Government under fire for Sonera flop

The former head of the supervisory board at Finland's state-controlled phone operator Sonera has implicated the government in the failure of a multi-billion-dollar venture in Germany, telling a newspaper in an interview appearing Aug. 6 that authorities had supported the move.

Pauli Saapunki told the newspaper Ilta-Sanomat the government knew about and backed Sonera's 4-billion-euro investment in next-generation mobile phone, or UMTS, licenses abroad.

Saapunki represented the opposition Center Party on the supervisory board.

UMTS, also known as 3G, or third generation, offers high-speed wireless Internet connection and audio and video streaming capabilities for compatible handsets.

"At the board meeting, where the UMTS-issue was handled I asked whether the purchase was discussed with the majority owner," Saapunki told the newspaper.

He said the answer he received was that not only did the government know about the deal it also supported it.

"Such decisions were not made without support from the government. There is no company to be found in this country that would not clear a deal of this magnitude with the biggest owner," Saapunki concluded.

As late as Monday Minister of Communications Kimmo Sasi said the government had no responsibility for the failed venture.

In a nationally televised press conference Sasi said his ministry had "gone through the protocols of the government's meetings and found no entries where the investments were discussed."

The Finnish press on Aug. 6 slammed the inquiry as a sham, saying the matter needed to be independently investigated by Finland's attorney general.

In 2000 Sonera invested more than four billion euros in a joint 3G license in Germany with Spain's Telefonica. In addition Sonera also acquired 3G licenses in Spain, Finland, Norway and Italy.

In July Sonera wrote off the German investment as a 4.3 billion-euro loss.