Mergers and Acquisitions in Finland: Legal Due Diligence, Deal Structuring and Closing Support

EU Customs Reform 2026–2037: What Customs Changes Should Businesses Know?

KKO 2025:99 – Tachograph exemption for forestry contracting clarified | LKOS Law Office

KKO 2025:99 – Finnish Supreme Court clarifies tachograph exemption in forestry transport

On 20 November 2025, the Finnish Supreme Court issued a precedent, KKO 2025:99, clarifying when a forestry contracting company may operate a truck without a tachograph under EU road transport social legislation. The decision is highly relevant for forestry contractors, transport and logistics companies, and employers responsible for drivers’ working time, tachograph compliance and safety obligations.

1. Background – what was the case about?

A was driving a truck owned by B Oy, transporting a forest harvester less than 100 km from the company’s place of business to a logging site. No tachograph was installed or used in the vehicle. The prosecutor argued that the transport fell under the tachograph requirement and that A had breached EU road transport social rules.

The lower courts considered that B Oy was not a forestry undertaking for the purposes of the national exemption, because it did not own forest land, but provided contracting services to third parties. Therefore, the exemption from tachograph use was considered inapplicable.

2. Supreme Court: forestry contracting is forestry activity

The Supreme Court overturned the lower courts and dismissed the charges. The Court held that:

• forestry includes both growing trees and harvesting them
• logging is part of forestry regardless of forest ownership
• a forestry contracting company (such as B Oy) is therefore a forestry undertaking under the exemption

The interpretation was aligned with Regulation (EC) No 561/2006 (driving and rest time rules), Regulation (EU) No 165/2014 (tachographs), and the CJEU’s case law requiring exemptions to be applied consistently and narrowly.

3. Own business operations – when does the exemption apply?

The Court also assessed whether the transport was part of B Oy’s own business operations. The Court noted that:

• the transport’s sole purpose was to move machinery used in the company’s own logging work
• the transport was secondary and necessary to the main forestry activity
• there is no separate competitive market for such movements of specialised forestry machinery

Accordingly, the vehicle was used in the company’s own forestry business. As the other requirements (including the 100 km radius) were met, the truck was exempt from the tachograph requirement.

4. What does this mean for businesses?

This ruling has practical implications for:

• Forestry contracting and harvesting companies – clearer guidance on tachograph exemptions and compliance.
• Transport and logistics operators – improved predictability regarding EU social legislation in road transport.
• Employers and fleet managers – reduced risk of criminal liability for tachograph or driving time errors.
• Insurance and liability assessments – more certainty when tachograph use (or non-use) affects responsibility.

This decision complements an already complex regulatory framework governing heavy vehicle operations, tachographs, working time, driver fatigue, accident prevention and road safety. Businesses should ensure their transport arrangements, contracts, internal guidelines and compliance processes fully reflect current law.

To learn more about how EU transport rules and tachograph obligations apply to your operations, explore our logistics, transport and maritime law services.

Need support with tachograph regulation and transport compliance?

LKOS Law Office advises companies on EU road transport social legislation, national transport law, tachograph requirements, driving time rules, and practical compliance management across forestry contracting, logistics and heavy transport operations.

Contact our experts for tailored advice: Contact LKOS Law Office – Transport & Logistics Law Specialists.

Frequently Asked Questions

What did the Supreme Court clarify in KKO 2025:99?
The Court held that forestry contracting is considered forestry activity, meaning companies engaged in logging may fall under the tachograph exemption if other legal criteria are met.

When can a company apply the tachograph exemption?
A company may apply the exemption when transporting machinery for its own forestry operations within a 100 km radius, and when the transport is secondary to its main activity.

How does the ruling affect Finnish logistics and forestry companies?
The decision increases legal clarity, reduces compliance risks, and supports predictable planning for companies moving forestry machinery.

Additional keywords for relevance: tachograph rules, driving time compliance, EU Regulation 561/2006, transport law Finland, forestry logistics, heavy transport compliance, LKOS Law Office transport law specialists.

The EU AI Act: Legal Compliance, Risks & Strategic Guidance for Businesses

Green Transition Strategies for SMEs | ESG & Sustainability in Practice | LKOS Law Office

Green Transition Strategies for SMEs: Transforming Business for a Better Tomorrow

Sustainability has become a popular topic, which is a good thing. However, I have come across ideas and comments that sustainability primarily concerns large corporations due to legislation as well as perceived high costs associated with it. In my view, this perception is outdated. Sustainability is equally relevant for SMEs and their competitive advantage. To lighten the overwhelming feeling caused by the myriad of legal regulations, standards, recommendations, and initiatives, there are a few practical steps that every company, regardless of size, can and should take.

If you want to turn ESG and sustainability into a strategic advantage for your company, you can also explore our ESG & Sustainability services.

Consumer demand

In an era where social media amplifies consumer voices, businesses are increasingly held accountable for their actions. Particularly among the younger generations, there is a growing emphasis on sustainability. Consumers are more informed and vocal about their preferences, often demanding companies to adopt sustainable practices. This shift in consumer behaviour makes it crucial for businesses to adapt in order to maintain their market relevance and customer base.

Beyond financial motives, there’s a growing recognition of corporate responsibility towards society and the environment. Ethical business practices resonate with consumers, employees, and stakeholders.

Regulatory compliance

The European Union, as an example, has been at the forefront of drafting and enforcing regulations that mandate businesses to be more sustainable and planet-friendly. The EU’s Circular Economy Action Plan is a notable initiative. It aims to transition from a linear to a circular economy, focusing on product lifecycle, design, circular processes, sustainable consumption, and waste prevention.

In addition, on 5 January 2023, the Corporate Sustainability Reporting Directive (CSRD) entered into force. This directive modernises and strengthens the rules concerning the social and environmental information that companies have to report. A broader set of large companies, as well as listed SMEs, will now be required to report on sustainability.

