BONJOUR L'ESTONIE

Subpoenas to be served via Facebook and Twitter in Estonia

According to a report from AFP, crime suspects may be contacted by a court using their email, Facebook or Twitter accounts. The message would contain a short link leading to court documents.

It’s a draft bill at the moment and a subpoena would only be delivered if the person receiving it clicks on the enclosed link. Then they would have to visit the official site that can be accessed with an electronic identification ID-card, one that is issued to all adult Estonians. Not quite frictionless then.

Justice ministry spokesman Priit Talv told AFP that court cases in Estonia take a long time because of the slow delivery method for documents. He also noted, “In addition to those criminal suspects who deliberately try to hide their mail or residence address there are many people whose address is either not registered or they travel a lot. Reaching people via electronic means is both cheaper and quicker.”

Digitally legal

The process of signing documents digitally is already becoming well practised, naturally, there’s an app for that. Evidence in divorce cases is also taking into account our social media activity. If you were considering insurance fraud, you might also want to re-arrange your social networking links as this too can be considered when investigating possible crime.

AFP quotes a study saying that, “65 percent of all Internet users in Estonia; a figure rising to 80 percent for those under 40, visit their Facebook account at least once a week.” If those figures are correct, then it is hardly surprising that this system makes sense as a way to contact people.

Though, unless you are following your local court on Twitter, it would also be a rather public way to be served your papers.

Estonian motorists evading taxes

Nearly half of all Estonian cars in Finland have legally dubious status, estimates the Customs Board. Many are kept here permanently but still registered in Estonia to avoid paying Finnish taxes. Estonia does not levy annual car taxes.

There are some 50,000 foreign-registered vehicles in the country, most of them from Estonia, which is Finland's nearest neighbour to the south.

By law, an automobile must be registered in the country where its owner primarily lives and works. A foreign vehicle may be driven in Finland for up to six months before it must be registered here -- but only as long as its user is a permanent resident of another country.

This may of course be open to interpretation, but by law Customs officials can make the decision in uncertain cases. The state of Finland loses out on hundreds of thousands of euros annually due to improperly registered cars.

"Most don't pay"

"Sure, I know people who live and work in Finland but don't pay car taxes here," says Mare, an Estonian who has lived here for six years. "There are lots of them. Some pay, but most don't. I don't think it's fair. If you live and work in Finland, then you should follow Finnish laws, too," she adds.

Trial over Estonian doctors accused of clinical trials on humans started in Tartu

Trial in the criminal case concerning unauthorised clinical trials on humans started in the Tartu County Court on Monday, writes LETA/National Broadcasting.

Charged with the crimes are well-known medical doctors Andres Sell and Lembit Allikmets.

According to charges, in 2006, 64 orthopaedic surgeries were carried out in the outpatient surgery centre Medex and in the Tartu University Hospital, using the anaesthetic drug for which there was no authorisation by the State Agency of Medicines and whereby patients were also not informed in accordance to the regulations.

The prosecutor has stated that Sell incited Allikmets to forge a permit for the trials and the latter did so.

If convicted in carrying out illegal clinical trials on humans, the court may sentence the accused with a monetary fine or a prison term of up to three years.

The Tartu County Court ruled on Monday that the trial would not be open to the public. The Southern Circuit Prosecutor Kristiina Laas requested that the sitting be declared closed in order to protect the private lives of the victims as the case would reveal the data on their health records which are considered delicate personal data.

Defence lawyers also agreed with the prosecutor’s request.

Juhan Tere

Personal bankruptcies on the way up in Estonia

70% of bankruptcies that were declared in Estonia in October 2011 were personal bankruptcies of private persons. According to experts, declaring one personally bankrupt is cheaper than paying debts to bailiffs, writes Eesti Ekspress weekly.

A typical case: a resident of Tallinn who owns 116,000 euros, has no assets, earns 640 euros a month and has two children.

While a year ago a total of 1,655 bankruptcy applications were filed last year, of which 20% were personal bankruptcies, the ratio is now at 30%.

