Estonia offers e-residency to allow non-citizens access to government services and business online

Updated

The Estonian government has become the first country in the world to offer e-residency to non-citizens.

Successful applicants will be issued a digital ID card with a computer-readable chip which, in combination with authentication PIN codes, will allow them to access a number of the country's e-services and conduct business online.

Kaspar Korjus, the project manager, said the move was initially to help foreign residents in Estonia, often described as "the most wired country in Europe", participate in the country's "digital society" - the suite of government services that are provided online, including e-health, e-school, e-tax and e-voting.

"And then we just decided, why not let's just open it up to all foreigners also so that they could be involved in Estonia more openly," Mr Korjus said.

E-residency does not grant citizenship rights or function as a travel document, but it will enable people to incorporate a company, set up bank accounts and access the EU market from a virtual online base in Estonia, using the government-backed digital ID.

Map: Estonia

Mr Korjus said he expected the offer would be most appealing to people in the tech industry.

"Especially technology-based businesses which don't have cash flow so much ... and entrepreneurs who actually can see that this is a platform where Estonia gives a face on the internet to everybody in the world who desires it," he told 7.30.

"This means that you can actually start building your own start-ups, your own services, and start authenticating people there, because you know and can trust them."

E-residency next step in creating 'digital identities'

Dr Clare Sullivan, a cyber law and digital identity expert from the University of South Australia, said the move had even broader implications.

Digital identity is probably the most significant legal and commercial and political concept we have in today's world – it's developing very rapidly. Dr Clare Sullivan

"It's a significant move in terms of the evolving notions of digital identity," Dr Sullivan told 7.30.

"Digital identity is probably the most significant legal and commercial and political concept we have in today's world – it's developing very rapidly."

"It's very appealing to a lot of people, and this is the first time that a government-backed e-credential will be available to anybody in the world.

"So, providing the Estonian government gets the security right and gets its identity verification right, it could very well be an inducement to other countries following suit and using the same architecture.

"It is designed to make Estonia synonymous with e-commerce and e-documentation, much like Switzerland was synonymous with banking."

But Dr Sullivan said suggestions the move will create an "e-tax haven" are unfounded, as e-residents will be liable for taxation in both Estonia and Australia.

"So a double taxation is a possibility and there is no double taxation treaty between Australia at Estonia at present," she said.

Mr Korjus said Estonia was viewing their move into e-residency as a "government start-up", and that they have been surprised by the level of interest.

About 10,000 people have applied from 140 countries so far, with projections for 10 million e-residents by 2025 - almost 10 times as many as the country's physical population of 1.3 million.

Currently, e-residency applicants must physically apply at the Estonian border, but the government plans to roll out the process to embassies and consulates around the world from next year.

Topics: internet-technology, science-and-technology, computers-and-technology, human-interest, estonia, australia

First posted