Estonia’s Defence Minister Hanno Pevkur resigned on September 2, taking political responsibility for a €70 million arms deal, worth roughly $81 million, that fell apart after the government advanced funds to a company with no history of making artillery shells for Ukraine.
Estonia’s Centre for Defence Investments signed four contracts with Datasel S.R.L. in all, starting in August 2024 with a €15 million advance, followed by a second contract and a €10 million payment that October. The Indian firm Neco Defence Munitions owns Datasel, an Italian-registered company that, like its parent, had never made an artillery shell.
Estonia drew the advances from the EU’s European Peace Facility, funded partly by profits from frozen Russian assets and direct contributions from member states.
Sponsored · Cambria Gold Mines
The first shipment was due in Ukraine that November. It never arrived, and Datasel cited repeated delays. Some ammunition eventually did turn up, Pevkur later said, just not in usable form. “The product supplied by the manufacturer is not of sufficient quality,” he told Estonian television, adding that tens of millions of euros’ worth now sits in a warehouse in Europe.
The dispute dragged on through warnings and financial penalties before Estonia pulled the plug on the contracts in November 2025, and the case has since gone to the European Court of Arbitration in Strasbourg. Datasel disputes that account entirely — its lawyer says the shipment was checked and cleared under the contract’s terms, with no defects found.
The resignation followed an August 28 audit report criticizing Estonia’s defense procurement. Pevkur conceded he’d never gone through the contracts line by line himself, arguing that kind of granular review isn’t normally a minister’s job. “The defence minister does not count socks and ammunition,” he said.