One of the most prominent persons to be declared bankrupt recently was Viktor Levada who was once one of Estonia's richest businessmen and who had guaranteed a business loan in the amount of over 6 million euros. Also his company that had paid about 700 million kroons for a vacant lot opposite Hotel Olympia is now bankrupt.

Another is Väino Pentus, father of Estonian minister of environmental affairs Keit Pentus, owned 195,000 euros and whose transport company Autorollo went bankrupt in spring.

Toomas Hõbemägi

Estonian justice ministry will start compiling a cohabitation law in 2012

Estonian justice minister Kristen Michal sent a letter to Riigikogu factions on Monday informing them of intentions to start creating the cohabitation law in 2012, LETA/Postimees Online reports.

“In Estonia, the share of cohabitation couples has increased and that of traditional marriages has decreased for a long period of time,” Michal writes. “For example, in the past decade, the majority of children were born outside registered marriages (58% of children in 2007). At the same time the property and legal relations of partners have become more complicated,” wrote Michal.

Michal said that thus the feeling of security and protection of rights of the weaker side of tens of thousands of couples, be it a woman or a man, has become so much more important and a very sensitive subject for all.

Michal announced that after analyses and consultations, the ministry includes in its working plan for next year creation of a cohabitation law to regulate non-marital cohabitation better.

Juhan Tere

Court sentences businessman into prison in record time

Tallinn Administrative Court has sentenced Indrek Vürst who was accused of masterminding a VAT fraud in the total amount of 80,000 euros for three months in prison, writes Äripäev.

This is one of the VAT fraud cases where a sentence was handed down in only 48 hours instead of lingering in courts for years. The court found that Vürst had a significant role in the VAT fraud case.

Terje Leng from the tax and customs board said in comment that a prison sentence is an unusual punishment in tax crimes because in most cases the guilty get a fine or a conditional sentence.

The court found that Vürst had participated in a scheme where a company was incorporated, buys fuel from the Estonian excise duty warehouse at zero percent VAT, sells it while adding VAT and then terminates its existence or is sold.

According to the prosecutor, FuelPRO, the company of Vürst, committed the VAT fraud in just one month.

Toomas Hõbemägi

Land tax exemption passes final reading

The bill exempting homeowners, as opposed to property investors, from the land tax, was finally passed in Parliament after its second reading had dragged on for three sessions.

The amendment to Land Tax Act - exempting 0.15 hectares of land in settled areas and 2 hectares in the open countryside from the tax - was passed 54 to 39, with the divide running more or less along the power distribution line between the governing Reform-IRL coalition and the opposition.

Attempting to filibuster the second reading at all costs, the opposition disagreed with what it saw to be a political move to drain local governments of their revenue. Although the coalition made a pledge to compensate for the loss of local revenue ensuing from the exemption, the mechanism was not included in the draft act itself.

The land tax has been the only nationwide tax that does not create revenue for the national budget but for municipalities alone. Prime Minister Andrus Ansip has proposed making up the lost revenue, an estimated 10 to 14 million euros per year, by increasing the share of income tax allotted to the local governments, which was, despite much criticism from the opposition, cut down during the recession years. Currently, 11.4 percent of the income tax goes to the local governments.

The Centre Party-run city of Tallinn, whose land tax rates were considered to be abusively high and were allegedly the main cause prompting IRL and the Reform Party to come up with the exemption bill, is bound to enforce a similar exemption a year before the national law comes into force in 2013, having submitted a corresponding motion to the City Council last week.

Erkki Sivonen

Refusing a wage cut deemed unreasonable grounds for redundancy

The Civil Chamber of the Supreme Court found in a case involving a Kuressaare nursery school teacher who had been made redundant that if the work load is not reduced or the work of the institution reorganized, then reducing the wages is illegal and refusing to take the cut does not provide grounds for redundancy.

The long-winded court action arose from an incident in March 2009, when the employer started pressuring the nursery school employees to agree to amending the employment contract in such a way that their wages would be reduced, but the work load would remain the same. Soon after, the head of the institution announced the implementation of an 18 percent retroactive pay cut beginning April 2009, wrote Postimees.ee.

