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Guide to Estonian Legal System and Legal Research

By Jannu Kuusik and Kart Miil

 

Jannu Kuusik  is enrolled in a master degree program at the Universiy of  Tartu Faculty of  Law and works  in Tallinn City Government as a legal adviser.  Kart Miil is a  librarian at Tartu  University  Library.

 

Published April 2008
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Table of Contents

I. GOVERNMENT AND LEGAL SYSTEM

1.1 Historical Background

1.2 Government

1.3 Legal System

1.4 Constitution

II. LEGISLATIVE AND EXECUTIVE POWER AND OTHER GOVERNMENT BODIES

2.1 The Riigikogu

2.2 President of the Republic

2.3 Government of the republic

2.3.1 Ministries

2.3.2 Ministers without Portfolio

2.4 State Chancellery

2.5 Government Agencies

2.5.1 Executive Agencies

2.5.2 Inspectorates

2.5.3 National foundations

2.6 National Audit Office

2.7 Local Authorities

2.8 County Authorities

2.9 Bank of Estonia

2.9.1 Financial Supervision Authority

2.9.2 Estonian Central Register of Securities

2.10 Liberal Professions

2.11 Chancellor of Justice

III COURT SYSTEM / COURT PROCEDURE

3.1.1 Civil Procedure

3.1.2 Administrative court procedure

3.1.3 Criminal procedure

3.1.4 Arbitral tribunals

3.1.5 Enforcement procedure

IV. PRIVATE LAW

4.1 Civil Law

4.2 Commercial Law

4.3 Labour Law

V PUBLIC LAW

5.1 Administrative Law

5.2 Tax Law

VI PENAL LAW

Web Resources of Estonian Law

 

I. Government and Legal System

1.1 Historical Background

The first traces of human settlement on the territory of today’s Estonia date back to more than 10,000 years ago when these areas were inhabited by Finno-Ugric tribes. Modern-day Estonians can be said to be the descendants of those tribes, with the concession that throughout history Estonians have blended with various other nationalities that came to these areas as conquerors. The ancient Estonians retained their independence until the beginning of the 13th century when Estonian areas were conquered by Germans. From the 13th to the beginning of the 20th century, Estonian territory was ruled by different foreign invaders, including German, Swedish, Danish, Polish, and Russian. Development of Estonian law has been most affected by the German legal order. As development of continental European law at that time was itself most influenced by ancient Rome, the roots of Estonian law can also be found there. Instruction about Roman law forms an integral part of training today’s lawyers.

 

The modern Estonian state was founded on 24 February 1918 when Estonia declared its independence and sovereign statehood. Unfortunately, the first period of independence remained short, because the ambitions of different world powers at the beginning of the 20th century brought Estonia under occupation by the Soviet Union in 1940. Estonia regained its independence as a result of disintegration of the Soviet Union. Estonia declared its independence for the second time on 20 August 1991, which also marked the end of fifty years of Soviet occupation.

 

The keywords of Estonia’s development after regaining independence have been openness, liberalism, and international cooperation. In a relatively short period, the state-building process was completed and European values were reaffirmed. Estonia’s openness has guaranteed rapid economic development and the social welfare of its people. The success and openness of the economy is also attested by the fact of Estonia’s continuing high-level global ranking by its index of economic freedom. As a small country, Estonia has well understood the importance of international cooperation and the meaning of globalization. These processes are inevitable in today’s society, so that there is no sense in fighting them but, rather, trying to make best use of them. Estonia is now a member of a number of major international organizations, most important among these being the European Union, NATO, and the Schengen visa area. Estonia has proved to its partners that despite its smallness, it is a serious and reliable partner that respects democratic values. The most important feature of today’s legal system in Estonia stems from the fact of its membership of the European Union since 2004 so that EU law forms an integral part of Estonian law.

1.2 Government

Estonia is a parliamentary republic with the supreme power of the state vested in the people. Legislative power lies with the parliament (Riigikogu). The parliament consists of 101 members, elected by Estonian citizens for a term of four years. Executive power lies with the Government of the Republic, which implements the country’s domestic and foreign policy and organizes implementation of legislation. The Government consists of 14 ministers, headed by the Prime Minister, and operates through eleven ministries. The head of state is the President. The President plays a primarily representative role, though also serving as supreme commander of national defence forces. Issues of local life are managed by local authorities, divided into rural and urban municipalities. The local government representative body is the council, elected for a term of four years. Unlike in parliamentary elections, non-citizens who have permanently resided in their local community for at least five years may also participate in local government elections. Local authorities are independent bodies of executive power and interference by the central government in local issues is minimal. County authorities serve as a link between central and local government. The main role of county authorities is to coordinate and monitor performance of state functions at local level.

