Augustinas Žemaitis

E-mail: augustinas.zemaitis@gmail.com

Aug 122016
 

Even though you never had a Lithuanian nationality (citizenship) you may “restore” it if at least a single parent, grandparent or great-grandparent had it. In this case, the usual requirements for naturalization (10 years residence in Lithuania, speaking good Lithuanian) will not be applicable.

To restore nationality one has to provide documents proving that his/her forefathers had a Lithuanian nationality and that he/she is their descendant. The forefathers‘ nationality could be proved with a passport, army service documents, state service documents, personal certificate. If there are no such documents you may provide other ones (e.g. ones proving a place of residence). There are possibilities to look for historical and genealogical data in Lithuanian State Archive.

Simplified nationality for Lithuanian diaspora

Even if your forefathers never were Lithuanian nationals or you may not prove it you may still have a route to simplified Lithuanian nationality if you are a Lithuanian. This system works for ethnic Lithuanians from the historical Lithuanian communities that were left outside modern-day Lithuania as well as descendants of pre-1918 migrants (i.e. those who emigrated before modern Lithuania was established). In order to become Lithuanian national this simplified way, it is also not necessary to live in Lithuania.

Right to nationality certificates

If you seek to acquire Lithuanian nationality later (because, for example, you are not yet willing to denounce your current nationality) you may now apply for a Right to Nationality Certificate. The certificate is issued to members of Lithuanian diaspora after they prove their right to Lithuanian nationality as specified above. When you‘ll finally decide to become a Lithuanian national you will not need to prove it all again. “Right to Nationality” also gives you a right to easily get a residence permit in Lithuania (despite not being a Lithuanian national).

Technically there are two types of these certificates (one for proving a right to restore nationality and one for certifying Lithuanian descent), but they are nearly identical in their meaning.

Dual nationality in Lithuania

According to a controversial decision by the Constitutional Court of Lithuania dual nationality is only permitted in Lithuania in rare circumstances. Under the 2016 Law on Nationality such “rare circumstances” have been greatly expanded however: they include all the Lithuanian citizens who were expelled from Lithuania or left the country before 1990 03 11 and their descendants (up to great-grandchildren), except for those who left willingly to Soviet Union. If you are not among those eligible for dual citizenship then you‘ll have to renounce your current nationality after gaining Lithuanian one.

History of the Nationality Law shows that these norms have been changed especially frequently (e.g. before 2006 Constitutional Court decision special circumstances for dual nationality encompassed everybody who did not repatriate). In the future, the right to dual nationality may thus be further limited. Dual nationality (under normal circumstances) is prohibited by the 1st part of the Constitution which means this could be changed by referendum alone and the Referendum procedure in Lithuania is one of the toughest among democratic countries, largely rendering the referendums on constitutional change impossible to succeed (even if the majority would support wider application of dual nationality). Therefore if one could get a dual nationality under a current law perhaps he/she should hasten to seek it.

Dual nationality is controversial in Lithuania for a couple of reasons. On the one hand, Lithuania seeks to foster a connection with a million-strong Lithuanian diaspora to prevent their complete assimilation and have them as a support for the “dying out and emigrating” Lithuania. On the other hand, there is a fear of a situation such as happened in 2008 Georgia where Russia issued its own nationality to thousands of people from local ethnic minorities and then, due to disagreements with Georgian policy, invaded the country justifying it by the “protection of Russian nationals”.

We help restore the Lithuanian nationality

We help you collect the necessary documents, we search the Lithuanian archives, we draft the Lithuanian nationality application, we keep contact with Lithuanian institutions and more. We take away the hard work associated with getting a Lithuanian citizenship.

Moreover, we also help with acquiring residency permits in Lithuania and the right-to-nationality certificates. Contact us at augustinas.zemaitis@gmail.com .

Read our clients’ comments:

  • Citizenship Restoration Opinion (Hebrew)
Aug 192014
 

Lithuania has a Roman legal system based on laws. Legal precedents are subordinate to laws but also recognized. Laws are drafted and adopted by the Parliament. Other institutions (including municipalities) may adopt bylaws which could not contradict the laws.

Laws of Lithuania

Nearly every law and bylaw in Lithuania has been adopted post-1990 as the country completely reversed its course after dropping the Soviet shackles. Much of the legal system has been modeled on various long-standing laws of Western European countries as the pre-occupation (1940) Lithuanian laws were deemed too dated to reinstate.

The Constitution has been adopted by referendum in 1992.

There is no single Lithuanian Code in a way there is a US Code. Instead there are multiple codes for different spheres of law, the most important of them are: Civil Code (includes commercial law), Criminal Code, Civil Procedure Code, Criminal Procedure Code, Administrative Penalties Code and the Labour Code.

There are also many shorter laws that govern particular areas which are not covered by the Codes. For example, in the intellectual property sphere, there are separate laws for patents, trademarks, copyright/related rights, plant breeds, topographies, and designs.

Sometimes the same issues are governed by several laws in which case the least abstract one typically holds precedence.

After Lithuania joined European Union (2004) it has to adopt certain European Union-wide measures. These are set in the EU treaties (which are applicable directly), EU directives (which must be incorporated into Lithuanian laws to become fully applicable) and EU regulations (applicable directly). If the EU measures conflict with Lithuanian laws typically the EU measures apply.

Lithuanian judicial system

In Lithuania, there are two systems of courts.

Criminal and civil cases are heard by the Common courts of which there are three instances. 49 district (apylinkės) courts are the first instance for minor cases. The district court decisions may be appealed to five county (apygardos) courts which also serve as the courts of the first instance for major cases. These major cases may then be appealed to the single Appellate Court (Apeliacinis teismas). And finally, there is the Supreme Court (Aukščiausiasis teismas) which is the third (cassation) instance for all cases.

The second court system is that of Administrative courts (administracinis teismas) which solve disputes against administrative (usually governmental/municipal) institutions. There are two instances: regional administrative courts and the Highest Administrative court (Vyriausiasis administracinis teismas) the later hosting appeals.

The Constitution is safeguarded by Constitutional court the decisions of which are largely political and have been criticized for limiting democracy when popular opinion opposes that of the establishment. Whenever some court or other major institution thinks a law might be in breach of Constitution it applies to the Constitutional Court for an answer.

In a similar fashion European Court of Justice and European Court of First Instance in Luxembourg may be addressed to explain the European Union law.

In addition to courts, there are pre-judicial institutions which are in some cases voluntary, in others a required step in dispute resolution.

The litigation time in Lithuania largely depends on case and varies greatly. Arbitration may be stipulated in contracts.

Aug 192014
 

29% of GNP are redistributed in Lithuania through taxes (European Union average is 38%). While there are many different taxes in Lithuania only a few behemoth taxes brings in the state the most income.

The most important is Value Added Tax. Its rate is 21% and usually, when anything is sold in Lithuania this is added to the price (there is a mechanism of VAT return if the same thing is resold several times so that VAT is typically paid only once).

Personal income tax is officially 15%. This is only part of the story however as much of income taxation is formally considered to be other taxes. The true burden goes up to 40%-50% of work income. While nominally a flat rate the income tax is actually progressive as the untaxed portion gradually decreases as the salary increases. There are income tax discounts available for the self-employed.

Company income tax (known as Profit tax) is 15%, with additional 20% income tax on most dividends paid to natural persons (meaning 33% effective tax rate on dividends). Company income is taxed deducing expenses.

Fuels, electricity, tobacco and alcohol are additionally taxed by excise duties. The European Union typically requires high excise duties so Lithuania was forced to increase them. For this reason, car fuel in Lithuania is nearly double as expensive as in the USA where there is no excise (but the prices are still lower than Western Europe).

