Estonia and Finland launch automated data exchange between population registers

In September 2020, cross-border interoperability between Estonia and Finland took another step further with the launch of automated data exchange between the countries’ national population registers. With the support of X-Road, the solution replaces the previous batch data processing and improves information accuracy and security.

Automating the exchange of population data is the third cross-border interoperability link in place between Estonia and Finland, after connecting the countries’ business registers and tax boards in 2019.

Together with Timo Salovaara, Deputy Director General at the Finnish Digital Agency (DVV), we outline the main features of the cooperation and solution at hand.

BACKGROUND AND INSTITUTIONAL FRAMEWORK

The exchange of population data between Finland and Estonia dates back to the signing of a collaboration agreement between the countries’ population register authorities in 2005. The document provided a framework for the exchange of details of citizens living in the other country, when and where necessary. Relevant subjects cover the following:

1)    Deaths

2)    Name changes

3)    Changes of address

4)    Information on their dependent children.

The collaboration created a framework that has enabled batch-based data exchange between Finland and Estonia for almost 15 years, with data being requested and provided on average once a year.

The increasing digitalization of the Finnish population register, and the national data exchange layer, have now led to a partial institutional overlap. Automating the existing collaboration seemed, logically, the next step. “The DVV is the owner of the population register in Finland and, since 2014, we also own the national X-Road infrastructure – the Suomi.fi Data Exchange Layer,” Salovaara explains. “So, with the existing data exchange framework that we have in place with Estonia, these two things meet here,” he observes. 

The technical foundation for cross-border interoperability between Estonia and Finland was established in 2018 with the federation of the two countries’ national X-Road. While connecting the national ecosystems paved the way for an array of technical possibilities, their development and implementation have been dependent on resolving legal intricacies. “Despite this, we decided to use X-Road to update the information exchange system from 2005, as we already had the legal framework in place,” Salovaara states. 

NEEDS AND CHALLENGES

Data exchange automation responds to the need for greater data accuracy and a decreased manual workload – all while maintaining and improving underlying security. 

“Previously, we had a facility that allowed uploading a file into a system, which could be accessed by the Estonian Ministry of Interior,” Salovaara says about the process in place since 2005. “Our Estonian colleagues could log into the service, access the file prepared by us and then update their records in the population register based on that. While all of this was secure and audited, it was not as practical and required a lot of effort. 

The new automated solution secures the data exchange, ensuring improved maintenance of the entire system at the same time. 

“For example, we have a similar arrangement with the Nordic countries concerning population data exchange,” Salovaara brings forth. “But we are using legacy systems from the beginning of the century. When updating information security protocols, we need to wait until the last country is ready to make the updates before completing the process,” he continues. With a standardized interoperability solution, such as X-Road, the system updates are conducted faster and more securely. 

Besides the legal boundaries set by the original collaboration agreement from 2005, the technical implementation of the solution did not see any significant challenges. “We can say that technology is no longer the barrier, especially in this case where both parties already had experience with X-Road infrastructure,” Salovaara observes. “This means we can focus more on the substance and needs of the specific use case, as well as the legal details surrounding new types of data exchange,” he says. 

THE SOLUTION

X-Road has now automated the data transfer between the population registers of Estonia and Finland, improving information accuracy and timeliness as well as increasing the efficiency and security of the data exchange process.

The solution breathes new life into this long-standing collaboration. Population authorities can now easily access up-to-date information on their citizens whenever necessary; e.g. when preparing for national elections. While the legal framework established by the 2005 agreement currently limits the type of information that can be mutually accessed, the solution is a significant stepping stone to expanding the scope of data exchange in the future. 

Further negotiations are ongoing between Estonia and Finland, but a similar technical solution between population registers also has significant potential beyond the Baltic Sea region. With the free movement of people in Europe, there would, for example, be a need to standardize data exchange between EU member states. 

“Currently, if someone moves to Finland, we verify their identity by using their passport and verify their family relations with legalized paper certificates given by the authorities of their country of origin,” Salovaara explains, bringing up a typical case. “But requesting and providing these documents takes time – from both the public authorities and the citizens – and at least theoretically, the risk of forged paper documents remains. To have the most accurate data at all times, this information could be requested directly from other countries’ population registers. If these kinds of arrangements can be made, facilities like the X-Road would be very useful in the technical implementation of the data exchange!”

Automating data transfer between the population registers of Estonia and Finland serves as another example of how X-Road can simplify and enhance international collaboration, for both citizens and the state. 

