Merger Control 2023 Comparisons

The main national merger control (concentration control) rules of Estonia are set forth in the Competition Act (konkurentsiseadus). In addition, the following additional guidance exists: the Guidelines for the Calculation of Turnover and the Guidelines for the Submission of the Concentration Notification that are established with Regulations No 68 and 69 of the Minister of Economic Affairs and Communications of 17 July 2006.

From 1 September 2023 the Foreign Investment Reliability Assessment Act (välisinvesteeringu usaldusväärsuse hindamise seadus) shall enter into force to regulate foreign investments into Estonia. Additional sector-specific rules have been set forth for mergers and acquisitions of credit institutions, insurance providers, investment fund managers and investment companies.

The concentration control legislation is enforced by the Competition Authority (Konkurentsiamet). In case of sector-specific transactions, the relevant sector-specific authorities (eg, the Financial Supervision Authority) are also involved in the review process according to the relevant specific rules.

Prior notification is mandatory, if the relevant thresholds are met.

As a general rule, no concentration subject to control may be effected before receipt of the relevant approval from the Competition Authority. However, as an exception, it is possible to implement a public offer or a series of transactions in securities, including those convertible into other securities admitted to trading on a market such as a stock exchange, by which control is acquired from various sellers, provided that:

• the concentration is notified to the Competition Authority without delay; and
• the acquirer does not exercise the voting rights attached to the securities in question or does so only to maintain the full value of its investments.

Furthermore, the Competition Authority may, upon reasoned request, grant a derogation from the restriction to effect the concentration or from the restriction to refrain from exercising the voting rights.

A fine of up to EUR400,000 may be imposed on a legal person who effects a concentration without approval, violates a prohibition to concentrate, or breaches the terms and conditions of an approval decision. A natural person committing the same offence may be punished with a fine of up to EUR1,200 or a detention of up to 30 calendar days. Such penalties are applicable to the party who is obliged to file the concentration notification (see 3.4 Parties Responsible for Filing).

In addition, if the parties to the concentration effect the concentration prior to the approval to concentrate, then such transaction may be deemed to be void, except when specifically permitted by the Competition Act (see above regarding exceptions).

Damage caused by acts prohibited by the Competition Act may also be subject to compensation by way of civil court procedure.

The Competition Authority has applied penalties for failure to notify a concentration, but such penalties have not been common. Since such penalties are not generally made public, it is not possible to present the relevant statistics.

The Competition Act provides that a “concentration” is deemed to arise where:

• previously independent undertakings merge within the meaning of the Commercial Code or parts of undertakings are merged;
• an undertaking acquires control of the whole or a part of another undertaking, or of several undertakings or parts thereof;
• undertakings jointly acquire control of the whole or a part of another undertaking, or of several undertakings or parts thereof;
• a natural person already controlling at least one undertaking acquires control of the whole or a part of another undertaking, or of several undertakings or parts thereof; and/or
• several natural persons already controlling at least one undertaking jointly acquire control of the whole or a part of another undertaking, or of several undertakings or parts thereof.

The joint creation, by persons specified in the third and fifth bullet points above, of a new undertaking performing on a lasting and independent basis is also deemed to be acquisition of control.

A “part of an undertaking” is defined as the assets of the undertaking or an organisationally independent part of the undertaking, including an enterprise or plant which constitutes a basis for business activities and to which turnover on the goods market can be clearly attributed.

As can be seen from the above, a change of control is required for a transaction to constitute a concentration. Therefore, internal restructurings and reorganisations are not caught. However, a concentration does not require the transfer of shares or assets – it can also result from shareholders’ agreements, changes to articles of association, etc.

“Control” is defined as the opportunity for one undertaking or several undertakings jointly or for one natural person or several natural persons jointly, by purchasing shares or on the basis of a transaction or articles of association or by any other means, to exercise direct or indirect influence on another undertaking which may consist of a right to:

• exercise significant influence on the composition, voting or decision-making of the management bodies of the other undertaking; or
• use or dispose of all or a significant proportion of the assets of the other undertaking.