In summary, Estonia characterizes a democratic parliamentary republic observing the classic principle of separation and balance of powers in the shape of legislative, executive, and judicial power with mechanisms for ensuring balance of power.

1.3 Legal System

According to the classic approach, the Estonian legal system belongs to the continental European legal tradition, the Roman-Germanic family, and follows the classic division into private, public, and criminal law. Significantly, however, Estonian law today is increasingly influenced by other legal systems, in common with the legal systems of other developed countries. Various principles contribute to the development of law, each legal system borrowing from the other. Additionally, generally recognized principles of international law and binding international treaties form an inseparable part of Estonian law. Judicial precedent, too, serves as an important source of law in Estonia today. Case law of the Supreme Court is decisive with regard to issues of interpretation of law or when gaps in legislation need to be bridged. Today’s globalised society is rapidly developing so that the somewhat cumbersome legislative process is not always able to react to necessary changes. However, as appropriate for a system governed by rule of law, legal gaps should not exist. The Supreme Court has the authority to interpret legal rules and its opinions are taken into account when dealing with similar situations in the future. Reflection of rapid changes and shifting values in society in court judgments also conforms to the spirit of the law. Note, however, that the Estonian legal system is formally norm-based, not a mixed system of precedent and statutory law. Interpretation of norms is necessary to allow the legal system to keep pace with a rapidly changing modern society.

 

The classical distinction between private and public law is somewhat difficult nowadays. Estonia wishes to attend to the welfare of all members of society. In the process of law-making, this also implies attempting to ensure the rights and interests of the weaker party in legal relationships. Under this principle, legal norms aimed at protecting the interests of the weaker party are usually imperative, so that agreements entered into in contravention of these principles are void. Norms aimed at protecting the public interest increasingly often find their way into private law. At the same time, an opposite trend also exists, with more and more private law principles emerging in public law. This occurs mainly in areas regulating relations between the state and individuals (both natural and legal persons), as such relations should be based on an equal footing, excluding the possibility of abuse of power.

1.4 Constitution

The current Estonian Constitution was adopted by a referendum held on 28 June 1992. The Constitution stipulates that Estonia is a sovereign democratic republic where the supreme power of the state is vested in the people. The Constitution also includes the principle of a state based on social justice, according to which the state must ensure basic social guarantees such as education, medical assistance, and minimum income. The independence and sovereignty of Estonia are timeless and inalienable. State authority is exercised solely under the Constitution and laws that conform to it. The Constitution also states that generally recognised principles and rules of international law are an inseparable part of the Estonian legal system.

 

The key principles enshrined in the Constitution include the following: the principle of separation of powers; protection of the rights and freedoms of all people, restricted only in accordance with the Constitution; the principle of legality and equal treatment; prohibition of discrimination; the right to state protection for ensuring compliance with the rights of individuals; the right of recourse to a court of law; freedom of speech and assembly; integrity of the person; the presumption of innocence; inviolability of family life and privacy; protection of national minorities; freedom of enterprise; protection of health; protection of property; freedom of choice of occupation; and other important principles characteristic of a country governed by rule of law.

 

 

II. LEGISLATIVE AND EXECUTIVE POWER AND OTHER GOVERNMENT BODIES

2.1 The Riigikogu

As the parliament, the Riigikogu is the highest legislative body and consists of 101 deputies elected by popular vote. Riigikogu elections are held every four years and only adult Estonian citizens can participate in elections. Election results are determined on the basis of the principle of proportionality.

 

 

The European Parliament

Estonia has six seats in the European Parliament. Members of the European Parliament are elected by popular vote according to the principle of proportionality for a term of five years.

 

2.2 President of the Republic

An Estonian citizen by birth of at least forty years of age may be nominated as a candidate for President of the Republic. The President is elected for a term of five years. No one can be elected President for more than two consecutive terms. The right to nominate a candidate for President rests with not less than one-fifth of the members of the Riigikogu. Under § 79 of the Constitution, the Riigikogu elects the President by secret ballot. A candidate approved by the votes of a two-thirds majority of the members of the Riigikogu is considered elected. If the Riigikogu fails to elect a President of the Republic, the president of the Riigikogu convenes an electoral body for election of the President of the Republic within one month. The electoral body consists of members of the Riigikogu and representatives of local government councils.

