Estonia, Investments, Tourism, Transport

The secret documents have come out in September, revealing that Leedo had built his monopolistic business on the state money. Estonia paid for vessels long ago, but they're still in private hands. In 2006 the state with Edgar Savisaar, the Minister of Economy, signed a ten-year contract with Leedo, giving him the right to be the only ferry operator.

Tonis Rihvk, the CEO of Leedo's Saaremaa Laevakompanii donated the Centre Party 500,000 kroons before the Parliament elections in 2007.

"The biggest minus of the tender was that there was no real competition," Mario Lambing, the expert of economic analyses division at the Ministry of Economic Affairs and Communications of Estonia, said.

At the tender a company had to offer the price with which they were willing to offer the service. The company had to assess its annual fixed costs and how much a trip will cost. Lambing said they paid for the trips which have actually taken place and a company files a report on trips, passengers, vehicles, incomes and expenses each month.

"Cost of ferry service was also under question during negotiations. The price was notably higher from previous one and it was difficult to base that on changed expenses. In the end the carrier agreed to lower the price, but total cost of service increased despite that," Lambing said.

Leedo have not commented on the documents.

Leedo got eight ferries from state company Saarte Liinid for four million kroons back in 1997.

The state had a condition that Leedo must invest to new ferries in time. Finally, Estonia paid for the new ships as well. PricewaterhouseCoopers, an auditing company, which controlled donations given to Saaremaa Laevakompanii, said in 2000 that the state has paid company's capital rent in form of paying for amortization costs.

In 1998-2003, the state paid 135 million kroons to Leedo for the ferries' amortization and rent costs. Leedo paid 63.2 million kroons for three ferries – Regula, Ofelia and Scania.

The cost the ten ferries Saaremaa Laevakompanii, owned in 2004, was 283 million kroons, while the state had paid 500 million kroons as donations to the company.

In 2005 Leedo sold four ships to Arco Vara, Estonia's developer's, owners Richard Tomingas and Hillar-Peeter Luitsalu's company Euro Shipping sister companies for 350 million kroons.