Under a European Union directive, publicly listed companies must adopt the European Single Electronic Format, ESEF. But they will probably not have to file ESEF format annual reports for another year.

The obligation to file annual reports in ESEF was established by an EU directive for reporting periods beginning 1 January 2020 or later.

The goal is to ensure a high level of transparency and comparability of financial reporting.

In connection with the complicated situation with regard to the coronavirus, the European Parliament and Council decided on 11 December 2020 that member states can decide to postpone the ESEF obligations by one year.

The Estonian Ministry of Finance announced that it had submitted an amendment proposal under which the ESEF requirement would apply to periods beginning 1 January 2021 or later.

The Ministry of Finance believes it is hard to predict the potential entry into force date, due to which amendments to domestic legal acts may come into force after publicly listed companies have already prepared their 2020 annual reports. Taking into account the purpose, timing and intention of the amendment, submitting annual reports for 2020 in ESEF would be voluntary.

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