EditEstonian defence minister resigns over failed €70 million shell deal
The Italian supplier had no established record of producing or delivering artillery shells – it is described as a shell company
Estonian Defence Minister Hanno Pevkur announced his resignation on 2 September 2026 after a National Audit Office report and a criminal investigation exposed serious problems in a munitions procurement intended for Ukraine.
The Estonian Centre for Defence Investments paid roughly €70 million in advance to Datasel S.R.L., an Italian-registered company acquired by the Indian firm Neco Defence Munitions. The supplier had no established record of producing or delivering artillery shells, and was described on social media as a shell company. Deliveries that later arrived were judged incomplete or of insufficient quality; usable ammunition did not reach Ukrainian forces as planned. Estonia is now pursuing recovery through the courts and international arbitration.
Pevkur, who has held the post since 2022, said he accepted political responsibility for shortcomings in the defence sector even though he maintained he was not personally involved in contract negotiations. He will remain in office until a successor is appointed, expected after parliament reconvenes on 14 September.
The episode forms part of broader criticism of financial controls and high-risk procurement practices in Estonia’s defence agencies. Some of the funding came from EU mechanisms and frozen Russian assets allocated for Ukraine aid.
Caption: Estonian Minister of Defence Hanno Pevkur attends the annual Nordic-Baltic summit ‘Unleashed’ in Stockholm, Sweden, 20 August 2026. EPA/ANDERS WIKLUND
Updated: September 3, 2026 - 11:46
