Category: Business

Bankruptcy of an Estonian Company

[vc_row][vc_column][vc_column_text]Bankruptcy of an Estonian CompanyThe termination of a company’s activity is as natural a stage in the development of any business as its beginning. At the same time, it is often very difficult to liquidate an enterprise due to the large number of legal and business relations, obligations, and often debts that are part of the company’s business activity.

Depending on economic circumstances, the company owner, who has decided to end the business, must make a choice between liquidation or bankruptcy.

If it is a question of voluntary termination (the law also establishes cases when the company is terminated forcibly), the issue is resolved at the general meeting of shareholders, and in case of a positive decision, the liquidation process begins. This lengthy and time-consuming procedure of debt collection, sale of property and satisfaction of creditors’ claims involves many issues of both a legal and economic nature. As a result of the liquidation, the assets remaining after the satisfaction of the creditors’ claims will be distributed among the shareholders, after which the company is deregistered from the Commercial Register.

The process is somewhat different in the case of bankruptcy. The main difference here is the fact that the company is unable to satisfy the claims of creditors, and that this inability is not temporary, taking into account the economic situation. If such a situation occurs, the members of the management board of the company must immediately file to the court an application for declaring bankruptcy. It should be stressed that the filing of an application for bankruptcy in this case is the responsibility of the members of the board and, in the event of non-compliance, members of the management board may incur both civil and criminal liability.

Not only the debtor but also the creditor may file an application to the court to declare a company bankrupt, however, it should be remembered that the main condition here the debtor’s insolvency.

In any case, the processes described above are quite complex from both a legal and an economic point of view, and it is extremely difficult to navigate in them without in-depth knowledge. A good way in building this knowledge is to start with simple consultation. The further participation of our specialists will be determined solely by your needs.

If the Estonian company is put into liquidation, the company’s creditors (clients) can file their claims through the appointed liquidator within four months. If the assets of the company are insufficient to fulfil all its obligations, the liquidator is required to file to the court an application to declare the company bankrupt.

The court will most likely declare the company bankrupt and appoint an interim bankruptcy trustee, The court proceedings will begin. If the company does not have any assets that can be sold in the process of bankruptcy, and none of the company’s creditors deposits with the court funds to cover the future work of the bankruptcy trustee, the bankruptcy process will end on the basis of the deregistration of the company. After that, it is no longer possible to submit a claim against the company’s former management board member.[/vc_column_text][vc_column_text]

Bankruptcy procedure description

In the current economic situation, issues related to insolvency proceedings – restructuring, bankruptcy, debt adjustment – have become particularly relevant.

Competition law and bankruptcy and liquidation procedures are one of the most important activities of our company. By combining both legal and economic experience and thinking, we can be doubly useful and effective in addressing possible problems.

Bankruptcy is not necessarily a dead end for the debtor or creditor, but it can also be a solution – not a good solution, but still a solution. Bankrupt nests often have resources that, when handled skilfully, can satisfy creditors’ claims, and although this is not common in practice, it is also possible to rehabilitate the debtor company by judiciously using the resource found in it.

Our lawyers have many years of experience in representing the interests of both creditors and debtors in bankruptcy proceedings. In addition, we advise clients at all stages of restructuring, debt adjustment and liquidation procedures.

If the above is not entirely related to your problem, feel free to contact us. Only by accurately describing our problem can we decide how we can best help you.

We can support you with the following questions:

  • Legal analysis of pre-bankruptcy transactions;
  • Initiation of bankruptcy proceedings, including filing for bankruptcy and filing for bankruptcy;
  • Advising debtors on finding optimal solutions in a pre-bankrupt situation;
  • Representation in court during the consideration of the bankruptcy application, by way of submission and admission of claims, at general meetings of creditors, etc.;
  • Preparation of applications, claims, complaints, and other documents necessary for bankruptcy proceedings;
  • Advice on restructuring procedures;
  • Consulting and representation in liquidation procedures;
  • Representation in transactions with insolvency practitioners, creditors, or the debtor;
  • Representation of insolvency practitioners in more complex proceedings.