This includes both positive and negative control (ie, strategic veto rights).

Acquisitions of minority or other interests less than negative control are not caught, except for sector-specific rules that regulate also acquisitions of minority interests (eg, 10%).

A concentration shall be subject to control by the Competition Authority if:

• during the previous financial year, the aggregate turnovers of the parties to the concentration in Estonia exceeded EUR6,000,000; and
• during the previous financial year, the aggregate turnovers of each of at least two parties to the concentration in Estonia exceeded EUR2,000,000.

There are no separate jurisdictional thresholds for particular sectors.

The “turnover in Estonia” means the turnover accrued from the sale of goods to purchasers located in the territory of Estonia. Such turnover does not include discounts, value added tax or other taxes directly related to turnover.

The turnover of a credit or financial institution is deemed to comprise the total amount of the following income items after deduction of value added tax and income tax:

• interest income;
• income from financial investments;
• income from service charges;
• income from financial operations; and
• other operating income.

The turnover in Estonia of credit and financial institutions consists of the income earned by a credit or financial institution established in Estonia, or an Estonian branch of a foreign credit or financial institution.

The turnover of an insurer is deemed to comprise the value of the gross insurance premiums which includes all insurance premiums received and receivable in respect of insurance contracts issued by or on behalf of the insurer, including outgoing reinsurance premiums after deduction of the taxes and other fees and payments to be paid on individual insurance premiums or the total volume of insurance premiums.

Turnovers expressed in a foreign currency need to be converted into euros.

As indicated above, the turnover of the parties to the concentration is relevant.

The “parties to the concentration” are:

• the merging undertaking or an undertaking whose share is being merged;
• the undertaking or natural person who acquires control over another undertaking (or part of it) or over other undertakings (or their parts);
• the undertakings or natural persons who jointly acquire control over another undertaking (or part of it) or over other undertakings (or their parts); and
• the undertaking over which or over a part of which control is acquired.

Where a joint venture is created, only the parents of the joint venture are considered to be parties to the concentration, ie, not the joint venture itself (see also 2.10 Joint Ventures).

For calculating the turnover of the party to the concentration that is acquiring control, the turnovers of the following undertakings will be added:

• the party to the concentration itself;
• undertaking or undertakings controlled by the party to the concentration;
• undertaking or undertakings controlling the party to the concentration;
• undertaking or undertakings controlled by an undertaking specified in the third bullet point above; and
• undertaking or undertakings jointly controlled by two or more undertakings specified in any of the bullet points above.

For the target, only the turnover of the target and the turnovers of the undertakings controlled by the target will be taken into account, ie, the turnover of the seller is not relevant. If the target is only a part of an undertaking, then the turnover of only that part is taken into account.

If a subsidiary is only partially owned, its revenue is taken into account only if a party to the concentration exercises control over it (for definition of “control”, see 2.4 Definition of "Control"). If that is the case, the totality of the revenue of the subsidiary is taken into account.

The data from the previous official financial report is used or, if such financial report is not yet available (eg, if the concentration takes place in the beginning of the financial year), a summary of turnover certified by the management board is taken as the basis. If an acquisition or divestment has occurred after the end of the financial year then the relevant turnover is either added or deducted from the turnover of the relevant financial year. 

There are two so-called “two-year rules”:

• If a concentration comprises acquisition of control by the same natural persons or undertakings of parts of one or several undertakings through two or several transactions conducted within a period of two years, such transactions are deemed to be one and the same concentration and the date of the last transaction is deemed to be the date of such concentration.
• If, within the preceding two years one and the same undertaking or an undertaking belonging to the same group has acquired control of parts of an undertaking or undertakings which operate within one and the same sector of economy in Estonia, the turnover of the undertaking over which control is acquired shall include the turnover of the undertakings over which control has been acquired within the two years preceding concentration.