The Real Estate tax is paid only by companies and owners of real estate deemed expensive (0,3% to 3% of value annually). Land tax is paid by every freehold owner (0,01%-4%). Municipalities decide the actual percentage but the “value” here is the official value which may be lower than the market value. There are no other property taxes. Note that much of the commercial land in Lithuania is rented from the state for 99 years (leasehold) but these public rental rates are comparable to land tax.

There is no inheritance tax for the close-of-kin.

Aug 152014
 

Lithuanian Law on Companies describes the issues of companies, their governance and shareholder rights in Lithuania.

REPUBLIC OF LITHUANIA LAW ON COMPANIES

13 July 2000 No VIII-1835

(As last amended on 17 July 2009 – No XI-354)

CHAPTER ONE

GENERAL PROVISIONS

Article 1. Purpose of the Law

1. The Law shall regulate the incorporation, management, activities, reorganisation, transformation, split-off and liquidation of the companies having the legal form of public and private limited liability company, the rights and duties of the shareholders, as well as establishment of branches of foreign companies and termination of their activities. When the provisions of this Law apply both to a public and a private limited liability company, the term “company” shall be used.

2. The peculiarities of regulation of public limited liability companies not established by this Law, where the companies are considered as issuers of securities under the Securities Law, shall be laid down by the Law on Securities. The provisions of this Law regarding the companies whose shares are admitted to trading on the regulated market shall apply to the companies whose shares are admitted to trading in the Republic of Lithuania, any other EU member state or the regulated market functioning in the state belonging to the European Economic Area.

3. The provisions of this Law have been brought into line with the legal acts of the European Union listed in the Annex to this Law.

Article 2. Public Limited Liability Company and Private Limited Liability Company

1. The company shall be an enterprise whose authorised capital is divided into parts called shares.

2. The company shall be a private legal person with limited civil liability.

3. The amount of the authorised capital of the public limited liability company must be not less than LTL 150 000. Its shares may be offered for sale and traded in publicly in compliance with the legal acts regulating the securities market.

4. The authorised capital of the private limited liability company must be not less than LTL 10 000. It must have less than 250 shareholders. The shares of the private limited liability company may not be offered for sale and may not be traded in publicly unless the laws provide otherwise.

5. The name of the public limited liability company must include the words “akcinė bendrovė” (public limited liability company) defining its legal form or the acronym “AB”. The name of the private limited liability company must include the words “uždaroji akcinė bendrovė” (private limited liability company) defining its legal form or the acronym “UAB”.

6. The company’s written documents used in its relations with other persons, also the documents signed according to the procedure established by the Law on Electronic Signature and transmitted by means of electronic communications and the company’s Internet website, if the company has one, must contain the information specified in Article 2.44 of the Civil Code.

7. The registered office of the company must be situated in the Republic of Lithuania.

8. In its activities, the company shall be guided by the Articles of Association, the Civil Code, this Law and other laws and legal acts.

Article 3. Shareholders

1. Shareholders shall be natural and legal persons who have acquired shares in the company.

2. Each shareholder shall have such rights in the company as are incidental to the shares in the company owned by him. Under identical circumstances, all holders of shares of the same class shall have equal rights and duties.

Article 4. Articles of Association of a Company

1. 1 The Articles of Association of a company shall constitute a document governing the conduct of the company’s business.

2. The Articles of Association of a company must state:

1) the name of the company;

2) the legal form of the company (public limited liability company or private limited liability company);

3) the registered office of the company;

4) the purposes of the company, specifying its object of activity;

5) the amount of the company’s authorised capital;

6) the number of shares and their number according to class, their nominal value and the rights they carry;

7) the powers of the General Meeting of Shareholders, the procedure for convening the Meeting;

8) other organs of the company, their powers, the procedure for electing or removing from office their members;

9) the procedure for publishing the notices of the company;

10) the daily of the Republic of Lithuania in which public notices shall be published;

11) the procedure for presenting the company’s documents and other information to the shareholders;

12) the decision-making procedure as regards the establishment of branches and representative offices of the company, and appointment and removal from office of the heads of the company’s branches and representative offices;

13) the procedure for amending the Articles of Association of the company;

14) the company’s duration period if the company is established as a company of limited duration;

15) the date of signing of the Articles of Association.

3. The objects of the company activity shall be specified in the Articles of Association with a brief description of the character of the economic and commercial activities of the company.

4. The sample Articles of Association of a private limited liability company shall be approved by the Government or the institution authorised by it.

5. The Articles of Association of a company may also contain other provisions which are in conformity with this Law and other laws.

6. The powers of the General Meeting of Shareholders, the procedure for convening a Meeting, the powers of other organs of the company and the procedure for electing and removing from office their members need not be stated in the Articles of Association, unless the procedure and powers differ from those laid down in this Law and the Articles of Association expressly state so.

7. The Articles of Association of the company being incorporated must be signed by all the incorporators or their representatives before the statutory meeting.

8. The Articles of Association of the company being incorporated shall become invalid if they are not submitted to the Manager of the Register of Legal Entities within 6 months from the day of the signing thereof by all the incorporators.

9. Following the decision by the General Meeting of Shareholders to amend the Articles of Association of the company, the full text of the amended Articles of Association shall be drawn up and signed by the person authorised by the General Meeting of Shareholders.

10. The signature of the persons who signed the Articles of Association need not be notarised.

Article 5. Parent Company and Subsidiary

1. A company shall be considered a parent company if it directly and/or indirectly holds a majority of the voting rights in another company which is its subsidiary or if it may directly or indirectly exercise a dominant influence on another company.

2. A company shall be deemed to directly hold a majority of the voting rights in another company if it has acquired shares in the other company granting it over 50% of voting rights at the General Meeting of Shareholders.

3. A company shall be deemed to indirectly hold a majority of the voting rights in a third company when it directly holds a majority of the voting rights in the company which directly or indirectly holds a majority of voting rights in the third company.

4. A company shall be deemed to be in the position to directly exercise a dominant influence on another company if it holds shares in that other company and:

1) has the right to elect or remove from office the manager, the majority of members of the Board or the Supervisory Board of that other company, or

2) holds a majority of voting rights in that other company under the agreements concluded with other shareholders. The proxy giving power to the company to represent another shareholder and to vote and make decisions on his behalf shall be a sufficient proof of such an agreement.

5. It shall be deemed that a company is in the position to indirectly exercise a dominant influence on a third company only provided that the company satisfies at least one of the following conditions:

1) the company is in the position to directly exercise a dominant influence on another company which directly or indirectly holds a majority of the voting rights in a third company or which may directly or indirectly exercise a dominant influence on a third company;

2) the company directly or indirectly holds a majority of the voting rights in another company which is in the position to directly or indirectly exercise a dominant influence on a third company;

3) together with the other companies in which the company concerned directly or indirectly holds a majority of voting rights or on which it may directly or indirectly exercise a dominant influence, the company holds a majority of voting rights in a third company or those other companies referred to in this subparagraph jointly hold a majority of the voting rights in a third company.

CHAPTER TWO

INCORPORATION OF THE COMPANY

Article 6. Incorporators

1. A company may be incorporated both by natural and by legal persons.

2. Every incorporator of a company must acquire shares in the company and become its shareholder.

3. The documents drawn up in the name of the company being incorporated and the documents connected with the incorporation of the company must be delivered by a transfer deed to the company manager within 7 days from the registration of the company.

Article 7. Memorandum of Association of a Company and the Act of Establishment

1. The Memorandum of Association shall be drawn up when the company is established by two or more incorporators. If the company is formed by one person only, the act of establishment shall be drawn up.