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The Economy of Estonia Grew by 5.4% in the First Quarter

[vc_row][vc_column][vc_column_text]In the first quarter of 2021, Estonia’s gross domestic product (GDP) increased by 5.4% compared to the same quarter of the previous year. In current prices, GDP amounted to 6.9 billion euros in the first quarter, the Department of Statistics reported on Monday. Compared to the first quarter of last year, GDP, adjusted by the number of days worked, increased by 5 per cent and by 4.8 per cent compared to the last quarter of 2020.

According to analysts, almost half of the growth of the economy is due to the influence of taxes, especially the turnover tax (value added tax) and good excise revenues. “However, this does not mean exceptionally high tax receipts, but that the comparative base of the first quarter of last year was unusually low. Now we are back to the level of 2019,” explained Robert Muirsepp, the lead statistician of the Department of Statistics.

Trade, information and communication, as well as financial and insurance activities, had the most positive impact on economic growth. As with taxes, the positive impact of trade is visible against the backdrop of the recession that occurred at the same time last year. Coronavirus expenditures in the health sector and the energy sector in the colder winter also contributed to the growth of the economy.

Among the major industries, the manufacturing and construction sectors continued to have a negative impact on the economy, with coronavirus crisis a little later. Accommodation and food services were also in decline due to coronavirus restrictions.

Private consumption continued to decline throughout the year, with a decline of 3.3 per cent in the first quarter. Excluding the costs associated with tourism, consumption showed modest growth. As in previous periods, there was an increase in expenditures related to home lifestyles, communications, home furnishings and household goods. Expenditure on meals outside the home, leisure, transport, clothing and footwear continued to decrease. At the same time, spending on health increased, which was also supported by growth in the government sector.

In foreign trade, growth started late last year and continued in the same direction. Merchandise exports increased by 5 per cent and imports by 12 per cent. Imports and exports of wood products, electronics and motor vehicles contributed to the increase in trade. In services, computer services have had the most positive impact. External trade in tourism services continued to decline, but transport services are gradually recovering.



How to Close an Estonian Company

[vc_row][vc_column][vc_column_text]How to close an Estonian companyThings do not always go according to the plan, and it’s completely OK. If a business doesn’t meet the hopes and expectations, or the circumstances demand the same, it is essential to initiate your company dissolution.

According to the Estonian legislation, an Estonian company’s activity cannot be suspended or paused — the company can either be active, in a state of liquidation or permanently liquidated. That’s why we strongly advise not to leave a company on its own when plans didn’t work out. It is important to act responsibly with a legal provider’s help to wrap this up and focus on new beginnings.

The most traditional way to liquidate a company in Estonia is a voluntary dissolution. Another potential option is to transfer a company to a new owner, simply put, to sell.

Voluntary dissolution

A full or limited partnership is terminated by a decision of the shareholders, upon expiry of the term or achievement of the objective, or is terminated by a court order.

In general, the termination of full and limited partnerships consists of three important phases:

  • Decision on termination and application for termination
  • Liquidation
  • Removal of the enterprise from the Business Register

The termination of a full or limited partnership shall be based on a shareholder’s decision for which more than 3/4 votes of the shareholders have been given, unless a higher majority is required by the association’s agreement. To close the company, submit a joint application to the Business Register with the minutes of the meeting of the members.

The decision to terminate a full or limited partnership and to apply to the Business Register is followed by liquidation, during which it is important for you to observe the established procedure.

Liquidation stages

  • Liquidators are appointed and entered into the Business Register. Liquidators are generally shareholders. A third person may be appointed as liquidator by agreement of the shareholders. At the shareholder’s request, the court may, for good reason, appoint a person who is not a shareholder as liquidator.
  • Approval of the opening balance of liquidation and the accounting for the business year by the shareholders. The opening balance of liquidation and the report for the business year shall be submitted immediately after approval to the Business Register.
  • Termination of the association, recovery of debts, sale of the association’s property and satisfaction of creditors’ claims.
  • Compilation of the final balance sheet of the liquidating enterprise and division of property, in exceptional situations also preparation of the report for the business year. The residual assets of the liquidators shall be distributed to the shareholders in accordance with the contributions of the shareholders, unless otherwise provided in the association’s contract.
  • After a proper liquidation of a full or limited partnership, you will be required to submit to the Business Register a declaration on the removal of the business from the Business Register.

