STOCKHOLM, May 12, 2021 /PRNewswire/ -- Ericsson (NASDAQ:
ERIC) has reached an agreement with Nokia for settling a damages
claim against Ericsson. The settlement relates to events that were
the subject of a 2019 resolution with the U.S. Department of
Justice (DOJ) and U.S. Securities and Exchange Commission (SEC) of
investigations into Ericsson's violations of the U.S. Foreign
Corrupt Practices Act (FCPA).
As communicated in 2019, the resolution with DOJ related to
criminal charges of books and records and internal controls
violations of the FCPA in five countries including in Djibouti and a guilty plea to one instance of
bribery in Djibouti. The
resolution with the SEC related to allegations of violations of the
books and records and internal controls provision of the FCPA in
six countries and of the bribery provision of the FCPA in three of
these six countries.
The agreement with Nokia contemplates the payment by Ericsson of
a total settlement amount of EUR 80 m
(SEK 0.8 b equivalent). The amount
reflects uncertainty, risk, expense, and potential distraction from
business focus associated with a potentially lengthy and complex
litigation. The settlement will have an impact of EUR 80 m on EBIT and EUR
26 m on cashflow in Q2 2021. The remainder of the settlement
amount will be made in similar installments in 2022 and 2023
respectively, impacting cash-flow. The settlement amount will be
recorded as Other Operating Expenses under Segment Emerging
Business and Other. Further details of the terms of the settlement
Ericsson has a zero-tolerance policy for corruption and has in
recent years worked hard to strengthen its Ethics and Compliance
program and to build a culture of compliance.
NOTES TO EDITORS:
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Ericsson enables communications service providers to capture the
full value of connectivity. The company's portfolio spans Networks,
Digital Services, Managed Services, and Emerging Business and is
designed to help our customers go digital, increase efficiency and
find new revenue streams. Ericsson's investments in innovation have
delivered the benefits of telephony and mobile broadband to
billions of people around the world. The Ericsson stock is listed
on Nasdaq Stockholm and on Nasdaq New York. www.ericsson.com
This release includes forward-looking statements, including
statements reflecting management's current views relating to the
growth of the market, future market conditions, future events,
financial condition, and expected operational and financial
performance, including, in particular the following:
– Our goals, strategies, planning assumptions and operational or
financial performance expectations
– Industry trends, future characteristics and development of the
markets in which we operate
– Our future liquidity, capital resources, capital expenditures,
cost savings and profitability
– The expected demand for our existing and new products and
services as well as plans to launch new products and services
including research and development expenditures
– The ability to deliver on future plans and to realize
potential for future growth
– The expected operational or financial performance of strategic
cooperation activities and joint ventures
– The time until acquired entities and businesses will be
integrated and accretive to income
– Technology and industry trends including the regulatory and
standardization environment in which we operate, competition and
our customer structure.
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We caution investors that these statements are subject to risks
and uncertainties many of which are difficult to predict and
generally beyond our control that could cause actual results to
differ materially from those expressed in, or implied or projected
by, the forward-looking information and statements.
Important factors that could affect whether and to what extent
any of our forward-looking statements materialize include, but are
not limited to, the factors described in the section "Risk Factors"
in the latest interim report, and in "Risk Factors" in the Annual
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associated with them, after the date of this release, to reflect
events or changes in circumstances or changes in expectations or
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MORE INFORMATION AT:
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(+46 10 719 00 00)
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settlement with impact in second quarter 2021