2. The Memorandum of Association of the company must indicate:

1) the incorporators (full name, personal number and place of residence of the natural person; the name of the legal person, legal form taken, its registration number, registered office, the register in which data relating to the person is accumulated and kept and the full name, personal number and place of residence of the representative of the legal person);

2) the name of the company being incorporated;

3) the persons who have the right to represent the company being incorporated and their rights and duties;

4) the amount of the company’s authorised capital;

5) the nominal value of shares, the share issue price;

6) the number of shares according to classes, the rights attached to the shares;

7) the number of shares acquired by each incorporator and the number of shares according to classes;

8) the procedure and time limits for the payment for the shares acquired by each incorporator, including the procedure and time limits for the payment of initial contributions;

9) each shareholder’s contribution made otherwise than in cash if payment for shares is made partly otherwise than in cash;

10) the time limits for convening the statutory meeting;

11) the procedure for submitting the documents of the company being incorporated and of information relating to the statutory meeting;

12) compensation of incorporation costs and remuneration for incorporation;

13) the procedure for concluding contracts in the name of the company being incorporated and for approving them;

14) the initial contribution repayment procedure, should the company be refused registration;

15) the date of the conclusion of the Memorandum of Association.

3. The Memorandum of Association may also contain other provisions which are not contrary to other laws.

4. The company’s Memorandum of Association shall be signed by all incorporators or persons authorised by them.

5. The Memorandum of Association of the company drawn up and signed in the manner laid down in this Article shall grant the right to open a savings account of the company being incorporated with a bank.

6. The Memorandum of Association of the company shall be submitted to the manager of the Register of Legal Entities together with the other documents prescribed by laws for the registration of the company. If the Memorandum of Association is amended prior to the registration of the company, the Memorandum of Association shall be submitted to the manager of the Register of Legal Entities together with the amendments.

7. The requirements laid down in paragraph 2 of this Article (subparagraphs 10 and 11 excluded) as stipulated for the company’s Memorandum of Association shall be applied to the contents of the act of establishment of the company. Paragraphs 3 to 6 of this Article shall also be applied to the act of establishment.

8. Sample forms of the act of establishment and Memorandum of Association of a private limited liability company shall be approved by the Government or the institution authorised by it.

Article 8. Subscription and Payment for Shares of the Company being Incorporated

1. The incorporators shall not conclude a separate share subscription agreement, the terms of the share subscription agreement shall be set out in the Memorandum of Association or the act of establishment. The Memorandum of Association of the company or the act of establishment shall also be treated as the share subscription agreement.

2. The shares of a company being incorporated must be fully paid up within the time period set in the Memorandum of Association or the act of establishment, which may not exceed 12 months from the date of signing of any of the above documents.

3. Paragraphs 1, 2, 3, 7, 10, 11 and 12 of Article 45 of this Law shall apply to the payment for shares of a company being incorporated.

4. The initial contributions for the shares subscribed for shall be paid within the time period set in the Memorandum of Association or the act of establishment into the savings account of the company being incorporated. The funds in the savings account may be used only after the registration of the company.

5. The initial contribution of each incorporator shall be paid in money’s worth only. It must be not less than one quarter of the nominal value of the shares subscribed for by the incorporator plus the whole of any premium.

6. The total amount of initial contributions paid must be not less than the minimum the authorised capital of the company prescribed by Article 2 of this Law.

7. After the incorporation of the company the remaining part of the shares subscribed for by the incorporator may be paid for both in money’s worth or by contributions made otherwise than in cash.

8. The contributions other than in cash which are intended for paying up for a part of shares must be valued by an independent asset valuer prior to the signing of the Memorandum of Association or act of establishment according to the procedure specified in the legal acts which regulate asset valuation. The valuation report shall, inter alia, indicate the following:

1) the person valuation of the assets whereof has been made (the full name, personal number and place of residence of the natural person; the name, legal form taken, code and registered office of the legal person);

2) description of every element of the assets the valuation whereof has been made;

3) description of the valuation methods used;

4) the number of shares to be acquired otherwise than for cash, the nominal value of a share and the share premium (the amount above the nominal value);

5) the conclusion whether or not the established value of the assets other than in cash corresponds to the number of shares to be issued for the contribution according to the sum of their nominal value and share premium (the amount above the nominal value).

9. The asset valuation report referred to in paragraph 8 of this Article shall be submitted to the incorporators.

10. The asset valuation report indicated in paragraph 8 of this Article must be submitted to the administrator of the Register of Legal Entities together with other documents required under law for the registration of the company.

Article 9. Statutory Report

1. After all initial contributions for the shares have been paid and the contributions other than in cash in which the shares in the company are partly paid have been evaluated, the statutory report of the company must be drawn up not later than 10 days before the statutory meeting. The statutory report shall indicate:

1) incorporation expenses;

2) the amount of the paid-up authorised capital;

3) the amount paid for shares;

4) the contributions other than in cash for the subscribed shares, the value of the contributions and reference to the reports of the valuers of assets who have performed the valuation of the contributions made otherwise than in cash;

5) the number of shares subscribed for by each incorporator, for which he has paid the initial contribution, also the number of the shares by classes;

6) incorporation expenses subject to reimbursement, remuneration for incorporation.

2. The statutory report shall be submitted to the manager of the Register of Legal Entities together with all other documents prescribed by law for the registration of a public limited liability company.

Article 10. Statutory Meeting

1. The statutory meeting must be convened before the registration of the company.

2. At the statutory meeting, each incorporator shall have the number of voting rights that are granted to him by the shares subscribed for by him.

3. The provisions on representation, establishment of the quorum, decision making and drawing up of the minutes as stipulated by this Law shall be applied to the statutory meeting (repeat statutory meeting included).

4. The statutory meeting shall approve the statutory report of the company, elect members of the company’s management bodies who are elected by the General Meeting of Shareholders, and may also settle other issues within the powers of the General Meeting of Shareholders as provided for in this Law.

CHAPTER THREE

REGISTRATION OF THE COMPANY

Article 11. Registration of the Company

1. The company shall be deemed incorporated from the date of its registration in the Register of Legal Entities.

2. The company shall be registered after the valuation of the contributions made otherwise than in cash as partial payment for shares, after the conclusion of the Memorandum of Association or the act of establishment, after the signing of the Articles of Association of the company being incorporated, after payment of all initial contributions for the subscribed shares, after the holding of the statutory meeting which approved the statutory report of the company and elected members of the company’s management organs which, under the Articles of Association of the company, are elected by the General Meeting of Shareholders, also following the election of the Board (where its election is provided for in the Articles of Association) and the company’s manager and following the fulfilment of other obligations established by other laws and the Memorandum of Association or the act of establishment or following the filing of the documents prescribed by law with the manager of the Register of Legal Entities.

Article 12. Particulars Given in the Register of Legal Entities

1. In addition to the data listed in Article 2.66 of the Civil Code, the following particulars shall be given in the Register of Legal Entities:

1) particulars of the Supervisory Board members, indicating the Supervisory Board chairman, dates of their election and expiration of the term of office;

2) the particulars of the Board chairman and the date of election and expiration of the term of office of the Board members and manager of the company;

3) the rule of quantitative representation, if quantitative representation is prescribed by the Articles of Association of the company, and particulars of the persons entitled under the rule of quantitative representation to act jointly in the name of the company, the scope of their rights, duration of their term of office where such is set, as well as specimens of signature of the representative and other member of the organ who are acting according to the rule of quantitative representation;

4) particulars of the shareholder of the company where the shareholder of the company is a single person;

5) the date of the opening and close of the financial year of the company;

6) the period of duration of the company where the company is of limited duration;

7) the particulars of the liquidator, the date of his appointment and expiration of his term of office, the powers of the liquidator, except for those provided for by laws and the Articles of Association of the company;

8) the company’s Internet website, if the company has one.

