The following summary is based on the tax laws of Finland in effect in March 2010, and is subject to changes in Finnish law, including changes that could have a retroactive effect. The following summary is not exhaustive and does not constitute definitive advice. Kemira’s shareholders are advised to consult professional tax advisors as to the tax consequences of the share dividend.

Non-residents of Finland

• As a general rule, in accordance with Finnish legislation (the Act on the Taxation of Non-residents’ Income), non-residents of Finland are subject to Finnish withholding tax on dividends paid by a Finnish corporation
• According to the law, the withholding tax rate is 28 percent, unless otherwise set forth in an applicable tax treaty
• Kemira will withhold tax with the following exceptions:
  • Withholding tax cannot be withheld in respect of the share dividend, if no cash dividend is distributed in connection with the share dividend
  • If entitlements to fractional shares are compensated to a non-resident shareholder in cash, Kemira does have an obligation to withhold withholding tax in respect of the total amount of the share dividend and cash dividend, but only up to the amount of the cash dividend
  • No tax will be payable if the amount of the tax is less than EUR 17.00
• Kemira will pay transfer tax payable in respect of the share dividend.
• The taxable value of the Tikkurila shares distributed as share dividend used in taxation is the volume-weighted average of the prices paid for Tikkurila’s shares during the first trading day after Tikkurila’s shares have been submitted to trading on the official list of the Helsinki Stock Exchange. Such volume-weighted average price was EUR 15.80
• If the full amount of tax at source was not withdrawn from dividend paid by Kemira in the year 2010 due to absence of sufficient cash dividend, a tax return must be filed. The tax return form for non-residents is provided by Finnish Tax Administration.  >link< To avoid the obligation to pay interest on the tax, it is advisable to file the tax return during 2010 

Three examples of taxation of non-resident persons of Finland are illustrated below:

Each four shares of Kemira would entitle Kemira’s shareholder to receive one share of Tikkurila as a share dividend.

Example 1:

A Swedish resident owns 203 shares of Kemira and received 50 shares of Tikkurila as a share dividend and EUR 11.85 in cash.  In accordance with the tax treaty between the Nordic countries, the withholding tax rate regarding portfolio shares is 15 %.

Withholding of tax at source:

Total value of dividend: (50 shares * EUR 15.80) + (3/4 shares * EUR 15.80 )  =  EUR 801.85,
Calculated withholding tax = EUR 801.85 *15% =EUR 120.28
Dividend paid in cash: 3/4 *EUR 15.80= EUR 11.85
Withholding tax = EUR 11.85
Calculated tax at source:  EUR 801.85 * 15 % = EUR 120.28
Tax at source payable by the shareholder for the dividend received: calculated tax at source – withholding tax: EUR 120.28 – EUR 11.85  = EUR 108.43

Example 2:

A Swedish resident owns 100 shares of Kemira and received 25 shares of Tikkurila.

Withholding of tax at source:

Value of dividend: 25 shares * EUR 15.80  = EUR 395.00 Calculated withholding tax: EUR 395.00 * 15% = EUR 59.25
Withholding tax: Withholding tax can not be withheld, if no cash dividend is distributed
Calculated tax at source: EUR 395.00 * 15% = EUR 59.25
Tax at source payable by the shareholder for the dividend received: calculated tax at source- withholding tax: EUR 59.25 – EUR 0.00  = EUR 59.25.

Example 3:

A Swedish resident owns 5 shares of Kemira and received one share of Tikkurila and in cash EUR 3.95.

Withholding of tax at source:

Value of dividend: 1 share * EUR 15.80 + 1/4  *EUR 15.80= EUR 19.75
Calculated withholding tax: EUR 19.75 * 15 % = EUR 2.96.
Withholding tax: No tax will be payable if the amount of the tax is less than EUR 17.00

More detailed description of taxation of share dividend is available at the website of the Finnish Tax Administration.