 

Assumption of office by the President of the Republic terminates his or her authority and duties in all elected and appointed offices, and he or she must suspend membership in political parties for the duration of the term of office as President. The competencies of President as Head of State are listed in § 78 of the Constitution and specified by the President of the Republic Rules of Procedure Act and other special laws.

 

The President of Estonia fulfils a mainly ceremonial function. By tradition, the President pays great attention to international relations and communication. The first President of Estonia was Konstantin Päts, while the first President of re-independent Estonia was Lennart Meri, who was elected for two consecutive terms and thanks to whom Estonia gained wide recognition abroad. The President also proposes to the Riigikogu candidates for appointment to various high-level government offices and, following approval of the Riigikogu, appoints them to office. Formally, the President is also head of the Estonian Defence Forces.

 

 

2.3 Government of the Republic

The Government of the Republic is the executive power body in Estonia. Traditionally, the President of the Republic invites the leader of the political party that gained most votes in elections to form a Government. The Government is formed following negotiations between the political parties represented in the Riigikogu. The political parties that form the Government establish a coalition. This begins implementing policies agreed in a coalition agreement and party election promises. The Government includes 14 ministers, with the Prime minister as Head of Government.

2.3.1 Ministries

2.3.2 Ministers without Portfolio

 

2.4 State Chancellery

The State Chancellery is a government agency within the Government of the Republic. The State Chancellery supports the Government and the Prime Minister in policy development and implementation; provides support to ministers without portfolio; promotes public service; develops document management and archiving; organises publication of the State Gazette; and manages issues relating to symbols and decorations.

 

 

2.5 Government Agencies

Government agencies include various executive agencies and inspectorates acting within their competencies under the area of administration of different ministries, as well as other institutions that exercise executive power within their area of administration.

2.5.1 Executive Agencies

·       Technical Surveillance Authority

2.5.2 Inspectorates

·       Environmental Inspectorate (in Estonian)

·       Nature Conservation Act

·       Health Protection Inspectorate

·       Public Health Act

·       Labour Inspectorate

·       Employment Contracts Act

·       Language Inspectorate

·       Language Act

·       Data Protection Inspectorate

·       Personal Data Protection Act

·       Plant Production Inspectorate

2.5.3 National Foundations

 

2.6 National Audit Office

The National Audit Office supervises public sector agencies and institutions. Its main focus is on assessing practicality and efficiency. The National Audit Office is an audit body acting in the interests of and paid for by the taxpayer. Its tasks include investigation of how state and local government spent taxpayers’ money and what they gave in return. Results of the work of the National Audit Office are intended primarily for the Riigikogu, the Government, and the public. The National Audit Office is not competent to punish anybody, and it does not exercise power of its own but assists decision-makers in an advisory capacity. In order to enable the Riigikogu and the Government to spend public money more efficiently and to govern more effectively, the National Audit Office carries out two types of audit: (1) financial audit, and (2) performance audit.

 

 

2.7 Local Authorities

The local government system consists of rural municipality and city authorities. Local authorities act on the basis of the principle of local autonomy so that they are independent in exercising power and managing local issues within their administrative territory. Local administrations are formed as a result of local council elections. Elections take place every four years. Adult Estonian citizens can vote in elections. Unlike in the Riigikogu elections, non-citizens who have lived in the territory of the corresponding local authority for at least five years also have the right to vote in local council elections. Election results lead to formation of local government councils, which are competent to decide main local issues and develop local policy. Daily issues are managed by the rural municipality administration or city administration. Local government mayors representing rural municipalities or cities are appointed by the local council. Other posts within a rural municipality or city administration are non-political.

 

2.8 County Authorities

Estonia has fifteen counties. Counties are run by county authorities which serve primarily as a link between central and local government. The main task of the county authority is to perform state functions at a local level. To a limited extent, county governments also supervision the activities of rural municipality and city administrations, first and foremost with regard to performance of state functions.