2. The particulars of the natural persons as referred to in paragraph 1 of this Article shall comprise the natural person’s full name, personal number and place of residence, while the particulars relating to legal persons shall be the name of and legal form taken by the legal person, its code and registered office.

3. If any changes are made to the data of the Register of Legal Entities or the Articles of Association of the company or if other documents provided for by law must be submitted, the manager of the company must, within the time limit set by laws, present to the manager of the Register of Legal Entities the document confirming the decision taken by the organ of the company, where such a decision is necessary under law, as well as other documents prescribed by legal acts.

4. In its relations with the third parties, the company may rely on the data, information and documents of the Register of Legal Entities only after the publication thereof according to the procedure laid down in the Regulations of the Register of Legal Entities, unless the company proves that the third parties had knowledge thereof. However, when conducting the transactions concluded before the sixteenth day after the publication, the company may not rely on the data, information and documents given in the Register of Legal Entities, unless the third parties prove that they could not have any knowledge thereof.

5. Third parties may rely on the company’s data, information and documents in respect whereof decisions have been made, even though the formalities relating to the presentation thereof to the manager of the Register of Legal Entities or to the registration thereof in the Register of Legal Entities have not yet been completed. However, the amended Articles of Association may be relied upon by the third parties only after the registration thereof in the Register of Legal Entities.

6. After the manager of the Register of Legal Entities has published the particulars of the persons entitled to act together in the name of the company, the company, in its relations with the third parties, may not invoke the violation of the procedures of election of the persons entitled to act on behalf of the company, unless the company proves that the third parties had knowledge thereof.

7. If the company’s particulars and information published by the manager of the Register of Legal Entities as well as the company’s documents or references to documents are not in conformity with the documents submitted to the Register of Legal Entities, the company may not, in its relations with the third parties, rely on the published text, whereas the third parties may rely on the public text, except where the company proves that the documents submitted to the Register of Legal Entities have been brought to the third parties’ knowledge.

8. The company may voluntarily submit to the manager of the Register of Legal Entities translations of the company’s Articles of Association and other documents provided for by laws as well as of data of the Register of Legal Persons into one or several official languages of the EU Member States. The submitted translations must be published according to the procedure specified in the Register of Legal Entities. If the company’s data and documents submitted to the manager of the Register of Legal Entities do not correspond to their translations, the company may not, in its relations with the third parties, rely on these translations, however the third persons may rely on them, except in cases where the company proves that the company data and documents submitted to the Register of Legal Entities the translations whereof are relied on by the third parties, have been brought to the third parties’ knowledge.

Article 13. Acquisition of Assets from the Incorporator of a Public Limited Liability Company

1. For two years after the registration of a public limited liability company, every transaction of the company for the acquisition of assets from the company’s incorporator, where the sum of the transaction or the aggregate sum of such transactions during the financial year is not less than 1/10 of the authorised capital of the company, shall be subject to approval at the General Meeting of Shareholders by the qualified majority vote, which must be not less than 2/3 of the voting rights carried by the shares of the shareholders present at the Meeting.

2. The assets indicated in paragraph 1 of this Article shall be subject to valuation prior to the General Meeting of Shareholders by an independent asset valuer in the manner prescribed by the legal acts regulating asset valuation. The asset valuation report shall be subject to the requirements set in subparagraphs 1, 2 and 3 of paragraph 8 of Article 8 of this Law. In addition to other information, the assets valuation report must contain the conclusion as to whether the value of the assets acquired by the public limited liability company corresponds to the amount paid for them.

3. The valuation of the assets specified in paragraph 1 of this Article may be set without applying the requirements set in paragraph 2 of this Article. In this case, Article 451 of this Law shall apply mutatis mutandis.

4. The asset valuation report or the certificate indicated in paragraph 5 of Article 451 of this Law must be submitted to the public limited liability company and the manager of the Register of Legal Entities not later than within 10 days before the General Meeting of Shareholders.

5. The requirements of this Article shall not be applied where the assets are acquired in the course of regular business activities of the public limited liability company, also in respect of the securities transactions concluded in the regulated market, with the exception of negotiated transactions.

CHAPTER FOUR

RIGHTS AND DUTIES OF SHAREHOLDERS

Article 14. Rights and Duties of Shareholders

1. The rights and duties of shareholders shall be established by this Law and other laws of the Republic of Lithuania as well as the Articles of Association of the company. The property and non-property rights of shareholders established by this Law and other laws may not be subjected to any restrictions, except in the cases specified by laws.

2. The shareholders shall not have other property obligations to the company save for the obligation to pay up, in the established manner, all the shares subscribed for at their issue price.

3. If the General Meeting of Shareholders takes a decision to cover the losses of the company from additional contributions made by the shareholders, the shareholders who voted “for” shall be obligated to pay the contributions. The shareholders who did not attend the General Meeting of Shareholders or voted against such a resolution shall have the right to refrain from paying additional contributions.

4. The person who acquired all shares in the company or the holder of all shares in the company who disposed of a part of his shares to another person must notify the company of the acquisition or disposal of shares within 5 days from the conclusion of the transaction. The notice must indicate the number of the shares acquired or disposed of, the nominal share price and the particulars of the person who acquired or disposed of the shares (the natural person’s full name, personal number and place of residence; the legal person’s name, legal form it has taken, registration number, and registered office).

5. Contracts between the company and holder of all its shares shall be executed in a simple written form, unless the Civil Code prescribes the mandatory notarised form.

6. The shareholder must repay the Company the dividend as well as any other payment related to the exercise of the shareholder’s property rights if they were paid out in violation of the mandatory norms of this Law and if the Company proves that the shareholder aware or should have been aware thereof.

*7. Each shareholder shall be entitled to authorise a natural or legal person to represent him when maintaining contacts with the Company and other persons.

Article 15. Property Rights of Shareholders

1. The shareholders shall have the following property rights:

1) to receive a part of the company’s profit (dividend);

2) to receive the company’s funds when the authorised capital of the company is reduced with a view to paying out the company’s funds to the shareholders;

3) to receive shares without payment if the authorised capital is increased out of the company funds, except in cases specified in paragraph 3 of Article 42 of this Law;

4) to have the pre-emption right in acquiring the shares or convertible debentures issued by the company, except in the case when the General Meeting of Shareholders decides to withdraw the pre-emption right for all the shareholders according to the procedure specified by this Law;

5) to lend to the company in the manner prescribed by law; however, when borrowing from its shareholders, the company may not pledge its assets to the shareholders. When the company borrows from a shareholder, the interest may not be higher than the average interest rate offered by commercial banks of the locality where the lender has his place of residence or business, which was in effect on the day of conclusion of the loan agreement. In such a case, the company and shareholders shall be prohibited from negotiating a higher interest rate;

6) to receive a part of assets of the company in liquidation;

7) other property rights established by this Law and other laws.

2. The rights specified in subparagraphs 1, 2, 3 and 4 of paragraph 1 of this Article shall be held in public limited liability companies by persons who were shareholders at the close of the tenth working day after adopting the appropriate decision of the General Meeting of Shareholders (hereafter – at the close of the rights accounting day).

Article 16. Non-Property Rights of Shareholders

1. The shareholders shall have these non-property rights:

1) to attend General Meetings of Shareholders;

2) to submit to the Company in advance the questions connected with the issues on the agenda of the General Meeting of Shareholders;

3) to vote at General Meetings of Shareholders according to voting rights carried by their shares;

4) to receive information on the company specified in paragraph 1 of Article 18 of this Law;

5) to file a claim with the court for reparation of damage resulting from nonfeasance or malfeasance by the manager of the company and Board members of their duties prescribed by this Law and other laws and the Articles of Association of the company as well as in other cases laid down by laws.

