Law & Q&A

Art. 2. Undertaking

(1) For the purposes of this Act, an undertaking is a company, sole proprietor, any other person engaged in economic or professional activities, an association which is not a legal person, or a person acting in the interests of an undertaking.

(2) The provisions concerning undertakings apply to the state, local governments, legal persons in public law and other persons performing administrative duties if they participate in a goods market.

(3) For the purposes of this Act, undertakings which are connected to each other through control may be deemed to be one undertaking.

(4) Control is the opportunity for one undertaking or several undertakings jointly or for one natural person or several natural persons jointly, by purchasing shares and on the basis of a transaction or articles of association or by any other means, to exercise direct or indirect influence on another undertaking which may consist of a right to:

1. exercise significant influence on the composition, voting or decision-making of the management bodies of the other undertaking, or to
2. use or dispose of all or a significant proportion of the assets of the other undertaking.

Art. 3. Goods market

(1) A goods market is an area covering, inter alia, the whole of the territory of Estonia or a part thereof where goods which are regarded as interchangeable or substitutable (hereinafter substitutable) by the buyer by reason of price, quality, technical characteristics, conditions of sale or use, consumption or other characteristics are circulated.

(2) In order to define a goods market, the turnover of substitutable goods shall, as a rule, be assessed in money. If this is not possible or expedient, the market size and the market shares of the undertakings participating in the goods market may be assessed on the basis of other comparable indicators.

Art. 4. Prohibition on agreements, concerted practices and decisions by associations of undertakings which restrict competition

(1) The following are prohibited: agreements between undertakings, concerted practices, and decisions by associations of undertakings (hereinafter agreements, practices and decisions) which have as their object or effect the restriction of competition, including those which:

1. directly or indirectly fix prices or any other trading conditions, including prices of goods, tariffs, fees, mark-ups, discounts, rebates, basic fees, premiums, additional fees, interest rates, rent or lease payments applicable to third parties;
2. limit production, service, goods markets, technical development or investment;
3. share goods markets or sources of supply, including restriction of access by a third party to a goods market or any attempt to exclude the person from the market;
4. exchange information which restricts competition;
5. agree on the application of dissimilar conditions to equivalent agreements, thereby placing other trading parties at a competitive disadvantage;
6. make the entry into agreements subject to acceptance by third parties of supplementary obligations which have no connection with the subject of such agreements.

(2) The prohibition provided for in subsection (1) of this section shall apply to agreements and practices, and decisions of agricultural producers, their associations and federations of such associations, which concern the production or sale of agricultural products or the use of joint facilities, only to the extent determined on the basis provided for in Article 42 of the Treaty on the Functioning of the European Union.

Art. 5. Agreements, practices or decisions of minor importance

(1) The provisions of clauses 4 (1) 4)–6) of this Act do not apply to agreements, practices and decisions of minor importance.

(2) Agreements, practices or decisions are considered to be of minor importance if the combined market share of the total turnover of the undertakings which enter into the agreement, engage in concerted practices or adopt the relevant decision does not exceed:

1. 15 per cent for each party of in the case of a vertical agreement, practice or decision;
2. 10 per cent in total for all parties of a horizontal agreement, practice or decision;
3. 10 per cent in the case of an agreement, practice or decision which includes concurrently the characteristics of both vertical and horizontal agreements, practices or decisions.

(3) Agreements by undertakings, concerted practices of undertakings or decisions by associations of undertakings are considered to be vertical if the undertakings operate at different levels of the production or distribution chain (for example the production of raw materials or finished goods, or retail or wholesale distribution). Agreements by undertakings, concerted practices of undertakings or decisions by associations of undertakings are considered to be horizontal if the undertakings operate as competitors at the same level of the production or distribution chain.

(4) Agreements, practices or decisions are deemed to be of minor importance if the conditions provided for in subsection (2) of this section are fulfilled during the whole period of effect of the agreement, practice or decision.

Art. 6. Exemption

(1) The prohibition provided in subsection 4 (1) of this Act shall not be imposed concerning an agreement, activity or decision which:

1. contributes to improving the production or distribution of goods or to promoting technical or economic progress or to protecting the environment, while allowing consumers a fair share of the resulting benefit;
2. does not impose on the undertakings which enter into the agreement, engage in concerted practices or adopt the decision any restrictions which are not indispensable to the attainment of the objectives specified in clause 1) of this subsection;
3. does not afford the undertakings which enter into the agreement, engage in concerted practices or adopt the decision the possibility of eliminating competition in respect of a substantial part of the goods market.

(2) An undertaking which makes use of the conditions arising from this section is required to provide proof concerning compliance with all the conditions set forth in section (1) of this section.

Art. 7. Block exemption

(1) A block exemption is general permission granted by a regulation of the Government of the Republic on the proposal of the minister responsible for the area to enter into a certain category of agreements, engage in a certain category of concerted practices or adopt a certain category of decisions which complies with the conditions provided for in § 6 of this Act and restricts or may restrict competition.

(2) A block exemption is established for a specified term and may designate:

1. the name of the category of agreements, practices or decisions to which the block exemption applies;
2. restrictions or conditions which shall not be included in such agreements, practices or decisions;
3. conditions which must be included in such agreements, practices or decisions, and restrictions and conditions which may be included in such agreements, practices or decisions;
4. other conditions which such agreements, practices or decisions must comply with.

(3) [Repealed - RT I 2004, 56, 401 - entry into force 01.08.2004]

Art. 8. Nullity of agreements or decisions

Any agreement or decision or a part thereof which has as its object or effect the consequences specified in § 4 of this Act is void unless it is permitted on the basis of §§ 5–7 of this Act.