Nokia 2006 Annual Report Download - page 119

Nokia and Siemens on the results and consequences of a Siemens compliance review, and the
agreement of a number of detailed implementation steps. See ‘‘Item 4 Business Overview—Nokia
Siemens Networks.’’
10.D Exchange Controls
There are currently no Finnish laws which may affect the import or export of capital, or the
remittance of dividends, interest or other payments.
10.E Taxation
General
The taxation discussion set forth below is intended only as a descriptive summary and does not
purport to be a complete analysis or listing of all potential tax effects relevant to ownership of our
shares represented by ADSs.
The statements of United States and Finnish tax laws set out below are based on the laws in force
as of the date of this annual report on Form 20F and may be subject to any changes in US or
Finnish law, and in any double taxation convention or treaty between the United States and Finland,
occurring after that date, possibly with retroactive effect.
For purposes of this summary, beneficial owners of ADSs that hold the ADSs as capital assets and
that are considered residents of the United States for purposes of the current income tax convention
between the United States and Finland, signed September 21, 1989, referred to as the Treaty, and
that are entitled to the benefits of the Treaty under the ‘‘Limitation on Benefits’’ provisions
contained in the Treaty, are referred to as US Holders. Beneficial owners that are citizens or residents
of the United States, corporations created in or organized under US law, and estates or trusts (to the
extent their income is subject to US tax either directly or in the hands of beneficiaries) generally will
be considered to be residents of the United States under the Treaty. Special rules apply to US Holders
that are also residents of Finland and to citizens or residents of the United States that do not
maintain a substantial presence, permanent home, or habitual abode in the United States. For
purposes of this discussion, it is assumed that the Depositary and its custodian will perform all
actions as required by the deposit agreement with the Depositary and other related agreements
between the Depositary and Nokia.
If a partnership holds ADSs (including for this purpose any entity treated as a partnership for US
federal income tax purposes), the tax treatment of a partner will depend upon the status of the
partner and activities of the partnership. If a US holder is a partner in a partnership that holds ADSs,
the holder is urged to consult its own tax advisor regarding the specific tax consequences of owning
and disposing of its ADSs.
Because this summary is not exhaustive of all possible tax considerations – such as situations
involving financial institutions, banks, taxexempt entities, US expatriates, real estate investment
trusts, persons that are dealers in securities, persons who own (directly, indirectly or by attribution)
10% or more of the share capital or voting stock of Nokia, persons who acquired their ADSs
pursuant to the exercise of employee stock options or otherwise as compensation, or whose
functional currency is not the US dollar, who may be subject to special rules that are not discussed
herein – holders of shares or ADSs that are US Holders are advised to satisfy themselves as to the
overall US federal, state and local tax consequences, as well as to the overall Finnish and other
applicable nonUS tax consequences, of their ownership of ADSs and the underlying shares by
consulting their own tax advisors. This summary does not discuss the treatment of ADSs that are
held in connection with a permanent establishment or fixed base in Finland.
For the purposes of both the Treaty and the US Internal Revenue Code of 1986, as amended, referred
to as the Code, US Holders of ADSs will be treated as the owners of the underlying shares that are
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