Introduction

Takeover bids in Estonia are regulated by the Securities Market Act (Väärtpaberituru seadus – the ‘SMA’) and the Rules of Takeover Bids. The Act on Amendment of the SMA and Related Acts (Väärtpaberituru seaduse ja sellega seonduvate seaduste muutmise seadus), implementing the provisions of the Takeover Directive, was passed by the Estonian parliament (Riigikogu) on 24 October 2007, and the amended version of the SMA came into force on 19 November 2007 (i.e., well after the prescribed deadline of 20 May 2006). Further, the respective amendments to the Rules of Takeover Bids were not adopted until 11 January 2008 and became effective only on 8 February 2008. As a result, full harmonization of the Takeover Directive in Estonia was not achieved until February 2008.

Prior to the Act on Amendment of the SMA and Related Acts coming into effect, the SMA already was, to a significant extent, in compliance with the principles introduced by the Takeover Directive, and the amendments to the SMA and the Rules of Takeover Bids were required to introduce some of the remaining principles and more specific provisions in order to ensure full compliance with EU law.

Scope

The SMA defines a takeover bid as a public offer made to the shareholders of the offeree company (the ‘target persons’) for the acquisition of their shares in exchange for money or securities traded on the market.