LEXTAL advised Bank Zachodni WBK S.A. (Santander Group) in connection with the accession of Estonian company to the existing 18MEUR revolving credit facility granted to a group of financial service companies operating in Eastern Europe. LEXTAL team was led by partner Ants Karu.
LEXTAL advised Atso Matsalu in connection with the management buy-out of Puukeskuse AS (http://www.puukeskus.ee) from DT Finland OY (Wolseley group). LEXTAL team was led by partners Urmas Ustav and Ants Karu.
More information from the daily newspaper Äripäev in Estonian: http://www.aripaev.ee/uudised/2016/08/01/puukeskuse-juht-ostis-ettevotte-valja and http://www.aripaev.ee/uudised/2016/08/01/matsalu-ainuomanikuna-on-lihtsam-tegutseda.
The Common Reporting Standard (CRS) of the Organization for Economic Co-operation and Development (OECD) on the automatic exchange of financial accounts information is intended to combat cross-border tax fraud and tax evasion.
The Common Reporting Standard was developed upon the request of G20 and approved by the OECD Council on 15 July 2014. The Common Reporting Standard provides that tax authorities all over the world will receive information from financial institutions and exchange this information on the taxpayers of the respective countries once a year automatically. Previously such information was exchanged upon request, however, from now on the information will be exchanged automatically and regularly.
In accordance with the Common Reporting Standard financial institutions undertake to conduct a due diligence procedure in order to identify the accounts of non-residents exposed to the reporting criteria and transfer this information to the local tax administration which will eventually transfer this information to the non-resident’s tax authority. Clients of the Latvian banks, Latvian tax residents, obtaining income in the territory of Latvia and possessing no foreign bank accounts, will not be affected by the exchange of information system.
As at the middle of 2016, 101 countries have undertaken to exchange information. Latvia along with 55 other countries has joined the group of early adopters; therefore, the first automatic information exchange has to be held at the end of September 2017 providing information about the year 2016. At the same time, automatic exchange will be initiated in all of the EU Member States, as well as low-tax countries such as British Virgin Islands, Cayman Islands, Isle of Man, Jersey, Guernsey etc. Russia is not among the early adopters of the Common Reporting Standard and together with other countries will start the gradual exchange of information, in compliance with country’s abilities as of 2018. As to the Belarus, it has decided not to become a member of the system and will not participate in the exchange.
The laws for the information exchange to be implemented have been developed and have come into legal effect – amendments to the Law On Taxes and Fees (chapter XII), amendments to the Credit Institutions Law and Regulations of Cabinet of Ministers of 05.01.2016. No.20 “On the Procedure how Financial Institution Performs Appropriate Verification of Accounts and Provide Information on Financial Accounts to the State Revenue Service”.
What information will have to be notified?
The Standard stipulates what information shall be notified, certain types of accounts and holders of accounts, to whom the standard will be applicable, as well as common due diligence procedures, which the financial institutions will have to comply with. Financial institutions will electronically submit the information to the State Revenue Service (SRS) until the reporting period of 31st July of the following year. Financial institutions will have to report to the SRS information on the holders of foreign legal and natural persons’ accounts (including the true beneficiaries), the balance and value of the accounts, interest and dividends from financial investments, revenue from the sale of assets, etc. In case a person is holding an account for the benefit of another person, the latter will be considered the true holder of the account and the information about this person will be notified to the respective authority.
Banks will have to notify about the accounts, owned by foreigners or passive non-financial legal entities, the beneficial owners of which are non-residents. Nevertheless, there is no notification obligation about the accounts, held by active non-financial entities, e.g., LLCs, at least half of the profit of which is generated by an active commercial practice. The SRS will ensure the further exchange of this information with other states, as well as receive the information about the Latvian natural persons’ and legal entities’ foreign bank accounts. The exchange of information may be carried out more often than once in a year.
Importantly, Latvian financial institutions have already been collecting the above mentioned information in order to exchange it in September 2017 with other parties to the system.
The analysis Merger control in the Baltic States introduces comparatively the rules of merger control in Estonia, Latvia and Lithuania. The authors of the material are Margus Reiland from Estonia, Edvins Vilkins from Latvia and Tadas Vilcinskas from Lithuania.
Read an overview about M&A rules in the Baltic states here: Merger control
Partner Alar Urm4 advised Marsalis Marsalis Metall in the agreement to acquire Loksa shipyard. Loksa shipyard was founded in 1905. It is located on the northern coast of Estonia just about 65 kilometres from Tallinn and specializes in fabrication and painting different large-sized non-standard steel structures.
More information from the daily newspaper Äripäev in Estonian.
Ants Karu13 advised Aasa Global in Estonian law matters in connection with investment by Novator Partners and Olympia Group into AASA group. New investors committed EUR 30 million to fund loan portfolio development in Poland and Czech Republic and to continue European expansion. New investment will also be used to fund research and development of group’s own credit scoring based on big data. AASA group is headquartered in Estonia and operates non-collateral consumer credit businesses in several countries, incl Finland, Poland, Czech Republic and Sweden.
More information on http://aasaglobal.com/
Attorney at law Tiina Pukk advised seed company Capster with bringing in their first round of investment
Attorney at law Tiina Pukk advised seed company Capster with bringing in their first round of investment. Capster is a Tehnopol Startup Incubator company who has set its heart and mind to combat chronic rhinitis. Total value of the investment was 85,000 EUR coming from seven investors, three of whom are members of Estonian Business Angels Network EstBAN.
Attorney at law Tiina Pukk advised coModule with investment involving. In autumn 2014 coModule participated in 3-month Startupbootcamp business accelerating program in Germany and also this time 500,000EUR investment came from Germany. Tiina Pukk advised coModule founders and prepared transaction documents from Estonian side. See more on coModule at www.comodule.com.29