Tiscali 2014 Annual Report Download - page 116

Annual financial report as at 31 December 2014
Date
File Name
Status
Page
-
Annual Report as at 31
December 2014
116
Consob proceedings
On 29 October 2014, CONSOB notified Tiscali, pursuant to Articles 193.1 and 195.1 of the
Consolidated Finance Law (TUF), of the failure to make the following available to the general public;
by the legal deadlines: (i) the annual financial report as at 31 December 2013 (as well as the reports of
the Board of Statutory Auditors and the independent auditing firm pertaining to this document); as well
as (ii) the interim management report as at 31 March 2014. By the legal deadlines, the Company
formulated it defence briefs, pleading, amongst other things, the absence of its responsibility for the
subjective element or in any event the fact that its conduct cannot be found fault with, since the
alleged delay was due to the extension of the negotiations with the Senior Financiers and the
consequent uncertainty regarding the possibility of approving the accounting documentation in
question with a view to the business as a going-concern. It being understood that the outcome of the
proceedings cannot be predicted, in the event that the Company should be held responsible in any
way, the possible fine would range between a minimum of EUR 5,000.00 and a legal maximum of
EUR 500,000.00.
WOL dispute
In relation to the holding in World Online International BV, acquired by the Group in 2000, in July
2001, the Dutch association Vereniging van Effectenbezitters and the Stichting VEB-Actie WOL
foundation, which represent a group of around 10,000 former minority shareholders of World Online
International NV (hereinafter “WOL”), summonsed WOL (currently 99.5% owned by Tiscali) and the
financial institutions tasked with the stock market listing of the Dutch subsidiary, disputing, in
particular, the incomplete and incorrect nature, as per Dutch law, of certain information contained in
the WOL listing prospectus and of certain public statements made by WOL and its Chairman
immediately prior to and after the listing.
By means of provision dated 17 December 2003, the first level Dutch court deemed that in certain
press releases issued by WOL prior to 3 April 2000, sufficient clarity was not provided regarding the
declarations made public by its former chairman at the time of listing relating to his shareholding.
Consequently, WOL was held responsible vis-à-vis the parties who had subscribed the shares of the
company at the time of the IPO on 17 March 2000 (start date of trading) and who acquired shares on
the secondary market up to 3 April 2000 (date on which the press release was issued, specifying the
effective shareholding held by the former chairman of WOL). WOL appealed against this decision,
citing the correctness of the listing prospectus.
On 3 May 2007, the Amsterdam Court of Appeal partially amended the decision of the first level court,
deeming that the prospectus used at the time of listing was incomplete in some of its parts and that
WOL should have corrected certain information relating to the shareholding held by its former
chairman, reported by the media before said listing; furthermore, it was deemed that WOL had created
optimistic expectations regarding its activities.
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 listing 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