RESTRICTED
WORLD TRADE WT/ACC/EST/12
28August 1996
ORGANIZATION(96-3373)
Original: English
ACCESSION OFESTONIA
Additional Questions andReplies
TheMinistryofForeignAffairsoftheRepublicofEstoniahassubmittedtherepliestoadditional
questions raised byMembers reproduced hereunder.
_______________
TABLE OFCONTENTS
II. ECONOMY AND FOREIGN TRADE
1. Economy (Questions 1-2)
III. FOREIGN TRADE REGIME
1. Import Regulations
(a) Evolution oftheCustoms Tariff Regulation (Questions 3-5)
(b) Customs tariff nomenclature, types ofduties, general
description ofthecustoms tariff structure, weighted average
levelofthecustoms tariff groupings (Question 6)
(d) Taxation Regime (Question 7-23)
(f) Non-tariff Measures, Quotas andLicensing
System (Questions 24-37)
(g) Customs Valuation (Questions 38-42)
(i) Sanitary andPhytosanitary Measures (andTechnical
Barriers toTrade) (Questions 43-47)
(j) Other (Question 48-50)
2. Export Regulations (Question 51)
3. Export Incentives (Question 52)
IV. OTHER POLICIES AFFECTING FOREIGN TRADE
2. Agricultural Policy (Question 53-55)
5. Foreign Investment Policy
6. Government Procurement (Questions 56-57)
7. State Trading (Questions 58-59)
8. Industrial Subsidies (Question 60)WT/ACC/EST/12
Page2
V. INSTITUTIONAL BASE FOR TRADE AND ECONOMIC
RELATIONS WITH THIRD COUNTRIES (Questions 61-64)
VI. TRADE RELATED INTELLECTUAL PROPERTY RIGHTS (Question 65-75)
Annex I:LawonMotor vehicle Excise
_______________
II. ECONOMY AND FOREIGN TRADE
1. Economy
Estonia hasstated initsresponses toquestions inWT/ACC/EST/2, 4,and9thatitmaintains
controls (a)onlyonthepricing ofelectricity andoilshale, and(b)ontheoutput of"natural monopolies",
i.e.,onoilshale, electricity, heatofcentral boiler houses, some citytransport andon30-40 percent
ofsalesofalcoholic beverages inEstonia whose alcoholic content exceeds 21percent.Response no.5
inWT/ACC/EST/9, however, states thatsince1December 1995, pricecontrols onalcoholic beverages
were released.
Question 1.
Please confirm thescope andstatus ofEstonia 'sprice control programme. Arethere any
products (besides natural monopolies) subject toprice controls? Please citeanddescribe thelegal
basis fortheapplication ofprice controls inEstonia. Estonia should provide adescription of
itsexisting price controls, listing affected products byHStariff line,anddescribing theprovisions
oflawthatauthorise theapplication ofsuchcontrols, e.g.,thebasis upon which thecontrols are
applied; what provision, ifany,ismade fortheborder charges thatincrease import prices; and
theconditions under which theauthority tocontrol prices istobeexercised.
Answer
Estonia hasnopricecontrol programme assuch. During theSoviet occupation theSoviet price
control system waseffective overtheterritory oftheRepublic ofEstonia. Restoration ofindependence
hasresulted inextensive pricedecontrol programmes which havebeenimplemented onagradual basis.
Thelastpricedecontrol stage hastosolve thedecontrol ofthelastkeyprices sofarstillunder control:
oil-shale andelectricity. Thelegalbasisofpricecontrol forelectricity andoil-shale prices -thegradual
movement towards world price level-isregulated inthefollowing laws:
- Price Law, 1989 (ENSV Teataja 1989, 36,610;Riigi Teataja 1992, 30,400);
- Decree oftheMinistry ofEconomic Affairs No.7; 15May1996
Oil-shale Prices inEstonia (Since 1June1996)
Quality class
MJ/kgPrice forastable
client
EEK/tPrice forclients
without contract
EEK/t
1. PK over11.51 68.93 98.43
2. 1PK over10.97 68.07 97.21
3. 2PK 10.26 -10.97 67.12 95.86WT/ACC/EST/12
Page3
4. 3PK 9.59-10.25 66.27 94.65
5. 4PK 8.54-9.58 65.33 93.03
6. P over9.21 64.40 92.00
7. 1P over8.79 63.55 90.78
8. 2P 7.79-8.79 62.68 89.55
9. 3P 7.29-7.78 61.74 88.23
10. 4P 6.28-7.28 60.88 87.00
11. 5P 6.07-6.27 59.96 85.67WT/ACC/EST/12
Page4Electricity prices inEstonia (Since 1June1996)
Consumer group Payment variants Capacity
chargeConsumer
chargeActive energy Reactive energy
Main
priceTime price sent/kw consumptio
nreleasing to
thenetwork
EEK/kW
permonthEEK/A
permonthsent/kw day
07.00-
12.00day
12.00-
23.00night sent/kvarh sent/kvarh
I.Consumer
withcapacityAvoltage in
connection point51.00 - 27.6 31.2 29.6 19.4 3.8 7.6
400Kw 110kV ormore 30.4 30.4
ormore
peroneBvoltage in
connection point56.00 - 30.8 34.6 32.8 21.6 4.3 7.6
substation 6-35kV 33.7 33.7
ormeasuring
systemCvoltage in
connection point61.00 - 33.5 37.8 35.8 23.6 5.0 7.6
unit lessthan6kV 36.8 36.8
II.Consumer
withcapacity
belowAvoltage
inconnection
point less- 1-phase
2.50
3-phase37.7 42.6 40.4 24.7 5.0 7.6
400Kw than6kV 7.50 41.5 41.5
perone
substation or
distribution
unit.Bvoltage in
connection
point less
than6kV- - 48.6 53.5 53.5 33.0 5.0 7.6
Atthechoice of
theconsumer
either A,B,or
C.Cvoltage in
connection
point
6-35Kv- - 43.2 47.5 47.5 30.5 4.3 7.6
III.Reseller - 7.00 C C+2.0 C+2.0 0.61C 4.1 6.8WT/ACC/EST/12
Page5Consumer group Payment variants Capacity
chargeConsumer
chargeActive energy Reactive energy
Main
priceTime price sent/kw consumptio
nreleasing to
thenetwork
EEK/kW
permonthEEK/A
permonthsent/kw day
07.00-
12.00day
12.00-
23.00night sent/kvarh sent/kvarh
IV.Households - - 38.1/
45.038.1/
45.038.1/
45.018.6/
22.0- -
V.Consumer A(1-phase) - 53.00 - - - - - -
without
measuringB(2-phase) - 159.00 - - - - - -
VI.Night
consumers,
consumption
regulatorsAvoltage in
connection
point 6kV
ormore- 3.00 - - - 19.3 4.3 7.6
100kW
ormoreBvoltage in
connection point
lessthan6kV- 3.00 - - - 22.4 5.0 7.6
EEK=100 *sentWT/ACC/EST/12
Page6
Question 2.
Does Estonia contemplate extending suchcontrols toother "natural monopolies"? Under
what other circumstances doesthelawprovide forprice controls ordoesEstonia contemplate
applying suchmeasures.
Answer
Itisimportant tounderline thatEstonia iscurrently inthestage ofeliminating price controls;
therefore anyextension ofthecontrols doesnotcome intoquestion.
III. FOREIGN TRADE REGIME
1. Import Regulations
(a) Evolution oftheCustoms Tariff Regulations
Estonia hasreported thatitreplaced itsadvalorem based customs procedure feewithafixed
feeof200EEK perimport andexport declaration inApril 1995.
Question 3.
Isthisfeeapplied toalltrade, orisanytrade exempted, e.g.,trade withpreferential trading
partners suchasother Baltic States andtheEU?
Answer
EstoniaconfirmsthatthefixedfeeofEEK200(aboutUSD20)perimportandexportdeclaration
applies toalltrading partners, naturally covering theother Baltic countries andtheEU.Thecustoms
clearance ofcustoms transit, customs warehousing, andthecustoms clearance carried outwiththe
firstidentification declaration andwiththegoods declaration ofphysical persons isnotsubject toState
fee.There aresixcases, when thefeeisnotimposed. These exemptions include thecustoms clearance
ofgoods meant forofficial usebytheforeign diplomatic representations, consular representations or
theinternational organisations. Neither isStatefeeimposed inthecaseofirrecoverable economic aid,
printed materials andinformation carriers which aresenttothefunds oflibraries norinthecaseof
humanitarian aidaddressed totheEstonian RedCross.
Question 4.
Estonia states that"allnecessary expenses forcustoms clearance service" arecovered by
thefee.What doesthatmean inpractice? Does thefeecover allcustoms expenses, e.g.salaries,
inspections, uniforms, training, building maintenance, pensions, etc.,orareitsrevenues limited
tothecostofcustoms processing?
Answer
Therevenues generated bythecustoms procedure feedonotcover theexpenses ofrunning
EstonianCustoms.AlldutiesandfeescollectedbythecustomsgototheStatebudget.Thefeeiscovering
thecostofcustom processing.
Question 5.
What aretheannual revenues generated bythetaxandwhat istheannual budget ofthe
customs service (most recent dataisacceptable)?WT/ACC /EST/12
Page7
Answer
In1995theEstonian Customs contributed EEK66.6million intotheStatebudget andreceived
EEK99million. According toexperts 'opinions thetaxrevenues constitute around 20percentofthe
totalcontribution.
(b) Customs tariff nomenclature, types ofduties, general description ofthecustoms tariff
structure, weighted average levelofduties onmain customs tariff groupings
Customs duties
InWT/ACC/EST/2,4,and9Estoniahasindicatedthatnewlegislationonimporttariffsisinpreparation.
Question 6.
Estonia 'snewLawonCustoms Tariff hasbeen"pending" within theGovernment orbefore
theParliament fornearly twoyears andisreportedly still"notyetadopted" bytheParliament.
Thetranslation referred toinWT/ACC/EST/9 isnotyetcomplete. Progress towards completion
ofEstonia 'saccession requires thattheWorking Party haveanopportunity toreview andcomment
onthislawprior tothediscussion ofmarket access orprotocol provisions. Estonia should supply
theWorking Party withadraft ofthislawassoonaspossible.
Answer
Theproject ofthelawhasbeenturned down bytheEstonian Parliament. Thevarious ideas
ofdifferent political parties about apossible lawtocover thecustoms tariffs ingeneral donotconstitute
arepresentative document.
(d) Taxation Regime
Excise Taxes
Intheresponse toquestion 14inWT/ACC/EST/9, Estonia indicates thatitsdiscriminatory
excise taxeshavebeenequalised from1January 1996withtheexception ofbeer.Wecommend Estonia
foritsefforts torevise itsexcise taxsystem tobring itintoconformity withWTO provisions. Wehave
additional questions toclarify thenature ofthereform.
Concerning thetaxonalcoholic beverages:
Question 7.
