The 22-page memo, sent to the Riigikogu's European Affairs Committee, and its accompanying cover letter (the latter dated Sept. 6) notes that it in Estonia's interest that Brexit take place with a minimal impact on the functioning of the EU, in particular guaranteeing the rights and status of citizens and businesses as far as is possible.

Estonia's desire is also to retain close U.K.-EU relations and information exchange, particularly in the areas of the economy, foreign policy, and defense and security.

As many as 1,500 UK citizens reside in Estonia

There are around 1,300-1,500 U.K. citizens resident in Estonia, according to the memo. As at Sept. 1 2019, 1,408 U.K. citizens had valid Estonian ID cards. This compares with 15,000-20,000 Estonian citizens resident in the U.K., whose rights and situation are examined at length in the document.

Following the passing of a law in February 2019 ahead of the original Brexit date in March, the right of residence for U.K. citizens living in Estonia will be governed by the Aliens Act instead of the current Citizen of the European Union Act. This will convert the right of residence is converted into a temporary residence permit, and the right of permanent residence (which EU citizens automatically obtain after five years resident in Estonia) to be superseded by a long-term residence permit. This will be subject to a transition period.

Those U.K. citizens arriving after Brexit will be reckoned as third country citizens, though exempt from the annual immigration quota (set by Estonia at a little over 1,300 people per annum) as is the case for U.S. and Japanese citizens.

A U.K. citizen will be able to stay in Estonia up to three months without a residence permit, after which they must hold a residence permit, which as a general rule must be guaranteed by the individual's employer.

The move roughly mirrors the U.K. government's own requirement that EU citizens wishing to remain in Britain and Northern Ireland after Brexit must apply for a right of residence.

The European Health Insurance Card will also cease to be valid both for EU citizens in the U.K. and vice versa, the memo said, adding that current U.K. pensioners living in Estonia (which the memo said amounted to 29 people) should have health insurance provision assured by the ministry of Social Affairs.

So far as travel within the Schengen Zone goes, U.K. citizens will need to take their passport with them, for instance when traveling from Estonia to Finland or Latvia (recommended in any case) from Jan. 1 2021.

Third-country duty free regulations will also apply after the U.K.'s withdrawal.

As reported on ERR News, U.K. citizens resident in Estonia who drive will have a year to exchange their driving license for an Estonian one, without needing to take a test, should a no-deal Brexit take place.

Economic effects on Estonia

According to the memo, a U.K. departure from the EU will lead to a 0.38 percent drop in the union's GDP, rising to 1.54 percent in the event of a no-deal Brexit.

The cost to Estonia's economy would be 690 jobs (with a contract) and 2,710 jobs (contract-less) and the country will lose revenue in the range of €51-193 million.

The memo also notes the likely increase in MEP seats in Estonia, from six to seven, following the redistribution of over 20 of the U.K.'s 74 seats, a move originally slated to happen ahead of the May European elections.

At the time of writing, the status of Brexit and the deadline of Oct. 31 is far from clear following successive defeats for U.K. Prime Minister Boris Johnson (Conservative) in votes at the House of Commons, which attempted by turns to prorogue parliament, to allow a no-deal going to go ahead, and to hold a general election as a mandate on the matter.

Whether a ratified deal between the U.K. and the EU will take place by this date or an extension to the deadline will be found is not clear either.

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