The notice of dismissal said that based on a ruling made by the Kuressaare City Council, the salary fund of the municipal institutions had been reduced by 18 percent, which made it impossible to uphold the employment contract under the same wage conditions. The employee, who disagreed with this proposal, was made redundant and began a long court battle.

The court of first instance found for the employer, but the district court took the opposite view, finding that the employer had no need to lay off the plaintiff and ruling that the employment contract in question was still in effect.

"The refusal of an employee to agree to amending the terms of an employment contract (including the wage conditions) cannot be viewed as a redundancy situation that provides grounds for terminating the contract. Amending the terms of a contract of employment in any way does not mean that employment has been terminated under the terms contained in it," noted the Civil Chamber of the Supreme Court.

So all of you who are having the same trouble as ever so many had during these past 2 years, perhaps that this is the time to get listen to and to get the law on your side. Most of us never had this chance, as we were all dismissed, by the "Work Inspection", body on the employers' side in Estonia.

Sigrid Maasen

Nordea confused by tax law amendment

A seemingly innocent amendment of the income tax act has made alarm bells ring in one of Estonia’s largest banks, Nordea, writes Äripäev.

The amendment in question concerns Estonian representative offices of foreign companies or so-called affiliates and taxation of their dividends.

Until now, such representative offices like Nordea in Estonia were taxed when the amount of dividends they paid to their parent company exceeded the amount that the parent company had invested in Estonia

However, under an amendment that took force in January 2011, they will be taxed at the moment they are paying out dividends to their parent company.

According to Nordea, the amendment seems to create a retroactive tax claim on dividends paid out by 2011. To avoid the risk of facing a large tax claim with interest, the bank on its own initiative transferred 8 million euros to the account of the Estonian tax authority and is demanding an explanation from the finance ministry.

It seems to be a case of bad wording of the law and the finance ministry has already informed the bank that there will be no retroactive tax claim.

Toomas Hõbemägi

Estonia gets a law of cemeteries

Estonia will get a law of cemeteries that will starting in 2012 implement common rules for cemeteries and burial in all of Estonia, LETA/Äripäev.ee reports.

There was no general regulation on graveyards and burial before in Estonia. So far the matters concerning cemeteries have been up to local municipalities to decide.

Regional affairs minister Siim Kiisler said that the freshly adopted law will fill a legal gap an end an undetermined and unregulated situation.

The law prescribes now for example that the usage purpose of cemeteries closed for burial can be changed in 75 years and the buried have to be reburied elsewhere; the minimum period over overburial is 20 years from the last burial and that there is a 50 metres peace zone around the outer borders of cemeteries.

Juhan Tere

Riigikogu approves of new language law

The Estonian Riigikogu approved on Wednesday of the new language law that aims to guarantee survival of the Estonian language for a long time to come, LETA/Postimees Online reports.

The language law that was initially approved in 1995, had been amended 17 times and the volume of amendments exceeded the law’s initial text volume, education and science ministry spokesperson said.

The new language law regulates the use of the Estonia language and foreign languages in public matters, requirements and evaluation of Estonian language skills, state supervision and responsibility. Mainly the law’s structure has been updated, made clearer and more logical.

Some of the more important changes in the content of the law include appointing Estonian language council at the law level and determining the language tasks of the state.

Juhan Tere

2010 income must be declared in Estonian kroons

Users of SEB’s Internet bank will be able to check the information on their pre-completed 2010 tax returns through the e-Tax Board starting from 8 February 2011.

Salaries, other remuneration, mandatory pension payments, unemployment insurance payments withheld, training costs paid, pensions and voluntary pension payments will be reflected on the tax returns in Estonian kroons.

Since the other information on the tax returns is in kroons, bank information is also being given in the former national currency. Clients should also note that income tax incentives on interest earned on student loans were scrapped in 2010, as a result of which this information is not being forwarded to the Tax and Customs Board by the bank. Nor is confirmation provided of this in the Internet bank.