Please provide theupdated information ontheexcise taxrates applied outlined inthe
response toquestion 14inWT/ACC/EST/9 toimports anddomestic products byHSline.Please
confirm thatsimilar domestic products aresubject tothesame tax.
Answer
Thesections intheEstonian Classification System 1996 (based onHS)which define alcohol
thatissubject totaxation aredetermined bytheMinister ofFinance (Decree No. 148,
28November 1995). Estonia confirms thatalcohol manufactured inEstonia (domestic products) and
alcohol imported intoEstonia (imported products) aresubject tothesame taxwiththeexception of
beer. Theexcise taxonbeermanufactured inEstonia andimported beerwillbeequalised from
1December 1996.WT/ACC/EST/12
Page8
Excise taxratesonalcohol
Taxable product
theNomenclatureHeading, subheading
ofEstonian goodsTaxrate
1.Sparkling wines andother
wines offresh grapes withan
alcoholic content byvolume
upto15%2204 10110-2204 21840
2204 29120-2204 29840
ex2205 10101-2205 10109
ex2205 90101-2205 9010910.40*
-unbottled wines offresh
grapesex2204 29120-2204 29990
ex2205 90101-2205 901098.00*
2.Sparkling wines andother
wines offresh grapes withan
alcoholic content byvolume
exceeding 15%2204 21870-2204 21990
ex2204 29100
2204 29870-2204 29990
ex2205 10101-2205 10109
2205 10901-2205 10909
ex2205 90101-2205 90109
2205 90901-2205 9090915.60*
-unbottled wines offresh
grapes2204 29870-2204 29990
ex2205 90101-2205 90109
ex2205 90901-2205 9090912.50*
3. Other fermented
drinks (e.g.cider, berry, wine
etc.)andtheirblends:2206 00100-2206 00510
2206 005914.90*
1)withanalcoholic
content byvolume upto15
%vol.2206 00810
2206 008914.90*
2)withanalcoholic
content byvolume exceeding
15%vol.2206 00592
2206 008926.50*
4. Other alcohol ex2207 10000
2208
2106 90200
3302 101001.15**
5. Rectified spirits
produced inEstonia, usedin
medicine, pharmaceutics,
veterinary medicine for
scientific andstudy purposes,
theproduction ofperfumeryex2207 10000
ex2208 90910
ex2208 909900.20**
*perlitre
**perone%vol. ofabsolute alcohol alitreWT/ACC /EST/12
Page9
Excise taxonBEER HS until 1Dec1996 from 1Dec1996
1)withanalcoholic content by
volume upto4.7% vol.incase
ofannual production in
thousands ofdekalitres:
upto300(incl.)
over3002203 00019
2203 00099
2203 00909
1.50*
2.00*2.00*
2.50
2)withanalcoholic content by
volume exceeding 4.7% vol.in
caseofannual production in
thousands ofdekalitres:
upto300(incl.)
over3002203 00011
2203 00091
2203 00901
2.00*
2.50*2.50*
3.00*
5. Imported beer:
1)withanalcoholic content by
volume upto4.7% vol.2203 00019
2203 00099
2203 009096.00* After
1December 1996 no
separate excise tax
exists onimported
beer. Both
2)withanalcoholic content by
volume exceeding 4.7% vol.2203 00001
2203 00091
2203 009019.00* domestic and
imported beerwill
becovered bythe
same excise rate.
*perlitre
Question 8.
Arethere anyexemptions from theexcise taxforanyalcoholic beverages produced or
soldinEstonia?
Answer
According totheArticle 6oftheLawonAlcohol Excise Tax,excise taxshallnotbecharged
on9different cases:
1. Beermanufactured inEstonia byonemanufacturer, whose annual production ofbeerdoesnot
exceed 5000 dekalitres;
2. Wine withanalcoholic content byvolume upto15%vol, manufactured inEstonia byone
manufacturer, whose annual production ofwinedoesnotexceed 100dekalitres;
3. Alcohol manufactured byanEstonian manufacturer andexported bythelatter, incaseagoods
declarationforexportcertifiesexportation.TheTaxBoardshallpayarefundtothemanufacturer
ofthealcoholic beverage forspirits usedtomanufacture thealcoholic beverage tobeexported
inaccordance withtheconditions andorder established bytheMinister ofFinance;
4. Alcohol tobeexported thatisadmitted intoacustoms warehouse, incaseagoods declaration
forimport certifies theadmittance ofgoods intothecustoms warehouse.WT/ACC/EST/12
Page10
Import forfreecirculation ofalcohol manufactured inEstonia thathasbeenadmitted intoa
customs warehouse forexportation, isdisallowed:
5. Alcohol conveyed aboard water andairtransport vessels engaged inforeign travel, andtostores
located inareas accessible afterthepassport andcustoms control, intheformofconsumption
ortake-away supplies, incaseitiscertified byagoods declaration forexport;
6. Alcohol soldforsupplying water orairtransport vessels engaged inforeign travel, andtoan
entrepreneurwhohasownershipofaprivatecustomswarehouseandwhoisengagedinproviding
supplies tostores located inareas accessible afterthepassport andcustoms control, incase
agoods declaration ofimport certifies theadmittance ofalcohol intothecustoms warehouse;
7. Alcohol inlimited amounts owned byajuridical person registered inaforeign country, for
displaying onexhibitions, fairsorshows, admitted uponthepermission oftheCustoms Board
temporarily tothecustoms territory subject tore-exportation inthesame State;
8. Alcohol tobeconveyed tothedatabaseofbrands ofalcohol, inaccordance withtheorder
established bytheMinister ofEconomy;
9. Alcohol imported byrepresentations offoreign diplomatic andconsular missions, aswellas
internationalorganisationsandinter-governmentalprogrammesofco-operationenjoyingasimilar
status, andnatural persons enjoying diplomatic status, foruseintheexercise oftheirofficial
function, inaccordance withtheorder established bytheMinister ofFinance.
Question 9.
Please explain thedifference intheapplication oftheexcise taxto"unbottled wines of
fresh grapes" and"sparkling wines andother wines offresh grapes." (Note :Thisdistinction does
notappear tohaveexisted inthetaxrates reported inWT/ACC/EST/2. Why wasthedistinction
introduced? Endnote)
Answer
Thisarrangement wasintroduced inorder toencourage theimporters andproducers ofunbottled
winetousetheEstonian locallabour forfurther production orbottling. Ifthebottled wineisafterwards
soldtoother countries theexcise taxisrefunded. Inthecaseofdomestic salesthedifference between
taxes should beadditionally paidbytheimporter.
Question 10.
Please explain whythetaxondomestic beer"incaseofannual production inthousands
ofdekalitres" islower onproduction levels of300,000 dekalitres andbelow thanonother beer,
andwhythetaxonimported beerisequal tothehigher leveloftaxation? (Note: Thiswould appear
tobeadiscrimination against imported products. Please address howthelower rateisalsoavailable
toimports. Endnote)
Answer
On12June 1996 amendments totheLawonAlcohol Excise Tax. were adopted bythe
Parliament. Accordingly thedistinction intaxation ofdomestic beerandimported beerinthecaseof
annual production upto300thousand dekalitres isinforce onlyupto30November 1996. From
1December 1996 nosuchdistinction exists.WT/ACC /EST/12
Page11
Question 11.
CanEstonia confirm thatthetaxon"other alcohol" 1.15EEK peronepercentvolume
ofabsolute alcohol perlitrecovers allother alcoholic beverages other thanwine andbeer, e.g.,
brandy, whisky, vodka, rum, grain alcohol, andother distilled spirits, inwhatever sizecontainer
sold?
Answer
Estonia confirms thatexcise taxonother alcohol 1.15EEKperonepercentvolume ofabsolute
alcohol perlitrecovers allother alcoholic beverages other thanwineandbeer. Theexcise taxonsuch
alcoholic beverages doesnotdepend onthesizeofthecontainer.
Question 12.
Please givetheformula forapplying these taxes, including theelements ofthetaxable
base, thepoint ofsaleapplied, andspecific information onhowthetaxiscollected onimported
anddomestic goods.
Answer
Thetaxable baseisdetermined bytheamount andvolume ofalcoholic beverages. Excise tax
onimported alcohol ispaidbytheimporter andischarged upon importation ofalcohol intoEstonia.
Excise taxonalcohol manufactured inEstonia ispaidbythemanufacturer andispaidupon thesale,
exchange, freetransfer, oruseforselfconsumption. TheCustoms Board andtheTaxBoard exercise
control overthecorrectness andtimeliness ofpaying excise tax.There aretwoformulas forapplying
excise tax.Thefirstcovers alltaxable products which excise taxrateisdetermined byfixed amount
perlitre-quantity ofalcohol shallbemultiplied withtheexcise taxrateperlitre.Thesecond formula
covers taxable products which excise taxrateisdetermined byonepercentvolume ofabsolute alcohol
perlitre.
Forexample: excise taxfor1litrebottle ofvodka (volume 40%) is:
1.15*100*1*40/100 =46EEK.
Incaseofalladvalorem duties, including excise taxonalcoholic beverages, thebasis for
determining theduties onimportation ofgoods ispricetogether withcostsfortransport andinsurance
(CIF-value).
Concerning allother excise taxes:
Question 13.
Please listallitems, domestic andimported, byHStariff line,thataresubject toexcise
taxes andgivethelevelcurrently ineffect (taking thechart produced inAnnex 1ofWT/ACC/EST/2
intoaccount).
Answer
Alcohol, tobacco, motor fuelandmotor vehicles, bothdomestic andimported, aresubject to
excise tax.Thecurrently effective excise taxratesforalcoholic beverages aregiven intheanswer to
thequestion 7.WT/ACC/EST/12
Page12
Motor Fuel
Taxable product HS Taxrate
1.Petrol 2710 00271,2710 00272
2710 00290,2710 00320
2710 00341,2710 00342
2710 00343,2710 003441.20EEK perlitre
2.Diesel Oil 2710 00691 0.75EEK perlitre
3.Aviation petrol and
gasoline2710 00510,2710 00260
2710 003701.50EEK perlitre
4.Liquid gasusedasmotor
fuel2711 12940,2711 12960
2711 12980,2711 13910
2711 13930,2711 139800.75EEK perlitre
5.Compressed gasusedas
motor fuel2711 21000 0.75EEK perm3
6.Motor oil 2710 00871 0.15EEK perlitre
Tobacco products
Filtered cigarettes 2402 20 3*
Unfiltered cigarettes 2402 20 3*
Russian cigarettes 2402 20 3*
Cigarillos 2402 10001 3*
Cigars 2402 10009 3**
Smoking tobacco 2403 10 3***
Snuff 2403 99100 3***
Chewing tobacco 2403 99100 3***
Other tobacco products 2402 90000,2403 99900 3***
* applies toupto20cigarettes orcigarillos; apackage containing 21-40cigarettes orcigarillos
ismarked withtworevenue stamps etc.