“Foreign-to-foreign” transactions are subject to the same concentration control rules as domestic transactions, since there is no local effects test. However, since the turnover thresholds refer to turnover “in Estonia”, a transaction between the parties belonging to corporate groups who have no sales in Estonia would not be caught.

There is no market share jurisdictional threshold.

In case of creation of joint ventures, which are considered to be “full-function” joint ventures under the EU Merger Regulation, the same concentration control rules apply, eg, there are no separate thresholds for joint ventures. However, where a joint venture is created, only the parents of the joint venture are considered to be parties to the concentration.

As a peculiarity of Estonian law, it should also be noted that if several undertakings acquire joint control over an undertaking in which they did not have any holding before the concentration, concentration control rules could be applicable irrespective of whether the resulting joint venture would be “full function” or not. In such a case, the undertakings acquiring joint control and also the undertaking over which they acquire control would be considered to be parties to the concentration (as indicated above, normally only the parents of a joint venture would be parties to the concentration).

The Competition Authority may only investigate a transaction that meets the jurisdictional thresholds. The statute of limitations for imposition of penalties is three years from the infringement or, if the infringement is continuous, from the termination of the infringement.

As indicated in 2.1 Notification, as a general rule, no concentration subject to control may be effected before receipt of the relevant approval from the Competition Authority (for exceptions, see below).

See 2.2 Failure to Notify.

As an exception to the suspensive effect, it is possible to implement a public offer or a series of transactions in securities including those convertible into other securities admitted to trading on a market such as a stock exchange, by which control is acquired from various sellers, provided that:

• the concentration is notified to the Competition Authority without delay; and
• the acquirer does not exercise the voting rights attached to the securities in question or does so only to maintain the full value of its investments.

Furthermore, the Competition Authority may, upon reasoned request, grant a derogation from the restriction to effect the concentration or from the restriction to refrain from exercising the voting rights.

See 2.14 Exceptions to Suspensive Effect.

It is not possible to just carve out the businesses or assets in the jurisdiction in order to avoid concentration control, unless such carve-out is done on a permanent basis (ie, the relevant part is divested).

There is no deadline for notification. However, the concentration notification must be submitted to the Competition Authority before the concentration is implemented.

The Competition Authority shall be notified of a concentration subject to control before the entry into force of the concentration and after:

• entry into a merger agreement or performance of a transaction or other act for acquisition of parts of the undertaking;
• performance of a transaction or other act for acquisition of control;
• performance of a transaction or other act for acquisition of joint control; or
• announcement of a public bid for securities.

According to the rules, the concentration notification may also be filed with the Competition Authority prior to signing a binding agreement, if the parties to the concentration can prove with enough certainty that they plan to sign the agreement. However, in practice the Competition Authority initiates the concentration control proceedings, but will refrain from issuing a formal decision (they will stay the proceedings) before a binding agreement is presented.

Note that once the approval has been granted for the concentration, then it has to be effectuated within six months from obtaining the approval.

The filing fee is EUR1,920 and it must be paid prior to filing of the concentration notification.

In the case of an outright merger, the merging undertakings file a notification jointly.

In the case of acquisition of control over an undertaking or a part of it or undertakings or parts of them, the acquiring undertaking files a notification.

In the case of joint acquisition of control over an undertaking or a part of it or undertakings or parts of them, both acquiring undertakings file the notification jointly.

In the case of acquisition of control over an undertaking or a part of it or undertakings or parts of them by a natural person who already has control over at least one undertaking, the acquiring natural person files a notification.

In the case of joint acquisition of control over an undertaking or a part of it, or undertakings or parts of them by natural persons who already have control over at least one undertaking, both acquiring natural persons file the notification jointly.

The nature of information and level of detail depend to some extent on whether a notification is submitted in the long or the abbreviated form. As a rule, the notification must be submitted in the long form.

