Tondi school decision | Law firm Matteus

⚖️ The Tallinn Circuit Court annulled the financial correction imposed on our client the City of Tallinn, finding that the requirement for a guarantee letter from a credit institution registered in Estonia in a construction procurement did not harm the EU budget. This was because participation of cross-border bidders was not excluded, and there was no genuine interest from such bidders. At the same time, the procurement ensured a significant level of competition. It is also important to note the court’s position that even if an infringement were established, the rate of the financial correction must be proportionate to the severity of the breach. In exercising its discretion, RTK must therefore assess on a case-by-case basis why a specific rate (e.g. 10% vs 5%) is applied.

⌛ This has been a long-running dispute, which has already once been reviewed by the Constitutional Review Chamber of the Supreme Court (read more on the Public Procurement Blog)

🏛️ Last autumn, the case reached the Supreme Court again for a decision on whether to grant leave to appeal, and on 17 March 2026, the Supreme Court decided not to admit the cassation appeal. This means that the Circuit Court judgment of 24 September 2025 (case no. 3-24-181) has entered into force (decision).

💡 It is very encouraging to see developments in financial correction disputes where courts, following the guidance of the Supreme Court, are clearly moving towards a more reasonable and balanced approach.

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