Cost savings

Sustainability often leads to rethinking and improving business processes, particularly in reducing waste, which directly translates to cost savings. Additionally, focusing on employee health and safety can reduce absenteeism and increase productivity, further cutting costs.

Large investors, including massive pension funds, are increasingly focusing on sustainability. Sustainable businesses often enjoy better long-term financial performance and may have more favourable access to financing. In addition, the shift towards sustainable finance is important to keep in mind.

Brand reputation and trust

Sustainable practices enhance a company’s reputation and build trust with consumers, investors, and partners. It reflects a commitment to ethical standards and social responsibility.

A sustainable supply chain is not only cost-effective but also essential for maintaining the integrity and reputation of the business. It ensures the business model is resilient and adaptable to future challenges.

Risk management

The adage “No planet – no business” encapsulates the existential risk of ignoring sustainability. Businesses that neglect environmental impacts may face substantial future risks, including resource scarcity and regulatory penalties.

Sustainable practices are often aligned with long-term business viability. They help ensure that businesses can thrive in a changing world, where resource constraints and environmental considerations are increasingly paramount.

Competitive advantage

Integrating sustainability into the core business strategy can be a source of innovation and competitive advantage. It encourages rethinking products, services, and processes, leading to new business opportunities.

Sustainability presents new market opportunities. By embracing sustainable practices, businesses can tap into new consumer segments and create innovative products and services.

Frequently Asked Questions

Why is sustainability important for SMEs?
Sustainability strengthens competitiveness, improves brand reputation, reduces costs, and meets growing consumer and investor expectations.

Are SMEs affected by EU sustainability regulations?
Yes. Many SMEs are indirectly affected through supply chains, financing requirements, and increasing expectations from customers and partners.

How can SMEs begin their sustainability transition?
SMEs can start by improving resource efficiency, reviewing supply chains, adopting ESG policies, and preparing for upcoming EU reporting expectations.

Explore our ESG & Sustainability services

Schedule a meeting

Our Partner Speaking at Technology 2025 | Turning Regulation into Opportunity

Our Partner Speaking at Technology 2025 | Turning Regulation into Opportunity

Technology 2025 – The Leading Nordic Technology and Industry Event

LKOS Law Office Partner Oscari Seppälä has been invited to speak at Technology 2025, the leading Nordic technology and industry event. His presentation explores how increasing regulation can be turned into an opportunity for technology companies.

LKOS Law Office Partner to Speak on the Opportunities in Regulation

Regulation is increasing rapidly – but could it also be an opportunity for technology companies? LKOS Law Office Partner [Name] will address this question as a speaker at Technology 2025, held at Helsinki Expo and Convention Centre on 6 November 2025, 13:20–13:50.

Regulation as a Competitive Advantage

His presentation, “Increasing Regulation and Market Expectations – Can They Also Be an Opportunity for Technology Companies?”, explores how compliance can drive competitiveness and sustainable growth rather than merely impose obligations.

Technology 2025 is the leading Nordic technology and industry event, bringing together experts, companies, and decision-makers for three days (4–6 November 2025). The event showcases the latest innovations in smart and sustainable industry – from automation and digitalisation to quantum technology.

Join the Discussion at Technology 2025

📅 Mark your calendar and join the discussion on how regulation can be transformed into an advantage.

👉 Read more about the event: https://lnkd.in/dJt_QCb8

Public Consultation: Regulatory Measures to Improve the Operating Conditions in the Transport Sector

Public Consultation: Regulatory Measures to Improve the Transport Sector

The Ministry of Transport and Communications of Finland invites comments on a draft government proposal to amend the Act on Transport Services and several related acts.
The aim of the proposal is to improve the operating conditions of the transport sector and to promote the use of low-emission, alternatively powered vehicles.
Comments can be submitted until 19 November 2025.

The draft proposal refines the EU cabotage rules to make their implementation and supervision clearer and introduces national measures to facilitate the transition to cleaner transport technologies. The Ministry has previously, in spring 2025, assessed various regulatory measures that could strengthen the competitiveness and sustainability of the Finnish transport sector — this consultation now presents the concrete steps.

Key Proposed Changes

1) Clarification of Cabotage Rules (Section 23, Act on Transport Services)

• For freight transport, one cabotage journey may include:
1. one loading and one unloading location;
2. multiple loading points and one unloading point (final consignee as per waybill); or
3. one loading point and multiple unloading points (same sender as per waybill).
• For bus transport, cabotage would be allowed for up to seven consecutive days within a 30-day period.

Impact:
These clarifications harmonize Finnish law with other Nordic countries, ensuring consistent business practices and more effective roadside checks. The reform will improve legal certainty and operational predictability for companies and transport service purchasers

2) Administrative Penalties for Violations

• €5,000 for a cabotage violation.
• €3,000 for failing to obtain a required driver attestation.
  Penalties may be imposed on both natural and legal persons, with enforcement handled by the Legal Register Centre.

Impact:
A swift and proportionate penalty system will enhance compliance, curb undeclared work and unfair competition, and reduce the burden on criminal courts. Clear rules also strengthen oversight and equality between domestic and foreign operators.

3) Driving Rights for Vehicles Using Alternative Fuels

• Holders of a B licence (car licence valid ≥ 2 years) could drive alternatively powered vehicles up to 4,250 kg total weight.
• Holders of a BE licence (valid ≥ 2 years) could drive combinations where the alternatively powered towing vehicle weighs up to 4,250 kg.
• Alternative fuels include electricity, hydrogen, CNG/LNG (including biomethane), LPG, and mechanical energy from vehicle systems.

Impact:
The change encourages companies to adopt low-emission vehicles earlier, improves driver availability, and supports Finland’s climate targets. Safety impacts are minimal, as the vehicles covered are subject to modern EU safety standards.

