senior resident Magistrate David Ndugi summoned Rajee Suri, who was CEO of Nokia until last July and Aapo Saariviti as well as the firm’s lawyers-- Roschier Attorneys LTS-- to appear in court virtually and plead to several charges related to Technoservice’s tax records.

TechnoService reckons that Nokia obtained the tax records from the Kenya Revenue Authority (KRA) and used the information in a case that was pending before the International Court of Arbitration pit-ting the two firms. The case was later withdrawn and its details not made public, according to court documents.

The former Nokia CEO and the lawyers are to appear before the virtual court on March 16 at 2 p.m., setting the stage for a diplomatic spat.

“Tax records are confidential, yet it would appear that the applicant’s tax filings were disclosed to the respondents or their representatives who were able to use the records in the ICC arbitration,” court records show. On December 9, a Nairobi court allowed the Kenyan company to privately prosecute directors of the Finish multinational.

The local court noted that despite lodging a complaint with the Directorate of Criminal Investigations (DCI) and the Director of Public Prosecutions (DPP) in December 2018, no steps had been taken to prosecute Nokia or its agents. The court heard that Nokia or its agents obtained the information from Registrar of Companies and the KRA between September 2018 and March 2019.

Technoservice alleged that Nokia obtained the information for purposes of defeating justice in the arbitration proceedings. Thereafter, Technoservice, through its director Bulent Gulabahar, lodged a complaint with the DCI and the DPP.

Nokia challenged the claims saying the filings were defective and that they were foreigners and there-fore required to be served by diplomatic means.

The court further heard that the case was an abuse of court process because the arbitration before the International Court of Arbitration was withdrawn in February. Nokia also said Technoservice was litigious and that the case was a demonstration of its owner’s vindic-tive attitude against the multinational firm.

The DCI acknowledged receiving the complaint but said the matter could not proceed because Mr Gu-labahar failed to turn up to record statements.

The Kenyan company had in a separate case accused Nokia of breaching a partnership contract signed between the companies in 2006.

Technoservice said it was coerced into investing in the deal by establishing Nokia care branded service centres across the country. The centres were later transferred to Microsoft without its consent, it argued.

The transfer followed Nokia’s sale of its mobile phone business to Microsoft in April 2014.