• New Residence Permit for Intracompany Transferees and Investors; New Residence Permit Exemption
  • July 13, 2017
  • A new law has created a residence permit for intracompany transferees (ICTs), investors and startup employees, increases the validity period for short-term employment and creates a new short-term residence permit exemption, among other changes. Key changes are discussed below.

    New Intracompany Transferee Residence Permit

    Specialists, executives or trainees working in a non-EU company are now eligible for a new ICT residence permit, in line with the 2014 EU Directive. To be eligible for the ICT residence permit, the following criteria must be met:

    • The ICT must have been employed under an employment contract for at least 12 months with a non-EU company within the same corporate group as the Estonian company to which he or she is transferring.
    • The Estonian company must enter into an employment contract with the ICT permit holder; and
    • The Estonian company must pay the ICT permit holder at least the average gross monthly salary in Estonia (current approximately EUR 1,200) under its local payroll.

    Specialists’ and executives’ ICT permits are valid for three years and trainees’ permits are valid for one year. Following the expiration of the ICT permit, ICTs can only apply for other types of residence permits in Estonia. Current ICT permit holders who seek to renew their permits will be subject to the new ICT rules.

    ICTs issued an ICT permit by another EU Member State can be transferred to Estonia under their non-Estonian permit for the validity of the permit and vice versa.

    Non-EU nationals must submit an application for an Estonian ICT permit. Non-EU nationals who intend to work in Estonia first for at least as long as they intend to work in another EU Member State may submit their ICT permit application after they enter Estonia.

    Short-term ICTs staying in Estonia for fewer than 270 days do not need to obtain an ICT permit but can merely register with the Police and Border Guard Board before their employment commences.

    Temporary Residence Permit for Investors

    Investors are now eligible for a new temporary residence permit if they make a direct investment of at least EUR 1,000,000 into an Estonian company. Previously, investors could only enter Estonia on the basis of an employer-sponsored visa.

    Investors in the intracompany transferee sector or in a startup are exempt from the immigration quota.

    Increased Short-Term Registration Validity Period

    Foreign nationals can work in Estonia under the Short-Term Registration program for up to 270 days per year, up from the previous 180 days per year. Specialists and startup employees can work in Estonia under the same program for longer periods, though the legislation does not specify how long.

    Visas for Startups

    A new visa for startup employees is available to those seeking to develop a new business and their dependents. The visa is valid for 90 days within a 180-day period for a short-term visa, or up to 12 months in a year for a long-term visa.

    New Residence Permit Exemption

    Workers staying in Estonia for no more than five days within a period of 30 days are now exempt from a residence permit.

    What This Means for Employers and Foreign Nationals

    The new ICT residence permit is more restrictive than the previous systems available to ICTs in Estonia. For example, foreign payroll was an option under the previous system, whereas now, it is not.

    Nevertheless, since foreign workers can obtain an ICT residence permit in any EU Member State without applying for a separate residence permit to work in Estonia, the program should benefit workers who travel between EU Member States.

    Investors and startup employees should benefit from the new residence permit category and short-term workers should benefit from the longer registration validity period and the new residence permit exemption.