4) Driving Test Examiners – Easier Qualification and Better Availability

• The duty to conduct oral theory tests would be removed from the examiner’s role.
• Qualification requirements would be simplified: a valid driving instructor’s licence and a relevant training module (“Acting as a Driving Test Examiner”) would suffice.

Impact:
The reform would free up examiner capacity equivalent to approximately 12,000 additional driving tests per year, improving availability during peak seasons and ensuring smoother service nationwide.

Why It Matters for Businesses

• Clarity and predictability: Clear cabotage rules reduce interpretation disputes and inspection delays.
• Fair competition: Administrative penalties ensure a level playing field and reduce undeclared labour.
• Sustainability: Broader B/BE licence scope accelerates the shift to electric and low-emission fleets.
• Labour availability: More flexible driver qualification supports logistics continuity and national preparedness.

Invitation to Comment

The Ministry welcomes input from companies, industry associations, authorities, and other stakeholders. Feedback will help ensure that the new regulation is clear, proportionate, and effective in practice.
Deadline for comments: 19 November 2025.

How the New EU-US Tariff Deal Impacts Business

How the New EU-US Tariff Deal Impacts Business

Summary

On 27 July 2025, the EU and the United States announced a preliminary agreement that brings long-awaited relief and opportunity to transatlantic trade. The deal reduces steep U.S. tariffs on EU goods, expands EU market access for selected U.S. exports, and paves the way for increased investment and regulatory cooperation.

But for businesses, this isn’t just political news it’s a call to action.

What Businesses Must Know

U.S. Tariffs on EU Goods Drop to 15%
Most EU-manufactured goods, including cars and car parts, will now face a single capped tariff of 15% in the U.S., reduced from the initially proposed 30%. This offers immediate cost savings and pricing predictability.

Steel and Aluminum Still Face High Tariffs
EU exports of steel and aluminum remain subject to a 50% tariff, though new tariff-rate quotas (TRQs) aim to protect historical trade volumes.

New Opportunities in Energy and Tech
The EU has committed to large-scale purchases of U.S. energy products and AI chips, signalling major investment flows. Finnish companies in related sectors should evaluate export and partnership opportunities.

Improved Access for U.S. Goods to the EU
The EU will reduce tariffs for select U.S. agricultural and industrial goods under new TRQs, while maintaining protection for sensitive sectors such as beef and poultry.

Reduced Non-Tariff Barriers & Regulatory Cooperation
Enhanced alignment of standards and conformity assessments will facilitate trade in sectors such as automotive, pharmaceuticals, and tech.

How This Affects Finnish Businesses

Exporters should reassess U.S. pricing models, trade agreements, and supply chains in light of reduced tariffs and regulatory clarity.

Investors may benefit from a favourable investment climate in the U.S., with EU companies planning over €550 billion in fresh investment by 2029.

Importers and manufacturers in Finland sourcing U.S. goods from tech to raw materials should re-evaluate duties and ensure compliance with TRQs.

Risk Management Alert: The agreement is political, not yet legally binding. Companies must stay alert as negotiations and implementation evolve. 

What Is Recommended To Do Now

1. Review your trade contracts and pricing structures
   
2. Reassess supply chain strategies with U.S. partners
   
3. Explore new growth avenues in transatlantic markets
   
4. Ensure ongoing compliance with evolving EU and U.S. regulations
   

Need help navigating these changes?

Our legal team supports businesses in international trade, cross-border contracts, and sanctions compliance. Contact us for further information.

Partner Oscari Seppälä Interviewed by Dow Jones News on Finland’s Sanctions Enforcement

Partner Oscari Seppälä Interviewed by Dow Jones News on Finland’s Sanctions Enforcement

We are proud to share that Oscari Seppälä, Partner at LKOS Law Office, was interviewed by Dow Jones Risk Journal for a feature article discussing Finland’s role as one of the EU’s most active enforcers of sanctions following Russia’s invasion of Ukraine.

The article, titled “Finland Probes Sanctioned Exports to Russia,” highlights Finland’s proactive legal and institutional approach in monitoring and prosecuting export-related sanctions violations.

Legal Expertise Recognised Internationally

In the article, Oscari offers expert commentary on how Finnish criminal law enables personal and corporate liability in sanctions cases, even when complex company structures are used to conceal unlawful exports.

“Finnish criminal law allows for individual criminal liability even when a corporate structure is used. If a person directs or controls a company in a manner that enables or conceals the offense, they may be held personally liable regardless of corporate separation,” Oscari explains.

He also outlines recent amendments to Finland’s Criminal Code introducing corporate criminal liability for sanctions violations, with companies facing fines of up to 5% of turnover or €40 million.

Finland’s Leading Role in Sanctions Enforcement

The article discusses how Finland’s geographic location, longstanding trade ties with Russia, and automated customs control systems have made it a central player in EU sanctions enforcement. Authorities have launched nearly 1,000 criminal investigations into sanctions breaches, many of which involve attempts to circumvent EU sanctions via Central Asia.

This includes suspicious export patterns such as 257 EU-based companies with no prior Central Asian trade history using Finland for clearance triggering red flags for enforcement authorities.

Why It Matters to Our Clients

This feature highlights not only Finland’s increasing scrutiny of international trade flows, but also LKOS Law Office’s position as a trusted legal advisor in complex sanctions, export control, and cross-border trade matters. Our deep understanding of EU and Finnish regulation combined with practical experience means we are well-placed to support companies facing increasing compliance demands.

Whether you require legal risk assessments, export licensing advice, or representation in enforcement matters, our team is here to help you stay compliant and protected.

Learn More

🔗 The full article is available to Risk Journal subscribers here: LINK TO THE ARTICLE
📞 Contact us today to discuss how we can help your business navigate sanctions and export control regulations.

Sanctions Enforcement and Compliance in Finland | What Businesses Need to Know

Finland’s Strong Position on Sanctions Enforcement

Since the outbreak of the war in Ukraine, Finland has emerged as one of the EU’s most active enforcers of sanctions legislation. Authorities have launched nearly a thousand criminal investigations related to sanctions violations, with close to a hundred convictions—placing Finland among the leading EU countries in terms of enforcement activity.