By the time the total and limited partnership is liquidated, there are no strict restrictions, and it depends primarily on the characteristics of the enterprise and on the coherence of the cooperation between the different actors involved in the liquidation.

The completed activities of the association may also be continued, or the enterprise may be merged, divided or reorganized. Liquidators must submit to the Business Register a declaration of continuation of the business for this purpose.

Selling a company

The first thing to do when planning to sell a company is to find a potential buyer. When the buyer is found, you need to visit the notary and submit all required documents. Beforehand make sure that:

  • Annual reports are prepared
  • Accounting is in order
  • Corporate taxes are paid

Finding a buyer and managing legal procedures is rather complicated. It is very common and smart for entrepreneurs to use the services of legal providers.

Re-registration of a company occurs in two ways – by power of attorney or by a personal visit of all company representatives to Estonia. By law, the procedure for re-registering a company should take up to 5 business days after visiting a notary.

We are here to close this case for you. The specialists of LKS Consult OÜ have a vast positive experience in both company liquidation by voluntary dissolution and transferring. We offer full support on all stages of developing your business, and offer a variety of services, including  accounting services in Estonia.

We will help you complete a company termination procedure as soon as possible in full compliance with the law and fully remotely. More about the services and cost, please find here.[/vc_column_text][/vc_column][/vc_row]

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Tallinn Joined the European Space Agency Project

[vc_row][vc_column][vc_column_text]The Tallinn City Assembly, at a meeting on 6 May, agreed to participate in the project “Support for the activities of the European Space Agency Business Incubator for the period 2022-2025″, confirming funding for these activities for the next four years up to EUR 50,000 annually.

According to the Chairman of the Innovation Commission of the Tallinn City Assembly, Andrés Colliste, the project may seem at first sight incomprehensible, as Estonia is not very well connected in the public consciousness with space research. ” Here I would like to recall that we have student satellites, and Tartu University has a professorship in space and defense technology,” noted Colliste.

“There are several significant aspects to this draft. First, space exploration and the application of space technology do not mean just space flight. In the study and use of near space, most of the work is done on the ground. The same is true of this project. Second, it is important that the Tallinn Center for Strategic Management will have an excellent experience of collaboration on innovation promotion with science parks and institutions in Tartu and Tallinn, universities and KredEx Foundation. But most importantly, such projects stimulate investment in high technologies and inspire young people with interest and inspiration to study natural and technological sciences,” added Collist.

The objective of the project is to receive, within the next four-year treaty period, eight startups dealing with space data and technology at the European Space Agency’s Estonian Business Incubator in Tallinn. The project will be managed by the Tallinn Center for Strategic Management, and the Tallinn Center for Strategies, while the City’s Deputy Mayor for Entrepreneurship and Innovation and the City Chancellor are authorized to negotiate and sign the project contracts and other necessary documents on behalf of the city.

LKS Consult OÜ  is a team of specialists who will help you in a company formation and developing your business in Estonia. We will gladly provide you an overview of the business environment of Estonia in the shortest possible time. Please send your enquiry.


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E-Notary in Estonia

[vc_row][vc_column][vc_column_text el_class=”padding”]The e-Notary systeme-Notary is an environment that helps notaries in their everyday work and allows electronic communication between notaries and the state. The setting is established with notaries in mind, and it will enable them to do everything they need in their work; the system also allows making queries to 16 different registries. E-residents can use their Digi-IDs to perform an array of business services for their companies online from anywhere in the world. However, up until now, there were still some activities, which required e-residents to travel to Estonia and utilise the services of a notary registered there.

The e-Notary system could be used both by residents and e-Residency holders.

