Tiscali 2012 Annual Report Download - page 101

Annual financial report as at 31 December 2012
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Date File Name Status Page
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Annual Report as at 31
December 2012 101
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On 24 July 2007, the Dutch association and the foundation mentioned above proposed an appeal
before the Dutch Supreme Court against the sentence of the Court of Appeal. On 2 November 2007,
WOL and the financial institutions tasked with the stock market listing filed their counter-appeal. In
November 2009, the Dutch Supreme Court pronounced its final sentence confirming the ruling of the
Court of Appeal and ruled that the IPO prospectus was not complete under certain aspects and that
WOL management should have provided additional information during listing. It should be mentioned
that the ruling is limited to ascertaining certain aspects of WOL’s responsibility and that of the financial
institutions handling the listing with regard to the obligations on disclosure during an IPO and defines
certain principles that might be considered applicable to future court decisions (e.g. on the proof of
cause), while it did not rule on the actual damages, which should be the object of new, separate and
independent proceedings at the competent courts petitioned by investors. At present no such petition
has been initiated.
A dispute of a similar nature to that described above was forwarded by another Dutch foundation,
Stichting Van der Goen WOL Claims, in August 2001, and letters were subsequently received from
other parties, in which the hypothesis of being able to proceed with similar action was furthered, if the
conditions should apply.
With regard to the settlement agreements reached in November 2010 and in July 2011 between the
financial institutions tasked with the stock market listing and the foundations, the Tiscali Group, also
taking into account the specific insurance coverage taken out, is carrying out negotiations aimed at a
settlement of the dispute, partly so as to avoid any recourse taken by the financial institutions which,
as indicated in the letter dated 11 December 2012, could take action against WOL in the event that
this settlement is not reached.
You are also hereby informed that Stichting Van der Goen WOL Claims in December 2011 made an
additional request for compensation representing a further 29 shareholders or those entitled, in which
the hypothesis of proceedings with legal action was furthered. This request for compensation does not
fall within the afore-mentioned negotiations which the Tiscali Group is finalising with the financial
institutions for the transactional component of the dispute. The same Stiching Van der Goen confirmed
its claims by means of letter dated 6 March 2013 which was accompanied by the draft of a potential
writ of summons vis-à-vis WOL. To-date, what is more no proceedings appear to have been launched.
These disputes are potentially significant; however, at present there are not enough sufficiently
defined elements for quantifying the potential liability. Therefore, no provision has been made at
present in the financial statements.
Tax assessments
In 2003, the Dutch tax authorities notified WOL and the direct subsidiary Tiscali International BV with
regard to the alleged non-payment of withholdings on remuneration and stock options acknowledged
to a number of company executives. The total amount of these disputes is EUR 2 million, against
which payments were made totalling around EUR 0.3 million. The residual amount mainly refers to
withholdings on stock options which, in the opinion of the Group’s tax advisors, would not be subject to
taxation in the Netherlands. Given this circumstance and considering that the Dutch tax authorities
have not sent any formal letter or document in the years following receipt of the notice of dispute, it is
not deemed that the liability can be considered probable and, consequently, no further provision has
been made.