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Goods and services are purchased constantly online in Estonia, yet our online retailers have untapped potential – we are lagging a bit behind the European Union average in cross-border online retail. It is worth putting more effort into sales of electronic goods and services to consumers in other member states, especially given that the European Commission has and will continue to simplify cross-border e-commerce, including changes in the tax system.

Hundreds of companies are bought and sold each year in Estonia. In the case of bigger transactions, relying on assistance from transaction advisers has become the norm, although for the sake of total certainty, it’s a good idea to bring aboard an adviser even on smaller acquisitions.

The European Union has adopted new rules on VAT that will simplify and facilitate e-commerce. The rules will come into effect in full on 1 January 2021, but companies that provide electronic services will be able to benefit from the rules already starting 1 January 2019.

This year, a number of large-scale purchase and sale transactions have provided much fodder for discussion in the media – Nelja Energia, Luminor and Utilitas are three examples. The large transactions always stand out, but this year has seen many mid-sized and small company acquisitions as well.

United Motors has purchased the distributor of Peugeot and Hyundai in Estonia. Grant Thornton Baltic provided advisory services for the transaction.

International commerce is increasingly digital. But the global taxation system is still aimed at traditional “brick and mortar” needs. The action plan of the OECD’s package of measures to combat base erosion and profit shifting (BEPS) acknowledges the need for modernisation. This has been partly achieved after the BEPS Action Plan was released in October 2015.

Grant Thornton has released a new guide to help international entrepreneurs navigate transfer pricing regulations in different countries.

Effective 15 January 2018, an amendment to the Commercial Code comes into force requiring all Estonian companies whose management board is located abroad to appoint a contact person in Estonia.

In October, a Finnish company acquired the majority shareholding in the Milrem LCM OÜ, a company that provides maintenance and repair work for Estonian Defence Forces armoured vehicles and other military vehicles.

Grant Thornton Baltic advised the sale of AS United Motors vehicles retail business in Estonia. BMW and KIA vehicles retail business, vehicle parts and accessories retail business, maintenance and repair of motor vehicles in Tallinn, Tartu, Pärnu and Kohtla-Järve were sold to Inchcape Motors Estonia OÜ. GTB advised the seller AS United Motors on legal, financial and tax due diligence performed by the buyer, and carrying out the transaction. GTB had a remarkable role in negotiating the terms and price of the transaction.

Key tax changes in the Baltic states

Indirect tax

Key tax changes in the Baltic states

A growing trend – outsourcing payroll accounting

First anniversary of e-residency program

IBR Growth Barometer