Harju County Court started the proceedings on the claim filed by ESTEVE AS against Tallinna Sadam

Harju County Court stared the proceedings on the claim filed by ESTEVE AS (hereinafter: „ESTEVE“) in 19.12.2019 against AS Tallinna Sadam (hereinafter: „Tallinna Sadam“) applying for compensation of the loss of revenue due to the alleged unjustified early termination of the Old City Harbour and Paldiski South Harbour mooring services contracts in the amount of EUR 379,768 plus accrued interest. In addition, ESTEVE has requested the suspension of the proceedings until the final resolution of the dispute regarding the validity of the mooring service contracts described below.

ESTEVE has been providing mooring services at Paldiski South Harbour since 30.05.2008 and at the Old City Harbour since 23.02.2009. On 08.06.2016, Tallinna Sadam submitted notifications for extraordinary early termination of both contracts as of 31.12.2016 on the grounds that the former management board members of Tallinna Sadam did not follow the procurement procedure stated by the Public Procurement Act and thus the terms of the contracts may not correspond to market conditions. In June 2016, a new public procurement was announced to find a mooring service provider for both harbours, which was won by ESTEVE and with whom new contracts were signed for the provision of mooring services in the Old City Harbour and Paldiski South Harbour at a lower price than previous contracts.

ESTEVE filed a claim with the Harju County Court on 26.08.2016 seeking to establish the validity of the Paldiski South Harbour mooring service contract and 29.08.2016 a claim for the validity of the of the Old City Harbour mooring service contract, as WCE did not accept the extraordinary early termination of the contracts by Tallinna Sadam. On 15.01.2020, The Tallinn District Court issued a judgment dismissing the action brought by ESTEVE against Tallinna Sadam in a claim for a declaration of the validity of the Old City Harbour mooring Services Agreement and ordering ESTEVE to pay the costs of court proceedings. ESTEVE may appeal this decision under cassation proceeding. The proceedings on the claim regarding the validity of the Paldiski South Harbour mooring services contract are still ongoing in Harju County Court.

The compensation claim of ESTEVE does not affect the financial results of Tallinna Sadam, as it the company has formed a reserve since 2017 to cover the amount of the claim and accrued interest.

Tallinna Sadam is one of the largest cargo- and passenger port complexes in the Baltic Sea region, which in 2019 serviced 10.64 million passengers and 19.9 million tons of cargo. In addition to passenger and freight services, Tallinna Sadam group also operates in shipping business via its subsidiaries – OÜ TS Laevad provides ferry services between the Estonian mainland and the largest islands, and OÜ TS Shipping charters its multifunctional vessel Botnica for icebreaking and construction services in Estonia and offshore projects abroad. Tallinna Sadam group is also a shareholder of an associate AS Green Marine, which provides waste management services. Tallinna Sadam group's sales in 2018 totalled EUR 130.6 million, adjusted EBITDA EUR 74.4 million and net profit EUR 24.4 million.

Additional information:

Marju Zirel

Head of Investor Relations

AS Tallinna Sadam