Duties and Liability of the Members of the Supervisory Board of Limited Companies in Estonia: The First Cases from the Supreme Court of Estonia

  • Andres Vutt
  • Margit Vutt
Keywords: director liability, supervisory board, one- and two-tier systems, Estonian Commercial Code, German Stock Corporation Act, company law, corporate law, corporate governance


Similarly to German law, Estonian company law provides two-tier management for all public limited companies. Legal regulation of the liability of members of the management board and supervisory board is the same, and therefore the question arises of whether there is any difference in liability between members of different boards. The Estonian Supreme Court recently made two decisions regarding the liability of members of the supervisory board. The main research question of the article is ‘what is the scope of the duties of the supervisory board in comparison to the duties of the management board, and how does the difference in duties affect the liability?’ As the main task of the supervisory board is to exercise supervision, the question is what the actual standard of supervision is. The main conclusions in the article are that the Supreme Court of Estonia has not given an answer to the question about the standard for the liability of members of the supervisory board and leaves open many other important questions about boundaries of their duties.