Out of around 800 entrepreneurs handed business bans in Finland, 46 continue operating in Estonia, Yle reported Wednesday. This despite the fact that Estonia is one of just a few European countries that recognizes Finnish business bans.

"This means that if a person banned from doing business in Finland comes to Estonia and wants to become a member of a company's board, the court will check for both Finnish and Estonian business bans. If they see that the person has a valid business ban in Finland, then the court will not confirm this person as a board member," explained Heddi Lutterus, deputy secretary general for legal policy at the Ministry of Justice.

However, a business ban does not mean that an entrepreneur cannot be a shareholder or employee of a company. A business ban is not a blanket prohibition on all business activity, she added.

"The fact that a person banned from business in Finland is operating in Estonia does not necessarily mean that they have violated the ban. The ban applies to them not being able to be a board member. If the company is engaged in business activity in Estonia, this is not inherently prohibited," Lutterus acknowledged.

This does not rule out that these individuals may still make significant decisions within the company. As Yle points out, it's difficult to verify whether a figurehead has been appointed as a board member.

"This would be circumventing the business ban. I think, in this case, it is not a problem in the Estonian context but would be a problem for Finland itself. This means circumventing the business ban in Finland as well. It's a separate question on how this could be monitored at all. Such blanket control, whether someone is a shareholder or an employee in a limited company, is not actually realistic," the undersecretary found.

Based on this limited information, it is impossible to say whether the entrepreneurs referred to by Yle are breaking the law or not, Lutterus acknowledged.

"Similarly, we don't really know what happens when a person banned from doing business in Estonia goes to Finland, Latvia or another European country. Generally, there is no recognition of each other's business bans. Beyond the national border, we no longer see what that person is doing," she explained.

This could be resolved with a unified system of business bans in the European Union. It has been discussed before, Lutterus said: "But ultimately, it came to nothing. The reason is that business bans are very different in each country. Both in terms of what they regulate and how long they last. This requires finding common ground on the conditions under which business bans are imposed."

Recently, neither Estonia nor other member states have raised the need to harmonize business bans again. However, discussing it anew is not out of the question, Lutterus added.

--

Follow ERR News on Facebook and Twitter and never miss an update!