Finnish vendor Nokia moved to allay concerns it could be hit with criminal penalties after revealing it had opened an internal investigation over possible compliance issues at Alcatel-Lucent, which it acquired in 2016.

In a statement, Nokia said it did not expect the investigation would have a “material impact” on the company, while adding it had not seen evidence which would suggest criminal penalties would apply in this case.

Should it face any penalties, it believes they “would be limited and immaterial”.

The issue arose after the vendor said in its annual report, filed last week with the US Securities and Exchange Commission (SEC), that it was “made aware of certain practices relating to compliance issues at Alcatel-Lucent”.

Following the revelation, Nokia’s share price dropped 7 per cent, reported The Wall Street Journal. 

Nokia bought Alcatel-Lucent, a France-based rival at the time, in 2016 for $17 billion.

The company told the SEC it had made regulators aware of the issue and opened an internal investigation. 

In its statement, Nokia did not provide any further details on the antitrust issues, other than to state it was “now scrutinising certain transactions in the former Alcatel-Lucent business”, to ensure complete compliance.

Nokia has announced a series of job cuts, mainly in its home market, as part of a broader global restructure of its operations following the Alcatel-Lucent deal.

It said it was aiming to benefit from cost savings of €1.2 billion in synergies through the tie-up in 2018.

In its annual report, the company also said it would refuse new business in Iran during 2019 due to the reintroduction of sanctions by the US government.