Contingent assets, collateral pledged and guarantees
As of the balance sheet date, contingent assets, collateral pledged and guarantees reported as contingent liabilities were distributed as follows.


December 31,
SEK in millions

20072006
Contingent assets

--
Collateral pledged



For warranty provisions: Blocked funds in bank accounts

960911
For operating leases: Blocked funds in bank accounts

1-
For deposits from customers: Blocked funds in bank accounts

10976
For pension obligations: Real estate mortgages

1817
For pension obligations: Current receivables

4037
For bank overdraft facilities: Chattel mortgages

16-
For operating leases: Real estate mortgages

43
For long-term borrowings: Shares in Svenska UMTS-nät AB

204359
Total collateral pledged

1,3521,403
Guarantees



Credit guarantee on behalf of Svenska UMTS-nät AB

1,8381,685
Credit guarantees on behalf of other associated companies

132
Other credit and performance guarantees, etc.

61152
Guarantees for pension obligations

234219
Total guarantees

2,1462,058
As of December 31, 2007, total unrecognized guarantees represented the following expected maturities.
Expected maturity, SEK in millions


Guarantees
2008


65
2009


3
2010


3
2011


1,841
2012


-
Later years


234
Total


2,146
Some loan covenants agreed limit the scope for divesting or pledging certain assets. Some of TeliaSonera AB's more recent financing arrangements include change-of-control provisions which under certain conditions allow the lenders to call back the arrangement before scheduled maturity. Conditions required include a new owner taking control of TeliaSonera AB, inter alia also resulting in a lowering of TeliaSonera AB's official credit rating to a so-called non-investment grade level.
For all guarantees, except the credit guarantee on behalf of Svenska UMTS-nät AB, stated amounts equal the maximum potential amount of future payments that TeliaSonera could be required to make under the respective guarantee.
As security for certain amounts borrowed by TeliaSonera's 50 percent owned joint venture Svenska UMTS-nät AB under a third-party credit facility totaling SEK 4,800 million, TeliaSonera and Tele2, the other shareholder of Svenska UMTS-nät, have each severally but not jointly issued guarantees of a maximum of SEK 2,400 million to the lenders and granted pledges of their shares in Svenska UMTS-nät. The indebtedness under the credit facility may become due on an accelerated basis, under certain circumstances, including if either TeliaSonera or Tele2 ceases to hold, directly or indirectly, 50 percent of the company, unless the lenders provide their advance consent. TeliaSonera is not contractually required to provide any further capital contributions to or guarantees in favor of Svenska UMTS-nät. As of December 31, 2007, Svenska UMTS-nät had, under the credit facility, borrowed SEK 3,676 million, of which TeliaSonera guarantees 50 percent, or SEK 1,838 million.
As of December 31, 2007, TeliaSonera had recognized all of its commitments on behalf of Ipse 2000 S.p.A. in the balance sheet as warranty provisions (see Note 24 "Other Provisions"). Ipse's UMTS license payments to the Italian government have been secured by bank guarantees. According to an agreement with the bank, Ipse and its shareholders, including TeliaSonera, have given cash collateral for the remaining license payments from 2008 to 2010. TeliaSonera's part of the cash collateral amounts to EUR 100 million, equivalent to SEK 948 million.
TeliaSonera has entered into a cross-border finance lease-leaseback agreement for mobile network equipment in Finland, with a remaining carrying value of SEK 9 million as of December 31, 2007. The arrangement was entered into in 1998 by TeliaSonera Finland Oyj (formerly Sonera Oyj) and is valid for 15 years, with an early termination option after 11 years. TeliaSonera has determined that in substance the transactions are not leases as defined in IAS 17, and the amounts are shown net on the balance sheet. Both the lease receivables and the lease obligations were settled at the inception of the agreement and TeliaSonera received a net cash consideration of USD 11 million (EUR 9 million) which was recorded in the balance sheet as an advance payment received and is recognized in financial income over the lease term.
No other cash payments are currently expected to be made by TeliaSonera, since TeliaSonera has defeased all obligations under the agreement with highly rated financial institutions and U.S. Government related securities. The ownership of the equipment is retained with TeliaSonera. However, during the agreement period, TeliaSonera can not dispose of the equipment but may make replacements.
Other unrecognized contractual obligations
As of December 31, 2007, unrecognized contractual obligations regarding future acquisitions (or equivalent) of non-current assets represented the following expected maturities.
Expected maturity, SEK in millionsIntangible assetsProperty, plant and equipmentOther holdings of securitiesTotal
2008392,138152,192
2009-1007107
Later years----
Total392,238222,299
Most of the obligations with respect to property, plant and equipment refer to contracted build-out of TeliaSonera's mobile network in Spain and fixed networks in Sweden and Lithuania.