This assertiveness is not due to more extensive legal powers than elsewhere in the EU. Instead, it reflects Finland’s unique geographic and institutional context: as Russia’s direct neighbour and a long-standing trade partner, Finland has developed extensive experience in managing cross-border trade risks, including customs fraud, tax evasion, and now, sanctions circumvention.

Customs Capabilities and Red Flags in Trade with Central Asia

One enforcement priority is the increasing use of Central Asian countries as transshipment points. Finnish Customs has publicly warned that companies should not be naïve about the true end-use of goods exported to countries such as Kazakhstan and Kyrgyzstan. For example, in early 2023, 257 EU-registered companies, none with a previous export history to Central Asia, used Finland for export clearances, prompting investigations.

Authorities rely on comprehensive evidence: customs records, transport documentation, falsified or manipulated paperwork, and cooperation with foreign customs. International intelligence and logistics data help trace onward movements of goods, especially when rerouted to Russia.

Legal Consequences for Individuals and Companies

Under Finnish law, aggravated sanctions violations (FI: törkeä pakoterikos) carry penalties ranging from four months to five years of imprisonment. Finnish legislation permits individual criminal liability even when a company structure is used. If a person directs or controls a company in a way that facilitates or conceals the offense, they may be held personally accountable regardless of corporate separation.

In 2025, Finland amended its Criminal Code to introduce corporate liability for sanctions violations and other trade-related offenses. Companies can now face fines of up to 5% of annual turnover, with a minimum of €850,000 and a maximum of €40 million.

How LKOS Law Office Supports Your Business

At LKOS Law Office, we help companies navigate the complex and rapidly evolving field of EU sanctions and export control compliance. Our services include:

• Risk assessments and compliance reviews

• Advice on dual-use goods and licensing obligations

• Drafting internal policies and due diligence procedures

• Representation in enforcement or criminal proceedings

• Strategic consultation on trade structuring and supply chain integrity

We understand that sanctions compliance is not just a legal issue—it’s a strategic business concern. Our practical, business-minded approach ensures that your company meets legal obligations without compromising operational efficiency.

Contact Our Sanctions & Trade Law Experts

If your business is engaged in cross-border trade, manufacturing, or logistics, you face potential exposure to sanctions risks. Our team is here to help you stay compliant, mitigate liability, and act decisively if issues arise.

📍 Contact LKOS Law Office to speak with one of our sanctions law experts.

Road Transport Cabotage Reform and Licensing Changes – 2026 Legislative Update

New regulations for road cabotage and transport sector in Finland – coming into force in 2026

In spring 2025, the Finnish Ministry of Transport and Communications launched a legislative project aiming to clarify cabotage transport regulations and improve the operating conditions of the transport sector. These changes align with the current government's goals to reduce unnecessary regulation and support entrepreneurship.

Key proposed changes

1. Clearer cabotage rules: The legislation aims to increase transparency for both businesses and enforcement authorities.
2. Penalty reform: Fines for unauthorised transport operations may be replaced by administrative fees.
3. Driving license reform: A category B driving license could permit driving up to 4,250 kg vehicles powered by alternative fuels, if held for at least two years.
4. Promotion of cleaner vehicles: The reform supports the use of low-emission vehicles, especially light trucks, in goods transport.

Why is the reform important?

As 90% of goods and people move by road in Finland, improving the legal framework for domestic road transport benefits the entire economy. The reform aims to enhance safety and reduce regulatory uncertainty for operators.

What happens next?

The legislative work continues with stakeholder consultations and a public hearing. The changes are expected to be finalised by June 2026, depending on the timeline for the new EU driving license directive.

Contact your expert at LKOS Law Office

Want to understand how the upcoming legislation may affect your business? Reach out to your legal expert at LKOS Law Office – we help ensure your operations remain compliant and future-proof.

LKOS Law Office Advised Signet Bank AS on Refinancing and Collateral Arrangements

LKOS Law Office Advised Signet Bank AS on EUR 5 Million Refinancing and Collateral Arrangement

LKOS Law Office advised Signet Bank AS on the Finnish law aspects of its EUR 5 million refinancing loan facility and related collateral package.

About Signet Bank

Signet Bank is Latvia’s leading investment bank, founded in 1991 as one of the first financial institutions in independent Latvia. The bank provides sustainable financing and investment solutions to Baltic-region entrepreneurs. Since 2021, Signet Bank has raised over EUR 500 million for more than 40 Latvian companies through bond and equity issues. As of 2024, the bank manages EUR 1.6 billion in client assets, making it the leading arranger of corporate securities offerings in Latvia and one of the strongest stockbrokers in the Baltics.

Our Role

Signet Bank sought our support in connection with a refinancing arrangement involving cross-border security. Our mandate focused on ensuring that the collateral structure complied with Finnish security, guarantee and transaction formalities—clearly, efficiently and without unnecessary complexity.

Working closely with the client, our team advised on the legal framework for Finnish-law security, helped structure and implement the collateral package, and coordinated the practical steps required for smooth execution.

This engagement reflects the type of work we do best: enabling clients to move forward with clarity and confidence, supported by legal advice that is both technically sound and pragmatically delivered.

Background on Shareholders

Signet Bank’s shareholders include eighteen Latvian and international private investors. The largest shareholders are:

• Signet Acquisition III (sole shareholder: U.S. investor Aleksandrs Solovejs)
• AS RIT Group (owned by the Rapoport family)
• SIA Reglink (founded by banking professional Irīna Pīgozne)

For more information on our services, explore: Contracts & Commercial Law and Corporate Finance & M&A.

Frequently Asked Questions

What was LKOS Law Office’s role in the Signet Bank refinancing?

LKOS advised on Finnish-law security, guarantees, and transaction formalities for a EUR 5 million refinancing loan facility, ensuring the collateral structure complied with local requirements.