 

 

2.9 Bank of Estonia

The main objective of the Bank of Estonia is to ensure price stability, achieved through a stable exchange rate. Estonia applies the principles of the currency board system in managing the exchange rate, under which the rate of the Estonian kroon is pegged to the euro (1 euro = 15.6466 kroons). The Estonian kroon is freely convertible, which means that no obstacles exist to free movement of capital. Estonia has used the currency board system since 1992. The currency board is an automatic system based on strict rules. To maintain the fixed exchange rate of the Estonian kroon, the liabilities of the central bank, including the monetary base in the economy, must be fully guaranteed by foreign currency or gold reserves. In the currency board system, the central bank is prohibited by law from granting credit to central or local government, either directly or indirectly. According to the Security of the Estonian Kroon Act, the Bank of Estonia may not devalue the exchange rate of the Estonian kroon.

 

In order to ensure smooth operation of the currency board system, the central bank has monetary policy instruments at its disposal. With the help of these instruments, the bank tries to ensure the smooth functioning of the liquidity system as well as the existence of sufficient buffers for coping with unexpected situations. The main monetary policy instruments include the permanent possibility of purchase and sale of foreign currency and the requirement of a mandatory reserve for commercial banks. In compliance with the currency board framework, the rate of the mandatory reserve is significantly higher (currently 15% of the reserve) than in countries with different exchange rate systems. As monetary policy instruments are limited in the case of a fixed exchange rate system, the government’s budgetary policy plays an important part in stabilising the Estonian economy. A conservative and balanced budgetary policy is necessary to ensure sustainability of the economy. Flexibility of the real sector, in particular the labour market, is an important prerequisite for the smooth functioning of the currency board. In the case of a fixed exchange rate, the economy cannot be balanced through changing the exchange rate. Thus, economic growth must be adjusted on the side of the real economy – in wages and prices.

 

2.9.1 Financial Supervision Authority

The Financial Supervision Authority is a financial supervisory agency with an autonomous competence and budget which exercises supervision on behalf of the state and is independent in its activities and decisions. The Financial Supervision Authority carries out state supervision over banks, insurance companies, insurance intermediaries, investment firms, management companies, and the securities market. The objective of supervision is to protect the interests of clients and investors in preserving their assets, thereby supporting the credibility of the Estonian monetary system. The main aim of supervision is to ensure that financial institutions are able to perform their obligations to clients, e.g. to pay out bank deposits, insurance indemnities, and funded pensions. The Financial Supervision Authority also aims to contribute to increasing the effectiveness of the Estonian financial sector, reducing systemic risks, and preventing fraudulent criminal use of the sector.

 

2.9.2 Estonian Central Register of Securities

Securities issued in Estonia are registered electronically in the central register. Practically no circulation occurs of paper-based securities. The central register reflects the turnover of securities and their owners.

 

2.10 Liberal Professions

The liberal professions are highly qualified professions where the main activities are performed personally (i.e. they cannot be delegated to paid assistants), independently and on one’s own responsibility. The liberal professions are characterised by preparatory service for entry into the profession, the requirement to pass a professional examination, and the principle of self-sufficiency (i.e. the state does not pay their wages). Some liberal professions exercise state authority to the extent delegated to them.

 

Notaries

Notaries are holders of public office empowered by the state to attest, on request, to facts and events with legal significance and to perform other notarial acts to ensure legal certainty.

 

Auditors

The professional activities of an auditor include auditing, business consultancy, and other functions assigned to auditors by legislation.

 

 

Trustees in Bankruptcy

Those who have passed the examination for trustees in bankruptcy and who have a certificate issued by the evaluation committee can serve as trustees in bankruptcy. The trustee ensures the legality of the bankruptcy process.

 

 

Bailiffs

Bailiffs are holders of public office whom the state has empowered to perform compulsory execution of court judgments and other financial claims, in compliance with applicable legislation.

 

 

Advocates

Only members of the Estonian Bar Association have the right to provide legal services as advocates. Higher requirements of ethics and education apply to sworn advocates. An advocate’s certificate is issued to those who pass the relevant examination to demonstrate knowledge of law.

 

 

Sworn Translators

Sworn translators are holders of public office empowered by the state to certify, equally with notaries, the correctness of translations of documents translated by themselves or by others.

 

 

Patent Agents

Patent agents provide legal services in the field of industrial property. In cases prescribed by law, legal services may be provided only by a patent agent.

