The Riigikogu passed three Acts
The amendments made under the Act on Amendments to the Customs Act (311 SE), initiated by the Government, lay down national implementing provisions for smoother transposition of European Union law in two areas. They are the customs clearance rules for postal packages and courier shipments of negligible value ordered from non-Union countries, in particular from online stores, as well as the control rules for the import and export of cash.
On 1 July 2021, all EU Member States will start to tax consignments of negligible value in the same manner and the exemption from VAT of consignments with a value of up to 22 euro will be eliminated. The taxation of such consignments may bring about a multiplication of the amount of customs declarations submitted. With a view to ensuring rapid movement of consignments to customers and preventing the need for large-scale storage of consignments by businesses engaged in the transport of postal packages and courier shipments, which would inevitably involve additional costs for the customer, the possibility for persons to lodge customs declarations already before the consignments arrive in Estonia is created.
Concerning cash control, the provisions regulating the procedure for the declaration of cash of a value of EUR 10 000 or more entering or leaving Estonia are omitted from the current Customs Act. In summer 2021, a new EU Regulation on controls on cash will come into force that sets out a requirement to declare in writing at EU level, thus the relevant national provisions cannot remain simultaneously in force. In addition, the right of the customs to detain cash is extended to three working days compared to the current provision, which is 48 hours. Union law gives Member States the possibility to provide for a period of detention of up to 30 days.
90 members of the Riigikogu voted in favour of passing the Act and there was one abstention.
The Act on Amendments to the Auditors Activities Act, the Accounting Act and the Securities Market Act (313 SE), initiated by the Government, was motivated by the assessment of the European Commission that Estonia had not correctly transposed the provisions pertaining to the annual financial statements, consolidated financial statements and related reports of certain types of undertakings in the relevant directive of the European Parliament and of the Council.
The Act specifies the obligations of auditors for auditing medium-sized undertakings, large undertakings and public-interest entities. In the future, auditors will be required to state in the audit report whether the management report is consistent with the financial statements and the applicable legal requirements. The purpose of the amendment is to strengthen investors and other interested persons’ confidence in the information published in the management reports of undertakings. In addition, the Act specifies the requirements regarding the information that large undertakings that are public-interest entities with more than 500 employees must reflect in their management reports. Analogous amendments are also made as regards consolidated accounts. The aim of the amendments is to better identify sustainability risks and to increase investors and consumers’ confidence. The audit fees of medium-sized and large undertakings rise slightly and the volume of the reporting obligation of some large undertakings increases slightly.
86 members of the Riigikogu voted in favour of passing the Act.
The explanatory memorandum to the Act on the Ratification of the Protocol amending the Agreement of 29 November 1996 between the Republic of Estonia and the Federal Republic of Germany for the Avoidance of Double Taxation with respect to Taxes on Income and on Capital (352 SE), initiated by the Government, notes that the agreement between Estonia and Germany for the avoidance of double taxation with respect to taxes on income and on capital entered into force on 30 December 1998. The purpose of the agreements for the avoidance of double taxation is to facilitate investments between Contracting States. To achieve this aim, the agreement limits the income taxes that the country of the source of income can establish for residents of the other country, ensures equal treatment of persons and eliminates potential double taxation.
The need to conclude a new protocol arose from the wish to bring the provisions of the tax agreement into conformity with the minimum standard agreed upon within the framework of the OECD action plan against base erosion and profit shifting. The entry into force of the Protocol will contribute to the reduction of tax avoidance opportunities.
76 members of the Riigikogu supported the passing of the Act.
The Riigikogu concluded the second reading of four Bills
The main purposes of the Bill on Amendments to the Credit Institutions Act and Amendments to Other Associated Acts (312 SE), initiated by the Government, are to ensure and increase financial stability, in particular to ensure the integrity and transparency of the banking sector, and to raise the “resilience” of banks (credit institutions) in stress and crisis situations. It also aims to establish more proportionate requirements for credit institutions and to bind the requirements more tightly to the risks assumed by credit institutions.
The second reading of the Bill on Amendments to the Maritime Safety Act and Amendments to Other Associated Acts (284 SE), initiated by the Government, that was suspended on 7 April, is resumed.
The Bill will amend several maritime regulations and will bring the Act into conformity with the requirements of European Union legislation and international conventions.
The Bill will ensure the conformity of the Maritime Safety Act and the Acts relating to it to the European Union and international maritime law. The coherence, understandability and legal clarity of Acts will also be ensured. The main impacts arising from the amendments will concern the relevant state authorities.