Confirmation will also be available in the Internet bank as of 8 February 2011 for interest paid on home loans and leasing in 2010, as well as for life insurance payments and payments made into pension funds.

Taxpayers will be able to begin confirming and lodging their pre-completed tax returns as of 15 February 2011. The Tax and Customs Board, via the e-Tax Board, will begin issuing rebates on submitted returns as of 28 February 2011. The deadline for submission of all tax returns is 31 March 2011.

Media law limits press freedom in Estonia

The parliament in Tallinn approved changes in media law which include a loosening of source protection and compensation during illness.

The daily Eesti Päevaleht is worried:

“Journalism does not need this new law because it was just nodded through and endangers the democratic values of Estonian society, including freedom of the press, a main foundation of democracy. So this new law affects not only the media but society as a whole, because the threat of punishment will put a damper on courageous citizens who might otherwise speak freely.

Every critical statement becomes punishable if it is determined ‘inappropriate’. And journalists aren’t the only ones who write every day about the offences committed by officials – the average retiree on the street will also be banned from calling the prime minister a robber for reducing his pension. This law benefits only those who have enough money for a good lawyer.”

 

Estonia wins case on retired military pensions in European Court of Human Rights

Today the European Court of Human Rights ruled in Estonia’s favour regarding the complaints* of 45 retired Russian military servicemen against the Republic of Estonia, finding that Estonia had not violated any rights protected by a convention.

The applicants of the complaints alleged that they have been discriminated against and their proprietary rights—the right to a pension—had been violated. The accusers felt that if they are being paid a pension on the basis of 1994’s “Agreement between the Republic of Estonia and the Russian Federation concerning social guarantees for the military pensioners of the Russian Federation staying on the territory of the Republic of Estonia”, then they are left without a pension and they have been discriminated against, because generally it is not a condition for receiving a pension in Estonia that a person may not be receiving a pension from a foreign country as well, but the aforementioned Estonia-Russia agreement does contain this stipulation. In their complaint, the accusers based their argument on the European Convention for the Protection of Human Rights and Fundamental Freedoms and its Protocol No. 1.

In its ruling today, the Human Rights Court found that the complaint is admissible; however, in the course of its analysis it reached the conclusion that the rights of the applicants were not violated. The court noted that a situation can only be called discrimination when equals are not treated equally. The court found that, in the given case, the plaintiffs were a special case bound by a special set of rules, and therefore their different treatment was justified.

Tallink sued by employees

TALLINN - Estonia's largest ferry operator is being sued by it's employess for an alleged breach of contract.

The Seamens Independent Union sued Tallink, claiming that the company violated its members' work contracts by transfering some employees from salaried to hourly work and by failing to deliver on a 6% pay rise.

The case has already reached the Harju County Court.

Riigikogu approves of “golden handcuffs” law from 2011

The Estonian Riigikogu approved on Wednesday of the so-called “golden handcuffs” law or an amendment to the income tax law that allows companies to give stock options to employees without paying the fringe benefits tax starting the year 2011, LETA/Postimees writes.

Currently, a company has to pay the fringe benefits tax at once when issuing a stock option to an employee. According to the new regulation, the tax will not have to be paid if there is a gap of at least three years between granting the option and real acquisition of shares.

Riigikogu finance committee chairman Taavi Rõivas said that so far, issuing options was a very big cost for a company but the new logic is that options are taxed more like securities income: if you buy a share and sell it at a profit you pay income tax on the profit.

He said that the 3-year sale restriction was added to prevent a tendency that companies start paying tax-free wages to employees in stock options.

Rõivas said that currently just 2% of Estonian population earns shareholder’s income but with the law amendment, more people should move from the status of a wage-earning employee to co-owner.

Juhan Tere

Riigikogu approves law that aims to protect Estonians taking consumer loans

The Estonian Riigikogu approved on Thursday of the amendments to the law of Obligations Act and other laws that aims to implement the new consumer credit directive in Estonian legislation, LETA/Eesti Päevaleht Online reports.

The amendments that accompany implementing the directive are mainly focused on raising the level of consumer protection in the consumer credit sphere.