 

 

2.11 Chancellor of Justice

The institution of Chancellor of Justice was recreated in accordance with the principle of continuity in the Constitution of 1992. Recreation of the institution of Chancellor of Justice on the model of the 1938 constitution demonstrates the importance of this institution in constitutional structure and legal culture. According to the 1992 Constitution, the Chancellor of Justice is proposed by the President of the Republic and appointed by the Riigikogu for a term of seven years. The Chancellor of Justice, as an independent official, reviews legislation of general application of the state legislature and executive and of local government to verify its conformity with the Constitution and other laws. Once a year, the Chancellor of Justice submits to the Riigikogu a report with an overview of his or her activity. The Chancellor of Justice in Estonia combines the function of a general body for petition and guardian of constitutionality. This combined competence is unique internationally. Another important constitutional task entrusted to the Chancellor of Justice is that of ombudsman. Under this function, the Chancellor of Justice monitors whether state agencies comply with fundamental rights and freedoms and with principles of good governance. An amendment to the Chancellor of Justice Act that entered into effect on 01 January 2004 further expanded the functions of the Chancellor as an ombudsman – the Chancellor of Justice now also supervises local government, legal persons in public law, and private persons who exercise public functions. By exercising these closely related tasks, the Chancellor of Justice focuses on review of compliance with fundamental constitutional values – human dignity, democracy, rule of law, social justice. Whether a law or regulation of the Government, a Minister, or local government conforms with the Constitution can to a large extent be assessed on the basis of information that the Chancellor of Justice obtains when verifying the guarantee of fundamental rights.

 

According to the Constitution, the Chancellor of Justice may participate in sessions of the Riigikogu and of the Government with the right to speak. The Chancellor of Justice receives copies of draft legislation submitted to the Riigikogu and the Government for debate, as well as other materials which, by their nature, require that the Chancellor should be informed about their various stages of processing until adoption. In principle, through exercise of the right to speak at sessions of the Government, the Chancellor of Justice performs the function of preliminary control in respect of draft legislation.

 

 

III Court System

Estonia has a three-level court system. First instance courts are county courts. The four county courts, in turn, are divided into regional courthouses. Second instance courts are two courts of appeal, also divided into regional courthouses. The court of highest instance is the Supreme Court, which reviews decisions of lower instance courts by way of cassation proceedings. The Supreme Court also functions as the court of constitutional review. Parties to proceedings have the right of single appeal, i.e. if dissatisfied with the decision at first instance they can appeal the matter to the court of appeal. If the parties are dissatisfied with the decision of the court of appeal, a right of further appeal also exists. However, this is not guaranteed: an appeals selection panel at the Supreme Court evaluates the facts and potential of the case. If it appears that the lower instance courts significantly breached substantive or procedural law, the Supreme Court allows leave to appeal in cassation. This system of appeal selection is necessary mainly to avoid dealing with frivolous and vexatious complaints where the parties argue merely for the sake of dispute and the substance has become secondary or is absent completely. The resources of the state are not inexhaustible and administration of justice is no exception in this respect; the principle of economy equally applies here, too.

 

The Constitutional Review Chamber, operating within the Supreme Court and consisting of the members of the Court, is also a body that enjoys a certain independence. The Constitutional Review Chamber deals with legal issues that involve discrepancy with the Constitution. It is inevitable that not all adopted legislation always conforms to the Constitution. If a dispute arises in this connection, the Chamber rules on the validity of the relevant norm. If the norm is declared to be contrary to the Constitution, it is invalid and should be disabled. Thus, the Constitutional Review Chamber under the Supreme Court has a certain balancing effect, so that the separation of powers is not a totally rigid principle to be observed at any cost.

 

The division of the court system into three levels is not absolute. Significantly, Estonia is a member of international organizations so that international law forms an integral part of daily legal activities. If, for example, the European Court of Human Rights rules differently on a case than the Estonian Supreme Court, this lays a basis for reopening proceedings so that a judgment earlier pronounced as final may be reviewed and a different conclusion reached.

 

 

3.1 Court Procedure

In addition to the division into three court instances, a triple division exists by areas of law, in the shape of a distinction between civil, administrative, and criminal procedure.

 

3.1.1 Civil Procedure

Civil procedure is used in litigating civil matters. These are cases arising from relationships under private law. The aim of the procedure is to ensure that cases are decided fairly, within a reasonable time, and as economically as possible. Parties are given equal opportunity to justify their claims and to refute or argue against the other party’s claims. The parties themselves determine which facts they present to substantiate their claim and what evidence they submit as proof. Throughout the procedure, the court must do everything within its power to achieve a settlement of the case or part of it with a compromise or other agreement between the parties, if the court believes this to be reasonable. As a rule, civil procedure is public.

