I was in Estonia two days ago. I just passed through on a whim as part of a European bicycle tour. I am embarrassed to admit, I knew very little about the country before being there.
I was only there a week, so my impressions are addmittedly naive, but very positive. There was a lot of technology forward thinking - online voting, constitutional right to internet access, co-working spaces catering to young entrepreneurs.
So quite hight tech on the one hand, and on the other hand, there is a deep respect for and serious comprehension of nature. The country is 50% forest! And my experience with Estonian camp sites was that they were free, ancient, and beautiful. I felt like I was camping in a sacred grove (I probably was).
Man, wish I had stayed longer. Anyone doing any cool projects there?
I see a lot of that across Europe. I've been dying to do a road trip out that way (from the UK) but it's difficult with three children.
Everyone I've met and spoken to out there has been through some serious shit right up until the late 1990s from wars to genocides. They really are forward thinking because looking back hurts badly.
It might sound cheesy but I have a lot of hope for Europe and most of it comes from the East.
At the same time I'm disgusted at how the media and general population treats our fellow Europeans.
Excuse the OT, I'm considering a visit. As a foreigner with no connections, how do you recommend I could get a feel for the startup scene there (as you seem to have done)?
> Anyone doing any cool projects there?
One Estonian startup whose product I use a lot is TransferWise, here's an invite link (for one free currency transfer):
I've never been there, but from what I understand, they love folk music, and kids learn to program in primary school. Sounds like a wonderful country. Also the home of Skype. Not to be underestimated.
A shameless plug but since you asked for it.. :)
We're doing something cool - at least it's really cool to me - a super simple CI server for mobile apps for freelancers and small teams (greenhouseci.com).
By the way, Estonia has a cool tech scene also outside of Tallinn! We're in Tartu and there are a lot of cool startups here too!
Check this out - www.zazler.com
Webserver designed to work with relational databases and bring more value on client-side. Zazler's unique architecture speeds up building mobile apps, JavaScript heavy interfaces and integrations by reducing amount of code and todo list. Basically, it creates a RESTful API of a relational database. Written in Haskell, in Estonia :-)
I believe this has huge implications for someone who would want to operate a company from a business friendly country, as opposed to say a country where the individual is located physically but is otherwise corrupt or war ridden.
My understanding is that this status allows you to form companies, open bank accounts and sign binding documents just like someone living in Estonia. And that is pretty impressive.
Add cryptocurrencies into play, and whole new world of companies is now suddenly possible.
I agree this is interesting, but the problem is that there is nothing to stop the government of the country in which you physically reside from having different ideas about what laws govern your dealings.
If the country you are physically in wants to (e.g.) tax you, they can. (There are, of course, many more nefarious possibilities than taxation.) This is, I think, true in an "in accordance with international law" sense (though there is the possibility that a bilateral double taxation treaty might apply) and it is certainly true in a "who's to stop them" sense. (And if we're hypothesizing that the person is physically located in a corrupt/war torn country, the latter would probably be all that matters anyway.)
It is to use Estonia's digital services and does not give you residency.
Nothing stops you opening a company in Estonia now, but that does not mean you would only pay corporation taxes there (they are at 10% when distributed as dividends), your physical location plays a role too.
For some time, I have daydreamed of various cool scenarios that would only be possible with a government-issued digital ID.
But in my daydreams, I've never considered a third-party government issuer. I don't see value in this beyond the value that I see in a corporate-issued digital ID, and that's hardly more valuable than a self-issued ID.
Obviously, Estonia has considered some angle which I have not.
You can become an e-Estonian!
They should probably change that to e-Stonian or something so that it's pronounced "eastonian". :) The "eee-eh" is awkward to pronounce.
A start would be to do anything an Estonian can do today online in almost real time. Founding a company online: 5 minutes and you're in business. Very simple tax and other legislation, so very simple reporting online - and getting tax refunds if needed in a few days.
But this should not be limited to existing legacy services we use. Think of what you could do anything online with an absolute cryptographically strong vetted proof, that it's you, valid across the world? That's very different from a corporate ID which has no power internationally.
Estonian language is perceived as having uncharacteristically long dragging of vowels during pronunciation, so e-Estonian works just as well. I wonder if there is some kind of inside joke around that.
For some time, I have daydreamed of various cool scenarios that would only be possible with a government-issued digital ID.
But in my daydreams, I've never considered a third-party government issuer. I don't see value in this beyond the value that I see in a corporate-issued digital ID, and that's hardly more valuable than a self-issued ID.
Obviously, Estonia has considered some angle which I have not.