The e-Notary makes it possible to conveniently:

  • Keep a daily schedule of notarising activities and a personal calendar for users
  • Make reliable queries to state registries
  • Prepare agreements and digitally sign them
  • Register official activities (official acts and services)
  • Record deposits
  • Issue apostilles
  • Prepare invoices and state fee payment orders
  • Forward records to state registries


  • To be the means which allows making necessary actions in the notary’s office
  • To create a registry of notarised acts in a unified, high-security environment
  • To minimise duplicated entry of data, paperwork and printing for both notaries and registrars
  • To contribute to the development and enhancement of other systems
  • To make it simple for clients to deal with notaries – unlike before, the client doesn’t have to present a large number of paper documents to the notary anymore
  • Via the e-Notary system, the notaries themselves can also review the necessary data

How to use:

  • Log into the e-notary self-service portal at using an ID card or an e-Residency digital-ID.
  • In the self-service portal, navigate to the verification page and choose a notary from the list of registered Estonian notaries, and select your desired time for an appointment.
  • Next, it is required to log in with Digi-ID and confirm that you are ready for the digital verification. It also notifies the notary in Estonia to initiate the verification process using the Veriff biometric facial recognition system.
  • Follow the instructions of Veriff.
  • Once you have been successfully identified, the notary will initiate a remote transaction by video link.
  • The notary will introduce the agreement and share it for review with all the parties.
  • Once approved, the notary will make it available for signing in the self-service portal.
  • Once all parties have digitally signed the contract, the notary closes the remote transaction and adds the notarial document to the portal.
  • You can access the transaction and any related invoice at any time afterwards.


LKS Consult OÜ  is a team of specialists who will help you in a company formation and developing your business in Estonia. We will gladly provide you an overview of the business environment of Estonia in the shortest possible time. Please send your enquiry.[/vc_column_text][us_btn label=”Contact us” link=”” align=”center” css=”%7B%22default%22%3A%7B%22margin-top%22%3A%2220px%22%7D%7D”][/vc_column][/vc_row]

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Estonian Start-up Wise Enters London Stock Exchange

[vc_row][vc_column][vc_column_text]London Stock ExchangeOn Thursday, the Estonian fintech company Wise (formerly TransferWise) announced entering the London Stock Exchange through the direct listing (DPO).

A highly capitalized company does not intend to raise additional funds on the stock exchange, so a direct listing is planned. “Unlike traditional IPO, a direct listing is a fairer, cheaper, and more transparent way to expand our ownership,” explained Wise.

Direct listing means you can trade existing stocks. The retail remittance platform, established in 2011, has evolved into a global payment network offering international banking services to more than 10 million private and business clients.

LKS Consult OÜ specialists will help you open an account for your company and provide full support when registering Estonian companies.[/vc_column_text][/vc_column][/vc_row]

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eBay: Estonian e-Commerce Sales Increased by 41 per cent

[vc_row][vc_column][vc_column_text]ebayIn the second quarter of this year, eBay upgraded its online trading platform and expanded the direct payment management process.

According to the company, since May changes will offer sellers a simplified way of doing business and buyers more flexibility and choice of different payment methods. In managing payments, eBay offers several new ways, including a credit card and PayPal. Apple Pay can be used as a payment method in the iPhone and iPad applications. Google Pay is available on the eBay website and the eBay application for Android.

Our specialists can help with the opening of the company for e-commerce and offer 4 options for the establishment of the company in Estonia.[/vc_column_text][/vc_column][/vc_row]


Estonian Startup Costs Over a Billion Dollars

[vc_row][vc_column][vc_column_text]zegoZego’s commercial transport insurance startup received an investment of $150 million, bringing the company’s value to $1.1 billion, writes Postimees.

The London-based startup company plans to use the proceeds to expand into Europe and beyond and to double its workforce to over 500 employees. The company also plans to invest in technology and recently acquired telematics company Drivit. Zego’s business idea is to offer hourly insurance to commercial vehicles, such as Uber drivers or Bolt drivers, so that they do not have to conclude expensive annual insurance contracts. Still, they can include insurance when they provide a service. To date, the company has offered 17 million insurance policies for more than 200,000 cars in five countries.

“It is clear that the way vehicles are used is certainly changing, and it is becoming increasingly obvious that the traditional rigid insurance model is no longer suitable”, said in a press release the co-founder and CEO of Zego Sten Saar.

