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Ease of Doing Business in

Estonia

Estonia Download Profile (1713.6KB, pdf)
Region OECD high income
Income Category High income
Population 1,311,998
GNI Per Capita (US$) 18,480
City covered Tallinn

190

1

DB 2017 Rank

1

100

DB 2017 DTF (% points)

  • local_library
  • group
Topics DB 2017 Rank DB 2016 Rank info_outline Change in Rank DB 2017 DTF (% points) info_outline DB 2016 DTF (% points) info_outline Change in DTF (% points) info_outline
Overall 12 11 down
1
81.05 81.01 down
0.04
Starting a Business 14 11 down
3
95.13 95.06 up
0.07
Dealing with Construction Permits 9 10 up
1
82.57 82.55 up
0.02
Getting Electricity 38 33 down
5
83.20 83.25 down
0.05
Registering Property 6 4 down
2
91.02 91.01 up
0.01
Getting Credit 32 29 down
3
70.00 70.00
-
Protecting Minority Investors 53 51 down
2
60.00 60.00
-
Paying Taxes 21 19 down
2
88.04 87.89 up
0.15
Trading across Borders 17 17
-
99.92 99.92
-
Enforcing Contracts 11 11
-
75.16 75.16
-
Resolving Insolvency 42 41 down
1
65.46 65.28 up
0.18

DB 2017 Rank:

9

DB 2016 Rank:

10

Change in Rank:

up1

DB 2017 DTF (% points):

82.57

DB 2016 DTF (% points):

82.55

Change in DTF (% points):

up0.02

STANDARDIZED WAREHOUSE
Estimated value of warehouse EUR 763,424
City Tallinn
Indicator Estonia OECD high income
Procedures (number) info_outline 10 12.1
Time (days) info_outline 102 152.1
Cost (% of warehouse value) info_outline 0.2 1.6
Building quality control index (0-15) info_outline 11 11.3
  • Measure of efficiency
    No. Procedure Time to Complete Associated Costs
    1

    Obtain project clearance from Fire Department

    Agency: Fire Department

    According to the Rescue Act of 2010, obtaining fire safety clearance for the building project from the National Rescue Service Agency or a local government rescue service should take 10 days. However in practice it takes 30 days. If the building project does not conform to the fire safety rules, the Rescue Service can decide to give on average five workdays to eliminate deficiencies.

    30 days no charge
    * 2

    Obtain project clearance from Environment Department

    Agency: Environment Department

    The Environmental Impact Assessment and Environmental Management System Act entered into effect on April 3, 2005, providing legal bases and procedures for assessing likely environmental impact, organization of eco-management and audit schemes, and the legal bases for awarding eco-labels to prevent environmental damage.

    The environmental impact shall be assessed upon application for, or application for amendment of, a development consent (a building permit or a permit for the building use), if the proposed activity, which is the basis for the application for, or the amendment of, the development consent, potentially results in significant environmental impact. A person who proposes an activity and intends to carry it out shall organize an environmental impact assessment and carry all the resulting expenses.

    It is up to the local municipality to decide whether it is at all necessary to assess the environmental impact of the project. There are two types of grounds for requiring an environmental impact assessment to be carried out. First of all there are instances in which it is obligatory to conduct environmental impact assessment. The hypothetical warehouse project should not qualify under this category. The second category is such that the local municipality is required to consider whether an environmental impact assessment is needed or not and if the local municipality decides that it is necessary, it must give reasons for such a decision. The hypothetical warehouse project might qualify under this category if for example considered to be (a part of) an industrial area development. Besides the fact that it is in hands of municipality to make a decision, there are no clear definitions on what does not exactly fall into category of projects that do not qualify for Environmental Impact Assessment (EIA). It is likely BuildCo would need to obtain a clearance but not the full scale EIA approval.

    The Environmental Impact Assessment and Environmental Management System Act established a term of 30 days for issuing a decision to approve the environmental impact assessment report. The time may vary from 30 days to 1 year for actual EIA approval both from Municipality and Environmental Supervisory Authority. It would also include a period of public hearing. However, since we are just getting a project clearance for a relatively simple project, the procedure should be completed within 30 days.

    29 days no charge
    * 3

    Obtain project clearance from Health Care Department

    Agency: Health Care Department

    A clearance for the building project from the Health Care Department is not required. However, this authority may be consulted by the local government before granting or refusing the building permit. In practice, the local government may ask the applicant to personally communicate with these authorities. There is no time limits for such communication. Further, the Health Care Department has the right to perform state supervision over compliance with occupational health requirements when the warehouse is put into use.

    28 days no charge
    * 4

    Obtain project clearance from Labor Inspections Department

    Agency: Labor Inspections Department

    A clearance for the building project from the Labor Inspections Department is not required by law in the stage prior to approval of the building permit. However, this authority may be consulted by the local government before granting or refusing the building permit. In practice, the local government may ask the applicant to personally communicate with these authorities. The Labor Inspectorate has the right to perform state supervision over compliance with occupational safety requirements during construction and when the warehouse is put into use. According to Occupational Health and Safety Act, Paragraph 13, the employer is obliged to notify the local department of the Labor Inspectorate in writing or in a format which can be reproduced in writing before commencing activities. The notification can also be made also via the Customer Portal of the Labor Inspectorate (https://eti.ti.ee/login/index?redir=true).