However, the notification may be submitted in the abbreviated form if at least one of the following conditions has been met:

• there is no horizontal overlap of the goods markets where the parties operate and there is no vertical relationship between the goods markets where the parties operate;
• the parties operate on the same market, but the joint market share does not exceed 15% after the concentration, or the parties operate on vertically linked markets, but either their individual or joint market shares do not exceed 25% after the concentration;
• the parties to the concentration jointly establish a new undertaking and the new undertaking does not operate and has no intention of operating in Estonia; and/or
• a party to the concentration acquires control over an undertaking over which the party, together with another undertaking, is already exercising joint control.

In any case, the notification should include information on each party’s total turnover and turnover in Estonia, market shares of the parties on the overlapping markets and information about other markets where parties are active, also the biggest competitors of the parties. The longer notification form entails, inter alia, provision of market data for the three years preceding the notification.

The following original documents or certified copies of them must be attached to the notification:

• registry extracts concerning the parties to the concentration who have been entered in the registers of other countries;
• the documents on the basis of which the concentration is put into effect;
• the annual reports of the parties to the concentration for the financial year preceding the concentration;
• a document certifying the authority of the person submitting the notice;
• a document certifying payment of the state fee;
• analyses, reports, research, reviews and other documents for evaluation or analysis of the concentration in relation to market shares, competition conditions, possible increase in sales or expansion into other markets, or general market conditions; and
• a list of the documents annexed to the notice of concentration.

According to the law, the notification and supporting documents must be submitted in Estonian. However, in practice the Competition Authority has also accepted certain documents (eg, agreements or registration documents, etc) in English and in some other languages.

Documents must be either originals or certified copies. However, the documents do not usually need to be notarised.  In the case of copies, the notifying party must certify with signature (including digital signature) that the copies are genuine and complete. 

The Competition Authority may always require additional and more detailed information during the proceedings.

The law provides that the Competition Authority has the right to issue a precept to a natural or legal person for any infringement (including for submission of incomplete notification). In the case of failure to comply with a precept, a periodical penalty payment of up to EUR6,400 may be imposed on natural persons or up to EUR9,600 on legal persons.

Also, the Competition Authority may revoke an approval to concentrate if the parties to the concentration submitted false, misleading or incomplete information which was a determining factor for the approval. Further, it may be argued that in case of such revocation, penalties, fines and other consequences applicable for failure to file a notification could also be applied.

Pursuant to the Penal Code, pecuniary punishment and/or imprisonment can be imposed on any person liable for obstruction of state supervision; refusal to submit or failure to submit on time documents or information necessary for state supervision; submission of false information; submission of documents or information in a manner which does not permit exercise of state supervision; or submission of false information to an administrative agency (if committed in order to obtain an official document or any other benefit or gain).

To our knowledge, no sanctions have been imposed in practice.

See 3.6 Penalties/Consequences of Incomplete Notification.

After the concentration notification has been submitted to the Competition Authority, the Competition Authority makes any of the following decisions within 30 calendar days of submission of the notification (Phase I):

• to grant permission for the concentration;
• to initiate supplementary proceedings in order to ascertain: (i) whether the concentration may significantly restrict competition in the goods market, in particular through creating or strengthening a dominant position in the goods market; and (ii) whether the concentration complies with the requirements of the Competition Act established for the agreements that may have an anti-competitive effect (in cases when the purpose or the result of the concentration would be co-ordinating the behaviour of undertakings that influences or may influence the competition);
• to make a decision that the concentration is not subject to control pursuant to the Competition Act; or
• to terminate the proceeding where the parties to the concentration decide not to go ahead.

In the course of the supplementary (Phase II) proceedings, the Competition Authority must reach any of the following decisions within four months, starting from the initiation of the supplementary proceedings:

• to grant permission for the concentration;
• to prohibit the concentration if: (i) the concentration may significantly restrict competition in the goods market, in particular through creating or strengthening a dominant position in the goods market; or (ii) the concentration does not comply with the requirements of the Competition Act established for the agreements, which may have an anti-competitive effect (in cases when the purpose or the result of the concentration would be co-ordinating the behaviour of undertakings that influence or may influence competition); or
• to terminate the proceedings where the parties to the concentration decide not to go ahead.