The business registers of Estonia and Finland start cross-border interoperability

The end of February 2019 brought great news for the enhancement of interoperability across borders. National business registers in Estonia and Finland are starting to exchange data between each other taking advantage of the opportunities given by X-Road, as the gateway to higher information accuracy and efficiency in handling queries.

Both parties involved have officially put their signatures on the agreement. Now, we take you through the main features of the cooperation on this project with Antti Riivari, Director General of the Finnish Patent and Registration Office (PRH), and Ingmar Vali, Head of Court Registration Department at the Estonian Ministry of Justice.

Background and institutional framework

The process that led to the signing of the agreement followed two parallel lines, not always moving towards the same goal at the same speed – there is a political side, and there is a technical side. Contrarily to what we could believe to be the issue in countries with a longer legacyon their shoulders, the technical aspects of the cooperation between the two business registers seemed to be cleared out by the end of 2017 already. However, in order to lay out and understand specifically what kind of data is going to be exchanged, and who has access to that information, there is the need for a specific agreement.

The final document with such information has been officially signed in February 2019, but it falls into place in the general institutional framework on digital cross-border cooperation between Estonia and Finland. Back in 2016, the Estonian and the Finnish Prime Ministers signed the joint declaration establishing the main lines of development to pursue for an international ecosystem in information exchange. Shortly afterwards, it became clear how the countries’ business registers could be among the first departments in the public sector to enjoy the advantages given by the implementation of X-Road.

Two things turned out to be necessary for this cooperation to come to life – refining the nation-wide implementation of X-Road in Finland and the compatibility with the Estonian system, as well as a specific definition of the people and the type of data that were to be involved in the information exchange. Though the cooperation on making the two systems match started right after the needs had been identified, it was only in 2018 that Estonia and Finland initially discussed the institutional draft agreement. Now in its official version, the document gives the green light to a few last operational tests and the practical beginning of the data exchange.

Needs and challenges

Antti Riivari (PRH) says it with a metaphor: “You need the road to drive on, and then you can have very different types of cars going to different places, but first you need the road.” X-Road in Finland was intended to provide a platform for all its departments and databases to communicate and cooperate. Then, after this initial phase, government agencies could actually proceed with more advanced practices of data exchange.

Despite not involving huge traffic of data and connections (for now), the Estonian and Finnish business registers identified a set of needs related to three main dimensions – quality of the data, efficiency, cost-effectiveness.

The topic of data accuracy is strictly connected to the long-lasting need for more security. “Let’s say that there is a company coming to Estonia to start a sub-unit or a branch here. If the mother company has some problems related to bankruptcy, or court cases, or annual reports, the business register in Estonia needs to know what is going on”, is the fitting example presented by Ingmar Vali (Ministry of Justice). Thus, enhancing the registers’ capability to gather the information they need results in a higher confidence in the data itself and less bureaucracy for both public and private actors, making checks and approvals more precise and quicker.

“But despite the general absence of problematic issues, an obstacle has been represented by fees”, Vali explains. While information can be accessed free of chargein the Estonian case, most business registers from other European countries require payments to access specific data. With the Finnish business register making no exception in this sense, this element accounted for the main talking point in the definition of the cooperation.

The solution

X-Road is now allowing the business register of Estonia and Finland to exchange queries directly, increasing the efficiency of the communications and improving the accuracy of the data. 

The recently signed agreement also generates more advantages for both the agencies and entrepreneurs – in the first place by cutting the costs of submitting requests, and in the second by eliminating the unnecessary paperwork that would have been required in country-to-country transactions. “It’s a need-driven process, we’re making sure that everything works as it should, and then we’ll explore future possibilities step by step. We now want to define and connect the authorities that would be most keen on accessing information on Estonian companies”, Riivari says.

Basic company details aside, the improved quality of the data and information security brings data exchange to the next level. “After reaching the full-scale implementation phase, borders and paper movement will basically stop, which is our goal because it makes everything more efficient and less costly. Imagine if these principles would take over across Europe! Estonia and Finland, in this sense, are doing well in setting an example for this idea”, Vali states.

By having X-Road as a national data exchange layer solution in Finland and Estonia, plugging in units and departments of the public administration to an X-Road trust federation between two countries comes easier. The case of the two business registers is another sign of how technology can favour international cooperation, and make routine work smoother and more efficient for both users and service providers.