I think the angle is that it allows a business presence in the EU and Eurozone for essentially anyone.
"To apply for one, you need to make visit a Police and Border Guard office in Estonia – there you need to submit an application and provide biometrical data (your facial image and fingerprints) for background check."
"We are working to add capacity to our embassies to process e-residency applications and issue cards abroad by the end of 2015 – so that you would not necessarily need to travel to Estonia to
join us as an e-resident."
How this is supposed to work in the future - hopefully soon - is for you to be able to authenticate yourself in any friendly embassy or consulate. The first issuance must be with a strong proof of identity.
are the facial image and fingerprints only used for background check, are they stored (and for how long) and are they shared with different entities, such as police or foreign governments?
Is there a tax advantage here? Estonia's tax system is supposed to be very simple, and allows for a 0% corporate income tax on all profits that are re-invested into the corporation (source: http://www.incorporate.ee/why-estonia/low-tax-jurisdiction).
Does this mean I can form a corporate entity in Estonia and gain all the tax benefits without any physical presence?
You will have to be very very careful about making Estonia the real physical center of the commercial activities deployed by your company.
If you don't - let's say you're Dutch, living in Holland and consulting mostly for Dutch clients, then forget it.
But let's say you're Dutch, you have a girlfriend in Estonia, you work from there a week every month, and you have clients in several EU countries, with NL only one of them... Maybe you even have a local employee in Estonia. That will work no problem.
Yes, you can keep the corporate profits in the corporate entity until their distribution. There is a 21% tax though on distributed profits like dividends. Until you keep the money in the company or re-invest to subsidiaries, it's ot taxed. http://www.investinestonia.com/en/investment-guide/tax-syste...
The rest depends on various double-taxation treaties which affect more individuals.
You're likely to run into domestic Controlled Foreign Corporation rules. Basically if you or your family own a large portion of a foreign registered company and that company is taxed less than domestic tax rates, it'll be classed as actually residing in your home country for corporate tax purposes.
If you want to pay taxes only in Estonia, consult a Double Tax Treaty between Estonia and your country of physical residence. Usually you would be able to employ a person in Estonia to close deals/contracts to qualify. But read the document.
As soon as you distribute the profits, 10% tax applies from the Estonian end.
Estonia could have a shot at becoming the "Delaware" for non-US entrepreneurs, esp EU, i.e. have all the high-growth companies incorporate because of clear, friendly startup support infrastructure and laws.
It is very entrepreneurial of the Estonian government. Quotes from their announcement:
"e-residency is also launched as a platform to offer digital services to a global audience with no prior Estonian affiliation – for anybody who wants to run their business and life in the most convenient aka digital way! We plan to keep adding new useful services from early 2015 onwards."
Is there any reason why I - being perfectly happy with my American citizenship and residency and having zero intent to change either - should avoid getting one for the novelty of it? I mean, is there any possible downside to getting this thing out of a sci-fi novel?
I think the biggest actual barrier to actually getting one would be having to apply in person, and pick up your card in person.
Certainly for Americans, not a huge number of people will have two weeks spare and sufficient funds to wait for their application to be processed (or the money to fly to Estonia and back twice in two weeks).
Edit: apparently they're "working to add capacity to our embassies to process e-residency applications and issue cards abroad by the end of 2015". This makes the whole thing absolutely amazing. Let's see how the rest of the world reacts, I guess.
How can anyone be happy with American citizenship when it places you under some of most bizzare laws seen in first world countries including huge tax code?
I really don't understand why Americans aren't moving out and dumping their citizenships in droves. I know that earning money in USA is supposedly easier than anywhere else but still...
There are only some minor downsides to acquiring a second citizenship of a decent country. (Watch out for American residency though, the taxes can be bad.)
I don't think there are any downsides to the e-residency, apart from having to give some of your data (and a modest fee) to Estonia.
E-future cannot be built if we don't fix serious issues with software engineering. There is no guarantee of security. There is no assurance. We basically don't know how to build secure systems yet. As daily events show (from #fappening, #shellshock to Snowden's revelations), this is one of those "hard", unresolved problems...and not just from algorithmic (non-repudiation) perspective, but also from a practical engineering perspective (we are still dealing with buffer overflows).
“The software security industry today is at about the same stage as the auto industry was in 1930" ... "it looks fast, goes nice but in an accident you die.” ... "The major shortfall is absence of assurance (or safety) mechanisms in software. If my car crashed as often as my computer does, I would be dead by now.” -- Brian Snow, Former Technical Director of the NSA, We Need Assurance http://www.research.att.com/talks_and_events/2008_distinguis....
