OREANDA-NEWS. September 03, 2013. Eesti Gaas group is the main natural gas wholesaler and retailer in Estonia and also owns the Estonian transmission and main distribution networks. Eesti Gaas is a consolidated group comprising Eesti Gaas and also EG Ehitus and EG Vorguteenus.

The primary activities of Eesti Gaas are purchasing, distribution and sales of natural gas. This is supplemented by the maintenance of the company’s gas systems, and organising the construction of new gas pipe systems and development works of the gas network. The natural gas used in Estonia has a high calorific value and is cleaner and more environmentally friendly than other fuels in use. Modern gas installations are reliable, safe and efficient.

The primary activities of EG Vorguteenus are the maintenance, development and renovation of gas supply systems, and the performance of gas installation works. The primary activities of EG Ehitus are the construction of gas pipe systems and gas installations, planning and the performance of gas supply works, and the sales, installation and maintenance of the gas systems and heating systems.

As a result of restructuring, the gas transmission network and transmission services are separate from distribution services, the distribution network and sale of natural gas. Restructuring was done under the unbundling regime in the 3rd Energy Package (Directive 2009/73/EC).

The purpose of the restructuring is to meet the requirements of the Estonian Natural Gas Act of 6 June 2012. The Act requires separation of the transmission network from assets and business activities related to provision of transmission services (ownership unbundled). Separation into a company providing only transmission services must be completed by 1 January 2015 at the latest and the company cannot be simultaneously engaged in and owned by a person performing any of the functions of sale or production of natural gas.

SORAINEN advised the client throughout the restructuring process, including analysing suitable legal structures for the restructuring, advising on implementation of the project and acting as project leader during implementation.

The assignment involved extensive pre-structuring work in relation to separating operations, assets, employees, accounting and IT matters. Additional work involved resolving property rights associated with use of transmission networks, communicating with the Estonian energy sector regulatory authority and advising on licensing and other energy sector specific regulatory matters, including ensuring compliance with the Natural Gas Act ownership unbundling provisions and public registration in relation to separation of businesses. During the project SORAINEN advised Eesti Gaas group on regulatory matters, corporate law, employment law and tax law.

The client was advised by the SORAINEN team led by partner Karin Madisson, and including partner Kaupo Lepasepp, specialist counsel Kadri Kallas, senior associate Inga Murula, associates Kaspar Endrikson and Piibe Lehtsaar.