1. Which system applies today
Until 31 August 2026 a three tier system applies, and each tier brings its own procedural rules, deadlines and obligations. From September two tiers remain.
| Tier | Value for construction works | Where it comes from |
|---|---|---|
| Simplified threshold | €60,000 | domestic decision |
| Public procurement threshold | €150,000 | domestic decision |
| International threshold | €5,404,000 | European Union directives |
The system has been unchanged for years, and the ministry considers it to have fallen behind today's market conditions. The rise in construction prices has meanwhile made the same work nominally more expensive without its substance changing, so more and more ordinary work has drifted into a heavier procedure.
2. What changes in September
The Riigikogu adopted the amendments on 16 June 2026 and they take effect on 1 September. The binding text is the one adopted.
The Public Procurement Act will have two thresholds instead of three. The domestic public procurement threshold is abolished, €150,000 for construction works. The simplified threshold and the international threshold remain.
The public procurement threshold is replaced by a higher simplified threshold, €100,000 for construction works instead of €60,000. A simplified procedure may in future be run where the estimated value is below the international threshold, that is up to €5,404,000 for construction works.
| Tier | Until 31.08.2026 | From 01.09.2026 |
|---|---|---|
| Simplified threshold, construction works | €60,000 | €100,000 |
| Public procurement threshold, construction works | €150,000 | abolished |
| International threshold, construction works | €5,404,000 | €5,404,000, unchanged |
The practical result is that the band from €100,000 to €5,404,000, previously split between two procedures, is now one: the simplified procedure. Most construction procurements fall in that band.
3. Why the threshold is abolished
Three reasons are given in institutional sources. Simplification of the system. Two tiers are easier to administer than three, and the intermediate band, where a choice had to be made between two procedures, disappears.
Reduction of administrative burden, both in the public sector and for businesses.
Faster procedures, so that services and investment reach their destination sooner.
The Ministry of Finance considers the amendments to be aimed at the area where Estonia can shape its own rules, since the part above the international threshold derives from directives. At state level the change is therefore an exercise of domestic discretion rather than compliance with a European requirement, and this explains why the reform touches only one of the three tiers.
4. What it means in practice
Institutional estimates give the order of magnitude. The exact effect will emerge in practice.
| Indicator | Estimate |
|---|---|
| Scope of the change | roughly 49 % of all public procurements |
| Average duration of procurement procedures | from around 87 days to about 50 days |
These are estimates, not guarantees, and the real effect will emerge in practice. Close to half of all procurements is nevertheless a substantial share, and this is why the change is worth following even from the perspective of a smaller authority or tenderer: the probability that it affects a given procurement is roughly one in two.
5. What stays the same
Two things are unaffected by the change. The international threshold, which derives from European Union directives and is not shaped by Estonia. It changes on its own two year cycle, most recently on 1 January 2026.
The rules for procurements above the international threshold, which are set by the directives. They are untouched by the reform.
The change therefore concerns only procurements below the international threshold. The rules for large construction procurements do not change, because those usually exceed the international threshold. This is a reform of medium sized procurements.
In summary, and four practical rules
The three tier threshold system is replaced by a two tier one on 1 September 2026: the domestic public procurement threshold, €150,000 for construction works, is abolished, and the simplified threshold rises from €60,000 to €100,000. A simplified procedure may in future be run up to the international threshold, €5,404,000 for construction works.
Four rules follow. Check whether the procurement starts before or after 1 September 2026, because everything else depends on it. Stop using the term public procurement threshold from September, because it no longer exists and using the old term in a new document creates confusion. Check the international threshold separately, because it does not change in September but on a two year cycle. Bear in mind that the rules for large construction procurements do not change, even though those for medium sized ones change considerably.
This article serves professional orientation at the date of checking. It does not replace the Public Procurement Act or information published by the Ministry of Finance.