That analysis was done by a group of individuals with strong ties to the biggest opposition party in Estonia, whose voters are primarily those who are less likely to participate in e-voting; they've been anti-promoting the e-voting system ever since they went to opposition; prior to that, they'd been openly positive about it it.
The analysts themselves were invited to the country and to do the analysis by that opposition party (Centre Party/Keskerakond); they had participated in several Centre Party events prior to publishing the research. They were reimbursed for their expenses and most likely paid a fee for the analysis. The group had demands that the system be taken down; they however refused to publish details about the study which is uncommon and is not a sign of goodwill.
but saying "terribly insecure" is more than wrong. yeah, thare are many procedural things which could be better, but technologically estonian e-voting is secure. only serious threat is propaganda.
Ah yes the Phyles of Diamond age. But this e-residency is still within the confines of a nation-state, whereas Stephenson's Phyles/Tribes replace the nation-state.
I can see Bitcoin - or its decedents - easily being used for Phyle "ID-card" infrastructure; no nation-state required.
It's an ID/credential system that government and financial services will be using. So you'll be able to use the ID/credentials to log in and interact with Estonian entities that use it, like banks, tax authority, corporate registry, etc. Vaguely like an OpenID identity, but run by the Estonian government, and with two-factor authentication.
It doesn't in itself give you any specific rights, as far as I can tell ("e-residency" is a bit of a marketing term). It just makes it easier to do things that foreigners are theoretically allowed to do, but which aren't currently very easy to do remotely. For example it's already legal for a foreigner to register a company in Estonia, but it's a bit of a hassle if you aren't an Estonian resident; this is supposed to make it easier, because you'll be electronically "in the system" with a proper ID number and login, making it easier for agencies and financial institutions to know how to deal with you. Especially since it's combined with a move towards self-service online portals for government services, so you should be able to log in with this ID and do a lot of things over the internet, instead of visiting civil-service offices.
Here (Denmark) all that is also theoretically true—anyone with legitimate business in Denmark can get an ID, and once you have one you can do things like register a company entirely online, self-service, as well as interact with banks and anyone else who implements the "NemID". But in practice the authorities are very suspicious of anyone not living in Denmark trying to get into the system, so almost the only non-residents who do so are Swedes and Germans who either commute cross-border or have frequent business in Denmark.
Maybe the main difference is that they will issue it also to non-residents.
By the way, I don't know in other countries but in Spain it was a complete failure due to a really bad implementation: only worked with Internet Explorer, reader with proprietary drivers, etc...
"The one-time state fee for the card is 50 euros, other fees will depend on service providers – public digital services will be offered mostly free-of-charge, just like to ‘real’ residents."
Most of the team of my startup SaleMove is in Tartu! This is yet another example of how great Estonia is for tech. If you want to develop for a great startup there reach out on our website!
[+] [-] ikawe|11 years ago|reply
I was only there a week, so my impressions are addmittedly naive, but very positive. There was a lot of technology forward thinking - online voting, constitutional right to internet access, co-working spaces catering to young entrepreneurs.
So quite hight tech on the one hand, and on the other hand, there is a deep respect for and serious comprehension of nature. The country is 50% forest! And my experience with Estonian camp sites was that they were free, ancient, and beautiful. I felt like I was camping in a sacred grove (I probably was).
Man, wish I had stayed longer. Anyone doing any cool projects there?
[+] [-] sudowhodoido|11 years ago|reply
Everyone I've met and spoken to out there has been through some serious shit right up until the late 1990s from wars to genocides. They really are forward thinking because looking back hurts badly.
It might sound cheesy but I have a lot of hope for Europe and most of it comes from the East.
At the same time I'm disgusted at how the media and general population treats our fellow Europeans.
[+] [-] namenotrequired|11 years ago|reply
> Anyone doing any cool projects there?
One Estonian startup whose product I use a lot is TransferWise, here's an invite link (for one free currency transfer):
https://transferwise.com/u/5d78
[+] [-] jkaljundi|11 years ago|reply
[+] [-] mcv|11 years ago|reply
[+] [-] tauntz|11 years ago|reply
By the way, Estonia has a cool tech scene also outside of Tallinn! We're in Tartu and there are a lot of cool startups here too!
[+] [-] rudolfosman|11 years ago|reply
[+] [-] yurylifshits|11 years ago|reply
[+] [-] plainOldText|11 years ago|reply
My understanding is that this status allows you to form companies, open bank accounts and sign binding documents just like someone living in Estonia. And that is pretty impressive.