 

 

3.1.2 Administrative Court Procedure

The administrative court is competent to adjudicate disputes under public law. Administrative court procedure applies the investigative principle. This means that the court must do everything within its power to ascertain the truth. If necessary, the court collects evidence on its own initiative.

 

 

3.1.3 Criminal Procedure

The main principles of criminal procedure are: mandatory proceedings when facts of a criminal offence appear; presumption of innocence; adversarial procedure (parties have equality of arms in proceedings); ensuring a defence counsel (when the accused or suspect is unable to hire their own criminal defence counsel, counsel is provided by the state); guarantee of rights (right to be informed of all the facts of the charges, as far as this does not damage the interests of investigation); public court hearing; ensuring proceedings in a language that the accused or suspect understands; principle of free assessment of evidence (no evidence has predetermined effect); no one is required to testify against themselves or against persons close to them; principle of legal collection of evidence (evidence acquired illegally is generally inadmissible). The criminal procedure also includes the possibility of a settlement (similar to a plea bargain) which allows cases to be dealt with more expediently and economically if the suspect or accused pleads guilty and consents to a simplified proceeding. In that case, a long trial is avoided and the judge may impose a lighter sentence than prescribed by law. However, settlements in criminal proceedings can only be entered into in the case of less serious criminal offences.

 

 

3.1.4 Arbitral Tribunals

Several institutions in Estonia may handle extrajudicial settlement of civil disputes (not already referred to the court). Arguments in favour of such tribunals usually point to the time-consuming nature and higher cost of settling disputes through court proceedings. In practice, the arbitral system has proved viable and the number of cases settled is fairly significant. Importantly, the decisions of arbitral tribunals may be appealed to the court.

 

- Labour Dispute Committee. Individual Labour Dispute Resolution Act

- Lease Committee. Lease Disputes Resolution Act

- Consumer Complaints Committee. Consumer Protection Act

- Arbitral Tribunal for Resolution of Insurance Disputes. Insurance Activities Act

- Copyright Committee. Copyright Act

- Expert Committee on the Quality of Health Care. Health Insurance Act; Public Health Act

- Arbitration Tribunal of the Estonian Chamber of Commerce and Industry.

 

3.1.5 Enforcement Procedure

Enforcement proceedings aim to ensure compliance with (or recovery arising from) court decisions that have entered into effect. The majority of enforcement cases involve recovery of money claims, in the process of which it is possible to attach a debtor’s assets or take other measures to satisfy a creditor’s claim. Enforcement procedures can also be used to reclaim dwellings or business premises from unlawful possession. The assistance of a bailiff can also be used to arrange access to a child (i.e. visiting rights) if one parent prevents the other from doing so.

 

Enforcement cases are dealt with by bailiffs acting on behalf of the state (as representatives of a liberal profession). In other words, the state delegates its functions to bailiffs by law. Therefore, bailiffs must meet high-level certification requirements established to ensure correctness of enforcement proceedings.

 

·       Code of Enforcement Procedure

·       Bailiffs Act

 

IV. PRIVATE LAW

4.1 Civil Law

General Part of the Civil Code Act provides for general principles of civil law: passive and active legal capacity; the principle of good faith; natural and legal persons; forms and general requirements for transactions; and other general principles of implementation of civil law.

 

Law of Property Act provides for real rights, their substance and bases for their creation and extinguishment. The scope of regulation includes the right of ownership and limited real rights – servitudes, real encumbrances, rights of pre-emption and security. The general principle of Estonian property law is to ensure wide-ranging protection of ownership and lawful possession. A unique and notable feature is existence of strong land register law, which includes a presumption of validity of entries in the land register. This is especially important in that it enables third parties in a legal relationship involving immovable property to rely on a presumption that entries in the land register are genuine and valid and any transactions entered into on that basis are considered to be in good faith.

 

Law of Obligations Act regulates issues related to transactions under the law of obligations, contractual relations, and non-contractual obligations. As a rule, the principles of freedom of contract, good faith, and party autonomy apply. However, norms applicable to certain types of transactions may be imperative. This applies principally to contractual relations where one party is clearly weaker, e.g. lessees, consumers, employees, borrowers, policyholders. In that respect, the law provides for minimum requirements to ensure the rights and interests of the weaker party. Imposing a contract that is less favourable than minimum requirements is prohibited, while a more favourable contract can be concluded.

