ESTONIA Law and Practice Contributed by: Maria Pihlak, Carri Ginter, Raul Kartsep and Katariina Kuum, Sorainen
2. Investment Treaties, Free Trade Agreements and Investment Laws 2.1 Bilateral and Multilateral Investment Treaties Bilateral Investment Treaties (BITs) Estonia has ratified a total of 32 BITs; 14 of these are currently in force. Following the Court of Justice of the European Union’s Achmea and Komstroy rulings, Estonia has terminated or suspended the operation of intra-EU BITs. The BITs currently in force are as follows: 1. Estonia–Switzerland BIT (1992); 2. Estonia–China BIT (1993); 3. Estonia–Israel BIT (1994); 4. Estonia–United States of America BIT (1994); 11. Estonia–Jordan BIT (2010); 12. Estonia–Moldova BIT (2010); 13. Estonia–Kazakhstan BIT (2011); and 14. Estonia–United Arab Emirates BIT (2011). While Estonia always strives to improve its trade rela- tions, particularly with developing economies, and is therefore constantly exploring opportunities for new BITs, it must also bear in mind the EU law constraints and its FDI screening framework. Per public informa- tion, there are no new BITs currently in negotiation. Multilateral Investment Treaties (MITs) • Estonia is a contracting party to the Energy Charter Treaty. • Additionally, as a member of the EU, Estonia is indirectly bound by a large number of MITs nego- tiated and concluded between the EU and third parties. 2.2 Model Bilateral Investment Treaty 5. Estonia–Ukraine BIT (1995); 6. Estonia–Turkey BIT (1997); 7. Estonia–Viet Nam BIT (2009); 8. Estonia–Morocco BIT (2009); 9. Estonia–Georgia BIT (2009); 10. Estonia–Azerbaijan BIT (2010); Estonia does not use a specific “Estonia model BIT” that is distinct and published. The BITs follow fairly standard templates for the promotion and protection of investments, fair and equitable treatment, non-
discrimination, expropriation with compensation, and other provisions. Additionally, as a member of the EU, Estonia is guided by the policies and directions of the EU when draft- ing and negotiating BITs. For example, Estonia can take guidance from the aiding tools and instructions published by the EU, such as the European Union Model BIT Clauses (2023), which seek to ensure that investment protections in BITs concluded between EU member states and third countries are consistent and harmonised with EU law and policy. 2.3 Free Trade Agreements As an EU member, Estonia is party to the EU’s trade agreements and subject to its internal market rules and the investment protection elements in EU agree- ments (eg, EU–New Zealand FTA (2023), EU–Viet Nam FTA (2019), EU–Singapore FTA (2018), EU–Korea FTA (2010), etc). 2.4 Interpretive Aids While Estonia’s treaties may have preambles, exchange of notes and standard treaty texts, there is no well‑known, widely used published commen- tary or model treaty with interpretive notes specific to Estonia. Domestic courts (especially the Supreme Court) have, in some instances, clarified how public policy is inter- preted, what non‑arbitrable disputes are, etc. These act as interpretive precedents. 2.5 Investment Laws There is no single comprehensive Estonian national investment law (in the sense of a law that mirrors treaty protections for foreign investors across the board) that provides exactly the same protection as treaty obli- gations. Estonia protects foreign investment through treaties, domestic constitutional property rights, gen- eral civil law, etc. More recently, the Foreign Investment Reliability Assessment Act (from 2023) provides regulatory over- sight/screening of certain foreign investments in stra- tegic sectors. It does not replace treaty protections or arbitration rights, but imposes prior authorisation in certain sectors for non‑EU investors.
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