The Bill on Amendments to the State Assets Act (308 SE), initiated by the Government, will update and improve the legal provisions regulating the release for use of state assets and the possibilities for the use of state assets between administrators of state assets, taking into account the development of the economic and technological environment.
According to the explanatory memorandum, it has appeared in practice that the current regulation does not take into account the specific aspects relating to the use of (including granting use of) intellectual assets, in particular in transactions relating to software belonging to the state. The current law lacks clear bases for granting free use of software to the public and for simultaneous use of software between administrators of state assets (“cross-use of software”).
The purpose of the Bill is therefore to provide in the Act uniform and clear bases for granting free use of national software to the public and for cross-use of national software between administrators of state assets.
Under the Bill on Amendments to the Penal Code (non-cash means of payment) (351 SE), initiated by the Government, the European Union directive on combating fraud and counterfeiting of non-cash means of payment and replacing an earlier Council Framework Decision will be transposed into Estonian law.
Significant gaps and differences in Member States’ laws in the areas of fraud and of counterfeiting of non-cash means of payment can obstruct the prevention, detection and sanctioning of those types of crime and other serious and organised crimes related to them. This makes police and judicial cooperation complicated and less effective. In view of this, the Council Framework Decision was updated in order to include further provisions on offences in particular with regard to computer-related fraud, and on penalties, prevention, assistance to victims and cross-border cooperation.
The adoption of the new directive also brought about the need to review the national legislation regulating the fight against crime relating to non-cash means of payment in Estonia. Under the Bill, among other things, the maximum sanction, that is, imprisonment, for misappropriation is planned to be increased from one year to two years. Other amendments to transpose the directive into national law are also made.
The Riigikogu concluded the first reading of two Bills
The Bill on Amendments to the Code of Criminal Procedure and Amendments to Other Associated Acts (revision of the Code of Criminal Procedure) (367 SE), initiated by the Government.
The amendments will allow for a transition to fully digital and data-driven criminal procedure. The wording of the Code of Criminal Procedure will be made terminology-neutral and the terms referring to drawing up paper documents will be abandoned.
In the future, files will be kept in the e-file system, which will ensure digital information exchange. The requirements for the performance of procedural acts will be simplified and the use of sound and audio-video recordings will be promoted. Similar amendments will also be made to the Code of Misdemeanour Procedure.
A large number of other amendments will also be made to the Code. For example, the systematics of evidence will be organised to increase the efficiency of criminal proceedings, the regulation of deadlines will be specified, the reconciliation of the victim and the offender will be facilitated and several amendments directed at saving procedural resources will be made. Amendments will also be made to extend the list of preventive measures that could be considered as alternatives to taking into custody or that would help ensure criminal proceedings with regard to suspects who are legal persons.
The Bill on Amendments to the Copyright Act (transposition of copyright directives) (368 SE), initiated by the Government.
The Bill will transpose two European Union copyright directives that entered into force in summer 2019. They were part of the “copyright reform package” published by the European Commission in September 2016 (transposition deadline 7 June 2021). The amendments will ensure consumers better access to content protected under copyright, while at the same time protecting the rights of authors and performers.
The amendments will improve the negotiating position of authors and performers when entering into author’s contracts, and will obligate their contractual counterparts to provide information on the exploitation of the rights to them at least once a year.
It will also be possible to enter into extended collective licensing agreements upon the use of works where obtaining authorisations from rightholders on an individual basis would be too onerous for the user. This will concern for example the provision of television and radio services.
Among other things, obligations will also be established for web platforms (e.g. YouTube, Facebook) the main purpose of which is to enable users of the service to upload content and to access works, performances and other content that may be protected by copyright or related rights (video clips of concerts, extracts from films and television series, music recordings, etc.).
More cases of free use will also be provided where users are allowed to use protected works and subject matter of related rights (e.g. performance or phonogram) without the consent of the rightholder and without payment of remuneration. For example, it will be possible to use works without the consent of the author and without payment of remuneration for the purposes of text and data mining for both commercial and non-commercial purposes. Under the current law, this is permitted only for non-commercial purposes. In addition, better opportunities will be created for cultural heritage institutions (libraries, museums, archives) to use out-of-commerce works to promote cultural heritage.
The video recording of the sitting will be available on the Riigikogu YouTube channel.
(Please note that the recording will be uploaded with a delay.)
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