Buying a company means buying its history: its contracts, its debts, its disputes and its obligations to authorities. A legal due diligence is the review that finds out what that history contains before you sign. In Estonia a great deal can be checked from public registers, but the most important risks are usually in documents only the seller has. This guide explains what a legal due diligence on an Estonian company covers, what it does not, and what happens after closing — with our legal due diligence and post-closing register filings add-ons.
The guide is general information, not legal advice for a specific transaction.
What can be checked in public sources
- Commercial register: the company's registered data, management board, shareholders of a private limited company (OÜ), articles of association, annual reports and beneficial owners.
- Register of economic activities: activity licences and notices of economic activity.
- Land register for real estate, and the commercial pledge register for pledges over the company's movable assets.
- Court decisions published in Riigi Teataja, and the tax debt information that the Tax and Customs Board publishes.
These searches are the minimum. They show what is registered, not what is agreed.
What only the documents show
- Material contracts — customers, suppliers, loans, leases — and in particular change-of-control clauses that let the other party terminate when the owner changes.
- Encumbrances on the shares — pledges, options, pre-emption rights under a shareholders' agreement.
- Employment — key employees, non-compete undertakings, open claims.
- Licences and permits — whether they are personal to the company, whether a change of owner must be reported or approved. For regulated companies a change of qualifying holding usually requires prior notice to or approval by the supervisory authority.
- Disputes and claims not yet in court, and correspondence with authorities.
- Intellectual property and data — whether the company actually owns what it uses.
The red-flag report
Our due diligence ends with a red-flag report in English: a list of the issues that matter for the price or the structure of the deal, each with a recommendation — a price adjustment, a specific warranty or indemnity in the purchase agreement, a condition to be met before closing, or a reason not to proceed. We do not produce a hundred-page description of every contract; the report is written for the decision you have to make.
A legal due diligence is not a financial or tax due diligence and not a valuation. Those are done by accountants and tax advisers; we coordinate with them where you engage them.
After closing
When the shares of an OÜ are transferred, the transfer agreement is notarised and the notary forwards the change in shareholders to the commercial register. The other consequences of the transaction must be filed by the company: a new management board, amended articles of association, a new business name or address, and updated beneficial owner data. Until these entries are made, the register — which banks, counterparties and authorities rely on — still shows the old situation.
What our add-ons include
Legal due diligence report — from
You receive: Document request list; review of the documents provided; red-flag report in English.
Not included: Financial and tax due diligence; valuation.
Post-closing commercial register filings —
You receive: Resolutions for the changes decided in the transaction; the commercial register application; a check that the notary's shareholder filing is in the register.
Not included: Notary fees; state fees.
The due diligence is available with our advice on Estonian or foreign transactions and is quoted individually, because it depends on the size of the target. The post-closing filings are a fixed-price service for Estonian companies. State fees and notary fees are never included in our prices.
How to request a quote
Use the quote form on the mergers and acquisitions page: choose the transaction type, tick the add-ons and describe the target briefly. We reply with a written quote by email before any work starts. All communication takes place by email.
Frequently asked questions
What does a legal due diligence on an Estonian company check?
Public registers — the commercial register, the register of economic activities, the land and commercial pledge registers, court decisions and tax debts — and the documents only the seller has: material contracts and change-of-control clauses, encumbrances on the shares, employment, licences, disputes and intellectual property. The result is a red-flag report in English.
Does the legal due diligence include tax and financial review?
No. Financial and tax due diligence and valuation are carried out by accountants and tax advisers; we coordinate with them where you engage them.
What must be filed with the register after buying an Estonian company?
The change of shareholders of a private limited company is forwarded to the register by the notary who certifies the share transfer. The company itself must file the other changes decided in the transaction — a new management board, amended articles, a new business name or address — and update its beneficial owner data.
Are notary and state fees included in the post-closing filings?
No. State fees and notary fees are never included in our prices and are paid separately.