** applies toonecigar
*** applies toupto50grams ofatobacco product; apackage containing 51-100grams ofatobacco
product ismarked withtworevenue stamps etc.
Motor vehicles
1. Excise taxbased onthecylinder capacity ofmotor vehicles
Description oftheMotor Vehicle HS EEK/cc
Motor carsandother motor vehicles principally designed for
thetransport ofpersons (other thanthose ofheading No.
8702), including station wagons andracing cars:8703
Motor vehicles specially designed fortravelling onsnow; golf
carsandsimilar vehicles70310 1WT/ACC /EST/12
Page13
Description oftheMotor Vehicle HS EEK/cc
Other vehicles, withspark-ignition internal combustion
reciprocating piston engine:
Ofacylinder capacity notexceeding 1,000 cc 8703 21 1
Ofacylinder capacity exceeding 1,000 ccbutnotexceeding
1,500 cc8703 22 1
Ofacylinder capacity exceeding 1,500 ccbutnotexceeding
3,000 cc8703 23 1
Ofacylinder capacity exceeding 3,000 cc 8703 24 3
Other vehicles withcompression-ignition internal combustion
piston engine (diesel orsemi-diesel):1
Ofacylinder capacity notexceeding 1,500 cc 8703 31 1
Ofacylinder capacity exceeding 1,500 ccbutnotexceeding
2,500 cc8703 32 1
Ofacylinder capacity exceeding 2,500 cc 8703 33 1
Motorcycles (including mopeds) andcycles fitted withan
auxiliary motor, withorwithout side-cars; side-cars (except
those specified insubheading 8711 90)8711 1
2. Excise taxbased ontheageofthemotor vehicle
Newmotor vehicle, irrespective of
age1000 EEK/year
Used motor vehicle
ofupto12years ofage 100EEK
from 13years ofage 150EEK
Question 14.
Please indicate ifanyadditional products havebeenadded tothelistsince therates were
revised on1January 1996.
Answer
Noadditional products havebeenadded tothelistofgoods which aresubject totheexcise
taxandtherateshavenotbeenchanged.
Question 15.
Please givetheformula forapplying these taxes, including theelements ofthetaxable
base, thepoint ofsaleapplied, andspecific information onhowthetaxiscollected onimported
anddomestic goods.
Answer
Allexcise taxes arebased onafixed rate,sothepayable excise taxisverysimple tocalculate.
Excise taxonimported goods iscollected bytheCustoms Board andondomestic goods bytheTaxWT/ACC/EST/12
Page14
Board. Theprice together withtransportation andinsurance isthebasisfordetermining theduties on
importation ofgoods.
Question 16.
Does Estonia produce petroleum products? Please describe howthedistinction between
"domestic" and"imported" fuelismade anddescribe howtheexcise taxisapplied (e.g., theformula
fortaxable base, themethod ofcollection, andatwhat point ofsale).
Answer
Theexcise ratesonmotor fuelandoilwere equalised inNovember 1995 andthecurrently
effective ratesaregiven intheanswer tothequestion 13.Atpresent Estonia doesnotproduce any
petroleum fuels, andthereisnodistinction between domestic andimported fuel.Excise taxischarged
onimported motor fuelandoilupontheirimportation intoEstonia andpaidbytheimporter atcustoms
inaccordance withtheexcise taxratesspecified intheLawonMotor FuelExcise Tax.Thecurrently
effective ratesareprovided intheanswer tothequestion 13.Theproducer ofmotor fuelandoilwould
payexcise taxupon thesale,exchange, freetransfer, oruseforselfconsumption.
Question 17.
Concerning thetaxonfuel, Annex 1inWT/ACC/EST/2 notes adistinction between
"domestic" and"imported" gasoline andother fueloils.Hasthediscrimination against "imported"
fuels been eliminated withthe1January 1996 newrates?
Answer
InWT/ACC/EST/2 onpage65Table 2(Annex 1)makes distinction between (*)cents (EEK
0,01) perlitreandEEKperkgbutnotbetween domestic andimported fuel.TheLawonMotor Fuel
Excise Taxdoesnotcontain anydiscriminatory provisions against imported fuelandoil,sothere is
nothing toeliminate.
VAT Tax
Estonia states thattheVAT isapplied equally todomestic goods andimports. Certain goods
andservices areexempt from theVAT.
Question 18.
Pleasedescribethenatureoftheexemptiongrantedto"goods,purchasedformoneyreceived
asforeign aid(1.4(5))" asnoted intheresponse toquestion no.34,inWT/ACC/EST/2?
Answer
LawonVATstates thatimport ofgoods purchased formoney received asirrecoverable foreign
aidbynon-profit associations andunions andother non-profit organisations registered inEstonia and
bybudgetary State andmunicipal institutions isnotsubject toVAT, provided thedocuments
accompanying these goods indicate thespecific beneficiary oftheassistance, thewayofdistributing
theassistance, andstatespecifically thatthedonor doesnotclaim consideration inanyform.
Question 19.
Please elaborate onthenature ofthe"goods imported onthebasisofcontractual guarantees
(1.4(6))," referred toinWT/ACC/EST/2 anddescribed asre-imports under guarantee in
WT/ACC/EST/9. What isthenature ofgoods arebeing referred to?Isthisasortofbarter or
repayment ingoods foraprevious transaction?WT/ACC /EST/12
Page15
Answer
Thistermmeans anykindofgoods which arere-imported toEstonia orwhich areimported
toEstonia formaking repairs under thecontract ofguarantee (Warrant). Thiscannot bebarter or
repayment foraprevious transaction. Usually suchgoods arerefrigerators, washers, vacuum cleaners,
audio-video equipment, watches, kitchen equipment etc.
Question 20.
DoesEstonia produce automobiles? Ifso,automobiles withwhatsizedengines areproduced
orassembled inEstonia?
Answer
Atpresent Estonia doesnotproduce anykindofmotor cars,motorcycles orothermotor vehicles
except thatSAAB-SCANIA buses areassembled insmall quantities.
Question 21.
Istheexcise taxapplied todomestic salesofusedautomobiles based onthesame schedule
ofageandengine sizeapplied toimports?
Answer
InEstonia motor vehicle excise taxaccording toengine-size isimposed onanyvehicles: the
importer paysexcise taxincustoms upon importation andmanufacturer paysexcise taxupon saleof
themotor vehicle.
Only inthecasetheimporter sellsused(notnew)motor vehicles intoEstonia should hepay
theexcise according toageuponimportation. Thistaxcannot becharged twice ormorewhen thevehicle
isbeing resold inside Estonia. Thiselement oftheexcise onmotor vehicles hastoencourage theimport
ofmodern vehicles intoEstonia.
Question 22.
Please describe thepoint ofsaleandformula fortaxable baseusedtoapply theexcise
taxandtheVAT taxtosales ofdomestic andimported automobiles inEstonia.
Answer
Thebasisfordetermining theVAT taxonimportation ofgoods isthericetogether withcosts
fortransport andinsurance (CIF-value). Excise taxondomestic andimported motor vehicles ispaid
onthesame basisandbythesame rates. Inorder toexplain theformula fortaxable baseusedtoapply
excise taxandVAT tax,weprovide afollowing example:
E.g.ausedFord, cylinder capacity 2000cm3,age10years andpriceaccording tothepurchase
documents is10000EEK.
10000-price according tothepurchase documents
2000-excise taxonthebasis ofthecylinder capacity
1000-excise taxonthebasis ofage
____________________________________________
13000
2340-VAT (18% from 13000)
____________________________________________
15340price forimporter afterimportationWT/ACC/EST/12
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Question 23.
Please provide thechart indicating thelevel ofexcise taxapplied based onengine size
andautomobile age.Wewillneedmore information ontheapplication ofthetaxprior toagreeing
thatitisnowapplied inconformity withtheArticle IIIoftheGATT 1994.
Answer
Thechart indicating thelevelofexcise taxisprovided intheanswer toquestion 13.Lawon
Motor Vehicle Excise Taxisannexed tothepresent responses andthistaxisapplied inconformity
withtheArticle IIIoftheGATT 1994.
(f) Non-Tariff Measures, Quotas andLicensing System
Quantitative Measures
Question 24.
CanEstonia confirm thatitdoesnotapply anyquotas, bans, licences, prior permits, or
other requirements ormeasures thatactasquantitative restrictions onimports orexports?
Answer
Estoniaconfirmsthatnoquotas,bans,licences,priorpermits,orotherrequirementsormeasures
thatactasquantitative restrictions onimports orexports areapplied.
Activity Licences
Question 25.
Please provide adetailed description ofthelawsandregulations relating toactivity licences
andanyother lawsandregulations affecting theproduction, importation andsaleoftobacco and
tobacco products, alcohol products, fuelsandlubricants, motor vehicles andtrailers. Please provide
details ofanyproposed changes inthese lawsandregulations. Please describe howthese areapplied
inpractice ineachofthese product groups to(a)domestically produced products and(b)imported
products. Areimported products accorded treatment nolessfavourable than thataccorded to
likeproducts ofnational origin, asrequired byGATT Article III?
Answer
Theproduction, importation andsaleoftobacco andtobacco products, alcohol products, fuels
andlubricants, motor vehicles andtrailers areregulated withthefollowing Government Regulations:
1. Government Regulation No.4, 7January 1994. "The order ofimportation andexportation,
manufacturing andsaleofalcohol, tobacco andtobacco products";
2. Government Regulation No.109, 22March 1994. "The arrangement ofimportation, sale,
exportation, service, repairing anddismantling ofthemotor vehicles andtrailers"
Hereby weprovide anoverview ofthemain rules intheproduction, importation andsales
ofabove mentioned goods.
Alcohol, tobacco andtobacco products
Theactivity licence forimportation, exportation, manufacturing andwholesale isissued by
theMinistry ofEconomic Affairs. Theactivity licence forretail isissued byalocalauthority. TheWT/ACC /EST/12
Page17
activity licence isgiven onlytotheenterprises, which areregistered andwhere theleveloffixedcapital
isatleast100000EEK. Theactivity licence isvalid for1-5years.
Motor vehicles andtrailers
Theactivity licence forimportation, exportation, wholesale, retail andrepairing isissued by
theMinistry ofEconomic Affairs. Thelicence isgiven onlytotheenterprises which areregistered.
Togetalicence, thestatute oftheenterprise mustcontain aprovision which states saleorrepairing
asoneofthemain activities ofthatenterprise. Theactivity licence isvalid 1-3years andaccording
toconcrete activities theyaredivided intofoursubgroups.
Motor fuelsandlubricants
Theactivity licence forimportation, exportation, wholesale, retail, andwarehousing (include
customs warehousing) isissued bytheMinistry ofEconomic Affairs. Thelicence isgiven onlytothe
enterprises which areregistered. Thestatute oftheenterprise must contain aprovision which states
relevant salesormotor repairing asoneofthemain activities ofthatenterprise. Theactivity licence
isvalid forafixed period.