    Paragraph 26 provides that after receiving the notification, an inspector has the obligation to carry out an inspection. The employee of the Labor Inspectorate must set up the time of inspection with the owner of the building, but in extraordinary situations, the inspector has the right to commence supervision without informing the employer in advance.

    27 days no charge
    5

    Obtain building permit

    Agency: Municipality

    To obtain a building permit from the Municipality, BuildCo must submit an application for a construction permit and construction design documentation. According to the Building Act, the local government must approve or refuse the issuance of a building permit within 20 days from the date on which the application for the building permit and the building design documentation are submitted. The Municipality conducts internal consultations with various departments and agencies. However in practice, BuildCo is likely to follow up with these authorities.

    Since June 2009, an energy certificate for the new building must be included in the application. The energy audit is assumed to be conducted by the engineers of the newly built warehouse.

    Prior to construction, BuildCo must notify the Municipality that construction will begin.

    25 days EUR 585
    6

    Receive on-site inspection by Municipality

    Agency: Municipality

    During construction, the Municipality may monitor the work to verify compliance with the requirements. If the construction does not comply with the applicable rules and regulations, the construction will be stopped.

    1 day no charge
    7

    Receive on-site inspection by Estonian Technical Surveillance Authority

    Agency: Technical Surveillance Authority

    According to the amendment of Building Act from January 1, 2008 Estonian Technical Surveillance Authority may carry out state surveillance on construction sites, in addition to the surveillance exercised by the Municipality. Before the building is being used or in case of an emergency in a building that is already in use, the Estonian Technical Surveillance Authority does not have to inform the owner about the inspection beforehand. In other situations, the owner must be notified at least 24 hours in advance.

    The number of inspections is not limited by law -- it is up to the discretion of the Technical Surveillance Authority. However it should comply with the principles of good administration practices. The costs of the evaluation services, of the expert assessment of building design documentation and of the evaluation of construction works ordered to verify conformity to the requirements are borne by the Technical Surveillance Authority. If it is established that the construction works or building design documentation do not conform to the established requirements, the owner of the construction works has to compensate the Technical Surveillance Authority for the costs of the evaluation services ordered to verify conformity to the requirements, including the costs of expert assessment or evaluation.

    1 day no charge
    8

    Apply for permit of use and request final inspection from Municipality

    Agency: Municipality

    The local municipality has discretion as to which agencies can be engaged in the inspection before the permit to use the building is issued. According to the law, the local municipality must issue a permit to use the building (or issue a refusal to not use the building) within 20 days from the date on which the last document necessary for the issue of the permit is submitted. However, in practice it takes longer. BuildCo would have the right to file an action to the administrative court in case the 20-day limit is not respected. In practice though few companies file lawsuits against the authorities.

    25 days EUR 64
    * 9

    Receive final inspection from Municipality and obtain permit of use

    Agency: Municipality

    The date and the time of the final inspection is agreed between the builder and the municipal authority. The permit for use is not issued before the final inspection is carried out.

    1 day no charge
    10

    Obtain water and sewerage connection

    Agency: AS Tallina Vesi

    20 days EUR 1,131

    * Takes place simultaneously with previous procedure.

  • Measure of quality
    Answer Score
    Building quality control index (0-15) 11.0
    Quality of building regulations index (0-2) 2.0
    How accessible are building laws and regulations in your economy? (0-1) Available online; Free of charge. 1.0
    Which requirements for obtaining a building permit are clearly specified in the building regulations or on any accessible website, brochure or pamphlet? (0-1) List of required documents; Fees to be paid; Required preapprovals. 1.0
    Quality control before construction index (0-1) 1.0
    Which third-party entities are required by law to verify that the building plans are in compliance with existing building regulations? (0-1) Licensed engineer. 1.0
    Quality control during construction index (0-3) 3.0
    What types of inspections (if any) are required by law to be carried out during construction? (0-2) Inspections by in-house engineer; Unscheduled inspections; Risk-based inspections. 2.0
    Do legally mandated inspections occur in practice during construction? (0-1) Mandatory inspections are always done in practice. 1.0
    Quality control after construction index (0-3) 3.0
    Is there a final inspection required by law to verify that the building was built in accordance with the approved plans and regulations? (0-2) Yes, final inspection is done by government agency. 2.0
    Do legally mandated final inspections occur in practice? (0-1) Final inspection always occurs in practice. 1.0
    Liability and insurance regimes index (0-2) 1.0
    Which parties (if any) are held liable by law for structural flaws or problems in the building once it is in use (Latent Defect Liability or Decennial Liability)? (0-1)  Architect or engineer; Professional in charge of the supervision; Construction company. 1.0
    Which parties (if any) are required by law to obtain an insurance policy to cover possible structural flaws or problems in the building once it is in use (Latent Defect Liability Insurance or Decennial Insurance)? (0-1) No party is required by law to obtain insurance . 0.0
    Professional certifications index (0-4) 1.0
    What are the qualification requirements for the professional responsible for verifying that the architectural plans or drawings are in compliance with existing building regulations? (0-2) University degree in architecture or engineering. 0.0
    What are the qualification requirements for the professional who supervises the construction on the ground? (0-2) Minimum number of years of experience; University degree in engineering, construction or construction management. 1.0