Court declares politician Tõnis Palts bankrupt

Harju County Court declared entrepreneur and politician Tõnis Palts bankrupt on Friday, ERR reported. The court granted an insolvency application filed by Varalaen AS, appointed Andrias Palmits as bankruptcy trustee and scheduled the first general meeting of creditors for October 5.

Creditors must notify the trustee of their claims within two months. Claims submitted after the deadline may still be accepted, but they will be satisfied last.

Eesti Ekspress reported this week that Palts owes about 135,000 euros, including late-payment interest, to Varalaen, which is owned by Koit Uus. The loan repayment deadline passed in November last year.

Varalaen told the publication that the transaction had resulted in a loss for the company and that examining it outside court proceedings was neither the company’s practice nor its aim.

Palts wrote on social media that after leaving his position as Tallinn mayor, he chose to invest in the Ukrainian market, which was considered highly promising at the time. He said the first setback came with the global financial crisis in 2009, followed by a more serious change in 2014, when Russia annexed the Crimean Peninsula, where his developments were also located.

Palts said his Ukrainian businesses suffered their final blow in 2022, when Russia launched its full-scale war. As another way to meet his obligations, he returned to the telecommunications sector, which he knew well, but said he was also unable to save Levikom.

Palts said he had reached agreements with some creditors, but Varalaen did not join the arrangement. The bankruptcy order can be appealed within 15 days.