Estonia's parliament passed a bill on May 15 enabling the usage of frozen Russian assets to pay reparations for war damage in Ukraine.
Kyiv and its Western partners have long been discussing possible methods of using around $300 billion in Russian assets immobilized in Western accounts to fund Ukraine.
The Estonian government estimated in October 2023 that it held about 38 million euros ($41.3 million) of frozen Russian assets.
"We're one step closer to setting a historic precedent in Europe," said Prime Minister Kaja Kallas.
"Our parliament passed the first law in Europe to allow the use of Russia's frozen assets to compensate for war damages."
The bill must still be signed into law by Estonian President Alar Karis.
"Russia is an aggressor state, and the burden of compensating the war damage caused by it cannot be left to Ukraine and its allies," said Estonian lawmaker Hendrik Johannes Terras.
"Russia is responsible for causing the damages and must bear that responsibility," he continued.
The legislation has been discussed and refined for the last six months, including with outside help from experts.