OREANDA-NEWS. October 01, 2013. SORAINEN is representing Tallinna Vesi, the leading Estonian water and sewerage company and part of the United Utilities group, in a high profile administrative court dispute regarding water tariffs in Tallinn, the Estonian capital.

The initial June 2011 complaint to the administrative court on the Estonian Competition Authority’s refusal to approve prices for water services as requested in the client’s tariff application was followed by a new complaint in November 2011. The new complaint was filed for annulment of a precept issued by the Estonian Competition Authority ordering our client to significantly lower its water tariffs in Tallinn. The assignment is unique as it is the first time the Estonian Competition Authority has exercised its newly acquired powers to issue precepts ordering water undertakings to lower their tariffs.

In September 2012 the Supreme Court decided not to review the Competition Authority’s appeal against the Tallinn District Court’s ruling that found the tariff regime agreed in the privatisation agreement to be an administrative contract, ie a public law contract.

As a result, part of SORAINEN's legal position has been approved by the courts. However, the main dispute over the legality of the Estonian Competition Authority’s refusal to take into account a tariff regime agreed in a privatisation agreement remains on-going since 2011. The core of the dispute is the question whether the regulator and other state authorities must honour the international privatisation agreement concluded with the participation and guidance of the European Bank for Reconstruction and Development, and the tariff regime agreed in the same international instrument. It is also the first time in Estonian regulatory practice that a stock exchange listed company has been directly subordinated to strict tariff regulation. To date local regulatory practice has been hostile to public listing of regulated companies.

SORAINEN is acting as lead counsel in this complex litigation. The client is being advised by partners Kaupo Lepasepp and Carri Ginter together with associate Piibe Lehtsaar.