In the second quarter, the volume of legislative drafting concerning entrepreneurs increased
In the second quarter of 2021, the Chamber published written opinions on 59 draft acts, intents to prepare a law or other policy formation documents. As a total for two quarters, the Chamber has submitted 101 opinions.
In addition to the selection highlighted below, there was daily official communication with various authorities and the government in relation to the health crisis, entrepreneurship education as well as other topics that require active interference in order to ensure stability and sustainability of the business environment. In the second quarter, the Board of the Chamber met separately with the Minister of the Interior Kristian Jaani and Head of the Citizenship and Migration Policy Department of the Ministry of the Interior, Ruth Annus in order to discuss concerns of entrepreneurs in relation to foreign labour. During the meeting it was agreed that the Ministry of the Interior will, in the future, include more stakeholders before establishing restrictions in order to find alternative solutions. In May, the general meeting of the members of the Estonian Chamber of Commerce and Industry was held with a presentation from the Prime Minister Kaja Kallas. There was also the traditional lunch of the Board of the Chamber with the President of the Republic of Estonia.
Furthermore, representatives of the Chamber participated in the work of the Council for Adult Education of the Ministry of Education and Research, in the lead committee for merging KredEx and Enterprise Estonia, work of the Council for Vocational Education, meetings of the Social Committee of the Riigikogu. There were also several meetings with the ambassadors of foreign countries. In the second quarter, Director General of the Chamber, Mait Palts was appointed as the chairman of the council of the Kuressaare Vocational School, and the head of the Chamber’s Pärnu office Toomas Kuuda was appointed as the Chairman of the Council of Advisors for the Pärnumaa Vocational Education Centre.
On 17 May, Liina Helstein started as the head of the Tartu office of the Estonian Chamber of Commerce and industry. The long-term head of the Tartu office, Toomas Hansson who led the office since its establishment in 1991 retired. Approximately 500 entrepreneurs among the members of the Chamber are from South Estonia and the active entrepreneurs from Tartu have always been members of the Board of the Chamber.
The most remarkable topics in the second quarter were:
We achieved that some entrepreneurs are exempt of the obligation to audit packaging reports
On 15 May, the amendment of the Packaging Act entered into force according to which entrepreneurs will be required to have their packaging reports audited if the place on the market more than 20 tons of packaging per year. At the moment, the rate for auditing obligation is 5 tons a year. As a result of the amendment requested by the Chamber, ca 600 entrepreneurs will be exempt of the obligation to have their packaging reports audited this year.
Safety card is not required for every hazardous chemical
By the proposal of the Chamber, in May 2021, the law was updated with the cases when employers are not required to obtain a safety card for a hazardous chemical. A hazardous chemical is also washing up liquid, laundry capsules and other household chemicals that are available for everyone at a regular shop. Safety cards for hazardous chemicals no longer have to be obtained if the chemical is publicly offered or sold or if the hazardous chemical is provided with sufficient information for the employer to be able to apply relevant measures for mitigating the risks. Read about the work victory
We expressed opinion that raising the excise duty for diesel fuel will bring back border trade
According to the law, the excise duty rate for diesel fuel will increase 121 euros per 1,000 litres, i.e. from the current 372 euros to 493 euros, which means that the price for fuel will increase 0,12 euros per litre as of 1 May of next year. The Chamber of Commerce and Industry turned to the government of the republic in order to emphasise the negative impacts of increasing the excise duty rate for diesel fuel and proposed to cancel or postpone the plan to increase the excise duty. In the Chamber’s opinion, cancelling the increasing of the excise duty will not decrease tax revenues but will have a negative impact on the business environment and will most probably bring along a new wave of border trade.
Presentation of the border trade survey
In January 2021, the Estonian Institute for Economic Research conducted the fifth border trade survey among the population of Estonia, which revealed that the collection of excise revenue on alcohol from the purchases of foreign tourists at the northern border of Estonia decreased significantly, however at the same time, the revenue from the purchases of local people on the domestic market increased because people of Estonia went less to buy alcohol from Latvia and made more purchases in Estonia.
Border trade at the southern border of Estonia continues to be in decline because in 2019, the share of people who purchased alcohol in Latvia was 33% and during the last year it fell down to 23%, which is the lowest of the past four years. In 2017 and 2018 during the high time of border trade, the share of people buying alcohol in Latvia was 35% of the adult population.