If the Competition Authority fails to reach any of the above decisions then the concentration is deemed to be approved.

The above timetable may be extended when the notifying party has failed to correct deficiencies in the concentration notification (the clock will be stopped as of the day following the letter from the Competition Authority).

Note that the Competition Act may be interpreted to mean that if the Competition Authority has established a deadline for correcting deficiencies in the concentration notification, then the 30 calendar day review period available for the Competition Authority (for Phase I proceedings) will commence only after such deficiencies have been corrected (ie, the clock will not be stopped but reset).

The timetable may also be extended when the parties to the concentration fail to submit the information or materials requested by the Competition Authority within the deadline established by the Competition Authority (the clock will be stopped as of the day following the letter from the Competition Authority).

The timetable can also be extended if the parties propose to undertake extra obligations to remedy the effects on competition and such measures need further analysis. In such case, the Competition Authority may stop the clock for up to two months.

The actual time that it takes for the Competition Authority to conclude its proceedings depends on the effects of the concentration, but also whether the Competition Authority is overwhelmed by the number of notifications (the Competition Authority may, in essence, initiate the supplementary proceedings without any significant reasons).

Pre-notification discussions with the Competition Authority are always encouraged by the authority and these are customary. Any information and documents provided during this process that include business secrets are treated confidentially by the authority, as are any other business secrets submitted by the parties, and these must be marked as such.

Information requests are quite common, but they are usually not very burdensome. Of course, this depends on the quality of the original notification and the market situation. Please refer to 3.8 Review Process on what effect information requests have on the timetable.       

As indicated in 3.5 Information Included in a Filing, in certain cases the notification may be submitted in the abbreviated form. However, this does not automatically change the review timetable, although in practice the review of the abbreviated notification usually takes less time by the Competition Authority.

There is no accelerated procedure for review or any other way to expedite the clearance.

The Competition Authority shall prohibit the concentration if it significantly restricts competition in the goods market, in particular through creating or strengthening a dominant position in the goods market.

Formally, there are affected markets if: (i) there is horizontal overlap between the activities of the parties to the concentration and the post-concentration joint market share exceeds 15%; or (ii) there is vertical connection between the activities of the parties to the concentration and any of the parties to the concentration which has a market share that exceeds 25%.

In principle, the Competition Authority may still prohibit the concentration even if there are no affected markets according to the above definition, but since lack of affected markets is one ground for submitting the notification in the abbreviated form (see 3.5 Information Included in a Filing), it is possible to argue that in such a case competitive concerns are deemed unlikely.

Considering the general lack of relevant practice in Estonia and the fact that the Estonian concentration control rules have been set on the basis of the EU merger control rules, the Competition Authority heavily relies on EU case law, eg, when defining markets or assessing the effects of the proposed concentration (see 4.4 Competition Concerns).

The Competition Authority very much follows the European Commission’s guidelines on the assessment of horizontal and non-horizontal mergers when it comes to the actual analysis of the proposed concentration. 

Therefore, in addition to high market shares, the assessment takes into account a variety of anti-competitive effects that could potentially arise out of a concentration, including unilateral effects resulting from horizontal mergers, co-ordinated effects (joint dominance), the elimination of a potential competitor, conglomerate or portfolio effects, vertical effects as well as the risk of co-ordinated behaviour of the parent companies subsequent to the creation of a full-function joint venture.

The law obliges the Competition Authority to base its appraisal of the concentration on the need to maintain and develop competition, taking into account the structure of goods markets and the actual and potential competition in the goods market, including:

• the market position of the parties to the concentration and their economic and financial power and opportunities for competitors to access the goods market;
• legal and other barriers to entry into the goods market;
• supply and demand trends for the relevant goods; and
• the interests of the buyers, sellers and consumers.

Therefore, the Competition Authority should consider economic efficiency, but this ground is not very often referred to.

For the formal bases for appraisal, see 4.5 Economic Efficiencies. Therefore, other considerations (ie, non-competition issues) should generally not be taken into account. 