TeliaSonera's Spanish subsidiary Xfera also pays an annual spectrum fee during the term of its 3G license expiring in 2020. The fee is determined on an annual basis by the Spanish government authorities and for 2008 is set to EUR 27 million.
Legal and administrative proceedings
In its normal course of business, TeliaSonera is involved in a number of legal proceedings. These proceedings primarily involve claims arising out of commercial law issues and regulatory matters. TeliaSonera is also involved in administrative proceedings relating principally to telecommunications regulations and competition law. In particular, TeliaSonera is involved in numerous proceedings related to interconnect fees, which affects future revenues. Except for the proceedings described below, TeliaSonera or its subsidiaries are not involved in any legal, arbitration or regulatory proceedings which management believes could have a material adverse effect on TeliaSonera's business, financial condition or results of operations.
Regulatory proceedings
The administrative courts in Sweden have ruled that TeliaSonera shall reimburse Tele2 for all traffic transferred by TeliaSonera to Tele2's mobile network, while TeliaSonera is entitled to be reimbursed by the originating operators who have transferred traffic on TeliaSonera's network. In connection with the proceedings above, Tele2 brought an action in the Swedish civil courts against TeliaSonera claiming currently SEK 932 million and accrued interest for interconnect fees for the period September 1998 - March 2004.
The action has been stayed pending the administrative procedures. TeliaSonera has paid parts of the sum claimed and has recognized provisions for the remaining exposure that management believes to be sufficient.
TeliaSonera is also in disputes with Tele2, Telenor and Hi3G in Sweden regarding the level of interconnect fees for calls from 2004 and onwards terminated in their respective mobile networks. The Swedish National Post and Telecom Agency (PTS) has decided that Tele2, Telenor and Hi3G were entitled to charge TeliaSonera approximately SEK 0.97 per minute until July 5, 2004 and thereafter down to SEK 0.55 in 2007. Tele2, Telenor and Hi3G claim that the interconnect fees should be higher, in the range of SEK 0.99-1.35 per minute, while TeliaSonera claims that the fees should at the most be in accordance with the fees that PTS has decided.
In December 2007, the Administrative Court of Appeal decided on the matter of the level of Tele2's and Telenor's interconnect fees from October 2003 until June 2007. The decisions from the Administrative Court of Appeal have resulted in reversals of existing provisions totaling SEK 571 million, of which amounts relating to prior years were recorded as other operating income (see Note 9 "Other Operating Income and Expenses").
The issues are presently pending in the courts. For the remaining exposure, TeliaSonera has recognized provisions that management believes to be sufficient. However, the final outcome may result in payments that deviate significantly - up or down - from the current provision level. As the other operators have submitted invoices to TeliaSonera, parts of which TeliaSonera dispute, the provisions form part of accounts payable.
During the second half of 2001, a number of operators filed complaints against TeliaSonera with the Swedish Competition Authority and the Authority initiated an investigation regarding TeliaSonera's pricing of ADSL services. The complaints suggest that the difference between TeliaSonera's wholesale prices and retail prices is too low to effectively enable competition in the retail market. In December 2004, the Competition Authority sued TeliaSonera at the Stockholm District Court claiming that TeliaSonera has abused its dominant position.
The Authority demands a fee of SEK 144 million. TeliaSonera's position is that it has not engaged in any prohibited pricing activities. Following the Competition Authority's lawsuit, Tele2 has on April 1, 2005 and Spray Network on June 29, 2006, respectively, claimed substantial damages from TeliaSonera due to the alleged abuse of dominant market position. TeliaSonera will vigorously contest Tele2's and Spray Network's claims. The actions for damages have been stayed pending the case between TeliaSonera and the Competition Authority.
Other legal proceedings
TeliaSonera is currently involved in court cases with Primav Construcoes e Comercio and Telmig, former share-holders of the Brazilian mobile operator Tess, relating to such shareholders' disposal of their investments in Tess as well as certain call options and subscription rights in Tess. Whilst TeliaSonera has sold its holding in Tess, it has entered into certain guarantees to compensate the buyer for certain losses in connection with the above-mentioned court cases. TeliaSonera will vigorously contest any claims in connection with the disputes. Even if TeliaSonera believes that losing the disputes is not probable, given the anticipated duration of the court proceedings, TeliaSonera has recognized a provision for estimated future legal fees.