The Zego C-Series round was led by DST Global, a Hong Kong-based venture capital company founded by founder Yuri Milner and Russian oligarch Alisher Usmanov. Their investments include Facebook, Twitter, Tswhaapp, Snapchat, Airbnb, Spotify, Alibaba, Xiaomi, Zynga, Groupon and Robinhood. Another important player was the American venture capital company General Catalyst, which also invested in Airbnb and Snapchat. General Catalyst co-founder and managing partner Joel Cutler will also serve on Zego’s board of directors.

“We very much believe in this new generation of insurance companies, and Zego is one of the most interesting and dynamic startups we have ever seen. They found that the transition from ownership to use is a huge opportunity in the insurance market”, said Cutler.

Our team can help with the development of your startup in Estonia and offer 4 options for establishing a company in Estonia.[/vc_column_text][/vc_column][/vc_row]

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Estonian Startup Attracted $78 Million in Investment

[vc_row][vc_column][vc_column_text]ПдшфEstonian-American startup Glia, which is developing a digital client service platform for financial companies, has attracted $78 million (approximately €63.8 million), writes Postimees.

According to Glia, funding for the C series was led by Insight Partner, who also led a $20 million investment round a few years ago. The startup was co-founded by Guatemalan-born Carlos Paniagua, a graduate of Tartu University and Tallinn University of Technology, the technical director of Glia.

The company has development centres in New York, Tallinn and Tartu, and according to the employment register, Glia offers jobs to at least 50 engineers in Estonia. Last year, the company grew by more than 150 per cent due to the need to rethink ways of communicating with its customers in the digital world due to the pandemic.

“Just as Zoom has changed the way consumers communicate with colleagues, family and friends, so digital customer service changes the way they support business clients and interact with consumers. A recent Facebook deal worth a billion dollars to purchase Kustomer shows that the industry is becoming increasingly mainstream”, said Glia co-founder and CEO Dan Michaeli. According to Lonne Jaffe, the CEO of Insight Venture Partners, who led the investment round, Glia technology combines shared viewing, video chat, voice, and chat platform bots that allow companies to communicate with customers through the channels they choose.

Our professionals can help with the development of your startup in Estonia and offer 4 options for establishing a company in Estonia.[/vc_column_text][/vc_column][/vc_row]

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A Startup Featuring the Estonian Ex-president Ilves Intends to Raise Millions of €

[vc_row][vc_column][vc_column_text]viveoEstonian startup Viveo Health plans this year to attract 7 million euro investment and in four years to offer digital health service to 1 billion people, writes Postimees.

On Monday, the company announced that it was recruiting 50,000 local doctors in India to serve Indian patients, focusing on clients with Covid-19 symptoms. “Currently, the company actively cooperates with several large investment funds but is ready to attract Estonian capital as well”, stated Viveo Health.

According to Company Advisor Toomas Hendrik Ilves, Vivo Health’s Indian ambitions show that Estonia’s success is still in creative thinking and intelligent solutions. “Viveo is an excellent thinker and performer, as evidenced by our rapid and energetic development in India”, – added Ilves. Currently, investors from Estonia include Ain Hanschmidt, Anders Anderson, Oleg Osinovsky, Indrek Kasela and Ivar Vendelin.

The target is a billion clients.

The idea of Viveo Health is to free the doctor’s consultations from restrictions on the location, saving time for both the patient and the doctor. Tele-consultations are conducted by doctors who can prescribe treatment to a person as soon as a health problem arises, regardless of their location.

India has a population of almost 1.4 billion. India’s public and private spending on health as a percentage of GDP is estimated at 3.9 per cent, well below the world average (9.9 per cent). In India, one of Viveo Heath’s partners is Dr Sandesh Mayekar, who has modernized dentistry in India and brought it to a new structural level across the country.

Viveo Health aims to attract seven million euros of investment in 2021. Founded in 2017 by Raul Kello, Viveo Health plans to provide digital health care to 1 billion people in 2025. Today the company operates in three Baltic countries, Armenia, India, South Africa, Brazil and Mexico.

Our team can help with the development of your startup in Estonia and offer 4 options for establishing a company in Estonia.[/vc_column_text][/vc_column][/vc_row]

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