Who is Signet Bank AS?

Signet Bank is Latvia’s leading investment bank, providing sustainable financing solutions and managing EUR 1.6 billion in client assets.

Why is Finnish-law security important in cross-border finance?

When collateral is located in Finland, lenders must comply with Finnish security and guarantee legislation to ensure enforceability and mitigate transactional risk.

LKOS Law Office at the 14th Baltic Arbitration Days 2025

Partner Liene Krumina from LKOS Law Office will be participating in the 14th Baltic Arbitration Days, taking place on 15–16 June 2025 in Riga and Jurmala.

Baltic Arbitration Days brings together arbitration practitioners, academics, and experts from across the globe to discuss key developments in international commercial and investment arbitration, with a particular focus on Central and Eastern Europe. Over two days of lectures, discussions, and networking, participants will have the opportunity to exchange knowledge and insights on some of the most current topics shaping the arbitration landscape.

We are looking forward to interesting discussions, new ideas, and meeting colleagues from around the world.

See you in Riga and Jurmala!

The LKOS Law Office Team

New Electricity Market Act 2025 – Key Changes and Impacts | LKOS Law Office

The New Electricity Market Act 2025 – Key Changes and Impacts

A major reform is coming to Finland's electricity market with the new Electricity Market Act, scheduled to enter into force in autumn 2025. The purpose of this reform is to increase market flexibility, clarify pricing models, and improve the utilisation of the electricity grid. This article presents the key changes and compares them with the current legislation.

1. Why is the Electricity Market Act being reformed?

The reform is driven by the implementation of EU directives and the Finnish Government’s objective to modernise the electricity system. The primary goals are to promote a smart electricity system, enhance customer participation, and bring energy production and consumption geographically closer together.

2. Key changes in the Electricity Market Act 2025

2.1 Construction and ownership of networks above 110 kV

The reform will allow distribution network companies to build and own local networks above 110 kV. Previously, this was only permitted for the transmission system operator (Fingrid). This change is intended to support the development of regional grid solutions and new investments.

2.2 Flexible use of connection lines

The new law introduces more flexible connection line arrangements for networks of at least 110 kV. The objective is to encourage electricity production and consumption to be located closer to each other and to improve the efficiency of the grid.

2.3 Integration of energy storage

The integration of energy storage facilities into connection lines will be allowed on a broader scale. This particularly supports the efficient use of renewable energy production and helps balance fluctuations in production and demand.

2.4 Power-based connection fees

Fingrid proposes that connection fees be converted to power-based fees. This would allocate costs more accurately to customers who create new investment needs for the grid and support more efficient use of network capacity.

2.5 Combined invoicing for customers

Customers will be offered voluntary combined invoicing, where electricity sales and distribution services are invoiced on a single bill. This simplifies billing, improves cost transparency and makes it easier for customers to understand their total electricity costs.

3. Impacts on businesses and consumers

3.1 Impacts on businesses

Companies will particularly benefit from power-based pricing, which allows for more accurate cost predictability and better alignment of network costs with actual usage. In addition, flexible connection options and the integration of energy storage open up new business opportunities in the energy sector, for example in local generation projects and flexibility services.

3.2 Impacts on consumers

Consumers’ position will improve through combined invoicing and increased opportunities for market-based load control. Customers will have better possibilities to influence their electricity costs by adjusting their consumption behaviour and by utilising smart solutions offered by electricity suppliers and distribution companies.

4. Comparison with current legislation

Compared with the current legal framework, the new Act significantly increases flexibility and clarifies cost allocation. In particular, the possibility for distribution network companies to construct networks above 110 kV and the shift to power-based connection fees represent major changes. The reform aims to encourage more efficient energy use, optimise location choices for production and consumption, and support the transition to a smarter electricity system.

5. Timeline and next steps

The legislative proposal will proceed to Parliament and the relevant committees in spring 2025. The legislative amendments are planned to enter into force between August and September 2025. Companies and other stakeholders should prepare for the changes in good time by reviewing their grid connection arrangements, pricing models and contractual framework.

6. Contact us to ensure your business is prepared

If you need further information about the Electricity Market Act reform or its implications for your business, contact our experts. LKOS Law Office’s specialists are ready to help you understand the changes, assess the legal risks and opportunities, and ensure that your company is fully prepared for the upcoming reforms.

Finland’s Co-operation Act reform enters into force July 2025 – key changes for employers

The Finnish Co-operation Act Will Be Revised in July 2025 – What Employers Need to Know

The amendments to Finland’s Co-operation Act will enter into force on 1 July 2025. The reform raises the applicability threshold and streamlines negotiation procedures. The objective is to reduce the administrative burden especially for smaller companies and to allow employers to respond more quickly to changes in their operating environment.

Applicability threshold raised – impact on companies with fewer than 50 employees

Currently, the Co-operation Act applies to employers with at least 20 employees. After the reform, the applicability threshold will increase to 50 employees.

However, companies employing fewer than 50 people will still have certain simplified obligations:

• Ongoing dialogue remains, but its procedures will be significantly simplified.

• Co-operation negotiations are required only when the employer considers measures affecting at least 20 employees within a 90-day period.

• Negotiations are not required for temporary layoffs (maximum 90 days) due to a temporary reduction in work.

• Provisions on business transfers, mergers, and demergers remain unchanged.

Duration of co-operation negotiations will be shortened

The minimum duration of negotiations related to workforce reductions will be halved:

• Current 6 weeks → 3 weeks

• Current 14 days → 7 days

The duration depends on company size and matters under discussion.

New deadline for labor authority notifications

If the employer plans to terminate at least 10 employees for economic or production-related reasons, the employer must:

• Submit a negotiation proposal to the labor authorities.

• Ensure that dismissals cannot take effect until 30 days have passed after submitting the proposal.