 

Family Law Act – regulates family relations. The overall purpose of the law is to ensure wide-ranging protection and welfare of the family.

 

Law of Succession Act (valid until 31 Dec 2008); Law of Succession Act (valid as of 01 Jan 2009) – provides the procedure for succession and regulates relations between successors (heirs) following death of the individual whose estate is to be administered. The law defines persons considered as first, second, or third order successors. Succession may be either intestate or testate. If no successors exist, the local authority or the state is the intestate successor.

 

As of 01 January 2009, the new Law of Succession Act enters into effect. This contains a fundamental change in comparison with the current law. Under the new law, a renunciation system is applied instead of the current acceptance system. Under the renunciation system, a person who is entitled to succeed is presumed to have accepted the succession if they have not notified their renunciation by the prescribed date. Under the acceptance system, it was necessary to submit an application to receive the succession and only then was the succession considered accepted.

 

4.2 Commercial Law

The Commercial Code mainly regulates the rights and duties of companies operating in the business environment. The law provides for types of companies, along with principles and rules for their operation, as well as rights and duties of management bodies, and other important principles regarding companies.

 

4.3 Labour Law

Employment Contracts Act regulates employment relations between employers and employees in the private sector, as well as persons who work on the basis of an employment contract in the public sector.

 

V PUBLIC LAW

5.1 Administrative law

In categorizing public functions, the Estonian Constitution proceeds from the dualist theory, distinguishing between local issues (§ 154(1)) and state issues or “duties of the state” (§ 154(2)). Local authorities enjoy universal competence in deciding and managing local issues. Delegated authority (with respect to state issues) emerges on the basis of a law or an agreement (administrative agreement) between the state and local authority. Administrative law distinguishes between general and special parts. The general part covers regulations, principles, terms, and legal institutions important for all fields of administrative law in general. This aims to include matters that are common, typical, or general. The special part of administrative law covers individual areas of administration, such as construction, roads, business, economy, social welfare, schools and higher educational institutions. Individual areas of the special part of administrative law are, to a greater or lesser extent, regulated by specific Acts.

 

Administrative procedure is based on the idea that the function of administrative bodies is to make decisions that are correct in substance. To ensure this, a fair administrative procedure needs to be laid down as an indispensable prerequisite for high-quality decisions and their recognition. The Administrative Procedure Act is a general act that lays down common procedural requirements for all fields of administration to be complied with by all bodies that exercise administrative functions. Procedural details are regulated in specific Acts, taking into account the unique features of each particular field. The Administrative Procedure Act lays down general requirements for conducting proceedings, including, most significantly: legality; proportionality, discretion; freedom of form, expediency and efficiency; the investigative principle; publicity. In addition, compliance with the principles of good governance (in its widest sense) plays an important role. According to the principles of good governance, public servants should not only refrain from breaching legislation, i.e. from acting unlawfully, but they also have the duty, for example, not to be impolite, careless, unfair, unjustifiably in delay with their response, abuse their authority, discriminate against individuals or treat them unequally. Any kind of insufficient, incorrect or irregular administrative practice should be avoided. General principles of administrative procedure and good governance apply to the entire public sector.

 

 

5.2 Tax Law

Estonia has been able to maintain a liberal taxation policy. This has ensured the country’s rapid development and economic success. Taxation policy is an important instrument for promoting investment and attracting foreign capital.

 

 

VI PENAL LAW

Extensive penal law reform took place in Estonia in 2002, with enactment of the new Penal Code. This stands among the most modern in Europe. Great emphasis focuses on protection of human rights and fundamental freedoms in criminal procedure. Important keywords are also prevention and reintegrating of offenders into normal life. As a rule, the treatment of first-time offenders is relatively lenient in order to allow them a chance to learn from their mistake. Instead of imposition of prison sentences, other forms of supervisory measures have been introduced. These allow more opportunities for people to continue to lead normal law-abiding lives.

 

 

Web Resources of Estonian Law

 

Estonian Government Information

 

Full Text Law Databases

 

Courts

 

Legal Education

 

Libraries and Databases

 

Journals

 

Estonia and EU

 

Human Rights

 

Organizations

 

Lawyers Associations

 

Law Firms (home page contains publications in English)

 

English Language Internet Sites on Estonia