Nokia offers voluntary retirement at Indian tax-dispute factory

NEW DELHI Fri Apr 11, 2014 6:24am EDT

A photo illustration of a man silhouetted against a Nokia logo in the central Bosnian town of Zenica January 23, 2014. REUTERS/Dado Ruvic

A photo illustration of a man silhouetted against a Nokia logo in the central Bosnian town of Zenica January 23, 2014.

Credit: Reuters/Dado Ruvic

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NEW DELHI (Reuters) - Nokia Oyj is offering voluntary retirement at an Indian factory at the centre of a tax dispute after a review of the regulatory environment in countries where it operates.

Nokia planned to transfer the plant to Microsoft Corp as part of the 5.4 billion euro ($7.5 billion) sale of its handset division, but the local tax office seized it last year.

A court later ordered Nokia give the tax office a 35 billion rupee ($582.17 million) guarantee before transferring the plant to Microsoft. Nokia has yet to agree.

Nokia on Friday said, without referring to the dispute, that it launched a voluntary retirement scheme (VRS) after a review in which it considered the "predictability and stability of the regulatory environment" in countries where it operates.

"We have set no target for the VRS in terms of the number of employees. All of the employees coming forward are entitled to the package," Nokia said in a statement.

The plant is in the southern city of Chennai and, with about 6,600 fulltime employees, is one of Nokia's biggest for making handsets.

($1 = 0.7204 Euros)

($1 = 60.1200 Indian Rupees)

(Reporting by Devidutta Tripathy; Editing by Christopher Cushing)

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Comments (2)
nose2066 wrote:
I once knew a school teacher from India. His favorite expression was:
“I may say anything”. And that expression sums up the government regulatory environment in India.

Apr 11, 2014 9:58am EDT  --  Report as abuse
spaceman776 wrote:
Nokia and Microsoft said this dispute wont hold back their final sale
deal closure however whenever a company offers early retirement of employees things seem shaky to me. I will feel for the folks who may loose their jobs if Nokia just closes this plant.

Apr 11, 2014 11:16am EDT  --  Report as abuse
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