Proposed changes inlegislation are:
1. Ministry ofEconomic Affairs arepreparing adraftoftheCommercial Code which contains
provisions concerning licensing.
2. TheGovernmental Commission dealing mostly withthetaxfrauds presented theamendments
totheGovernment Regulation inorder toaddrequirements forlicence applicants. These
amendments concern therequirements ofthelevelofcapital stock andresidual value ofthe
fixed assets.
Allabovementionedrequirementsaresimilarforbothdomesticandforeignapplicants.Imported
products arenottreated lessfavourable compared tothelikeproducts ofnational origin. Wewould
alsoliketomention thatthere isnoproduction ofmotor vehicles ormotor fuelinEstonia.
Concerning theavailability of"activity licences" fortheproduction, saleandtrade intobacco
andalcohol, thelistofenterprises requiring suchpermits iscontained inWT/ACC/EST/4.
Estonia notes intheresponse toquestion 19ofWT/ACC/EST/9 thatnewlegislation pertaining
tolicensing iscurrently being developed. Estonia alsoindicated inresponse toquestion 46in
WT/ACC/EST/2 that"theissuance oflicences isgoverned bytheLawonEnterprise andlegal act
isresulting fromthelatter. ThisLawwillinthenearest months bereplaced bytheCommercial Code
presently under discussion intheGovernment. Aseparate lawdealing withtheareaoflicensing will
beelaborated inthecoming years."
Question 26.
Please describe howthenewCommercial Code andthenewlegislation onlicensing, which
weunderstand isstillpending, willalter theconditions ofcompetition established forimports
under theactivity licensing regime.
Answer
TheMinistryofEconomicAffairsofEstoniahascontactedtheUSCommercialLawDevelopment
Programme forhelpincompiling thenewLicensing ActforEstonia. Itisgoing tobeinconformity
withtheWTO anditshould beasbriefandastransparently clear aspossible. Wehope tofinish itWT/ACC/EST/12
Page18
withUSassistance in1997. Thework isgoing tobecarried outinEnglish andthentobetranslated
intotheEstonian language fortheParliament fordiscussion andpassing itasalegalact.
Question 27.
What isthestatus ofthislicensing legislation? Please explain howthislegislation willdiffer
from existing regulations governing licensing ofimport activities orimport licensing. How will
thenewlegislation conform toWTO rules? Willthislegislation alsocover foodimports?
Answer
ThenewLicensing Actshould cover alllicensing activities inEstonia. Until thenintroduction
ofnewfields forlicensing hasbeenstopped; otherwise thealready operating licensing iscarried out
according torelevant Government Regulations.
InWT/ACC/EST/9Estoniahasstatedthattheavailabilityoftheactivitylicencesisnotrestricted,
and"serves asanequivalent ofanautomatic import licence applied inaneutral andimpartial way."
Question 28.
Yettodate, onlytwolicences (pertheresponse toquestion 74inWT/ACC/EST/9) have
beengranted forproduction oftobacco products. Thiscomes closetoaState-sanctioned production
oligopoly.
Answer
Itisagain important tonotethatinanation of1.5million people (with wellprotected markets
around it)thedomestic market istoosmall foralarge number oftobacco producers. Oneofthetwo
owners oftheabove mentioned licences evenwithdraw from theideaofproduction because itwas
notfeasible. Theother, owned byaSwedish company Svenska Tobaks AB,hasalready announced
itspossible ceasing from production bytheendofthisyear, because ofintroduction ofsame excise
terms under Estonia 'seffort tobecome amember oftheWTO.
Question 29.
What other activities ofthese entities areprovided forthatarenotgranted toother
enterprises?Dotheybenefitfromanynon-tariffmeasuresorexerciseanyspecialrightsorprivileges
intheimportation oftobacco formanufacture? Arethere anyimporters oftobacco formanufacture
orofmachinery toproduce tobacco products independent ofthisentity?
Answer
Intobacco trade there aremany importers andonlyoneproduction facility thathasbeen
privatised toaSwedish firmwhothreatens topullouttheproduction ifnodomestic protection becomes
available soon. TheGovernment ofEstonia hasrefused tointroduce anyspecial rights, privileges,
ornon-tariff measures totobacco trade andtotrade auxiliary totobacco trade. Thisistheonlyway
toderegulate tobacco trade inEstonia.
Concerning thegranting ofsuchlicences fortrade intobacco andtobacco products, alcoholic
beverages, fuelsandautomobiles, Estonia states thatasof20December 1995, ithadissued 184and
70licences fortheimport/export oftobacco andalcohol products respectively.
Question 30.
How many activity licences have been issued for(a)theproduction, (b)fortheimport,
and(c)forthedomestic distribution ofeachcategory ofproducts listed?WT/ACC /EST/12
Page19
Answer
Thetotalnumber ofalllicences issued byfarexceeds thenumber ofvalid licences.
Thistablepresents thenumber ofvalid licences asofJune1996 for:
tobacco alcohol
(a)theproduction 2 under review*
(b)fortheimport 34 186
(c)forthedomestic
wholesale only98 120
* Thenumber ofthelicences validforalcohol production ispresently under review because of
alarge scale taxevasion case.
Question 31.
How many applications forsuchlicences have been refused? Arerefusals accompanied
bywritten explanation forthereasons thelicence wasrefused?
Answer
Ifrefused, theapplicant can,after achieving conformity withrelevant rules, repeat the
application. Iftheapplicant considers theofficials decision unfair, hecancontest itthrough court. Under
Estonian lawanyStateofficial canfaceuptocriminal responsibility depending ontheseriousness of
thebreach ofrules. Thetotalnumber oflicences, bothissued (both validandinvalid) hasreached the
levelof3000-4000. What isimportant, isthefactthattheactual number ofvalidlicences isadynamic
figure dependent onprivate business decisions.
Asforrefusals, nonumerical record iskeptsinceafteranyrefusal, when thereasons thatcaused
therefusal havebeeneliminated bytheapplicant, principally inallcases thelicence istobeissued.
Estonia states intheresponse toquestion no21inWT/ACC/EST/9, "Nosporadic tradebased
onasingle deal...should bepossible under thissystem since long-term licences canbeobtained in
allcases ofconformity withtheestablished requirements. Enterprises thathavedeveloped alonger
record areeligible forlicences withlonger validity periods."
Question 32.
Doesn 'tsuch adistinction discriminate against traders ofperfectly safeandlegitimate
products thatwishtoestablish atrading presence inEstonia andfavour domestic producers over
newexporters toEstonia 'smarket?
Answer
Viceversa. Thatdistinction discriminates against traders whomake onedealwithcriminal
background andthenattempt toleave thefirms behind andvanish withthemoney gained. Perfectly
safeandlegitimate products, especially inthecases when accompanied bytrading presence inEstonia,
qualify foralonger record andlonger terms thanonedealbusinesses. Itisespecially conspicuous in
importswhenfullauthorizationandrecognitionbyaforeignproducer,inmanyinstances,isaninevitable
prerequisite. Certainly, alsosingle deals should, ifinconformity withrelevant rules, bepossible too.
Initsresponses,EstoniahasjustifieditslicensingregimeunderArticleXX(b)oftheGATT1994.WT/ACC/EST/12
Page20
Question 33.
Please specify precisely thenature ofdanger tohuman, animal orplant health orsafety
thatisassessed inthelicensing process foreach oftheproduct categories listed above. Please
specify precisely howthese criteria meet thestandards oftheWTO Agreements onTechnical
Barriers toTrade andtheSanitary andPhytosanitary Measures.
Answer
Estonia relies oninternational standards foralcohol andfuele.g.ISO-standards. Failure to
comply withrelevant international standards mayresult inauthorities ’refusal toissue alicence.
Question 34.
Specifically, what arethecriteria thatmust bemetbythose whowishtoproduce, import,
ordistribute alcohol andtobacco products, fuels, orautomobiles toobtain anactivity licence?
(Note: Please have reference totherequirements oftheWTO Agreements onTBT andSPSas
wellasImport Licensing Procedures. Endnote)
Answer
Thefollowing general rulesarestrictly observed: traders inallthearticles listed inquestion
34should be:
(a) registered under Estonian law,
(b) haveagood taxrecord,
(c) haveagood police record;
(d) theyshould follow thechemical andtechnological requirements
(e) theyshould observe fire-safety standards
(f) theirshare capital should beatleastEEK 100,000 (approximately USD 10,000).
None ofthese criteria arecontradicting TBT, SPSaswellasImport Licensing Procedures.
Question 35.
Please elaborate ontheinformation given inresponse toquestion no.20inWT/ACC/EST/9
thatseems toindicate thatinthecaseofalcoholic beverages, the"obligatory" inspection andtesting
ofevery shipment ofproduct iscarried outbyafirmthatalsoproduces alcohol fortheEstonian
market, i.e.,RAS Areto. How many other alcoholic beverage production facilities inEstonia
alsohave eachoftheir. shipments analyzed andregistered inthedatabank inthesame fashion?
Answer
Weapologize fortheslightly ambiguous wording intheanswer toquestion 20of
WT/ACC/EST/9.
RASAreto isanindependent laboratory anddoesnothaveanyproduction facilities.
RASLiviko isaproducer company butmaintains alaboratory tokeepthelevelofproduction
safety.
Question 36.
Weareconcerned thatEstonia hasnottodatebeenabletoindicate howitscurrent system
ofapplication ofactivity licences inthese areas meets WTO provisions ontheoperation ofState-
sanctioned State trading enterprises orother nontariff barriers totrade inthese goods.WT/ACC /EST/12
Page21
Answer
There isnoState-sanctioned Statetrading orother nontariff barriers totrade inthese goods.
Theactivity licences fortrade inthese goods aretoguarantee abidance byrelevant good practice and
conformity withrelevant international standards. Besides licensing hastoprovide numerical record
onsuppliers ofthese goods.
Question 37.
Inaddition, wepropose thatEstonia confirm intheprotocol thatnorestrictions existon
theright offoreign anddomestic individuals andenterprises toimport andexport goods and
services within Estonia 'scustoms territory, with theexception those specifically listed inthe
Working Party report, andthatthecriteria forengaging inimport andexport trade inthe
restricted sectors were consistent withgenerally applicable restrictions placed ontrade insimilar
domestically produced goods andbased oncriteria thatwere published intheofficial journal.
Answer
Estonia isready totakethefollowing commitment intheprotocol: Norestrictions existon
therightofforeign anddomestic individuals andenterprises toimport andexport goods andservices
within Estonia 'scustoms territory; thecriteria forengaging inimport andexport trade inallsectors
areconsistent withgenerally applicable rulesplaced ontrade insimilar domestically produced goods
inthecases when anysuchrules exist.
(g) Customs Valuation
Question 38.
