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§ 1. Undertaking
An undertaking is a natural person who offers goods or services for payment in his or her own name where the sale of goods and services is his or her permanent activity, or a company provided by law.
§ 2. Classification of companies
- (1)
- A company is a general partnership, limited partnership, private limited company, public limited company or commercial association. Other companies may also be prescribed by law.
- (2)
- A company shall be entered in the commercial register.
- (3)
- The passive legal capacity of a company shall commence as of its entry in the commercial register and shall terminate as of its deletion from the commercial register.
- (4)
- Companies may merge, divide or be transformed, only in the cases and pursuant to the procedure provided by law.
- (5)
- In the cases provided by law, the permission of a competent agency is required for merger, division or transformation.
§ 3. Sole Proprietorship
- (1)
-
Any natural person may be a sole proprietor. If a person is without active legal capacity, a legal representative shall conclude transactions in the name of the person to the extent provided by law. If the active legal capacity of a person is restricted, he or she may, under the conditions provided by law, conclude transactions with the consent of a legal representative.
(28.05.96 entered into force 08.06.96 - RT I 1996, 40, 773)
- (2)
- A sole proprietor shall be entered in the commercial register at his or her request. A sole proprietor shall be entered in the commercial register if he or she is registered with the Tax Board as a taxpayer pursuant to the Value Added Tax Act (RT I 1993, 60, 847; 2000, 7, 41; 2001. 16, 67, 69; 23, 129; 26, 148; 43, 242; 56, 335). Other cases in which a sole proprietor shall be entered in the commercial register may be provided by law.
§ 4. Areas of activity of undertaking
- (1)
- An undertaking may operate in areas of activity in which operation is not prohibited by law.
- (2)
- Areas of activity for which a licence is required or in which only a particular class of undertaking may operate may be provided by law.
- (3)
-
The area of activity indicated in the articles of association of a company and in the entry in the commercial register concerning the area of activity of an undertaking shall not be misleading with regard to the type or scope of activity of the undertaking.
(28.05.96 entered into force 08.06.96 - RT I 1996, 40, 773)
- (4)
-
A farmer is an undertaking whose area of activity is production of agricultural products and who for such purpose uses the farm in the possession of the farmer.
(13.03.2001 entered into force 10.04.2001 - RT I 2001, 34, 185)
§ 5. Enterprise and its transfer
- (1)
- For the purposes of this Act, an enterprise is an economic unit through which an undertaking operates. An enterprise is comprised of things, rights and obligations which are or should, by their nature, be designated for the activities of the enterprise.
- (2)
- Upon the transfer of ownership or possession of things and rights belonging to an enterprise or to an organisationally independent part thereof, as a whole, all the obligations related to the enterprise or to the organisationally independent part thereof shall transfer to the transferee or recipient of possession. Upon the transfer of ownership or possession of an enterprise or of a part thereof, the rights related to it shall transfer to the transferee or recipient of possession pursuant to an agreement between them.
- (3)
- The transferor shall be solidarily liable with the transferee to third persons for an obligation created before transfer of the enterprise or of an organisationally independent part thereof, the due date for performance of which has arrived or arrives within five years after the transfer. A claim against the transferee shall transfer to the transferor of the enterprise to the extent the transferor has performed the obligation.
- (4)
-
Agreements concerning division of obligations, entered into between the transferor and the transferee upon transfer of an enterprise or an organisationally independent part thereof, do not apply to third persons. An agreement made between the transferor and transferee which differs from the provisions of subsections (2) and (3) of this section applies only with regard to creditors who consent to the agreement in writing.
(06.06.2000 entered into force 08.07.2000 - RT I 2000, 49, 303)
- (5)
- The limitation period for the claim specified in subsection (3) of this section shall be five years from the transfer of the enterprise unless a shorter limitation period is established for the claim.
- (6)
- The provisions of subsections (2)-(4) of this section shall not apply to the merger, division or transformation of companies.
- (7)
- The provisions of this section shall also apply to enterprises which belong to persons who are not deemed to be undertakings according to this Act.
- (8)
-
The provisions of subsections (2)-(4) of this section shall not apply to the transfer of an enterprise in the course of compulsory enforcement or bankruptcy proceedings.
(17.06.98 entered into force 10.07.98 - RT I 1998, 59, 941)
§ 6. Group
- (1)
- If a company is a partner or shareholder of another company and owns a majority voting interest therein, the participating company shall be called the parent undertaking, and the company in which it participates shall be called a subsidiary. A company in which another subsidiary or subsidiaries, with or without the parent undertaking, have a majority voting interest is also a subsidiary of the parent undertaking.
- (2)
-
A subsidiary is also a company in which another company (parent undertaking) has control as a partner or shareholder, on the basis of an agreement or without an agreement.
(17.06.98 entered into force 10.07.98 - RT I 1998, 59, 941)
- (3)
- A parent undertaking together with its subsidiaries forms a group.
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