We made 22 proposals regarding the Draft Common Water Supply and Sewerage Act
The Estonian Chamber of Commerce and Industry, Estonian Food Industry Association and Estonian Chemical Industry Association presented to the Ministry of the Environment a joint opinion regarding the Draft Common Water Supply and Sewerage Act. The opinion considered also several proposals from the Estonian Association of Water Companies. In total, the joint opinion contained 22 different proposals and comments.
We made proposals regarding the Public Procurements Act
In April, the state sent for approvals the draft for the amendment of the Public Procurements Act and related other acts, according to which several updates are planned in the field of public procurements. For example, it is planned to extend the regulation for justifying business secrets to all public procurements, not only of procurement proceedings. In the feedback we supported 5 proposals and highlighted several additional proposals that are required to make the law better.
We drew attention to the need of the person diagnosing a vocational illness to communicate with the employer
Although diagnosing vocational illnesses presumes causal relation to a risk factor or working conditions in the working environment, the doctor diagnosing the patient currently has no obligation to review the working environment or communicate with the employer. The causal relation is established merely on the basis of documents and statements of the employee. In order to establish causal relation between the health problems of an employees and the risk factors of the working environment, the occupational health doctors are currently not required to inspect the working environment. Considering that employees might not provide the full information regarding their health or other employers they might have, it might be that the doctor makes a decision without the full picture of the situation.
Therefore we proposed the state to amend the law in the way that the occupational health doctors would have the obligation and opportunity to obtain full information for diagnosing an occupational illness, including information on other employers and all information regarding the health of the employee. The response received from the Ministry shows that the state has undertaken the project for digitalising health certificates as a result of which occupational health doctors will be able to have access to more data during diagnosing occupational illnesses. At the same time, the Ministry is not willing to amend the regulation in other aspects, explaining that when employers have a doubt regarding the quality of the work of occupational health doctors, employers can separately turn to an expert committee.
We made 4 proposals for the amendment of the Aliens Act and drew attention to the fact that the deposit requirement from the salary fund is unreasonably high
We contacted the Ministry of the Interior in order to make the requirements related to the deposit of the brokers of rented labour registered in Estonia set out in the Aliens Act simpler or abolish the requirement altogether.
Since the beginning of the year 2016, the brokers of rented labour registered in Estonia have had to fulfil the deposit requirement according to which entrepreneurs are required to maintain at least ten percent of the salary fund in deposit. As far as is known from the Chamber the Police and Border Guard checked until the beginning of the year 2021 the performance of the deposit requirement on the salary fund of one month and did not consider the length of the period of residence permits or short term employment granted to aliens. The Police and Border Guard Board changed its interpretation at the beginning of this year and is now relying on the principle that the deposit has to be at least 10 percent of the 12-month salary fund of an alien. However, the new interpretation has caused a situation where some of the brokers of rented labour have had to significantly increase the deposit.
We wanted that the liability of entrepreneurs upon the sale of used goods would be regulated more flexibly
The Riigikogu received a draft according to which the state transposes European Union directives, the amendments of which are obligatory for Estonia. For example, the term of reversed burden of proof will be extended from six months to one year in favour of consumers. This means that if goods have a deficiency that is revealed within one year from the transfer to the consumer, it is the obligation of the seller to prove (e.g. with expertise) that the deficiency did not exist when the item was transferred to the consumer. After that, the consumer is required to start proving it. The directives allow the member states to regulate certain issues at their own discretion. For example, it is possible to establish local exceptions on used goods. The Chamber of Commerce proposed the Riigikogu to add a special rule to the Law of Obligations Act according to which in case of a used item, the consumer and trader may agree that claims can be submitted in relation to the goods only within one year.
We turned to the Legal Committee of the Riigikogu to allow changing hour agreements also in smaller commercial enterprises
The Riigikogu is processing an amendment of the Employment Contracts Act that allows major employers and employees of the retail sector to conclude changing hour agreements. The Chamber considers the amendment very positive and necessary, but we made the proposal to allow for mor flexible employment contracts for the retail companies that have less than six employees.
We expressed concern to the Ministry of Social Affairs that health checks may become more expensive in the future
The Ministry of Social Affairs is planning to change the regulation concerning health checks. It is positive that the decisions regarding health checks will become digital and the form of the decisions will also become clearer. In the future, the health check decisions will be sent to the employers through the work life information system. This means that there will be no need to send and preserve paper documents. It is also positive that different doctors will have the opportunity to e-consult with each other and attempts will be made to solve the problem with the availability of the service.
