Terms and Conditions of Entrepreneur Account

Valid from 20.03.2019

1. General provisions

   1. Under the Agreement, the Bank undertakes to open to the Customer an Entrepreneur Account, keep the Customer's money in the Entrepreneur Account and make Payment Transactions on the terms and conditions agreed upon with the Agreement.
   2. The Conditions shall form an integral part of the Agreement, and shall be applicable to the Agreement, unless otherwise agreed between the Bank and the Customer.
   3. In issues not regulated by the Agreement, the Bank and the Customer shall be governed, in addition to the Conditions, by the Bank’s General Conditions and the Conditions of Payment Services Agreement, including other documents referred to therein, unless this is in conflict with the Conditions and the Agreement. The Customer has reviewed the General Conditions and the Conditions of Payment Services Agreement, and is aware of the corresponding obligations of the Customer and rights of the Bank.
   4. The Agreement shall be governed by the law of the Republic of Estonia.

2. Definitions used in the agreement

   1. In addition to the terms and definitions defined in the General Conditions of the Bank and the Conditions of the Payment Services Agreement, the following definitions with the following meaning shall be used in the Conditions:
      1. ETCB means the Estonian Tax and Customs Board;
      2. Entrepreneur Account means an account opened at the Bank in the name of a natural person, to which the sales proceeds of products and services shall be transferred (business income), on which Business Income Tax is calculated;
      3. Business Income Tax means a state tax within the rate set out by law, which is paid on the business income;
      4. Agreement means the Entrepreneur Account Agreement;
      5. Conditions mean these terms and conditions of the Entrepreneur Account.

3. Customer’s declarations and warranties

   1. By signing the Agreement, the Customer declares that:
      1. the Customer is a natural person with legal capacity, having all the rights to enter into and perform the Agreement;
      2. the Customer does not act in the same or similar area of activity as a sole proprietor;
      3. the Customer is not liable to value added tax;
      4. all amounts received in the Entrepreneur Account are considered business income within the meaning of business income act (Simplified Business Income Taxation Act, SBITA) and the said receipts are subject to Business Income Tax;

4. Using the account

   1. The Customer may open several Entrepreneur Accounts in their name, unless this is in conflict with effective legislation.

   2. With entering into the Agreement, the Customer gives the Bank an order for the indefinite term to reserve during the validity of the Agreement the Business Income Tax on all amounts received in the Entrepreneur Account and make payments to the account of ETCB within the sum of Business Income Tax the latest by the tenth (10) day of the next calendar month, following the reservation of Business Income Tax (hereinafter: the Customer's Order). With the conclusion of the Agreement, any payments effected on the basis of the Customer's Order shall be considered as authorised within the meaning of the Law of Obligations Act.

   3. The Bank reserves Business Income Tax on all amounts received in the Entrepreneur Account.

   4. The Bank sends information on the amount received in the Entrepreneur Account to ETCB for calculating the payment obligation. ETCB informs the Bank of the size of the Business Income Tax for each amount received in the Entrepreneur Account.

   5. After receipt of the notification of ETCB, stated in clause 4.4 of the Conditions, the Bank shall make a payment to the ETCB account within the sum of Business Income Tax, calculated by ETCB and forwarded to the Bank.

   6. The Bank forwards ETCB the amount received in the Entrepreneur Account and makes payments to the ETCB account in euros. If the amount received in the Entrepreneur Account is in any other currency than the Euro, the Bank shall calculate the amount received in the Entrepreneur Account into euros on the basis of the exchange rate determined by Eesti Pank. If the funds in the Entrepreneur Account are insufficient for making the payment to the ETCB account in euros, the Bank shall not convert the amounts in the Entrepreneur Account in another currency automatically into euros.

   7. The Customer ensures the availability of sufficient funds in the Entrepreneur Account in euros for executing the Customer’s Order.

   8. If the funds in the Entrepreneur Account are insufficient for paying the Business Income Tax, the Bank shall not execute the Customer’s Order and shall inform the Customer thereof. The Bank does not execute the Customer’s Order on the account of other accounts opened at the Bank.

   9. Notwithstanding the provisions of clause 4.8, the Bank has a right to check the Entrepreneur Account and if sufficient funds have been received in the Entrepreneur Account for making the payment of Business Income Tax within the tax amount to the ETCB account, shall execute the Customer's Order.

   10. If there are several Customer's Orders for a Entrepreneur Account, however the funds available in the Entrepreneur Account are insufficient for the execution of all Customer's Orders, the Bank shall decide on the order of their execution.

   11. It is not allowed to make securities transactions via the Entrepreneur Account and the Entrepreneur Account cannot be used as an investment account within the meaning of Income Tax Act.

   12. The Bank does not provide tax or legal advisory services to the Customer within the performance of the Agreement.

   13. The Bank forwards to ETCB information on the conclusion and termination of the Agreement, on the withdrawal of the Customer's Order and on each amount received in the Entrepreneur Account.

5. Liability

   1. The Parties shall be held liable for a breach of their obligations in accordance with the provisions of the Conditions, the General Conditions, the Payment Services Agreement and legislation.
   2. The Bank is liable for timely and complete execution of the payments to be effected on the basis of the Customer's Order. The Bank is not liable for the failure to execute payments, or for partial execution of payments, if the failure or partial execution was conditioned by the lack of sufficient funds in the Entrepreneur Account.
   3. The Bank is not liable if the Business Income Tax has been debited from the Entrepreneur Account in incorrect amount or if the Business Income Tax has been debited on the amounts, received in the Entrepreneur Account, on which Business Income Tax is not calculated. The Customer has a right to dispute the calculation of Business Income Tax at ETCB pursuant to procedure stipulated in legislation.
   4. The Bank shall not be liable for the notification specified in clause 4.8 not reaching the Customer, if this was caused by outdated or incorrect contact data submitted to the Bank by the Customer.
   5. Upon performance of the obligations arising from the Agreement, the Bank is not a withholding agent within the meaning of the Taxation Act and the obligations of a withholding agent do not extend to the Bank.

6. Entry into force, amendment and termination of the agreement

   1. The Agreement enters into force when it is signed by the Parties and is concluded without a term.
   2. The Bank shall have the right to unilaterally amend the Conditions by notifying the Customer thereof at least 2 (two) months in advance. The Customer shall have the right to immediately cancel the Agreement free of charge within the above term of 2 (two) months. If the Customer fails to cancel the Agreement within the above term, it shall be considered that the Customer has accepted the amendments.
   3. The Customer shall have the right to cancel the Agreement at any time.
   4. With withdrawal of the Customer's Order specified in clause 4.2 of the Agreement by the Customer, the Agreement is deemed terminated.
   5. The Bank shall have the right to terminate the Agreement by giving the Customer an advance notice of at least 2 (two) months.
   6. In addition to the stipulations of the General Conditions, Payment Services Agreement or other bases provided by legislation, the Bank shall have the right to extraordinarily cancel the Agreement without any advance notification, if the Customer fails to conform to the conditions specified in clause 3.1 of the Conditions.

7. Consequences of expiry of the agreement

   1. Expiry or termination of the Agreement does not influence debiting of the Business Income Tax that was reserved on the Entrepreneur Account under the Customer's Order before expiry or termination of the Agreement.
   2. Business Income Tax is not calculated on the amounts received in the Entrepreneur Account after expiry or termination of the Agreement.
   3. All agreements related to the Entrepreneur Account shall be deemed ended and the obligations arising from these agreements deemed immediately due as at the tenth (10) day of the next calendar month following the expiry or termination of the Agreement.
   4. A closed Entrepreneur Account cannot be reopened.