As previously announced, in 2007 and 2008 Tilgin appealed to the Administrative Court in Stockholm following the decision of the Swedish Customs to impose customs duties on certain imports during 2005 and 2006. The Administrative Court has now dismissed the appeal. Tilgin intends to appeal the decision of the Administrative Court to the Administrative Court of Appeal. If Tilgin should ultimately incur those customs duties, the company will claim compensation as set out in the contract with the relevant customer for whom the imports were made.

The customs duties included in this decision refers to 29 imports of Tilgin’s IPTV set-top boxes in 2005 and 2006 and amounts to SEK 21,552,251 of which SEK 1,763,982 is VAT, according to the Administrative Court’s decision.

To avoid having to provide full security for all customs duties, the company chose to pay the customs duties in full over 12 months in 2008 and 2009. This does not affect Tilgin’s position in the court proceedings. If the Administrative Court of Appeal approves review dispensation and will judge in favour of Tilgin, the amount paid will be refunded immediately.

Customs duties are excluded from the price in the customer agreement that applies to all 29 imports. If Tilgin should ultimately incur those customs duties, the company will claim compensation from the customer for the amount paid to the Swedish Customs.