Article 161. Shareholder’s Right to Submit in Advance Questions to a Company

1. A company must reply to the questions connected with the issues on the agenda of the General Meeting of Shareholders and submitted by a shareholder to the company in advance before the General Meeting of Shareholders, where the questions were received by the company not later than three working days before the General Meeting of Shareholders.

2. If several questions of the same content have been submitted, the company may provide one overall answer thereto.

3. A company shall not present an answer to the question submitted by a shareholder personally to him when the relevant information is available in the question and answer format on the company’s website, if the company has one.

4. A company may refuse to present answers to the questions submitted by a shareholder if they are linked to the company’s commercial (industrial) secret, confidential information subject to informing the shareholder thereof, except for the cases when the shareholder who has submitted the question cannot be identified.

5. Paragraph 4 of this Article shall not apply when a shareholder or a group of shareholders holding or controlling more than ½ of shares present to the company a written pledge in the form prescribed by the company not to disclose a commercial (industrial) secret, confidential information. In such a case, shall be submitted responses to questions of shareholders shall be submitted to each shareholder in person.

Article 17. Shareholder’s Right to Vote

1. The right to vote at the General Meetings of Shareholders convened prior to the expiry of the time limit for the payment for the first share issue indicated in the Memorandum of Association shall be granted by the shares which have been subscribed for and for which initial contributions have been paid. The right to vote at other General Meetings of Shareholders shall be granted only by fully paid up shares.

2. If all voting shares of a company are of equal nominal value, each share shall give its holder one vote at the General Meeting of Shareholders. If voting shares are of a different nominal value, one share of the lowest nominal value shall give its holder one vote and the number of votes carried by other shares shall be equal to their nominal value divided by the smallest nominal value of a share.

3. The Articles of Association of a company may lay down that preference shares of certain classes shall not carry voting rights. The holders of the preference shares which do not carry the voting rights shall be given the right to vote in the cases specified in this Law.

4. A shareholder shall not be entitled to vote on a decision on the right of pre-emption in acquiring the shares issued by a company or on withdrawal of convertible debentures if the agenda of the General Meeting of Shareholders provides that the right to acquire the above securities is granted to this shareholder, the shareholder’s close relative, the shareholder’s spouse or cohabitee, where the partnership has been registered in accordance with the procedure established by law, and to a close relative of the spouse, if the shareholder is a natural person, also to the shareholder’s parent company or the shareholder’s subsidiary, if the shareholder is a legal person, unless the shareholder has acquired all the shares in the company.

Article 18. Shareholder’s Right to Information

1. A company shall, at a shareholder’s written request and within 7 days from the receipt of the request, grant to the shareholder access to and/or submit to him copies of the following documents: the Articles of Association of the company, set of annual financial statements, annual reports of the company, the auditor’s opinion and audit reports, minutes of the General Meetings of Shareholders or other documents executing decisions of the General Meetings of Shareholders, the recommendations and responses of Supervisory Board to the General Meetings of Shareholders, the lists of shareholders, the lists of members of the Supervisory Board and the Board, also other documents of the company that must be publicly accessible under laws as well as minutes of the meetings of the Supervisory Board and the Board or other documents executing decisions of the above-mentioned company organs, unless these documents contain a commercial (industrial) secret of the company, confidential information. A shareholder or a group of shareholders who hold or control more than 1/2 of shares shall have the right to access all documents of the company subject to presenting to the company a written pledge in the form prescribed by the company not to disclose a commercial (industrial) secret, confidential information. A company may refuse to grant to a shareholder access to and/submit copies of documents, if it is not possible to identify the shareholder who requested the documents. A refusal to grant to the shareholder access to and/or submit copies of documents shall be executed by the company in writing if the shareholder so requests. Disputes relating to the shareholder’s right to information shall be settled in court.

2. A company’s documents, copies thereof or another information must be furnished to the shareholders free of charge, unless the Articles of Association of the company provide otherwise. The charge fixed in the Articles of Association shall not exceed the costs of furnishing of the documents and another information.

3. The list of shareholders of a company presented to the shareholders must contain the full names of the shareholders, the names of legal persons, the number of registered shares owned by the shareholders, the shareholders’ addresses for correspondence according to the most recent data available to the company.

CHAPTER FIVE

MANAGEMENT OF A COMPANY

Article 19. Company’s Organs

1. A company shall have the General Meeting of Shareholders and a single-person management organ – the company manager.

2. A collegial supervisory body – the Supervisory Board and a collegial management organ – the Board may be formed in the company.

3. If the Supervisory Board is not formed in the company, its functions shall not be assigned to the scope of powers of other management organs.

4. Where the Board is not formed in the company, the functions assigned to the scope of powers of the Board shall be fulfilled by the company manager, except where this Law provides otherwise.

5. The General Meeting of Shareholders may not charge other management organs to address the issues assigned to its sphere of competence.

6. In the company’s relations with other persons, the manager of the company shall act at his own discretion on behalf of the company.

7. Where quantitative representation is provided for in the Articles of Association of the company, the Articles of Association must set a specific rule of such representation whereunder the manager of the company must in all cases act on behalf of the company together with the members of the management organs.

8. The management organs of the company must act for the benefit of the company and its shareholders, comply with laws and other legal acts and be governed by the Articles of Association of the company.

9. Every candidate for the office of the manager of the company, to the position of the Board or Supervisory Board member must inform the electing body where and what position he holds, how his other activities are connected to the company and to other legal persons related to the company.

10. In the cases specified in paragraph 4 of Article 2.82 of the Civil Code, an action for declaring the decisions of the company bodies invalid may be brought by the shareholders, creditors, the manager of the company, members of the Board and Supervisory Board or other persons provided for by law within 30 days from the day when the plaintiff found out or should have found out about the contested decision.

Article 20. Powers of the General Meeting of Shareholders

1. The General Meeting of Shareholders shall have the exclusive right to:

1) amend the Articles of Association of the company, unless otherwise provided for by this Law;

2) elect the members of the Supervisory Board; if the Supervisory Board is not formed, elect members of the Board, if neither the Supervisory Board nor the Board is formed, elect the manager of the company;

3) remove the Supervisory Board or its members, also the Board or its members elected by the General Meeting of Shareholders and the manager of the company;

4) select and remove the firm of auditors for the carrying out of the audit of annual financial statements, set the conditions for auditor remuneration;

5) determine the class, number, nominal value and the minimum issue price of the shares issued by the company;

6) take a decision regarding conversion of the company’s shares of one class into shares of another class, approve the share conversion procedure;

7) take a decision to replace the private limited liability company’s share certificates with shares;

8) approve the set of annual financial statements;

9) take a decision on profit/loss appropriation;

10) take a decision on the formation, use, reduction and liquidation of reserves;

11) take a decision on the issue of convertible debentures;

12) take a decision on withdrawal for all the shareholders the right of pre-emption in acquiring the company’s shares or convertible debentures of a specific issue;

13) take a decision on increase of the authorised capital;

14) take a decision on reduction of the authorised capital, except where otherwise provided for by this Law;

15) take a decision for the company to purchase own shares;

16) take a decision on the reorganisation or split-off of the company and approve the terms of reorganisation or split-off;

17) take a decision on transformation of the company;

18) take a decision on restructuring of the company;

19) take a decision on liquidation of the company, cancellation of the liquidation of the company, except where otherwise provided for by this Law;

20) elect and remove from office the liquidator of the company, except where otherwise provided for by this Law.

