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Arctia Ltd.

Arctia Ltd. is a limited company established in 2010 and owned by the state of Finland. The company’s line of business is the provision of icebreaking services and specialised multipurpose vessel services, along with the management and chartering of ships in Finland and abroad.

Arctia’s vessels include the conventional icebreakers Voima (commissioned in 1954, renovated in 1979 and 2016), Urho (1975) and Sisu (1976), Otso (1986) and Kontio (1987), the multipurpose icebreakers Fennica (1993) and Nordica (1994), harbor icebreaker Ahto (2014), as well as Polaris, which is the world’s first icebreaker to use liquefied natural gas, LNG, as fuel and designed for the most challenging ice conditions in the Baltic Sea.

Meritaito Ltd, the state-owned company offering services in fairway maintenance and hydrographic surveying, became Arctia’s fully owned subsidiary in December. The Finnish Government made a decision on the reorganisation in its plenary session on 13 December 2018. Together the companies are able to offer their customers an even more comprehensive range of marine services both in Finland and overseas. More diversified services will improve competitiveness in the constantly tightening international market. The reorganisation aims to improve business opportunities and profitability and to strengthen international business operations.

In Finland, Arctia’s key customers are the Finnish Transport Infrastructure Agency and the maritime and inland waterway operators that benefit more extensively from the services it purchases. Arctia gathers annual feedback on the success of its services in cooperation with the Finnish Transport Infrastructure Agency. For example, shipping companies and merchant vessels expect a speedy response to their requests for assistance. The icebreakers have contractual quality indicators, such as assistance efficiency and waiting time. In 2018, the expected values were realised in line with the quality indicators.

International customers and stakeholders are increasingly important to Arctia in ensuring viable year-round activities that are necessary for fleet renewal. In 2018, sales and marketing work focused especially on new customers in the research, mining operation and passenger transport service sectors.

Meritaito focused on developing its customer relationship management to be even stronger and more extensive during 2018. At the same time, services were offered to customers as tailored service bundles. Customers are particularly interested in service contracts and a comprehensive method of purchasing. Development work to promote the sale of bundled services in the entire Arctia Group continues in 2019.

In addition to international conventions, international customers expect service providers to comply with the practices and rules required by the customer. The rules set by the customer are usually stricter than the requirements of general maritime or waterway regulations. The requirements vary according to the customer concerned. They may apply to, e.g. occupational safety, supplier management, communication on operations and the use of social media, responsibility in the wider sense, or emissions from vessels in a certain area. The customers direct and monitor Arctia’s operations actively, e.g. through inspection rounds, working group meetings and audits.

The Prime Minister’s Office is responsible for the ownership steering of Arctia Ltd. In 2018, the Minister of Economic Affairs acted as the minister responsible for the State’s ownership policy. The Ownership Steering Department of the Prime Minister’s Office prepares and implements the state ownership policy and steers state-owned enterprises. The dialogue between Arctia and its owner is continuous and open. State-owned companies are expected to build their competitiveness with a long-term approach and, as the owner, the State requires its companies to carry on responsible business operations. The owner expects the company to generate a return on its investment, operate profitably and discharge its duties efficiently. Furthermore, the owner requires the company to be able to finance its own operations and investments.

In addition to numerous discussions with the owner, Arctia took part in the corporate social responsibility seminar for state-owned companies in 2018. Contacts with the owner were particularly close towards the end of the year before the reorganisation of Arctia and Meritaito.

Finnish Transport Infrastructure Agency The Finnish Transport Infrastructure Agency (until the end of 2018 the Finnish Transport Agency) is Arctia’s most important customer. The Finnish Transport Infrastructure Agency is responsible for winter navigation and its organisation in Finland. This entity includes, e.g. the ice classes of vessels and the ice class rules, port-specific traffic restrictions according to the ice conditions, launching of icebreaking operations, specifying the number of icebreakers used in traffic assistance, suspension and ending of icebreaking operations, and cooperation with the other countries around the Baltic Sea.

From its service providers, the Finnish Transport Infrastructure Agency expects cost-efficiency and safe, punctual and reliable operations. Arctia engages in regular dialogue with the Finnish Transport Infrastructure Agency during and after the icebreaking season. Targets have been set for Arctia regarding, e.g. ship waiting times, towing speed and the number of transit voyages. The achievement of these targets is actively monitored in cooperation with the Finnish Transport Infrastructure Agency during the icebreaking season. In 2018, Arctia met the targets assigned for it.

Due to protectionist measures, there has been a decline in demand for icebreaking, offshore and other maritime services in the North American and Russian markets, which used to be important to Arctia. Furthermore, there are many vessels competing with Arctia’s vessels in the market. The fall in global chartering prices calls for improvement in cost competitiveness. The company must adapt to changes in the demand for its services and to the reduction in the number of customer contracts. In order to address these challenges, Arctia continued in 2018 the development projects on costeffectiveness that it had already previously started. The objective is to improve the company’s efficiency and cost competitiveness.

Arctia has promoted the shared use of icebreakers for years. Icebreaker operators in the Baltic Sea and in the Arctic Ocean would benefit from closer cooperation. In April 2018, Arctia took the initiative of promoting international shared use of icebreakers, for example, by extending Finland’s current bilateral icebreaking treaties into a multilateral agreement between the member states of the Arctic Council.