Add cryptocurrencies into play, and whole new world of companies is now suddenly possible.
[+] [-] pdabbadabba|11 years ago|reply
If the country you are physically in wants to (e.g.) tax you, they can. (There are, of course, many more nefarious possibilities than taxation.) This is, I think, true in an "in accordance with international law" sense (though there is the possibility that a bilateral double taxation treaty might apply) and it is certainly true in a "who's to stop them" sense. (And if we're hypothesizing that the person is physically located in a corrupt/war torn country, the latter would probably be all that matters anyway.)
[+] [-] agilebyte|11 years ago|reply
Nothing stops you opening a company in Estonia now, but that does not mean you would only pay corporation taxes there (they are at 10% when distributed as dividends), your physical location plays a role too.
[+] [-] boh|11 years ago|reply
[+] [-] daveloyall|11 years ago|reply
But in my daydreams, I've never considered a third-party government issuer. I don't see value in this beyond the value that I see in a corporate-issued digital ID, and that's hardly more valuable than a self-issued ID.
Obviously, Estonia has considered some angle which I have not.
You can become an e-Estonian!
They should probably change that to e-Stonian or something so that it's pronounced "eastonian". :) The "eee-eh" is awkward to pronounce.
[+] [-] jkaljundi|11 years ago|reply
A start would be to do anything an Estonian can do today online in almost real time. Founding a company online: 5 minutes and you're in business. Very simple tax and other legislation, so very simple reporting online - and getting tax refunds if needed in a few days.
But this should not be limited to existing legacy services we use. Think of what you could do anything online with an absolute cryptographically strong vetted proof, that it's you, valid across the world? That's very different from a corporate ID which has no power internationally.
[+] [-] TrainedMonkey|11 years ago|reply
[+] [-] goodcanadian|11 years ago|reply
But in my daydreams, I've never considered a third-party government issuer. I don't see value in this beyond the value that I see in a corporate-issued digital ID, and that's hardly more valuable than a self-issued ID.
Obviously, Estonia has considered some angle which I have not.
I think the angle is that it allows a business presence in the EU and Eurozone for essentially anyone.
[+] [-] tvanantwerp|11 years ago|reply
[+] [-] spindritf|11 years ago|reply
From the leaflet [PDF] http://e-estonia.com/wp-content/uploads/2014/10/Become-Eston...
[+] [-] jkaljundi|11 years ago|reply
[+] [-] anemic|11 years ago|reply
[+] [-] memnips|11 years ago|reply
Does this mean I can form a corporate entity in Estonia and gain all the tax benefits without any physical presence?
[+] [-] markvdb|11 years ago|reply
If you don't - let's say you're Dutch, living in Holland and consulting mostly for Dutch clients, then forget it.
But let's say you're Dutch, you have a girlfriend in Estonia, you work from there a week every month, and you have clients in several EU countries, with NL only one of them... Maybe you even have a local employee in Estonia. That will work no problem.
[+] [-] jkaljundi|11 years ago|reply
The rest depends on various double-taxation treaties which affect more individuals.
[+] [-] xmr|11 years ago|reply
You're likely to run into domestic Controlled Foreign Corporation rules. Basically if you or your family own a large portion of a foreign registered company and that company is taxed less than domestic tax rates, it'll be classed as actually residing in your home country for corporate tax purposes.
[+] [-] agilebyte|11 years ago|reply
As soon as you distribute the profits, 10% tax applies from the Estonian end.
[+] [-] anmol|11 years ago|reply
Estonia could have a shot at becoming the "Delaware" for non-US entrepreneurs, esp EU, i.e. have all the high-growth companies incorporate because of clear, friendly startup support infrastructure and laws.
[+] [-] bjelkeman-again|11 years ago|reply
"e-residency is also launched as a platform to offer digital services to a global audience with no prior Estonian affiliation – for anybody who wants to run their business and life in the most convenient aka digital way! We plan to keep adding new useful services from early 2015 onwards."
http://e-estonia.com/wp-content/uploads/2014/10/Become-Eston...
[+] [-] kstrauser|11 years ago|reply
[+] [-] pgl|11 years ago|reply
Certainly for Americans, not a huge number of people will have two weeks spare and sufficient funds to wait for their application to be processed (or the money to fly to Estonia and back twice in two weeks).
Edit: apparently they're "working to add capacity to our embassies to process e-residency applications and issue cards abroad by the end of 2015". This makes the whole thing absolutely amazing. Let's see how the rest of the world reacts, I guess.