2. The General Meeting of Shareholders may also decide on other matters assigned within the scope of its powers by the Articles of Association of the company, unless these have been assigned under this Law within the scope of powers of other organs of the company and provided that, in their essence, these are not the functions of the management organs.

Article 21. Right to Attend the General Meeting of Shareholders

1. The persons who are shareholders of the company on the day of the General Meeting of Shareholders or, in case of a public limited liability company, who were shareholders at the close of the accounting day of the meeting shall have the right to attend and vote at the General Meeting of Shareholders or repeat General Meeting of Shareholders in person, unless otherwise provided for by laws, or may authorise other persons to vote for them as proxies or may conclude an agreement on the disposal of the voting right with third parties. The shareholder’s right to attend the General Meeting of Shareholders shall also cover the right to speak and to enquire. The record date of the meeting of a public limited liability company shall be the fifth working day before the General Meeting of Shareholders or the fifth working day before the repeat General Meeting of Shareholders.

2. Members of the Supervisory Board, members of the Board, the manager of the company, the inspector of the General Meeting of Shareholders, the auditor who prepared the auditor’s report and report on audit may also attend and speak at the General Meeting of Shareholders.

3. A shareholder may vote in writing by filling in a general ballot paper. The filled-in general ballot paper may be transferred to the company by means of electronic communications, on the condition that the security of the information thus transmitted is ensured and it is possible to establish the shareholder’s identity.

4. The company may provide a possibility for shareholders to attend the General Meeting of Shareholders and to vote by means of electronic communications.

5. For the shareholders to be able to attend and vote at the General Meeting of Shareholders by means of electronic communications, only the requirements and restrictions which are necessary for establishing the shareholders’ identity and for ensuring the security of the transmitted information may be applied to the use of the means of electronic communications and only in the case when they are proportionate to achieving these goals.

6. The shareholders attending the General Meeting of Shareholders shall be registered in the shareholder registration list. This list shall indicate the number of votes granted to each shareholder by the shares held by him.

7. The shareholder registration list shall be signed by the chairman and secretary of the General Meeting of Shareholders. Where no secretary of the Meeting is elected, the list shall be signed by the chairman of the Meeting. Where all shareholders present at the Meeting voted in writing, the list shall be signed by the manager of the company.

8. A person attending the General Meeting of Shareholders and entitled to vote shall produce a document which is a proof of his identity. A person who is not a shareholder shall additionally produce a document attesting to his right to vote at the General Meeting of Shareholders. The requirement to present the document confirming a person’s identity shall not apply if votes are cast in writing by filling in a general voting ballot and by means of electronic communications.

Article 22. Inspector of the General Meeting of Shareholders

1. The General Meeting of Shareholders shall elect the inspector of the General Meeting of Shareholders for the next Meeting, where the election of the inspector is provided for in the Articles of Association of the company.

2. The inspector of the General Meeting of Shareholders shall determine:

1) the total number of votes carried by the shares issued by the company on the day of the General Meeting of Shareholders;

2) the number of valid and invalid general ballot papers filled-in and submitted in advance;

3) the number of valid and invalid proxies submitted;

4) the number of submitted agreements on the disposal of voting rights;

5) the number of voting shares represented at the Meeting (in person, through proxies, through persons under agreements on the disposal of voting rights, under the general ballot papers filled-in advance, under other documents entitling to vote);

6) whether the Meeting has a quorum;

7) the results of voting at the General Meeting of Shareholders.

*3. The inspector of the General Meeting of Shareholders of the public limited liability company whose shares are admitted to trading on the regulated market shall, in addition to the actions established in paragraph 2 of this Article, establish the following in respect of each decision of the General Meeting of Shareholders:

1) the portion of the authorised capital which shall be represented by voting;

2) the number of shares of the shareholders attending the General Meeting of Shareholders whereby it was voted;

3) the total number of votes of shareholders who voted, from among them – the number of votes for and against each decision;

*4. If not a single shareholder requires at the General Meeting of Shareholders a detailed voting report before the beginning of voting, paragraph 3 of this Article shall not apply.

5. Where election of the inspector is not provided for in the Articles of Association of the company or the elected inspector is not able to fulfil his duties, the General Meeting of Shareholders shall elect the person responsible for the actions provided for in paragraphs 2 and 3 of this Article.

*Note: The Article shall be supplemented with paragraphs 3 and 4 on 1 August 2009, paragraph 3 of Article 22 shall be renumerated as paragraph 5.

Article 23. Convening of the General Meeting of Shareholders

1. The right of initiative to convene the General Meeting of Shareholders shall be vested in the Supervisory Board, the Board (if the Board is not formed, in the manager of the company) and the shareholders who have at least 1/10 of all votes, unless the Articles of Association provide for a smaller number of votes.

2. The General Meeting of Shareholders shall be convened by a decision of the Board or, in the cases specified in paragraph 3 of this Article, of the manager of the company, unless this Law establishes otherwise.

3. The General Meeting of Shareholders shall be convened by a decision of the manager of the company if:

1) no Board has been formed in the company, or

2) the number of the company’s Board members present is not more than a half of their number specified in the Articles of Association, or

3) the Board fails to convene the General Meeting of Shareholders in the cases and within the time limits laid down in this Law.

4. If the Board of the company or, in the cases referred to in paragraph 3 of this Article, the manager of the company fails to take the decision on convening within 10 days from the receipt of the request indicated in paragraph 5 of this Article, the General Meeting of Shareholders may be convened by a decision of the shareholders whose shares carry more than ½ of all the votes.

5. The initiators of convening of the General Meeting of Shareholders shall submit a request to the Board (or, in the cases specified in paragraph 3 of this Article, to the manager of the company) which must state the reasons for convening the Meeting and its purposes, present the proposals regarding the agenda, date and venue of the Meeting, drafts of the proposed decisions. The General Meeting of Shareholders must be held within 30 days after the date of receipt of the request . It shall not be mandatory to convene the General Meeting of Shareholders if the request does not comply with all the requirements set forth in this paragraph and the required documents have not been submitted or the issues proposed for the agenda are not within the scope of powers the General Meeting of Shareholders.

6. If the General Meeting of Shareholders is not held, a repeat General Meeting of Shareholders must be convened.

Article 24. Convening the Annual General Meeting of Shareholders and the Extraordinary General Meeting of Shareholders

1. An Annual General Meeting of Shareholders must be held every year at least within four months from the close of the financial year.

2. The Extraordinary General Meeting of Shareholders must be convened if:

1) the company’s equity capital falls below ½ of the authorised capital specified in the Articles of Association and the issue has not been discussed at the Annual General Meeting of Shareholders;

2) the number of the Supervisory Board or Board members elected by the General Meeting of Shareholders has declined to 2/3 of their number indicated in the Articles of Association or less than their minimum number prescribed by this Law;

3) the manager of the company elected by the General Meeting of Shareholders resigns or is unable to continue performing his duties;

4) the audit firm terminates a contract with the company or is for any other reasons unable to audit the company’s annual financial statements, where the audit is mandatory under this Law or is provided for by the Articles of Association;

5) the convening of the General Meeting of Shareholders is requested by the shareholders having the right of initiative to convene the General Meeting of Shareholders, the Supervisory Board, the Board or, if the Board is not formed, by the manager of the company;

6) the duration of the company specified in the Articles of Association is drawing to a close;

7) it is required under this Law and other laws or the company’s Articles of Association.