Changes to employee representation under preparation

The government has decided to lower the threshold for employee representation from companies with at least 150 employees to those with at least 100 employees. Representation must be arranged either at board or management team level. A tripartite working group is preparing the changes as part of the second phase of the reform.

Stay up to date with changing employment legislation

If you want to ensure that your company’s processes, negotiations, and HR practices comply with the new law — our experts are ready to assist you.

👉 Contact your advisor.

Planned changes to the statute of limitations for working hours and annual leave claims in Finland

Planned Changes to the Statute of Limitations for Claims on Working Hours and Annual Leave in Finland

A legislative reform may be coming to Finnish labor law, as a working group appointed by the Ministry of Justice is reviewing the statute of limitations for claims related to working hours and annual leave. The goal is to clarify the current legislation, where court practice has revealed conflicting interpretations, particularly regarding applicable limitation and filing periods.

Current statute of limitations for working hours and annual leave claims

The statute of limitations and filing deadlines for claims related to working hours and annual leave currently depend on whether the claim is based directly on the law or on a collective agreement.

• The Supreme Court of Finland (KKO) has ruled that the limitation period under the Working Hours Act also applies to claims based on collective agreements. This results in a shorter filing period.

• The Labour Court (TT), on the other hand, has ruled that for claims based on collective agreements, the longer limitation periods of the Employment Contracts Act apply.

Similar uncertainty exists for annual leave claims when the right to leave is based on a collective agreement. These conflicting rulings have created legal uncertainty for both employers and employees.

Ministry of Justice examines need for legislative clarification

Due to these differing interpretations, the Ministry of Justice has appointed a working group to assess whether the rules on limitation and filing periods should be clarified. The group's task is to prepare a possible legislative proposal that would bring greater clarity and predictability to the statute of limitations for working hours and annual leave claims.

Why are these changes significant?

Clear and unambiguous legislation would:

• Reduce uncertainty in the labor market

• Make dispute prevention easier

• Better safeguard the legal rights of both parties

• Decrease the number of court proceedings

As the working group's review progresses, it is important to closely monitor any legislative developments, as they directly affect employer practices and claim filing deadlines.

We will continue to follow the legislative process and keep our clients informed of any updates.

Do you need expert advice on employment law in Finland?

Our specialists are happy to assist you with questions related to working hours claims, annual leave claims, and contract practices.

👉 Contact your advisor.

Contract Strategies for a Volatile World | Tariffs & Trade

Tariffs & Trade: Contract Strategies for a Volatile World

In today’s unpredictable global trade environment, tariffs are no longer just taxes—they are powerful geopolitical instruments that can reshape supply chains, pricing, and long-term commercial relationships. Companies engaged in international trade must understand not only what tariffs are, but how contract terms determine who ultimately carries tariff-related costs.

What Are Tariffs?

Tariffs are customs duties imposed on goods crossing borders. While they may apply to both imports and exports, they are most commonly levied on imports, often serving political or strategic objectives. Tariffs may be:

• Product-specific – applied to certain categories of goods
• Geographically targeted – linked to a specific country or trade bloc
• Revenue-driven or politically motivated – shaping trade relations

Regardless of origin, tariffs directly influence the cost base, pricing structure, and delivery timelines of cross-border trade.

How Tariffs Affect Cross-Border Trade

Tariffs can quickly change the economics of an international transaction. More importantly, contract terms—not customs law—often decide who pays the tariff. Without clear contractual allocation, the importer may unexpectedly bear additional costs.

Well-drafted agreements can shift, share, or control tariff exposure—giving companies commercial flexibility in a turbulent environment.

Key Contract Clauses That Mitigate Tariff Risk

1. Cost Allocation & Incoterms®

Delivery terms, such as Incoterms® 2020, play a central role in identifying who pays duties, taxes, and customs formalities.

• EXW (Ex Works) or FCA (Free Carrier) → Buyer pays import duties
• DDP (Delivered Duty Paid) → Seller bears all import costs

Contracts should specify:

• Who is the importer of record
• Whether prices include or exclude duties
• How new tariffs imposed mid-contract are handled

This ensures risk is aligned with commercial intention and prevents disputes.

2. Price Adjustment Clauses

Tariff changes can erode profit margins instantly. A price adjustment clause allows the contract price to change if duties increase.

Common mechanisms include:

• Automatic adjustments based on agreed formulas or indices
• Renegotiation triggers when tariffs exceed a threshold
• Cost-sharing arrangements between the parties

These provisions reduce financial shocks and support business continuity.

3. Force Majeure

Force Majeure clauses excuse non-performance due to unforeseeable and uncontrollable events. Tariffs rarely qualify because they generally make performance more expensive—not impossible.

However, a Force Majeure clause may apply if drafted to include:

• Governmental actions
• Trade restrictions
• Sudden tariff surges or economic sanctions

Review and update Force Majeure clauses to reflect real-world trade vulnerabilities.

4. Hardship Clauses

Hardship applies when performance remains possible but becomes economically unreasonable—for example, when tariff increases exceed 10–15%.

A well-drafted hardship clause should:

• Define what constitutes hardship (e.g., tariff increase threshold)
• Enable renegotiation of prices or terms
• Specify a fallback mechanism if renegotiation fails

This gives parties a structured method for restoring commercial balance.

5. Termination Rights

When contractual adjustments are no longer feasible, termination rights offer a critical safety valve.

• Termination for convenience
• Rights triggered by excessive cost increases
• Exit options tied to supply chain disruptions or economic events

Clear exit pathways reduce legal exposure and protect long-term business interests.

Building Resilience Into Future Contracts

To safeguard international operations, companies should incorporate the following best practices:

• Define tariff responsibilities and cost-sharing
• Select the right Incoterms® rule
• Use dynamic pricing and renegotiation triggers
• Broaden Force Majeure and hardship provisions
• Include clear termination pathways

With rising global uncertainty, regularly reviewing existing contracts—and ensuring new ones are resilient—is essential.

