Estonia passes law allowing to transfer funds from frozen russian assets to Ukraine

The Estonian parliament has passed a law that allows the use of frozen russian assets to compensate Ukraine for damages caused by the war.

The Government-initiated Law “On Amendments to the Law on International Sanctions and Other Related Laws” creates a domestic mechanism in Estonia that will ensure the property liability of the aggressor state for the damage it has caused by violating international law. The amendment allows for the use of assets of individuals and companies that have contributed to russia's illegal actions frozen by sanctions. This will be a payment for the damages that russia owes to Ukraine.

According to Hendrik Johannes Terrace, chairman of the constitutional committee, it is difficult to develop legal regulations to use frozen assets. Several allied countries and international organizations are working on this, and Estonia should play a pioneering role here.

“russia is an aggressor state, and compensation for the damage it has caused cannot be imposed on Ukraine and its allies. russia is responsible for the damage it has caused, and it must bear this responsibility,” Terras added.

In order to initiate proceedings in Estonia regarding the use of property, Ukraine must submit a request. In addition, there must be sufficient evidence of the property owner's connection to the illegal act.

The Estonian Ministry of Foreign Affairs must clarify all the circumstances and ownership of the property, as well as establish the absence of exceptional circumstances that would outweigh the interests of the person concerned. The owner of the property has the right, in accordance with the law, to appeal against the decision to use the property in an administrative court.

It is important to note that before the second reading of the draft law, the Constitutional Commission made seven amendments to it. In particular, the Ministry of Foreign Affairs of Estonia will now authorize the use of frozen funds not by an administrative court, as was envisaged in the original version of the draft law.

Source: website of the Estonian Parliament, ERR, text of the law