3. The General Meeting of Shareholders shall be convened by a court’s order if:

1) the Annual General Meeting of Shareholders has not been convened within 4 months from the close of the financial year and at least one shareholder of the company has brought the matter to the court;

2) the persons or company organs having the right of initiative to convene the General Meeting of Shareholders referred to the court regarding the failure of the Board or the manager of the company to convene the General Meeting of Shareholders as required under this Law;

3) the initiators of the convening of the General Meeting of Shareholders referred to the court regarding a failure of the Board or the manager of the company to convene the General Meeting of Shareholders upon the submission of the request as required under Article 23 of this Law;

4) at least one of the company’s creditors referred to the court regarding the failure to convene the General Meeting of Shareholders upon transpiration that the company’s equity company has fallen below ½ of the authorised capital specified in the Articles of Association.

Article 25. Agenda of the General Meeting of Shareholders

1. The agenda of the General Meeting of Shareholders shall be drawn up by the company’s Board or, in the cases specified in paragraph 3 of Article 23 of this Law, by the manager if the company. Where the General Meeting of Shareholders is convened by a court’s order, the agenda shall be drawn up and submitted to the court together with other prescribed documents by the person or persons who referred to the court requesting to convene the General Meeting of Shareholders.

2. The issues proposed by the initiators of the General Meeting of Shareholders must be put on the agenda of the Meeting provided that these issues are within the scope of powers of the General Meeting of Shareholders.

3. The agenda of the General Meeting of Shareholders may be supplemented by the Supervisory Board, the Board (if the Board is not formed – by the manager of the company) or by the shareholders who hold shares carrying at least 1/20 of all the votes, unless the Articles of Association provide for a smaller proportion. The proposal to supplement the agenda shall be submitted in writing or by means of electronic communications. Draft decisions on the proposed issues or, when it is not mandatory to adopt decisions, explanatory notes on each proposed issue of the agenda of the General Meeting of Shareholders shall be presented alongside with the proposal. The agenda shall be supplemented where the proposal is received not later than 14 days before the General Meeting of Shareholders.

4. The organs of the company and persons referred to in paragraph 3 of this Article may, at any time before the General Meeting of Shareholders or during the Meeting, propose new draft decisions on the items put on the agenda of the Meeting, nominate additional candidates to members of the company organs, the audit firm.

5. If the agenda of the General Meeting of Shareholders indicated in a notice of the Meeting to be convened is supplemented, the shareholders must be notified of the changes in the same manner in which they were given notice of convening of the General Meeting of Shareholders not later than 10 days before the General Meeting of Shareholders.

6. If the agenda of the General Meeting of Shareholders provides for a removal from office of members of the company bodies or the audit firm, the issues relating respectively to election of new members of these company bodies or a new audit firm must be put on the agenda.

7. Only the agenda of the General Meeting of Shareholders which was not held shall be valid at the repeat General Meeting of Shareholders.

Article 26. Notification of the General Meeting of Shareholders to be Convened

1. The Board of the company, the manager of the company, the persons or authority which adopted the decision on the convening of the General Meeting of Shareholders shall present to the company the information and documents required for drawing up of a notice of the convening of the General Meeting of Shareholders.

2. A notice of convening of the General Meeting of Shareholders must indicate:

1) the name, the address of the registered office and the code of the company;

2) the date, time and venue (address) of the Meeting;

the record date of the Meeting and the explanation that only the persons who are shareholders at the close of the accounting day of the General Meeting of Shareholders (for a public limited liability company) shall be entitled to attend and vote at the General Meeting of Shareholders;

4) the rights accounting day if the decisions adopted at the General Meeting of Shareholders are related to the property right of shareholders specified in subparagraphs 1, 2, 3 and 4 of paragraph 1 of Article 15 of this Law and the explanation that these rights will be held by the persons who, at the close of the tenth working day after the General Meeting of Shareholders which adopted the appropriate decision, will be the shareholders of a public limited liability company (for a public limited liability company);

5) the agenda of the Meeting;

6) the persons who initiated the convening of the General Meeting of Shareholders;

7) the body of the company, the persons or the authority who adopted the decision on the convening of the General Meeting of Shareholders;

8) the purpose and intended method of reduction of the authorised capital, where the issue of reduction of the authorised capital is on the agenda of the Meeting;

9) the procedure of participation and voting at the General Meeting of Shareholders by means of electronic communications, if the Company provides such a possibility;

where and how to receive draft decisions on each issue on the agenda of the General Meeting of Shareholders or, when the decisions need not be adopted, the explanations of the Supervisory Board, the Board (if the Board is not formed – the manager of the company) and the shareholders as well as other documents which must be submitted to the General Meeting of Shareholders and the information related to the exercise of the shareholders’ rights.

3. A notice of convening of the General Meeting of Shareholders needs not to contain a reference to the procedure indicated in subparagraph 9 of paragraph 2 of this Article if this notice specifies that the procedure can be accessed on the company’s website and provides the address of this website.

4. A notice of the convening of the General Meeting of Shareholders must be published in the daily indicated in the Articles of Association or delivered to each shareholder against acknowledgement of receipt or sent by registered post not later than 21 days before the General Meeting of Shareholders.

5. If the company creates for its shareholders a possibility to attend and vote at the General Meeting of Shareholders by means of electronic communications accessible to all shareholders, the General Meeting of Shareholders may decide, by not less than 2/3 of all the votes carried by the shares held by the shareholders attending the Meeting, that the company should notify the shareholders of the Extraordinary General Meeting of Shareholders in the manner specified in paragraph 4 of this Article at least 16 days before the day of the Extraordinary General Meeting of Shareholders. The decision shall be valid not longer than until the day of the Annual General Meeting of Shareholders.

6. If the General Meeting of Shareholders is not held, the repeat General Meeting of Shareholders shall be convened after the lapse of at least 5 days and not later than after the lapse of 21 days following the day of the General Meeting of Shareholders which was not held. The shareholders must be notified of the repeat General Meeting of Shareholders in the manner specified in paragraph 4 of this Article not later than 5 days before the repeat General Meeting of Shareholders.

7. The General Meeting of Shareholders may be convened in derogation of the time limits set in paragraphs 4, 5 and 6 of this Article subject to a written consent of all the shareholders who hold the shares conferring voting rights.

8. A notice of the convening of the General Meeting of Shareholders shall be published, delivered or sent to the shareholders free of charge in any manner set in this Law.

9. The documents confirming that the shareholders have been given notice of the convening of the General Meeting of Shareholders must be announced at the opening of the Meeting.

10. At least 10 days before the General Meeting of Shareholders, the shareholders must be granted access to the documents held by the company relating to the agenda of the Meeting, including draft decisions or, when the decisions need not be adopted, the explanations of the Supervisory Board, the Board (where the Board is not formed – the manager of the company) and the shareholders on the issue of the agenda of the General Meeting of Shareholders proposed by them as well as the request by the initiators of convening the General Meeting of Shareholders filed to the Board or, in the cases specified in paragraph 3 of Article 23 of this Law, to the manager of the company. If the shareholder requests so in writing, the manager of the company shall, within 3 days from the receipt of the written request, deliver to the shareholder against his signed acknowledgement of receipt or send by registered mail all draft decisions of the Meeting or, when the decisions need not be adopted, the explanations of the Supervisory Board, the Board (where the Board is not formed – the manager of the company) and the shareholders on the issue of the agenda of the General Meeting of Shareholders proposed by them. The draft decisions must indicate the initiator thereof. Where the initiator of a draft decision submits a substantiation of the draft decision, it must be attached to the draft decision.

11. Paragraphs 3, 4, 5, 6, 7 and 10 of this Article shall not apply to the public limited liability companies whose shares have been admitted to trading on the regulated market.