The amount of information that credit issuers are obliged to give consumers before any contracts are concluded increases considerably and credit issuers are obliged to counsel consumers before they take a loan so that the consumer could evaluate whether the consumer credit contract offered to him is adjusted to correspond to his needs and financial situation.

The credit issuer is clearly demanded to evaluate the credit repayment ability of the consumer before the credit agreement is concluded.

Rules on advertising consumer credit contracts were also changed.

The law will come in force on July 1 next year while the first provision of the first paragraph comes in force on February 23, 1011.

Estonia passes law limiting Tallinna Vesi profit

Estonia’s parliament adopted measures to limit profit at the country’s largest water and heating utilities, including AS Tallinna Vesi, a utility that supplies water to Estonia’s capital.

Lawmakers voted 52-3 to approve the bill that requires the biggest utilities to seek an approval from the competition board for tariffs, which have to be based on “reasonable profitability.”

Passing the bill will lower water tariffs in the capital, home to almost a third of the country’s 1.3 million population, by up to a quarter in coming years, Urmas Reinsalu, a lawmaker with the coalition Isamaa ja Res Publica Liit said in parliament yesterday. Heating prices may decline by 10-15 percent, Ken- Marti Vaher, a lawmaker with the same party, said yesterday.

Tallinna Vesi stock has declined 27 percent since March 9, when the parliament started discussing the bill. It is the worst performer in Tallinn this year with a 16 percent slide, compared with a 34 percent gain for OMX Tallinn index.

The company will comment on the bill in a statement “later today,” spokesman Priit Koff said in a phone interview.

Estonia to try 82-year-old-veteran in November

The trial of a former operations officer of the MGB ESSR (Ministry of State Security of the Estonian Socialist Soviet Republic), 82-year Väinö Pehk, accused of preparing and carrying out the deportations of civilians in 1949, will begin on November 3rd.

The decision to proceed with the prosecution was taken at a meeting on Friday by members of the Tartu County Court.

According to investigators, in preparation for the March deportations in 1949, Pehk, who was fulfilling his official duties, collected data on 61 families which, all told, included 174 inhabitants of Vana-Tartu. The information collected was said to be the basis for the deportation of the people in question.

In addition, investigators claim that Pehk, as a member of the Task Force was personally involved in the deportation order and personally delivered to the assembly point at the center of the Saadyarve parish, three families, totaling nine people.

Sam Pehk rejects the accusations, claiming that on the day of the expulsion of the civilians, March 25th, he was in another place and took no part in the deportation. According to him, he was originally included in the list of members of the Task Force, but later his name was replaced with that of another employee.

According to the Estonian security police, Pehk worked as a translator for the Tartu Division of the MGB ESSR until July 1948 and during the deportation served as a junior operational officer at the Division, which was at the time engaged in combating what were known as the "forest brothers".

Court declared appointment of Estonian Public Conciliator invalid

The Tallinn Administrative Court declared on Tuesday the Government’s decree re-appointing Henn Pärn as the Public Conciliator invalid, writes LETA/Postimees Online.

Thus the court agreed with the complaint filed by the Estonian Confederation of Trade Unions and the Estonian Central Organisation of Civil Servants’ Professional Unions.

The organisations claimed that re-appointment of Pärn was not in accordance with the law and hence the Government’s decree from December 10, 2009 is to be declared invalid.

In January, the trade union organisations turned to court, stating that the Government violated the law by not taking into account the proposals from the trade unions in appointing the Public Conciliator. The Government’s decree lacked legal basis as it was made without achieving an agreement between the employees’ and employers’ organisations.

The trade union organisations stated that in compliance with the agreement, the candidate for the Public Conciliator’s post was to be presented by trade unions and employers’ representatives had to either approve or reject the candidacy. The Confederation of Trade Unions proposed for the position Ago Tuuling, chairman of the Central Organisation of Civil Servants’ Professional Unions, but according to the chairman of trade unions Harri Taliga, the Confederation of Employers failed to give any responses to the candidacy.