Document reveals strict conditions for severance package for ex-UPM CEO Juha Niemelä

Lead boot to replace golden handshake if Niemelä fails to cooperate with cartel investigation

Juha Niemelä

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Juha Niemelä, the former CEO of the Finnish paper company UPM-Kymmene, is required to cooperate fully with the investigation by competition authorities investigating claims of a massive paper cartel.
      According to a document submitted by UPM to the US Securities and Exchange Commission (SEC), failure to cooperate would cause Niemelä to lose his generous severance package. The agreement had been signed by Niemelä and Vesa Vainio, the UPM Chairman of the Board.
     
When Niemelä's resignation was announced in January last year, the company did not reveal the real reasons behind the decision. Both Niemelä and Vainio spoke of a "controlled and voluntary change of generation". Niemelä was replaced by Jussi Pesonen.
      A few months later, when UPM revealed that it had contacted competition authorities on possible illegal cooperation among competitors, it would still not admit that Niemelä's resignation had anything to do with the suspicions of the existence of a paper cartel; generational change remained the official explanation.
      The documents submitted by UPM to the SEC confirm suspicions that Niemelä's departure was directly related to investigations of a cartel by US authorities.
      The agreement signed by Niemelä and Vainio calls for complete cooperation "in all possible investigations concerning violations of competition rules".
      Niemelä is required to give a "truthful and full" accounting of everything he knows to the various investigators. he must also give the company all relevant material that he has, and he must make himself available in Finland for the investigations.
     
If Niemelä fails to cooperate, UPM will suspend payment of his salary, which is to continue under his severance package until the end of August next year. The agreement also provides for "reasonable" legal costs related to the US cartel investigation.


Previously in HS International Edition:
  Competition Authority refuses to hand over documents in forest industry cartel case (7.6.2005)
  Minister Pekkarinen sees paper cartel allegations as blow to Finnish reputation (28.5.2004)
  Police raid offices of numerous forest companies over cartel suspicions (26.5.2004)
  Juha Niemelä unexpectedly resigns as CEO of UPM-Kymmene (30.1.2004)

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