[+] [-] scotty79|11 years ago|reply
I really don't understand why Americans aren't moving out and dumping their citizenships in droves. I know that earning money in USA is supposedly easier than anywhere else but still...
[+] [-] eru|11 years ago|reply
I don't think there are any downsides to the e-residency, apart from having to give some of your data (and a modest fee) to Estonia.
[+] [-] tikums|11 years ago|reply
E-future cannot be built if we don't fix serious issues with software engineering. There is no guarantee of security. There is no assurance. We basically don't know how to build secure systems yet. As daily events show (from #fappening, #shellshock to Snowden's revelations), this is one of those "hard", unresolved problems...and not just from algorithmic (non-repudiation) perspective, but also from a practical engineering perspective (we are still dealing with buffer overflows).
“The software security industry today is at about the same stage as the auto industry was in 1930" ... "it looks fast, goes nice but in an accident you die.” ... "The major shortfall is absence of assurance (or safety) mechanisms in software. If my car crashed as often as my computer does, I would be dead by now.” -- Brian Snow, Former Technical Director of the NSA, We Need Assurance http://www.research.att.com/talks_and_events/2008_distinguis....
[+] [-] eallik|11 years ago|reply
The analysts themselves were invited to the country and to do the analysis by that opposition party (Centre Party/Keskerakond); they had participated in several Centre Party events prior to publishing the research. They were reimbursed for their expenses and most likely paid a fee for the analysis. The group had demands that the system be taken down; they however refused to publish details about the study which is uncommon and is not a sign of goodwill.
[+] [-] asstonian|11 years ago|reply
only found this not-very-good response in english to those "experts": http://www.vvk.ee/valimiste-korraldamine/vvk-uudised/vabarii...
but saying "terribly insecure" is more than wrong. yeah, thare are many procedural things which could be better, but technologically estonian e-voting is secure. only serious threat is propaganda.
[+] [-] lifeisstillgood|11 years ago|reply
- who makes the smart card? What is the model?
- wow - that's just like Neal Stephenson and joining Tribes based not on location but membership.
But I can't see myself going to Estonia just to pick one up ... I'll wait till the embassy in London does it :-)
[+] [-] asstonian|11 years ago|reply
The Estonian ID-card and Digital Signature Concept: http://www.id.ee/public/The_Estonian_ID_Card_and_Digital_Sig...
[+] [-] jkaljundi|11 years ago|reply
Here are the Estonian specs: http://www.id.ee/index.php?id=35772
[+] [-] jp555|11 years ago|reply
I can see Bitcoin - or its decedents - easily being used for Phyle "ID-card" infrastructure; no nation-state required.
[+] [-] ahmett|11 years ago|reply
[+] [-] xmpir|11 years ago|reply
[+] [-] _delirium|11 years ago|reply
It doesn't in itself give you any specific rights, as far as I can tell ("e-residency" is a bit of a marketing term). It just makes it easier to do things that foreigners are theoretically allowed to do, but which aren't currently very easy to do remotely. For example it's already legal for a foreigner to register a company in Estonia, but it's a bit of a hassle if you aren't an Estonian resident; this is supposed to make it easier, because you'll be electronically "in the system" with a proper ID number and login, making it easier for agencies and financial institutions to know how to deal with you. Especially since it's combined with a move towards self-service online portals for government services, so you should be able to log in with this ID and do a lot of things over the internet, instead of visiting civil-service offices.
Here (Denmark) all that is also theoretically true—anyone with legitimate business in Denmark can get an ID, and once you have one you can do things like register a company entirely online, self-service, as well as interact with banks and anyone else who implements the "NemID". But in practice the authorities are very suspicious of anyone not living in Denmark trying to get into the system, so almost the only non-residents who do so are Swedes and Germans who either commute cross-border or have frequent business in Denmark.
[+] [-] 6t6t6|11 years ago|reply
http://en.wikipedia.org/wiki/Electronic_identity_card
Maybe the main difference is that they will issue it also to non-residents.
By the way, I don't know in other countries but in Spain it was a complete failure due to a really bad implementation: only worked with Internet Explorer, reader with proprietary drivers, etc...
[+] [-] ikawe|11 years ago|reply
[+] [-] jzd131|11 years ago|reply
[+] [-] embro|11 years ago|reply
Source : http://www.plugshare.com
[+] [-] listic|11 years ago|reply
[+] [-] wellboy|11 years ago|reply
[+] [-] unknown|11 years ago|reply
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[+] [-] avaku|11 years ago|reply
[+] [-] saanilb|11 years ago|reply