CanEstonia statecategorically forinclusion intheWorking Party report thatitnolonger
usesanyform ofreference price orfixed valuation schedule, whether ornotconsidered "arbitrary"
forthevaluation ofimports toapply duties andtaxes, andthatallmethods ofvaluation used
areinstrict conformity withthose provided forintheWTO Agreement ontheImplementation
ofArticle VIIofGATT 1994?
Answer
Atpresent, according totheLawonCustoms Valuation, which became effective asof
1January 1996, wecanassure thattheprices which areusedforthevaluation ofimports arenot
fictitious ordiscretionary. Estonia assures thattheLawonCustoms Valuation isfullyinconformity
withtheWTO Agreement ontheImplementation ofArticle VIIofGATT 1994.
Thefollowing questions areinregard toEstonia 'scustoms valuation legislation andresponse
totheWTO questionnaire onCustoms Valuation asprovided inWT/ACC/EST/4:
Question 39.
Please indicate whether Estonia intends toimplement Decision 4.1from theCustoms
ValuationCommitteeconcerningthevaluationofcarriermediabearingsoftwarefordataprocessing
equipment (Software Decision). WeseekEstonia 'sadoption oftheSoftware Decision aspartof
itsaccession package.
Answer
Estonia hasalready introduced theprovisions oftheSoftware Decision initslegislation. In
11January 1996 theMinistry ofFinance issued adecree, which states thatonlythecostofvalue of
thecarrier medium itself shallbetaken intoaccount. Thecustoms value shallnot,therefore, include
thecostorvalue ofthedataorinstructions, provided thatthisisdistinguished fromthecostorvalueWT/ACC/EST/12
Page22
ofthecarrier medium. Theexpression "carrier medium" shallnotbetaken toinclude integrated circuits,
semiconductors andsimilar devices orarticles incorporating suchcircuits ordevices; theexpression
"data orinstructions" shallnotbetaken toinclude sound, cinematic orvideo recordings.
Question 40.
InArticle 9(2)(4) oftheAct,setting forth alistofprohibited values, areference ismade
totheprohibition ofminimum customs values established bytheexecutive State institution. As
itappears inEnglish, other entities mayhavethelegalauthority tosetminimum customs values.
Wequestion whether thisinterpretation arises duetoatranslation problem oractually reflects
Estonia 'sintent, which would beinconsistent withtheAgreement.
Answer
Weconfirm thatArticle 9(2)(4) isnotinconsistent withArticle VII(Valuation forCustoms
Purposes) andthecurrent misunderstanding hasresulted from linguistic reasons. According tothe
Article9(2)(4)intheActonCustomValuationitisprohibitedforanyauthoritiestosetminimumcustoms
values.
Question 41.
InArticle 4(3)oftheActconcerning theuseoftransaction value between related parties,
thereference tothecircumstances connected withtheresale ofthemerchandise appears inconsistent
withtheWTO Agreement 'slanguage andemphasis oncircumstances surrounding thesalefor
exportation ofthemerchandise. Werequest clarification ofthisprovision inlightofWTO rules.
Answer
According toArticle 4(3)oftheCustoms Valuation Act,inthecasethere isdoubt thatthe
value forcustoms purposes ofimported merchandise hasbeeninfluenced byadirect linkbetween related
parties, theactual value oftheimported merchandise onwhich dutyisassessed should bedetermined.
Thatistobedoneinconformity withArticle VII(2)(a). Estonia confirms thattheprovisions ofthe
Customs Valuation Actareinconformity withWTO principles.
Question 42.
Werequest thatthelanguage found inArticles 4(5)(4) and(5)oftheActconcerning the
useoftestvalues toverify atransaction value between related parties bereviewed, asitdoesnot
appear totrack theprovision found intheWTO Agreement.
Answer
Wefindthatthereisnocontradiction between Article 4(5)(4), (5)andtherespective provisions
intheWTO framework. TheArticle 4(5)and4(5)state, thatthetestvalue toverify atransaction between
related parties canbethecostsincurred bytheseller insalesinwhich heandthebuyer werenotrelated
orthatarenotincurred bytheseller insalesinwhich heandthebuyer arerelated. These values are
usedonlyinorder toverify thedeclared value withactual value andthese provisions areusedonly
attherequest oftheimporter.
(i) Sanitary andPhytosanitary Measures (andTechnical Barriers toTrade)
WenotethatEstonia hasnotadopted anylaws, regulations, oradministrative procedures on
theimplementation oftechnical barriers totrade (TBT questionnaire).WT/ACC /EST/12
Page23
Question 43.
Please explain howEstonia intends toimplement technical barriers consistent withthe
WTO without thislegislation andprocedures. IsEstonia prepared todraft therequired legislation?
WeexpectthatEstoniawillhaveenactedthelegislationandadministrativeprocedurestoimplement
theTBT andSPSprovisions atthetimeofaccession.
Answer
Estonia hasmade several efforts inorder tounify itslegalsystem withinternationally applied
rules andprinciples. Atthepresent, theprocess oftheharmonisation oftheFood Act,Veterinary
Services Act,Plant Protection Actetc.withtheSPSandTBTagreements istaking place.
Thefollowing questions pertain toquestion 28inWT/ACC/EST/9.
Question 44.
Estonia noted thatthelicensing provisions forfoodimporting areexpected tobefinalized
inthefirsthalfof1996. What isthestatus ofthese licensing provisions? Please giveastatus report
onthiswork anddescribe indetail andinconformity with theinformation requested inthe
questionnaire onimport licensing procedures andtheAgreement onTBT andSPShowlicences
areobtained forimports andhowsimilar requirements areapplied todomestic foodproducts.
Answer
Thefollowing twotypes ofdocuments willbedemanded inconnection withfoodimport:
1. Permission forimport onthebases ofquality (document) checking incorrespondence with
theEUfooddirectives 89/397/EEC &93/99/EEC;
2. Licences forfoodhandling onthebases offoodhandling conditions checking incorrespondence
withtheEUfoodhygiene directive 93/43/EEC.
Theadoption ofthelicensing provisions forfoodimporting hasnotyetbeenfinalised. The
draftofthementioned actwillbeexamined intheEstonian Parliament inDecember 1996. Estonia
confirms thatthere arenocontradictions toWTO rules. TheWTO Secretariat willbeimmediately
informed assoonascorresponding regulations willbeadopted.
Estonia iscurrently preparing thesubmission oftherequired notifications.
Question 45.
What kinds ofquality control willagricultural products besubject tounder theLawon
Food? WillEstonia accept certification from theWTO Member Countries verifying thattheir
products meetquality standards orwillthese products besubject toadditional testing inEstonia?
Answer
Atpresent, thedraftoftheFood Lawmodification, andthedraftdecree ontheborder control
ofthefoodproducts, foodsupplements andadditives areinthepreparatory stage. According tothese
amendments tothelaw,Estonia willlegalize theacceptance ofexporters 'certificates ontheborder.
Estonia accepts certificates 'which areinconformity withISO9000andEN45000 series ofstandards.
Estonia willprovide occasional random laboratory testing forsurveillance purposes. Fortheimporters
from thenon-WTO Member Countries, voluntary Estonian localquality certification service willbe
proposedandfoodstoragepossibilityontheborderforthetimeofinvestigations.ThesafetyrequirementsWT/ACC/EST/12
Page24
which areinconformity withtheEuropean standards areplanned toaccept without anysupplementary
restrictions.
Question 46.
Inparticular, please describe theagency thatwilladminister these licences andtherole
oftheNational Food Board inestablishing requirements orparticipating intheir application.
Answer
Theinstitution thatwilladminister these licences hasnotbeendecided. Onepossible solution
which hasbeenunder consideration isthattheinstitutions whowillbedealing withthese issues will
beVeterinary Board andtheNational Inspectorate ofhealth protection. TheNational Food Board,
which willinthenearfuture reorganized asoneofthedepartments oftheMinistry ofAgriculture,
co-ordinates harmonisation process ofnational foodlegislation. Licensing willbeprovided inthe
framework ofordinary foodsafety control, which iscommon forallfoodhandlers.
Question 47.
HasEstonia submitted itsQuestionnaire onSPSMeasures? Werequest thisinformation
toaidinthereview ofEstonia 'sstandards regime. Haslegislation been enacted toimplement
theSPSmeasures consistent withtheWTO SPSagreement?
Answer
Estonia iscurrently intheprocess ofpreparing theSPSnotification forsubmission totheWTO
Secretariat. Thework ofimplementing theSPSmeasures consistent withtheWTO SPSAgreement
intoEstonian legislation isintheprocess aswell.
(j) Other
Estonia 'sresponse toquestion 31inWT/ACC/EST/9 issomewhat garbled. Itstates that
legislationconcerningantidumping,countervailingdutiesandsafeguardmeasuresisstillindevelopment,
butisunclear onwhether thelegislation onAntidumping andSubsidies iscombined orseparate.
Question 48.
PleaseindicatethestatusofthenewAntidumpingLaw.Whenwillthislawbeimplemented?
What other areas, e.g.,application ofcountervailing duties onsubsidised imports, arecovered
inthislegislation? What isthestatus ofpreparation oflegislation toimplement provisions in
Estonian lawconcerning countervailing duties inresponse tosubsidised imports inconformity
withtheWTO Agreement onSubsidies andCountervailing Measures (SCM)?
Answer
TheAntidumping Lawisnotbeing presently addressed bytherelevant authorities -given the
sizeofEstonia ’smarket andthemeans attheauthorities disposal implementation ofsuchalawisnot
feasible atthepresent time.
Duetothelimited resources theissue ofcountervailing duties hasnotyetbeenaddressed as
well.
Estonia isready totakeacommitment thatifthese legalactswillbeadopted, theywillnot
comprise contradictions withWTO principles.WT/ACC /EST/12
Page25
Question 49.
Please provide themostrecent draft oftheAntidumping Lawforthereview oftheWorking
Party.
Answer
Nosuchdraftexists sofar.
Question 50.
What isthestatus ofpreparation ofEstonian legislation fortheimplementation ofmeasures
forsafeguard orbalance ofpayments protection inaccordance withGATT 1994, theGATS, and
theWTO Agreement onSafeguards? Thepossibility toreview Estonia 'slegislation orregulations
inthese areas isnecessary prior tofinalising theposition ontheconsistency ofEstonia 'sregime
withWTO.
Answer
Thestatus ofEstonia 'slegislation onmeasures forsafeguard orbalance ofpayments protection
iscurrently inpreparatory stage ofinvestigating Estonia 'sneeds inthisfield. Estonia confirms that
thework isbeing carried outinlinewiththeWTO principles.
2. Export Regulations
Question 51.
CanEstonia confirm thatitnolonger applies anytaxes onExports? Ifitdoes, please give
theWorking Party astatus report onthisprogramme andEstonia 'sintentions forfuture
application. What isEstonia 'slegal authority toapply suchcharges?