Need Help Navigating Tariffs or Cross-Border Contract Risks?

LKOS Law Office advises businesses on international trade, sanctions, customs, and contract structuring. We help clients review existing agreements, draft tariff-resilient contracts, and manage cross-border risk exposures.

Explore our service: International Trade & Sanctions Advisory

For tailored advice on tariffs, trade clauses, Incoterms®, or supply chain risks, contact Oscari Seppälä.

*This article is for general information only and does not constitute legal advice.*

HOW IS AN EMPLOYMENT CONTRACT TERMINATED ON A PERSONAL BASIS

Options for terminating employment contract | Termination | Trial period annulment | Treated as annulled

Grounds for termination based on personal reasons | Employment contract

Regarding personal grounds | How to terminate an employment contract on personal grounds

When are the employer’s reasons for dismissal sufficient | How is an employment contract terminated on personal basis

Other conditions for terminating the employment relationship when citing personal reasons

* * *

Contact our employment law expert, who is on this subject field Oscari Seppälä. We will be happy to tell you more about our expertise and how we can successfully solve your challenges related to business law and employment related disputes.

About us | LKOS Law Office | A leading business law service provider in Finland

LKOS Law Office regularly assists its clients in Mergers and Acquisitions, Corporate law, Contracts law and Transport law matters. We are a reliable and internationally awarded business law office and Mergers and Acquisitions in our industry. 

Get in touch, we’ll be happy to tell you more.

** The article is intended for information and is not intended as a legal advice.

Employment Law in Finland: A Comprehensive Guide

Employment Law in Finland – Comprehensive Guide for Employers

1. Overview of employment law in Finland

Employment law in Finland is designed to balance the rights and responsibilities of employers and employees and to ensure fair practices and workplace equality. With a well-regulated legal framework and extensive collective bargaining agreements (CBAs), Finland has one of the most structured labour markets globally. This guide provides an overview of key aspects of Finnish employment law that are relevant in practice for employers.

2. Key legislation governing employment in Finland

The legal foundation of employment relationships in Finland is built upon several statutes. These laws ensure that employees enjoy robust protection while enabling employers to manage their workforce effectively, including among others:

• Employment Contracts Act (55/2001, as amended) – the cornerstone of employment law, governing employment contract formation, terms and termination.
• Working Hours Act (872/2019) – regulates standard working hours, overtime, rest periods and flexible work arrangements.
• Annual Holidays Act (162/2005) – defines employee rights to paid annual leave, public holidays and holiday pay.
• Codetermination Act (1333/2021) – ensures employee participation in decision-making processes within larger organisations.
• Occupational Safety and Health Act (738/2002) – establishes employer obligations to provide a safe and healthy working environment.
• Equality between Women and Men Act (609/1986) – promotes gender equality and prohibits gender-based workplace discrimination.
• Non-Discrimination Act (1325/2014) – provides broader anti-discrimination protection, including age, religion, disability, ethnicity and sexual orientation.

In addition to statutory regulations, collective bargaining agreements (CBAs) play a crucial role in shaping employment conditions. Many industries have generally binding CBAs, meaning they apply even if the employer is not a member of an employers’ association.

Employers must also consider international choice-of-law rules in cross-border employment relationships. The Rome I Regulation (EC 593/2008) applies to employment contracts signed after 17 December 2009 and allows parties to choose governing law, while ensuring minimum protections under Finnish labour law.

3. Termination of employment and redundancy in Finland

3.1 Grounds for termination

Employment termination in Finland is strictly regulated to ensure fairness and transparency. Employers must have justifiable grounds and follow proper legal procedures.

Employment contracts may be terminated based on, for example:

• Personal grounds – serious misconduct, repeated breach of duties, failure to meet work expectations or other substantial contractual breaches.
• Economic or production-related grounds – redundancies due to financial difficulties, reorganisation or reduced need for work. Employers must demonstrate that alternatives, such as retraining or reassignment, were considered before termination.

3.2 Notice periods

Notice periods vary depending on the duration of employment with the same employer:

• Less than one year: 14 days
• 1–4 years: one month
• 4–8 years: two months
• 8–12 years: four months
• Over 12 years: six months

Employees may also terminate their contracts, but must comply with the agreed notice period unless otherwise provided by law or contract.

3.3 Consultation obligations

Under the Codetermination Act, employers with at least 20 employees must conduct statutory consultation procedures before layoffs, redundancies or major contractual changes. These discussions allow employees or their representatives to express their views and influence the decision-making process.

4. Types of employment contracts in Finland

4.1 Indefinite and fixed-term contracts

Employment contracts in Finland can take several forms, offering flexibility to both employers and employees:

• Indefinite contracts – the default form of employment, offering stability and security to employees.
• Fixed-term contracts – allowed only for legitimate reasons, such as project-based work or temporary substitutions. Without valid justification, fixed-term contracts are deemed indefinite.

4.2 Written and oral contracts

While oral employment contracts are legally valid, written contracts are strongly recommended to prevent disputes. Employers must provide employees with written information on key employment terms, such as:

• Names and domiciles of the employer and employee;
• Job title and description of duties;
• Start date and, for fixed-term contracts, the end date or justification for the term;
• Working hours and remuneration details;
• Holiday entitlements and applicable CBAs;
• Notice periods and trial period (if any).

This information must be provided within a statutory timeframe after the commencement of employment.

4.3 Trial periods

A trial period of up to six months may be agreed upon. During the trial period, either party may terminate the contract with immediate effect, provided the termination is not discriminatory or otherwise unlawful.

5. Working hours and annual leave

5.1 Working hours

The Working Hours Act sets the framework for employees’ regular working hours, which are typically:

• Regular hours: eight hours per day, 40 hours per week; and
• Possibility for flexible arrangements, for example flexitime or other working time arrangements agreed under the Act.

Employees are entitled to statutory rest periods, including at least 11 consecutive hours of daily rest and 35 hours of uninterrupted weekly rest.