However, since competition law does not operate in a vacuum, the Competition Authority could and should take such other issues into account if their importance is greater than the protection of competition.

There are special considerations in the substantive review of joint ventures. Namely, if the creation of a joint venture or the acquisition of joint control in any other manner has as its object or effect the co-ordination of the behaviour of undertakings which influences or is likely to influence competition, compliance of such activity with the general rules related to anti-competitive agreements must also be appraised by the Competition Authority.

The appraisal shall be based, above all, on the following:

• whether the undertakings who have created the joint venture will continue, to a material extent, their activities in the same goods market as the joint venture, or in the previous or following affected market, or in another market connected to such goods market; and
• whether the co-ordination of behaviour which is the direct result of the creation of the joint venture gives the undertakings which created the joint venture an opportunity to eliminate competition in the goods market or a significant part thereof.

As indicated in 2.2 Failure to Notify, if the parties to the concentration effect the concentration prior to the approval to concentrate, then such transaction may be deemed to be void. Therefore, the Competition Authority would not have to do anything to prohibit or interfere with the transaction – it would not have any legal effect anyway.

However, the Competition Authority would also have the right to issue a precept against the parties to the transaction to enforce the prohibition to effect the concentration and also impose a periodical penalty payment if the precept is not complied with (see 3.6 Penalties/Consequences of Incomplete Notification).

If any competition concerns are identified, the parties to the concentration are informed thereof promptly, but not later than one month before the termination of the term of the supplementary proceeding. At the same time, the parties are also given an opportunity to offer remedies (eg, behavioural or structural obligations – see below) to alleviate such concerns. Although the Competition Authority might indicate potentially acceptable remedies, the Competition Authority may only impose remedies that the parties have offered themselves.

The parties may also offer remedies already in the concentration notification if they foresee competition concerns. However, it is not clear whether remedies can actually be accepted by the Competition Authority in the initial review period. The Competition Authority itself has indicated in at least one case that in order to accept remedies it would need to initiate supplementary proceedings (Phase II).

The parties to a concentration must describe the obligations assumed in sufficient detail to enable the Competition Authority to determine the suitability of the assumed obligations in order to avoid the competition concerns that have been raised or identified. 

The concentration will be prohibited if the Competition Authority does not deem the proposed obligations suitable and the parties do not agree to change those obligations.

The Competition Authority is clearly favouring structural remedies, eg, divesting overlaps. However, the authority has also accepted behavioural obligations offered by the parties.

Please see 5.2 Parties' Ability to Negotiate Remedies.

If the proposed obligations need further review, the Competition Authority has the right to extend the review timetable by up to two months. The review period may be extended only once in such circumstance.

The law provides that the parties to a concentration are required to inform the Competition Authority of performance of the assumed obligations within ten calendar days: (i) after the date of performance of the obligations; or (ii) after the expiry of the term for performance of the obligations referred to in the decision concerning grant of permission to concentrate.

Therefore, the Competition Authority may set a date for fulfilment of the remedies and the parties may effect the concentration if they comply with such conditions.

The relevant penalties were discussed in 2.2 Failure to Comply. Moreover, the Competition Authority may revoke an approval to concentrate if the concentration was effected in violation of a term or other condition or obligation specified in the Competition Act or the decision to grant permission to concentrate.

A formal decision permitting or prohibiting the concentration (see 3.8 Review Process) is issued to the parties.

Such decisions are also published on the Competition Authority’s website. Business secrets are redacted before publication if and to the extent requested by the notifying party.

As a rule, the Competition Authority does not distinguish between domestic and foreign-to-foreign transactions in connection with the review process, prohibitions or remedies. However, we are not aware of any recent prohibitions or remedies for foreign-to-foreign transactions.

The decision to approve the concentration will cover also related arrangements (ancillary restraints) in accordance with the same principles as is the case with EU merger control.