Answer
Aswasreported already inEstonia 'sMemorandum ontheForeign Trade Regime (L/7423)
incaseofexportation thecustoms dutyisimposed oncultural values (incl. theantique carsandother
motor vehicles withtheproduction yearupto1950) inextent of100percentoftheirprice.
Estonia confirms thatnoadditional taxes onExports willbeintroduced.
Prices forthecultural values (HS97andgoods from theother groups having antique value)
intended forexport aredetermined bytheExpert Division onExportation ofCultural Values ofthe
Central Board Antiquities.
3. Export Incentives
Estonia hasstated thattheExport Credit Fund makes credits forexports available toEstonian
firms atratesbelow market rates(response toquestions no.65and66inWT/ACC/EST/2, butthat
these loans arenotdirectly related, i.e.,donotdirectly finance exports (response toquestion no.18
inWT/ACC/EST/4), andtherefore donotconstitute anexport subsidy. However, intheresponse to
question no.33ofWT/ACC/EST/9, itisstated thattheFund is"expected toaddmore competition
tothecommercial finance sector, thereby influencing thecapital market togenerally refrain fromtoo
highinterest. ..".
Webelieve thatEstonia hasnotdealtdirectly withtheissueofinterest ratelevels ontheFund
loans, norwiththereality thattheloans aremade toselected firms with"export potential "forthe
purpose offomenting exports.WT/ACC/EST/12
Page26
Inaddition, intheresponse toquestion no.33inWT/ACC/EST/9, Estonia states thatitis
developing anExport Credit andguarantee Board thatwillgrantsupplier credit refinancing toencourage
reluctant private banks tosupport Estonian exports withcredits.
Question 52.
Wethink thattheintent oftheprogramme andthenature oftheneed being filled byEstonia
supports thecontention thatthese aresubsidies thathave, andaredesigned tohave, astimulative
effect onexports.
Webelieve thatEstonia should review itslegal provisions inbothareas withaview to
comparingthemmoredirectlywiththeprovisionsoftheSCMAgreementandreportinginaspecific
fashion totheWorking Party howtheydo,ordonot,meet SCM Agreement criteria.
Answer
Estonia repeatedly confirms thatnosubsidies norpreferential loans aregiven bytheFund.
Thefactabout expectations about theFund'soperations 'stimulative effect onEstonian economy does
notimply anyoftheregretful doubts expressed inthecomments above.
IV. OTHER POLICIES AFFECTING FOREIGN TRADE
2. Agricultural Policy
Question 53.
Estonia states thatsince itonlybecame amarket economy in1991, thebaseperiod of
1992-95 isnotrepresentative. Wedonotviewthebaseperiod of1986-88 fordomestic support
asarepresentative period forEstonia since itwasacommand economy during thistime. We
donotbelieve support inthatbaseperiod accurately reflects themarket situation inEstonia.
Further, itisnotrelevant tocurrent conditions.
Wewould, therefore, seekacommitment thatEstonia willmodify itsoffer onagricultural
domestic supports toreflect themost recent three yearperiod.
Answer
Weunderstand thattheperiod 1986-1988 waschosen because itwasthemostrepresentative
period forthecountries whowere involved intheUruguay Round negotiations. In1991 acomplete
reform process ofEstonian agriculture wasstarted, including suchradical measures asrestoration of
nationalised property (including land) toformer owners ortheir successors, reorganisation and
privatisation ofsoviet typefarms, price liberalisation, creation ofcompetitive environment dueto
increasing imports etc.Those processes arestillundergoing. Logically allthesubsidy schemes were
revoked bytheGovernment inthebeginning ofagricultural reforms aiming nottosupport oldstructures.
Thenewsupport schemes havenotbeenintroduced because ofongoing agricultural reforms andpolitical
debates.
Weaskunderstanding from ourpartners thatnoperiod insuchconditions canbetaken as
representative. Onthecontrary, theperiod since 1991uptodayshould betaken asextraordinary and
exceptional forEstonian agriculture. Estonia cannot therefor accept themost recent timeperiod as
abaseperiod fordomestic support inEstonian agriculture because ofnotbeing representative.WT/ACC /EST/12
Page27
Question 54.
Estonia didnotrespond tothepoints raised inquestion 46(WT/ACC/EST/9) onpolicy
information onitsagricultural support regime.
Please respond tothisinquiry andindicate whether Estonia willmodify itsschedule
according tothesuggested comments.
Answer
Theagricultural support regime hasnotyetbeenformulated entirely butEstonia willtakeinto
account theprinciples andagreements within theframework ofWTO. Presently serious discussions
onthesuitable support schemes ondomestic support inagriculture areundergoing between the
Government andagricultural producers.
Thesupport measures willinclude aswell:
1. General services
- research inconnection withenvironmental programmes andresearch programmes
relating toparticular products;
- pestanddisease control, including early-warning systems, quarantine anderadication;
- training services;
- extension andadvisory services;
- inspection services forhealth andsafety purposes.
2. Infrastructural services
- electricity reticulation, roads transport, water supply facilities, dams anddrainage
schemes.
3. Production
- payments forrelief from natural orlikedisasters ifthere hasbeenrecognition by
government authorities thatsuchdisaster hasoccurred orisoccurring;
- Structural adjustment assistance through investment aids.
4. Regional assistance programmes todisadvantaged geographical regions;
5. Social programmes
- support inthecaseofearly retirement
6. Payments under environmental programmes (only inthecaseofclearly-defined government
programmes provided thattheamount ofpayment islimited totheextracostsorlossofincome
involved incomplying withthegovernment programme).
WhenEstoniaappliedforaccessiontotheWTO,itdidnothaveanyexportsubsidyprogrammes.
According todocumentation provided bytheGovernment ofEstonia, asof31July1995, Estonia agreed
withitsagricultural producers tointroduce export subsidies initsoffer onagricultural support. We
remain concerned thatEstonia would liketobindnewexport subsidy commitments initsschedule.
Wemaintain serious reservations about permitting Estonia toenterintWTO membership with
anytrade distorting agricultural subsidies inplace, especially given thatthese programmes werenot
established untilJuly1995. Establishing agricultural export subsidy programmes asrecently as1995
contradicts thespirit inwhich theUruguay Round agreement wasnegotiated, andthegood faith
negotiating assumption of"standstill" during theGovernment ofEstonia 'saccession.WT/ACC/EST/12
Page28
Question 55.
Estonia states thattheExport Credit Fund andtheFund ofCrediting Agriculture and
Rural Lifefunction likeabank andarenotsubsidy programmes. Doesthismean thatthese credits
orloans arerepaid?
Answer
Export Crediting Fund orFund ofCrediting Agriculture andRural Lifefunction likethebank
andthecredits andloans arerepaid. Theaverage interest rateisabout 15percent.
5. Foreign Investment Policy
InWT/ACC/EST/9,EstoniastatesthattheydonothaveanyTRIMSandtheirForeignInvestment
Lawfullyconforms toWTO rules. TheEstonia 'saccession package should reflect thisstatement.
6. Government Procurement
TheLawonPublic Procurement entered intoeffect on1January 1996. Estonia state in
WT/ACC/EST/2thatthelawwouldnot"contradicttheWTOAgreementonGovernmentProcurement."
Question 56.
Towhat extent doesthisnewlegislation address theprovisions oftheWTO Agreement
onGovernment Procurement (GAP)? Doesthenewlegislation infactconform withtheprovisions
oftheGAP?
Answer
Estonia takes acommitment thatEstonia 'snewlegislation onGovernment Procurement will
beinlinewiththeAgreement onGovernment Procurement.
Question 57.
WillEstonia agree toadatewhen theywillinitiate negotiations withaviewtobecoming
amember oftheAgreement onGovernment Procurement?
Answer
Estonia canagree withtherequest tobecome anobserver oftheWTO Government Procurement
Committee andamember oftheAgreement onGovernment Procurement, butduetolimited human
resources available, itisdifficult tospecify theexact timing atpresent. Estonia suggests becoming
amember oftheGovernment Procurement Agreement atthelatest bytheyear2002.
7. State Trading Enterprises
Estonia notes thatitmaintains aState trading enterprise (STE) thatconducts trade inscrap
metal exports, butnoother State trading enterprises.
Question 58.
Estonia should submit anotification onthetrade ofthisfirm, withaviewtosharing with
Working Party members information onhowthissystem functions. Estonian should noteaswell,
thatGATT Article XVII doesnotrelieve aWTO Member oftheresponsibility toapply other
WTO obligations totrade conducted byState trading enterprises, e.g., regarding nontariff
measures.WT/ACC /EST/12
Page29
Answer
Estonia iscurrently preparing thesubmission ofthenotification onState trading enterprises
inthenearest future.
Question 59.
Webelieve, thatthenature ofactivity licensing andtheinspection rights exercised by
certain firms intheareaofalcoholic beverages andtobacco products is,infact,creating State-
trading arrangements withthese firms.
Answer
Estonia confirms thatthenature ofthepresent activity licensing system doesnotcreate State-
trading arrangements.
Certain firms havetesting andcertifying rights i.e.theyhavebeenaccredited andrecognised
byrelevant foreign institutions toextend recognition totheirclients. Bynomeans cantheyinspect
anybody oranyfirm: thisrightrestsonlybyrelevant lawimplementation agencies onlyinthecases
strictly governed bythelaw.
8. Industrial Subsidies
Question 60.
Estonia states thatprivate andState-owned enterprises arenotsubsidised, norareany
plans todosoforeseen. Estonia indicates thatithasnosupport schemes tobenotified inaccordance
withtheSubsidies agreement. Estonia 'saccession package should reflect these statements.
Answer
Estonia confirms thatinlinewithSCM noprohibited industrial subsidies areusednowand
there isnointention tointroduce suchmeasures inthefuture.
V. INSTITUTIONAL BASE FOR TRADE AND ECONOMIC RELATIONS WITH THIRD
COUNTRIES
Question 61.
Please update theresponse toquestion 100inWT/ACC/EST/2, i.e.,what portion of
Estonia 'simports andexports aresubject topreferential trade arrangements, using themostrecent
trade dataavailable, butnoearlier than1January 1996.
Answer
Estonia haspreferential tradearrangements withEFTA, EU,Baltic countries, Ukraine, Czech
Republic andSlovakia. Based ontheperiod January -March 1996 about 73percentofourexports
and73,7percentofourimports aresubject topreferential trade agreements.
Question 62.
Hasthepreferential trade agreement among theBaltic countries been submitted tothe
WTO Secretariat yet?WT/ACC/EST/12
Page30
Answer
AsofJuly1996 ithasnotyetbeendone, butthisagreement willbesubmitted totheWTO
Secretariat inthenearest future.
Question 63.
Hastheagricultural component ofthetrilateral agreement beencompleted? Wearemost
interested inreviewing howagricultural products have been treated aspartofthisagreement.
