The price ceiling would apply from October 2026, when the new operational period for ferry connections between the mainland and major islands starts up.

TS Laevad is a subsidiary of the Port of Tallinn (Tallinna Sadam), which is 70 percent state-owned.

The remaining 30 percent of stock is listed on the Tallinn Stock Exchange.

TS Laevad took in €14.7 million in ticket revenues last year, while it received €20.6 million in state subsidies in 2023.

The copany earned an additional €1.3 million in other revenues, totaling €36.7 million in sales revenues.

TS Laevad's 2023 profits came to €7.8 million.

This seemingly substantial profit has raised concerns among several figures connected to Saaremaa, who believe it is excessive.

Now, at a time when TS Laevad is from October 2026 set to start a new seven-year contract, the Ministry of Regional Affairs and Agriculture plans to introduce a profit cap.

Minister of Regional Affairs and Agriculture Piret Hartman (SDE) said: "The contract has been amended to include a formula for calculating reasonable business profits and for specifying that the return on capital invested by the carrier cannot exceed 8 percent."

"It is important to note that this 8 percent refers not to profit margins, but to what is considered a reasonable profit based on the capital invested by the carrier," the minister went on.

At the end of the past year, TS Laevad held assets coming to €100.9 million in total.

A maximum reasonable profit of 8 percent on this sum would slightly exceed the profit actually earned.

If profit were to calculated solely based on fixed assets, which amounted to €90.6 million, the maximum profit would instead be €7.2 million, compared with the reported €7.8 million for 2023.

According to Minister Hartman, the ministry is to start to monitor the reasonable profits on an annual basis. "If the carrier's profit exceeds 8 percent, adjustments will be made and the subsidy coming from the state budget to the carrier will be reduced accordingly," Hartman noted.

The minister said it is still too early to predict how the state subsidy to TS Laevad might change under the new contract in force form October 2026.

This is partly because, in addition to the vessels currently owned by TS Laevad, the company is also due to operate a new environmentally friendly ferry, both to be owned and constructed by the state.

Hartman added that no changes to the service conditions for passengers under the new contract are pending.

Additionally, any potential changes to ticket prices do not directly relate to the public service contract, she said.

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