Decision by TSE Court of Arbitration

22.09.2004 TLN

Tallinn Stock Exchange
09/22/2004

On 16 September, the TSE Court of Arbitration made a decision about the appeal of Tallinna Farmaatsiatehase AS to annul decision No. 7-2004 of the TSE Listing and Surveillance Committee of 25.5.2004. By the Committee’s decision, a penalty of EEK 250,000 was imposed on the
Tallinna Farmaatsiatehase AS for breach of requirements for the publication of information.

The Court of Arbitration decided:

1. To satisfy the appeal in part. To leave decision No. 7-2004 of the TSE Listing and Surveillance Committee of 25.5.2004 in force in other respects except for the imposition of the penalty.
2. To order the appellant to pay the registration fee and to order the appellant and the respondent to pay the arbitration fee in equal parts (i.e. EEK 10,000 each).

Comment by Tallinn Stock Exchange:

Since the Court of Arbitration found that the Tallinna Farmaatsiatehase AS’s breach of requirements for the publication of information was beyond doubt, but the TSE was not competent to impose a penalty because of the regrettable combined effect of the wording of the legislation and the TSE Rules, the TSE forwards the materials of the breach to the Financial Supervision Authority for implementation of the penalty based on the arbitration award.

The TSE sees the establishment of the Tallinn Pharmaceutical Company’s breach by the court as a positive result from the viewpoint of market reliability. However, it is regrettable that the formal combined effect of the Rules and the legislation allowed for such a situation. The TSE amended the Rules already before the arbitration procedure to eliminate the possibility of an interpretation that damages market reliability. The amendments were submitted to the Financial Supervision Authority for approval and will enter into force after approval pursuant to law.

The Court of Arbitration made its award independently; the award is lawful and subject to execution.

See also