Answer
Agricultural component ofthetrilateral agreement hasbeenratified byLithuania. Itisexpected
thatEstonia andLatvia willratify thetrilateral freetrade agreement ontrade inagricultural products
inAugust 1996. Inthatcasetheagreement willcome intoforce from 1October 1996.
Question 64.
Regarding theresponse toquestion 101ofWT/ACC/EST/2, please giveastatus report
onEstonia 'sefforts tojointheCentral European FreeTrade Agreement (CEFTA).
Answer
Thepreconditions ofbecoming CEFTA member arethemembership intheWTO, freetrade
agreements withallCEFTA countries andanenforced Association Agreement withtheEU.Estonia
hassofarfreetradeagreementswithtwoCEFTAcountries:theCzechRepublicandtheSlovakRepublic.
Estonia hasproposed Poland (November 1995), Hungary (October 1995) andSlovenia (August 1995)
toconclude afreetrade agreement
Aslongasthenecessary preconditions arenotfulfilled Estonian membership ofCEFTA is
notforeseen.
VI. TRADE RELATED INTELLECTUAL PROPERTY RIGHTS
Background: Thefollowing WIPO-administered international conventions entered intoforce
forEstonia inthemonths shown:
- Convention Establishing theWorld Intellectual Property Organisation (February 1994);
- Paris Convention fortheProtection ofIndustrial Property (August 1994);
- Berne Convention fortheProtection ofLiterary andArtistic Works (October 1994);
- Patent Co-operation Treaty (August 1994).
Estonia enacted thefollowing laws, effective inthemonths shown:
- Patent Law(23May1994);
- Utility Model Law(23May1994);
- Trademark Law(1October 1992);
- Copyright Law(November 1992).
Adesign protection lawisinpreparation.WT/ACC /EST/12
Page31
Question 65.
What ismeant bytheterms "administrative liability" and"administrative detention" in
theanswer toquestion 79inWT/ACC/EST/9? Please explain howtherelevant provisions work
inpractice.
Answer
Administrative liability applies bothforlegalpersons andindividuals inthecaseofinfringement
ofanyadministrative code(Law onCustoms Tariffs, Competition Lawetc.). Administrative liability
stands foradministrative compulsion, which willbeapplied inorder toprotect relations intheterms
ofpublic administrative laws.
Administrative detention applies inthecasewhen there hasbeen theinfringement of
administrative lawandthejudge canmeteoutoneofthefollowing punishments:
1. Forlegalperson thepunishment canbeeither pecuniary penalty orthetermination orsuspension
oftheactivity.
2. Fornatural persons thepunishment canbeeither pecuniary penalty, theremoval ofspecial
rights oradministrative arrest (upto30days). When thearrest isapplied there aresome
exemptions when thatisprohibited (forexample inthecaseofpregnancy).
Estonia states thatitsintellectual property rights protection regime isconsistent withtheWTO
TRIPS agreement withnoexception.
Copyrights
Estonia 'scopyright lawgives precedence totheterms ofinternational agreements towhich
Estonia adheres ifthere isaconflict between theagreement andthelaw.Estonia 'scopyright lawis
consistent withtheBerne Convention, except thatnoretroactivity wasprovided forforeign works that
didnothaveafulltermofprotection inEstonia butarestillprotected under copyright intheircountry
oforigin.
Question 66.
What plans doesEstonia havetocomply withtherequirements ofArticle 18oftheBerne
Convention torestore copyright protection forforeign works inthepublic domain inEstonia that
havenothadafulltermofprotection there andarestillprotected under copyright intheircountry
oforigin?
Answer
Article 3oftheCopyright Lawdetermines thescope andapplication ofthislaw:theCopyright
Lawshallapply toworks which require protection intheRepublic ofEstonia byvirtue ofinternational
treaties towhich theRepublic ofEstonia isaparty. According totheEstonian accession totheBerne
Convention asfrom 26October 1994, Estonia complies withtherequirements ofArticle 18ofthe
Berne Convention.
TheEstonian lawdoesprovide thecopyright owner withtherighttoexclude parallel imports.
Rental rights areprovided foraudio-visual works, phonograms, andcomputer programs. Theterm
ofprotection islifeoftheauthor plus50or,ifawork ispublished forthefirsttimeaftertheauthor 's
death, 50years fromthefirstpublication. Thetermforcopyrights incollective works andphotographic
works andproducers 'rights inaudio-visual works is50years. Works ofapplied artareprotected for
25years. Moral rights inawork areunlimited byterm.WT/ACC/EST/12
Page32
Thelawdoesspecify whatmustbeinanauthor 'scontract transferring rights inawork, but
theconditions arethose onewould ordinarily expect acontract tospecify, except thatArticle 53(2)
indicates thatadeadline ofnomore thanthreeyears tocommence utilising thework should beincluded.
Performers, producers ofphonograms, andbroadcast organisations areprotected under
neighbouring rights. Foreign nationals receive protection inaccordance withinternational agreements
towhich Estonia belongs.
Question 67.
The1994 Agreement between Estonia andtheUnited States onTrade Relations and
Intellectual Property Rights requires Estonia tomake every reasonable effort tobecome amember
oftheGeneva Phonograms Convention bytheendof1995. Please telluswhat plans Estonia has
tojointheGeneva Convention.
SincetheTRIPSAgreementwouldrequirethattherestorationofprotectionforcopyrighted
works under Article 18extend tosound recordings, willEstonia restore protection forforeign
sound recordings when itadheres totheGeneva Convention? Ifrestoration ofprotection does
nothappen then, when doesEstonia plantoprovide suchrestored protection?
Answer
Atthepresent moment thepreparations foraccession withthe1971 Geneva Convention and
1961Rome Convention aremade intheMinistry ofCulture. According tothescheme theaccessions
willtakeplace respectively in1997 andin1999.
Trademarks
Aswithcopyright, Estonia 'strademark lawprovides thatbilateral andmultilateral international
agreements towhich Estonia hasacceded takeprecedence ifprovisions ofnational lawareinconsistent
withthose insuchagreements. Thetrademark lawprohibits registration ofmarks thatarewellknown
inEstonia regardless ofwhether themark isregistered there andotherwise appears tobeconsistent
withtheobligations oftheTRIPS Agreement.
Layout Designs ofIntegrated Circuits
Question 68.
Please describe Estonia 'splans foradopting alawprotecting layout designs ofintegrated
circuits asrequired bytheTRIPS Agreement andunder the1994 Agreement between Estonia
andtheUnited States onTrade Relations andIntellectual Property Rights.
Answer
Thedraftoftheproposed lawprotecting semiconductor chiplayout designs isplanned tosubmit
totheRiigikogu (Estonian Parliament) in1998.
Industrial Designs
Question 69.
Please describe Estonia 'splans foradopting alawprotecting industrial designs asrequired
bytheTRIPS Agreement andunder the1994 Agreement between Estonia andtheUnited States
onTrade Relations andIntellectual Property Rights.WT/ACC /EST/12
Page33
Answer
Thedraftoftheproposed lawprotecting industrial designs willbesubmitted totheRiigikogu
(Estonian Parliament) onthesecond halfof1996.
Patents
Thecompulsory licensing provisions ofEstonia 'spatent lawdonotappear toprovide allof
thesafeguards required bytheTRIPS Agreement. TheAgreement between Estonia andtheUnited
States onTrade Relations andIntellectual Property Rights contains thesameobligations oncompulsory
licensing astheTRIPS Agreement. Thepatent lawcontains aprovision making theterms ofan
international agreement prevail where there isaconflict withdomestic law.Weneedtoconfirm that
acourt, indeciding onacompulsory licence, would follow theprocedures outlined inArticle VIII.
6ofthebilateral agreement.
Question 70.
Itisourunderstanding thatifaprovision ofEstonia 'spatent lawisinconsistent with
Estonia'sobligationsunderaninternationalagreement,theprovisionsoftheinternationalagreement
willprevail. TheAgreement between Estonia andtheUnited States onTrade Relations and
Intellectual Property Rights establishes conditions thatmust bemetingranting anycompulsory
licence forapatent. Estonia 'slawdoesnotappear tobefullyconsistent withtheprovisions. In
making adecision togrant acompulsory licence, would ajudge follow thecriteria established
inthebilateral agreement? Ifnotwhynot?
Answer
Unfortunately thebilateral Agreement onTrade andIntellectual Property Rights hasnotyet
come intoforce astherelevant procedures hasbeenfinalised byneither parties. AsforEstonia, we
foresee thecompletion oftheseprocedures thisautumn. When thisbilateral agreement comes intoforce
andthere iscollision between Estonian Patent Lawandthebilateral Agreement onTrade Relations
andIntellectual Property thenaccording toEstonian Patent Law(paragraph 4)theprovisions ofthe
international agreement willprevail.
Estonia 'spatent lawexcludes plantvarieties fromprotection. Todate,Estonia hasnotenacted
aseparate lawfortheeffective protection ofnewplant varieties.
Question 71.
PleasedescribeEstonia'splansforprovidingprotectionfornewplantvarietiesasisrequired
bytheTRIPS Agreement.
Answer
Estonia hasseparate Variety Protection Law, which waspassed inRiigikogu (Estonian
Parliament) on9March 1994 andentered intoforce on10April 1994. TheLawoffers protection to
allnewplant varieties bredinEstonia orinacountry having anagreement withEstonia onvariety
protection. Though Estonia isnotyetthemember oftheUnion fortheProtection ofNewPlantVarieties
(UPOV), theLawisbased onthe1978 UPOV-Convention. AsEstonia hasserious plans toaccede
theaforementioned Union, anumber ofamendments totheVariety Protection Lawaredrafted to
harmonise itwiththe1991 UPOV-Convention. Drafted amendments should enter intoforce on
1January 1997.WT/ACC/EST/12
Page34
Undisclosed Information
Question 72.
PleasedescribetheprotectionthatisavailableunderEstonia'slawforprotectingundisclosed
information asisrequired bytheTRIPS Agreement.
Answer
According toArticle 7oftheCompetition Lawtheabuse ofbusiness Article 4(1).Theabuse
ofbusiness secret isdefined inArticle 11:itistheuseofabusiness secret ofanother market participant
toobtain acompetitive advantage, ifthepertinent information hasbeenretrieved ortheuseofthis
informationisatvariancewithanagreementmadewiththeothermarketparticipants.Inordertoestablish
aviolation oftheLawonCompetition, market participants havetherighttoturntotheEstonian Board
ofSupervision ofCompetition. Iftheviolation oftheLawisestablished, theBoard ofSupervision
ofCompetition shallprescribe theviolator toimmediately endtheviolation andrestore thesituation
thatexisted before theviolation. Iftheprescriptions arenotfulfilled, theBoard ofSupervision of
Competition isentitled toexact from theviolator apre-emptory fineintheamount of10percentof
thegross turnover oftheprevious quarter ortosuggest theliquidation ofthatenterprise orassociation
ofenterprises. According tothecivilprocess lawitispossible todemand compensation oflosses from
theviolator.