The concentration notification must set out any ancillary restraints, ie, any restrictions on competition which are directly related to, and necessary to give effect to, the concentration and are contained in the agreements or other documents which are the basis for giving effect to a concentration together with the reasons for applying such restrictions.

No separate notifications are required or possible.

Once the concentration notification has been submitted, a relevant notice is posted on the Competition Authority’s website with an invitation to third parties to submit their comments and objections to the concentration. The notice will also include a non-confidential description of the concentration (this description must be attached to the notification).

However, in more difficult cases the Competition Authority also directly consults third parties, which include competitors, but also other parties, such as customers, trade associations, consumer organisations, etc. Such a practice is not regulated or limited by legal acts.

Please see 7.1 Third-Party Rights. In the more complex cases, the Competition Authority usually contacts the third parties via written questionnaires, especially if the parties have offered some remedies.

Please see 7.1Third-Party Rights regarding publication of the information about the concentration notification, ie, it is for the parties themselves to provide such non-confidential description of the concentration.

As to other information provided in the concentration notification, the notifying party must indicate information contained in the notification, which it deems to be a business secret. However, the Competition Act establishes certain categories of information that cannot be indicated to be a business secret, such as business names, registry codes, contact information and fields of activity of the parties to the concentration and information about their shareholdings and group structure.

Furthermore, the law contains qualitative criteria describing what type of information as such may constitute a business secret.

In practice, the Competition Authority has been complying with requests to treat as confidential such information that third parties would normally not have access to, eg, financial information, technical information about products, information about processes, future plans, etc.

The Competition Authority usually co-operates with other jurisdictions. The law does not include any specific regulation of such relationship regarding concentrations (eg, what kind of information may be shared), but indicates that this should be done according to EU law.

A decision approving or prohibiting a concentration may be challenged at the Competition Authority as an administrative body itself. As an alternative or after the Competition Authority has not reversed its decision, an action for annulment of the Competition Authority’s decision may be filed with the Tallinn Administrative Court. The decision of the Tallinn Administrative Court may further be appealed to the Tallinn Circuit Court and eventually to the Estonian Supreme Court.

If a decision of the Competition Authority has been challenged at the Competition Authority itself, the challenge is resolved within ten days after its delivery to the Competition Authority. If a challenge needs to be further examined, the term may be extended by up to 30 days. In case of filing an action for annulment with the court, the review in the first instance court might take approximately a year, all three instances together over two years.

The possibilities for appeal are the same for approval (clearance) and prohibition decisions. Therefore, third parties can appeal clearance decisions. To our knowledge there has been one successful appeal where the Circuit Court allowed the appeal, but in the end the court said that the transaction could not be reversed, because the two entities had been merged to such extent that this was not possible. However, the court indicated that damages could be sought.

From 1 September 2023 the Foreign Investment Reliability Assessment Act (välisinvesteeringu usaldusväärsuse hindamise seadus) shall enter into force to regulate foreign investments into Estonia. According to the law, a foreign investment requires an authorisation from the Consumer Protection and Technical Regulatory Authority, which is granted by assessing the impact of the foreign investment on the security and public order of Estonia or another Member State of the European Union.

There have been no recent changes to the Competition Act, but there are new rules being prepared based on the new vertical and horizontal block exemptions. Moreover, there are new rules still being devised on the basis of ECN+ Directive, which could introduce new administrative fining proceedings into Estonian law. As to specific concentration control rules, there are talks of possible changes to the law that would allow the Competition Authority to control a concentration even if the relevant jurisdictional thresholds are not fulfilled.

We know that the Competition Authority has imposed fines in the past years, but these have not been very frequent or substantial. The Competition Authority is more and more issuing clearances with conditions and has also prohibited some concentrations (very few compared to the total number of cases, none within 2022).

The Competition Authority is concerned about not being able to examine all concentrations that might be significant for the market, due to them falling below the jurisdictional thresholds. Since the Competition Authority is understaffed, it is quite often initiating Phase II proceedings, not because the concentration is problematic, but because they do not have the resources to conclude the process within 30 days.