Estonia and Finland heading towards real-time data exchange on taxation

The Estonian Tax and Customs Board (EMTA) and the Finnish Tax Administration (VERO) are moving towards a cooperation that would allow the agencies to exchange data in a more accurate and efficient way. And speaking of ways, what could serve the purpose better than the reliable and well-tested infrastructure of X-Road?

With the project currently on hold, but at a stage where preliminary talks and declarations of intention have already been explored, Anna Aleksejeva (EMTA) and Ann-Sofi Johansson (VERO) tell us about needs and benefits that this project will be dealing with.

Background and institutional framework

The northern and the southern shores of the Gulf of Finland celebrated the 100thanniversary of their independence respectively in 2017 and 2018. However, by that time, Estonia and Finland had already reached a crucial agreement enhancing the long-standing cooperation between the two countries: at the coming of age of the two Republics, Prime Ministers of both sides had signed a joint declaration in 2016 enhancing cross-border data exchange and the development of digital services in different fields. Tax records and fiscal matters, naturally, were included in the declaration as well.

The tax boards of Estonia and Finland have started a project aimed at fostering the exchange of information via X-Road, as the platform provides the best solution for the countries to share data in a secured, stable, and efficient digital environment. Legal obstacles have not presented concerns, and a draft agreement awaits to receive the final signatures; however, the current project, started in December 2016 and temporarily put aside exactly one year later, encountered a few bumps on technicalities regarding the databases that were to be connected. Currently on hold, both parties remain strongly interested in the project and work towards solving the last issues that can make this cooperation start in practice as well. 

The interest manifested by Estonia and Finland does not represent a novelty in this sense, not even for what concerns tax-related data exchange. The forefather of the current project could be identified in the BSR TaxI plan from 2014 and 2015, aimed at gathering tax authorities and state information agencies from Estonia, Sweden, and Latvia, and explore the possibilities for cross-border cooperation “on the electronic exchange of tax information in the Baltic Sea Region”. Though Finnish tax authorities did not take part to that project, both Estonia and Finland took the chance to openly express interest in starting bilateral agreements that would make such kind of cooperation come to life. As it then turned out, tax-related topics became part of the broader, more comprehensive agreement that the two countries reached in order to establish a smart process of information exchange.

Needs and challenges

Due to the current status of the project, it’s not easy to provide numbers on how many people and companies would be positively affected by this project. The needs to be tackled, instead, are clear and shared between the tax authorities of the two countries. “It is difficult to summarise and process the number of requests we receive”, explains Aleksejeva, Chief Expert at the International Information Exchange unit of EMTA, “as these often include information from foreign databases and additional documents that need to be analysed by an employee”. It is primarily a matter of human resources, since “human labour is frequently involved and now it can take from 1 up to 20 months to get the information we need”, Aleksejeva explains.

Ann-Sofi Johansson, Manager at the International Information Exchange department of VERO, gives us an idea of the pipeline involved in the process of requesting information. We are currently presented with a situation where employees need to overlook the process of auditing and requesting information from foreign authorities from the beginning to the end. “Saving resources is important, for example in the case of an audit: right now, if we need information from Estonia, first we have someone defining what kind of information is needed; then someone sends the request; then there’s another person on the other side receiving and processing the request, and so on and so on”, Johansson says.

Connecting agencies and databases, once that issues of compatibility and readability of the data are overcome, will allow the two Tax Boards to save human and economic resources, and to increase the accuracy of the data exchanged.

The solution

The reliability and scalability of X-Road has been put to test in different contexts and situations already. The reasons that make its implementation so appealing in this case are connected to what made it the backbone of e-Estonia, serving the needs of a whole country since 2001: efficiency, accuracy, security.

The path Estonia and Finland already decided to take, first with the Prime Ministers’ declaration, and then with the start of different projects aimed at enforcing such cooperation, implies the use of X-Road in its adaptability to diverse situations. As both the Estonian and the Finnish Tax Boards have recognized, the current project will bring significant advantages to the two agencies in dealing with income declarations, VAT information, and international audits.

“What we need to have is real-time information right from the start,” Johansson states, “as the world keeps moving faster, and it is important for us to dispose of correct information, at the right time, to formulate correct data on taxation”. The benefits do not affect only the quality of the information exchanged, but also the general workflow managed by the two agencies. “X-Road would be the perfect solution to avoid unnecessary manual analysis of data and to automate the information exchange between databases for simple requests,” Aleksejeva highlights.

The Estonian Tax and Customs Board and the Finnish Tax Administration remain interested in the project, and are currently working on the issues of compatibility and readiness to make the cooperation effectively see the light.