In the address we highlighted that extending the content of occupational health service will significantly increase the expenses of the employers and there should be more focus on making the supervision more efficient and the decisions on health checks more thorough. Furthermore, entrepreneurs are concerned with the plan to update the list of occupational illnesses with illnesses caused by psycho-social risk factors, because in practice it is extremely difficult to find causal relation between psycho-social risk factors and developing of an occupational illness. Furthermore, we found that in order to improve availability of occupational health doctors, additional measures should be taken and the right to conduct health checks could, in certain cases, be extended to family physicians.
We found that valuable agricultural land should be protected in a manner that is less restrictive for land owners
The Riigikogu started, yet again, the process on the draft act that restricts the right of the land owners to decide on the use of their land. The aim of the draft act is to protect agricultural land that has soil that is more fertile than the average and thereby ensure food security for the country. The idea is that the owners should use valuable agricultural land to as large extent as possible only for agricultural purposes, other activities on the valuable agricultural land would be significantly restricted. For example, as a general rule, land owners should not be allowed to build a new or extend an existing structure on their agricultural land, they should not let forest grow on the agricultural land or erect or allow natural generation of landscape elements.
The Chamber of Commerce proposed focusing instead on the better implementation of the valid and less restrictive provisions. Namely the law should define the meaning of valuable agricultural land and more general principles for its protection, but the final decision-making power should be given to the local municipality who assesses the circumstances of single cases and the need for specific restrictions instead of applying universal restrictions in each situation.
European Commission wishes to increase the reporting obligation of entrepreneurs
In May, the European Commission presented amendment proposals that would extent the number of entrepreneurs who should describe circumstances related to sustainability in their activity report, for example environmental and social impacts of their activities, management of human resources, observance of human rights, fight against corruption etc. We were against such amendments and sent a letter to the Ministry of the Environment where we highlighted that we understand the need to solve problems related to sustainability, but we expressed doubt if constant increasing of administrative burden on entrepreneurs in several different areas would be the most reasonable and purposeful measure for that.
We found that the rules for the conditions of collective agreements should be toughened
The Social Committee of the Riigikogu discussed the amendments to the Collective Agreement Act, the main aim of which is to clarify the regulation for extending the conditions of collective agreements. In the letter sent to the Riigikogu, we supported the amendment of the regulation on extending the conditions for collective agreements, because the respective provision of the Collective Agreement Act is in our opinion in contradiction with the Constitution. For example, the applicable Collective Agreement Act allows collective agreements to be concluded by an employers’ association consisting of two operators and trade union consisting of five employees and as a result to extend the agreed minimum salary for all employees and employers operating in the same area of activity.
We wanted the employers to have better opportunities for supporting employee health
We contacted the Ministry of Social Affairs with the proposal to increase the tax free limit for health promotion expenses up to 800 euros per year and extend the list of tax free expenses. It should include, for example, vaccinations, health examinations as well as paid healthcare services. Currently employees can contribute tax free to the health of their employees mainly when the expenses are related to performance of occupational health and safety requirements, for example, when something needs to be done for the health of employees based on risk assessment or decision of the occupational health doctor. In other cases, tax free compensation is allowed only for certain employee health and sports expenses that are limited and it can be done only to the extent of 100 euros per quarter. For example, to the extent of 100 euros, tax free compensation is allowed for the participation fee in public sports event, regular sports club use, physiotherapist service etc.
We expressed support for the participation at the Osaka EXPO
We sent to the Ministry of Economic Affairs and Communication an opinion in which we set out that Estonia’s participation in the 2025 Osaka EXPO is necessary and reasonable. As the majority of countries will most probably participate in the EXPO, Estonia’s participation in the EXPO would be essential. EXPO is a great opportunity for Estonia as a state and its entrepreneurs to communicate their success stories to the world. Asia, including Japan are markets with great potential for Estonian entrepreneurs and therefore participating in the EXPO will help to keep Estonia on the picture in this region. Additionally, the world exhibition will help Estonian entrepreneurs establish new international business contacts in Japan or the region at large.
We submitted proposals in relation to the amendment of the Public Information Act
The Ministry of Justice sent for approval, the draft amendment act of Public Information Act, where the most important updates concern establishing the concept of valuable data sets according to which certain data will become freely available in the commercial register. In our opinion, we highlighted that entry into force of the requirements could be faster compared to what is required and concerns related to disclosure of public data and protection of privacy should be clarified. Furthermore, nuances concerning the restriction on internal use should be reviewed.