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Estonia

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1) REFERENCES

Commission Opinion [COM(97) 2006 final - Not published in the Official Journal]
Commission Report [COM(98) 705 final - Not published in the Official Journal]
Commission Report [COM(1999) 504 final - Not published in the Official Journal]
Commission Report [COM(2000) 704 final - Not published in the Official Journal]
Commission Report [COM(2001) 700 final - SEC(2001) 1747 - Not published in the Official Journal]
Commission Report [COM(2002) 700 final - SEC(2002) 1403 - Not published in the Official Journal]
Commission Report [COM(2003) 675 final - SEC(2003) 1201 - Not published in the Official Journal]
Treaty of Accession to the European Union [Official Journal L 236 of 23.09.2003]

2) SUMMARY

In its July 1997 Opinion, the European Commission considered that the adoption of the new draft Competition Act in Estonia would mark a significant step towards the harmonisation of legislation on restrictive agreements, and provided that certain amendments were introduced into the draft text, the degree of harmonisation concerning state aid would also be satisfactory. However, a major effort would be needed in the medium-term to meet the requirements for monitoring of state aid, in particular as regards transparency.

The November 1998 Report noted that despite the adoption of a new Competition Act further progress was needed in this field, especially with regard to state aid. State aid control had to be further developed. Efforts were needed to create full transparency in the granting of state aid in order to establish a comprehensive and updated state aid inventory. In addition, the powers of the State Aid Monitoring Authority needed to be strengthened.

The October 1999 Report stated that some progress had been made with the anti-trust legislation, but that the legislation in force did not cover all aspects of merger control. In the state aid field, Estonia still needed to make an effort to meet the short and medium-term priorities of the Accession Partnership.

The November 2000 Report stated that Estonia had made some progress in coming into line with the acquis on competition, in particular, with regard to state aid. Amendments to state aid provisions, providing for ex ante control and strengthening the role of the national authority, came into force in January.

The October 2001 Report stated that Estonia had made steady progress in the area. The new law on competition, which came into force in October 2001, introduced checks on mergers and further alignment with the acquis relating to restrictive agreements and state aid.

The October 2002 Report considered that Estonia had made further progress. However, efforts are still needed to satisfy demands concerning the monitoring of state aid.

The November 2003 Report notes that Estonia is essentially meeting the commitments and requirements arising from the accession negotiations in the competition area. However, it must ensure the proper application and enforcement of legislation, particularly as regards the new criminal procedure applied in anti-trust cases.

COMMUNITY ACQUIS

European Community rules on competition stem from Article 3(g) of the EC Treaty, which states that the activities of the Community shall include "a system ensuring that competition in the internal market is not distorted". The main areas of application are restrictive agreements and State aid.

The Europe Agreement with Estonia was signed on 12 June 1995 and will come into force once it has been ratified by all the Member States of the European Union. It provides for a competition regime to be applied in trade relations between the Community and Estonia based on the requirements set out in Articles 81, 82 and 87 of the EC Treaty (ex-Articles 85, 86 and 92) concerning agreements between undertakings, abuses of dominant position and State aid, and for implementing rules in these fields to be adopted within three years of the entry into force of the Agreement.

Furthermore, the Agreement requires Estonia to make its rules on competition compatible with those of the Community.

The White Paper refers to the progressive application of the above provisions and of those contained in the Merger Regulation (4064/89) and Articles 31 (ex-Article 37) and 86 (ex-Article 90) concerning monopolies and special rights of the EC Treaty.

EVALUATION

The new Competition Act came into force in October 2001. This law brought Estonia's legislation on anti-trust largely into line with the acquis as regards merger control, vertical restraints and horizontal cooperation agreements. After the new criminal code was adopted in June 2001, Estonia modified the Competition Act in September 2002.

The national competition authority, called the Competition Office, has the necessary human and technical resources to handle a large number of cases. Nevertheless, significant financial resources will be required.

The Competition Act also contains provisions on State aid and makes alignment with the acquis possible at a later stage. The national State aid monitoring authority, called the Division for Competition and State Aid, is part of the Ministry of Finance and has wide powers to ensure that the rules are applied in this area. Estonia still has to finalise the application of state aid provisions in the three sensitive sectors, namely the steel, automobile and synthetic fibre industries.

Since the Commission's Opinion of 1997, Estonia has made steady progress. Negotiations on this chapter have been provisionally closed (see the 2002 Report). Estonia has not requested any transitional arrangements in this area.

This summary is for information only and is not designed to interpret or replace the reference document.

Last updated: 05.03.2004
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