Question 73.
Please describe theprotection provided forinformation thatissubmitted togovernment
agencies inEstonia inorder toobtain marketing approval forpharmaceutical andagricultural
chemical products.
Answer
According tothePublic Service Law(Article 67)theemployees ofgovernment agencies shall
atthetimeofservice relations aswellasafterrelease from theservice, keeptheState andbusiness
secrets andother confidential information disclosed tohim/her inthecourse ofperforming his/her
official duties. Iftheemployee doesnotperform official duties, thedisciplinary penalty maybeimposed.
Such penalties canbereprimands, different fines, suspension ofsalary, transfer toalower grade of
salary orrelease from theservice. According tothecivilprocess lawitispossible todemand
compensation oflosses from theviolator.
Enforcement
Wehavelittleinformation about Estonia 'scourt andadministrative enforcement regime. It
would beuseful toobtain adescription ofthestructure ofthecourt system andanyadministrative body
responsible forenforcing intellectual property rights andoftheprocedures andremedies forenforcing
suchrights. Border enforcement isparticularly important since itislikely thatmost counterfeit and
pirated goods found intheEstonian market were imported.
Question 74.
Please describe thestructure, authority, procedures, andremedies available under Estonia '
sjudicial system.
Answer
Patent disputes aresettled intheBoard ofAppeals andinthecourt. Iftheappeal includes solely
acomplaint itshould bepreliminary examined bytheBoard ofappeals. Thecourt settles patent disputes
intheorder prescribed bytheCode oftheCivil Court Procedure, taking intoaccount thestipulationsWT/ACC /EST/12
Page35
prescribed inthePatent Law. Upon settlement incourt ofpatent disputes thePatent Office maybecome
athird party totheproceeding. Thepatentee maybring action fordisposal oftheinfringement of
exclusive right, forpreventing itsrepetition andforrestoring thestatus quobefore theinfringement
commenced; forrecovery ofdamages caused bytheinfringement ofexclusive right; forcancellation
ofcompulsory licence orforchanging itsterms; forsettling disputes arising fromthelicence agreement
andforcontesting thedecisions ofthePatent office andtheBoard oftheAppeals. Forthecourse of
discussinganactionforterminationoftheinfringementofexclusiverightthecourtmayordertheproduct
protected byapatent andmade without theconsent ofthepatentee toberemoved fromthecirculation.
Upon necessity itispossible todemand theplaintiff togivesecurity forthedamages ofthedefendant
incaseofnonsuit. Inthatcasethecourt mayrule,uponrequest fromtheplaintiff, thattheproprietor
maycontinue using itforafaircompensation tothepatentee.
Question 75.
Please describe anyadministrative measures available forenforcing intellectual property
rights and,inparticular, please indicate whether Estonia 'scustoms officers have theability to
takeaction tostopimports ofcounterfeit andpirated goods.
Answer
According totheArticle 38intheCustoms Lawthecustoms officers perform theexamination
ofgoods tocontrol whether thenature, origin, condition, quantity andvalue ofgoods correspond to
theparticulars produced inthegoods declaration. Article 57ListofCustoms offences contains the
following: (9)ifrelevant documents havenotbeenpresented tothecustoms orthedocuments presented
areforged orcontain falseparticulars. Inmatters ofaviolation ofthecustoms regulations proceedings
maybetaken.
NOTIFICATIONS
Estonia should revise theinformation ithasalready provided required byWTO agreements
andshould provide, ataminimum, thedraftnotifications required bythefollowing Agreements for
Working Party review andthatitwillprovide theformal notifications atthetimeofaccession:
- Agreement onAgriculture (including acompleted Agricultural Country Schedule);
- Agreement onSubsidies andCountervailing Measures (SCM);
- Agreement onSanitary andPhytosanitary Measures (SPS);
- Agreement onImport Licensing Procedures;
- Agreement onImplementation ofArticle VIIoftheGATT 1994 (Customs Valuation);
- Agreement onTechnical Barriers toTrade (TBT);
- Understanding ontheInterpretation ofArticle XVII oftheGATT 1994 (State Trading);
- Agreement onTrade-Related Investment Measures (TRIMs);
- Agreement onTrade-Related Aspects ofIntellectual Property Protection (TRIPS).WT/ACC/EST/12
Page36
ANNEX 1
LAW ONMOTOR VEHICLE EXCISE TAX
1. Object ofExcise Tax
Motor vehicle excise tax(hereinafter referred toas:excise tax)isimposed onmotor vehicles
imported intoEstonia andmanufactured inEstonia aslisted intheAppendix ofthepresent Law.
2. Excise TaxRates
Motor vehicles aresubject toexcise taxinaccordance withtheratesspecified intheAppendix
ofthepresent Lawonthebasis ofthecylinder capacity andageofthemotor vehicle. Theexcise tax
computed onthebasis ofthetworates, isadded together fortaxation purposes.
3. Accrual ofExcise Tax
Theexcise taximposed bythepresent Lawaccrues intotheState budget.
4. Definitions
Forpurposes ofthepresent Lawthefollowing terms havethemeaning hereunder assigned
tothem:
- import -importation forfreecirculation asdefined intheCustoms Law;
- usedmotor vehicle -motor vehicle thathasbeenoristemporarily orpermanently registered
inthename ofanatural orjuridical person inanycountry;
- newmotor vehicle -motor vehicle thathasnotbeentemporarily orpermanently registered
inthename ofanynatural orjuridical person inanycountry.
5. Payment ofExcise Tax
(i) Excise taxonimported motor vehicles ispaidbytheimporter, excise taxonmotor vehicles
manufactured inEstonia ispaidbythemanufacturer.
(ii) Excise taxonimported vehicles ischarged upon theirimportation intoEstonia. Excise taxis
paidbytheimporter incustoms inaccordance withtheratesspecified intheAppendix ofthe
present Law.
(iii) Thecylinder capacity andageofthemotor vehicle forming thebasis forcharging theexcise
tax,aredetermined inaccordance withthefollowing documents submitted toandaccepted
bythecustoms:
- inthecaseofanewmotor vehicle -sellers invoice;
- inthecaseofausedmotor vehicle -certificate ofregistration andpurchase documents.
Incasethecylinder capacity andageofthemotor vehicle cannot bedetermined onthebasis
oftheabove mentioned documents, theyaredetermined onthebasis oftheestimate provided bythe
Estonian Register ofMotor Vehicles.WT/ACC /EST/12
Page37
(iv) Themanufacturer ofmotor vehicles paysexcise taxuponitssale,exchange, gratuitous transfer
orself-consumption inaccordance withtheratesspecified intheAppendix ofthepresent Law.
(v) Excise taxispaidbyjuridical andnatural persons onanequal basis andaccording tounified
rates.
6. Exemption From Excise Tax
Excise taxisnotcharged:
- onmotor vehicles manufactured inEstonia exported bythemanufacturer, incasea
customs declaration certifies theirexportation;
- onmotor vehicles imported byrepresentations offoreign diplomatic andconsular
missions, representations ofinternational organisations andinternational programmes
ofco-operation, enjoying asimilar status withtheformer, aswellasbynatural persons
enjoying diplomatic status, foruseintheexercise oftheir official functions, in
accordance withtheorder established bytheMinister ofFinance;
- motor vehicles constructed oradapted forusebythedisabled orforthetransportation
ofthedisabled.
7. Refunds ofExcise Tax
Excise taxisrefunded through theTaxBoard toajuridical person whoimported themotor
vehicle, upon itsexportation, ifthefollowing conditions aremet:
- themotor vehicle wasexported within sixmonths fromthedayofimporting themotor
vehicle, whereby thestorage ofthemotor vehicle inacustoms warehouse isnottreated
asexport;
- thecustoms declaration ofexport certifies theexportation ofthemotor vehicle from
Estonia.
8. Accounting
Theimporter ofmotor vehicles hastheobligation toaccount forthemotor vehicles imported
byhim,andthemanufacturer hastheobligation toaccount forthemotor vehicles manufactured, sold,
exchanged, gratuitously transferred, consumed andexported byhim.
9. Control
(i) TheCustoms Board exercises control overthecorrectness ofcalculating andthetimeliness
ofpayment oftheexcise taxonimported motor vehicles.
(ii) TheTaxBoard exercise control overthecorrectness ofcalculating andtimeliness ofpayment
oftheexcise taxonmotor vehicles manufactured inEstonia.
10. Sanctions
(i) Interest andsanctions prescribed bytheLawonTaxation (RTI1994, 1,5;24,394;54,904)
areapplied bytheCustoms Board andtheTaxBoard inthecaseofincorrect calculation of
theexcise tax,taxevasion ordelay inpayment.WT/ACC/EST/12
Page38
(ii) Inthecaseoffailure toprovide documents specified inSection 3ofArticle 5ofthepresent
Lawortheirprovision ininadequate form, thecustoms havetheright todeny theentry of
themotor vehicle across thecustoms frontier ofEstonia orkeepthemotor vehicle inacustoms
terminal orcustoms warehouse untilthedocuments aremeeting therequirements areprovided.
11. Implementation oftheLaw
Theorder ofimplementation ofthepresent Lawisestablished bytheMinister ofFinance.
12. Effective Date
Thepresent Lawtakes effect asof1April 1995.
Appendix totheLawonMotor vehicle Excise Tax
Motor vehicles
1. Excise taxbased onthecylinder capacity ofmotor vehicles
Description oftheMotor Vehicle HS EEK/cc
Motor carsandother motor vehicles principally designed forthe
transport ofpersons (other thanthose ofheading No.8702),
including station wagons andracing cars:8703
Motor vehicles specially designed fortravelling onsnow; golf
carsandsimilar vehicles70310 1
Other vehicles, with spark-ignition internal combustion
reciprocating piston engine:
Ofacylinder capacity notexceeding 1,000 cc 8703 21 1
Ofacylinder capacity exceeding 1,000 ccbutnotexceeding
1,500 cc8703 22 1
Ofacylinder capacity exceeding 1,500 ccbutnotexceeding
3,000 cc8703 23 1
Ofacylinder capacity exceeding 3,000 cc 8703 24 3
Other vehicles with compression-ignition internal combustion
piston engine (diesel orsemi-diesel):1
Ofacylinder capacity notexceeding 1,500 cc 8703 31 1
Ofacylinder capacity exceeding 1,500 ccbutnotexceeding
2,500 cc8703 32 1
Ofacylinder capacity exceeding 2,500 cc 8703 33 1
Motorcycles (including mopeds) andcycles fitted with an
auxiliary motor, with orwithout side-cars; side-cars (except
those specified insubheading 8711 90)8711 1WT/ACC /EST/12
Page39
2. Excise taxbased ontheageofthemotor vehicle
Newmotor vehicle,
irrespective ofage1000 EEK/year
Used motor vehicle
ofupto12years ofage 100EEK
from 13years ofage 150EEK