5.2 Annual leave

Employees accrue annual leave based on their length of service with the employer, typically:

• Less than one year of employment: two days of leave per month of employment; and
• Over one year of employment: 2.5 days of leave per month of employment.

The Annual Holidays Act ensures employees receive their salary during annual leave and guarantees compensation for unused leave when the employment relationship ends.

6. Employee salaries and fringe benefits

Salaries in Finland are typically agreed in the employment contract and must comply with the minimum standards set by applicable CBAs. Employers are required to pay salaries on time, usually on a monthly basis.

In addition to monetary compensation, many employees receive fringe benefits, for example:

• Meal vouchers or subsidised lunches;
• Company cars, laptops or mobile phones;
• Occupational health care, insurance or wellness allowances.

Performance-based bonuses and commissions are also common, particularly in sales and senior positions.

7. Workplace equality and non-discrimination

Equality is a fundamental principle of Finnish employment law. Employers must ensure fair treatment and equal opportunities for all employees, regardless of gender, age, ethnicity, religion, disability, sexual orientation or other protected characteristics.

Key measures include:

• Gender equality – the Equality between Women and Men Act mandates equal pay for equal work and promotes gender balance in the workplace.
• Broader equality – the Non-Discrimination Act prohibits unfair treatment during recruitment, employment and termination processes.

Violations of these principles may result in legal sanctions, including compensation to affected employees.

8. Employee representation and collective agreements

Employees in Finland enjoy strong representation rights, particularly in larger organisations. The Codetermination Act grants employees the right to appoint representatives to participate in company decision-making processes.

Collective bargaining agreements often define sector-specific employment terms and conditions, and may:

• Set minimum salaries and bonuses;
• Regulate working time and overtime compensation; and
• Include workplace dispute resolution procedures.

Employers are obligated to comply with generally binding CBAs where applicable.

9. Immigration and employment permits in Finland

Foreign nationals who wish to work in Finland must comply with immigration and residence requirements, for example:

• EU/EEA citizens – no work permit is needed, but registration of the right of residence is required for stays exceeding three months.
• Nordic citizens – enjoy simplified procedures and do not need a work permit.
• Non-EU/EEA citizens – generally require an employee residence permit. Processing times vary, with fast-track options available in certain cases.

10. Get expert legal guidance on employment law in Finland

Navigating Finnish employment law can be complex, especially when balancing legal compliance with business needs. Whether you are hiring employees and need an employment agreement, restructuring your organisation, or a foreign company expanding to Finland, our team of experienced legal professionals is here to assist you.

For more information about our services, please contact our employment law specialists or call us at +358 40 672 4285.

About us | LKOS Law Office

LKOS Law Office is an internationally recognised, high-quality boutique business law office located in Helsinki, Finland. We provide legal services to foreign and domestic companies. Our NewLaw concept ensures that we serve all of our clients individually and strive to exceed their expectations regarding business law services. We are a reliable partner in a rapidly changing business environment.

If you are interested in hearing more about our services and personnel, please do not hesitate to contact us by email or visit the LKOS Law Office website for further information.

This article is for informational purposes only and does not constitute legal advice.

SANCTIONS: A LEGAL LABYRINTH FOR BUSINESS LAWYERS

Don’t Let Sanctions Uncertainty Put Your Business at Risk

Business lawyers dislike uncertainty. Nevertheless, many business lawyers describe various sanction regimes as vague and inconsistent. In addition, conflicting sanction regimes create headaches for international businesses operating across borders.

Despite the common belief that sanctions are primarily a concern for the financial sector, they have quietly evolved into a significant business risk for companies across all industries. As a result, businesses of all sizes must identify and manage the various applicable sanction regimes to minimize both financial risks and the reputational damage caused by sanctions violations.

Further complicating compliance, sanction lists are frequently updated—sometimes daily—and are issued by different governmental and international bodies. These lists are not always harmonized across different regimes, adding yet another layer of complexity.

Navigating the legal labyrinth of sanctions has become a daily reality for multinational and multi-jurisdictional companies. To support businesses in tackling this challenge, we have compiled a brief guide addressing key questions about sanctions and how to comply with them.

What are sanctions? | Introduction

Sanctions are preventive measures designed to influence the policies or actions of certain high-risk individuals, groups, or states when such policies or actions pose a threat to international peace and security.

Sanctions may target the government of a specific state, as well as individuals or entities affiliated with that government. They may also target specific groups or industries. In addition to these, sanctions can restrict the availability of certain products, services, materials, technologies, or know-how that might otherwise contribute to the targeted activity.

Sanction regimes | Legal labyrinth

Checklist for businesses. Sanctions Compliance Process | Key to mastering multiple regimes

1. Screen Business Partners

2. Assess the Product or Service

• Verify whether the goods, services, or technology being traded are restricted or require special licensing.
• Check for dual-use goods (products with both civilian and military applications).
• Ensure compliance with sector-specific sanctions (e.g., energy, defense, telecommunications).

3. Evaluate the Destination and End-Use

4. Review Financial Transactions and Payment Flows

5. Establish a Compliance Policy and Ongoing Monitoring

• Implement a Sanctions Compliance Policy that sets clear internal procedures.
• Train employees, sales teams, and suppliers on sanction risks and compliance obligations.
• Continuously update sanction lists and screen transactions to remain compliant with changing regulations.

Our recommendations | To-Do list

When drafting and implementing a Trade Compliance Policy, companies should:

✅ Review all applicable sanction regimes relevant to your business activities.
✅ Draft and implement a comprehensive Sanctions Compliance Policy—and update it frequently.
✅ Integrate sanction screening tools into operational processes.
✅ Follow best practice principles, including strong documentation to support compliance decisions.
✅ Adopt a conservative interpretation of sanction rules to reduce legal risk.
✅ Engage with a trusted business law partner for legal guidance and industry-specific know-how.