Chapter 10 - Fighting the Grey Economy with National Legislation. The Case of Finland

Summary

INTRODUCTION

When the Finnish government embarked on a battle against the grey economy in 2011, commercial goods transport was defined as one of the focus areas. This reflected in Finland's revised Act on Commercial Haulage of Goods by Road (21.7.2006/693), which came into force in two phases in 2013 and 2014. Customer liability was introduced in the first phase.

Since 25 April 2013, Finnish customers of haulage companies are obliged, before concluding a transport contract, to verify that for example:

– the haulier has a current licence for freight transport on public roads or; the right to carry freight without a licence;

– when the contract price is liable to VAT, that the haulier is registered for VAT;

– in cabotage, that the company carrying out the haulage work has the right to engage in cabotage; and

– the haulier is fulfilling his legal obligations as an employer.

A particularly low price for transport services may indicate that the haulier is not fulfilling his legal obligations and should give the customer reason to suspect negligence. If in such cases the customer fails to conduct proper checks before signing a haulage contract, he will be breaking the law and may be subject to a fine (32 §). These measures can be considered stricter than general contractor's liability.

In order to speed up efficient implementation of these measures, Finnish Transport and Logistics SKAL has written and distributed two guidebooks for professional purchasers in cooperation with the Finnish authorities. These guidebooks present practical examples of the revised law and list sources for checking information related to customer liability. For example, the Finnish authorities maintain open-to-all online registers for checking Community licences and VAT information.

COMMERCIAL GOODS TRANSPORT AND GREY ECONOMY IN FINLAND

Commercial goods transport on Finnish roads concerns some 9,000 road haulage operators with an annual turnover of over €5 billion. The financial impact of the grey economy is approximately €500 million. It includes, among others, unlicensed commercial goods transport, engaging in illegal cabotage and failing to comply with legal obligations, such as offering appropriate wages, paying taxes and having the required insurance.