Article 261. Specifics of Notification of the Convening of the General Meeting of Shareholders of the Public Limited Liability Company whose Shares have been Admitted to Trading on the Regulated Market

1. A notice of the convening of the General Meeting of Shareholders of the public limited liability company whose shares have been admitted to trading on the regulated market must, in addition to the information indicated in paragraph 2 of Article 26 of this Law, contain the following information:

1) the shareholders’ right to propose supplements to the agenda of the General Meeting of Shareholders by submitting with every proposed additional issue a draft decision of the General Meeting of Shareholders or, when a decision needs not to be adopted, the shareholder’s explanation, the procedures for exercising this right which the shareholders must observe and the term by which the shareholders shall be entitled to submit proposals to supplement the agenda of the General Meeting of Shareholders;

2) the shareholders’ right to propose draft decisions on the issues which have been included or will be included in the agenda of the General Meeting of Shareholders, the procedures for exercising this right which the shareholders must observe and the term by which the shareholders shall be entitled to submit draft proposals;

3) the shareholders’ right to submit to the company in advance the questions relating to the issues on the agenda of the General Meeting of Shareholders, the procedures for exercising this right which the shareholders must observe and the term by which the shareholders shall be entitled to pose in advance the questions relating to the agenda of the General Meeting of Shareholders;

4) the procedure of proxy voting at the General Meeting of Shareholders, the form of representing the shareholder at the General Meeting of Shareholders, if it is established, and the procedure and dates for giving authorization by electronic communication facilities;

5) the procedure for voting in writing when a general ballot paper is filled-in;

6) the address of the website where the information indicated in Article 262 of this Law will be presented.

2. 2. The procedures for exercising the shareholders’ rights listed in subparagraphs 1, 2 and 3 of paragraph 1 of this Article which must be observed by shareholders need not be referred to in a notice of the convening the General Meeting of Shareholders if the notice specifies that those procedures are presented on the website of the public limited liability company whose shares are admitted to trading on the regulated market.

3. A notice of the convening of the General Meeting of Shareholders of the public limited liability company whose shares are admitted to trading on the regulated market must be published in the Republic of Lithuania and all other EU member states as well as countries of the European Economic Area not later than 21 days before the General Meeting of Shareholders according to the procedure laid down in the Law on Securities. The notice of the convening of the General Meeting of Shareholders may be additionally published in a daily referred to in the Articles of Association of the public limited liability company whose shares are admitted to trading on the regulated market if such an additional manner of publication is specified in the Articles of Association.

4. If a public limited liability company whose shares have been admitted to trading at the regulated market creates for its shareholders a possibility to attend and vote at the General Meeting of Shareholders by means of electronic communications accessible to all shareholders, the General Meeting of Shareholders may decide by not less than 2/3 of all the votes carried by the shares held by the shareholders attending the Meeting that the company should notify the shareholders of the Extraordinary General Meeting of Shareholders in the manner specified in paragraph 3 of this Article at least 16 days before the day of the Extraordinary General Meeting of Shareholders. Such a decision shall be valid not longer than until the day of the Annual General Meeting of Shareholders.

5. If the General Meeting of Shareholders is not held, the repeat General Meeting of Shareholders shall be convened after the lapse of at least 14 days and not later than after the lapse of 21 days following the day of the General Meeting of Shareholders which was not held. The shareholders must be notified of the repeat General Meeting of Shareholders in the manner specified in paragraph 3 of this Article not later than 14 days before the repeat General Meeting of Shareholders.

Article 262. Presentation on the Website of the Information and Documents of a Public Limited Liability Company whose Shares are Admitted to be Traded on the Regulated Market

1. A public limited liability company whose shares are admitted to trading on the regulated market must provide on the website to the shareholders during the entire period beginning not later than before 21 days until the General Meeting of Shareholders the following information and documents:

1) a notice of the convening of the General Meeting of Shareholders

2) the total number of shares and the shares carrying the voting rights on the day of convening of the General Meeting of Shareholders (including the number of shares according to classes, if there are shares of different classes);

3) draft decisions on every issue on the agenda of the General Meeting of Shareholders or, when decisions need not be adopted, the explanations of the Supervisory Board, the Board (if the Board is not formed – the manager of the company) and the shareholders, as well as other documents which must be presented to the General Meeting of Shareholders;

4) a general ballot paper and the form of a proxy to represent a shareholder at the General Meeting of Shareholders, if it is established, which must be used in proxy voting, except in the cases when the general ballot paper and the form of the proxy to represent the shareholder at the General Meeting of Shareholders are sent directly to each shareholder.

2. The supplemented agenda, also the draft decisions proposed and, when decisions need not be adopted, the explanations of the Supervisory Board, the Board (if the Board is not formed – the manager of the company) and the shareholders shall be forthwith presented on the website on the public limited liability company whose shares are admitted to trading on the regulated market.

3. When owing to technical reasons a general ballot paper indicated in subparagraph 4 of paragraph 1 of this Article and the form of a proxy to represent a shareholder at the General Meeting of Shareholders, if it is established, may not be presented on the website of the public limited liability company whose shares are admitted to trading on the regulated market, it shall be specified how the documents may be received in the printed form. . If the shareholders so require, the public limited liability company whose shares are admitted to trading on the regulated market must send by registered mail free of charge the general ballot paper and the form of the proxy to represent the shareholder at the General Meeting of Shareholders, if it is established, or deliver them in person against signed acknowledgement of receipt to the shareholders who so require.

4. When according to paragraph 4 of Article 261 of this Law a notice of the Extraordinary General Meeting of Shareholders is published not later than 16 days before the General Meeting of Shareholders, whereas according to paragraph 5 of Article 261 of this Law a notice of the repeat General Meeting of Shareholders is given not later than 14 days before the repeat General Meeting of Shareholders, the time limit specified in paragraph 1 of this Article shall be accordingly reduced.

5. A public limited liability company whose shares are admitted to trading on the regulated market shall, not later than within 7 days after the General Meeting of Shareholders, present to shareholders on the website the voting results established on the basis of paragraphs 2 and 3 of Article 22 of this Law.

Article 27. Quorum of the General Meeting of Shareholders and Decision-making

1. A General Meeting of Shareholders may take decisions and shall be held valid if attended by the shareholders who hold the shares carrying not less than ½ of all votes. After the presence of a quorum has been established, the quorum shall be deemed to be present throughout the Meeting. If the quorum is not present, the General Meeting of Shareholders shall be considered invalid and a repeat General Meeting of Shareholders must be convened, which shall be authorised to take decisions only on the issues on the agenda of the meeting that was not held and to which the quorum requirement shall not apply.

2. If consent of the holders of a certain class of shares is necessary for taking a decision, the decision regarding this consent shall be taken by a meeting of the holders of the relevant class of shares. Such a meeting may take decisions and shall be held valid if attended by the shareholders who own over ½ of all shares of that class. The provisions laid down by this Law for convening the General Meeting of Shareholders in respect of the convening of the meeting, representation by proxy, establishment of the quorum, decision-making and drawing up of the minutes shall apply to convening of this Meeting (also the repeat Meeting).

3. Every General Meeting of Shareholders must elect the chairman and the secretary of the Meeting. It shall be possible not to elect the secretary if the General Meeting of Shareholders is attended by less than 3 shareholders. The chairman and the secretary shall not be elected if all the shareholders attending the Meeting voted in writing.

4. For the purpose of establishing the total number of the votes carried by the shares of a company and the quorum of the General Meeting of Shareholders, the following shares shall be considered to be non-voting shares:

1) the own shares purchased by the company;

2) non-voting preference shares of the class specified in the Articles of Association.

5. If a shareholder exercises his right to vote in writing, he shall, upon familiarising with the agenda of the General Meeting of Shareholders and draft decisions, fill in and submit to the company a general ballot paper notifying the General Meeting of Shareholders of whether he is “for” or “against” each decision. The shareholders who have voted in writing in advance shall be considered as being present at the General Meeting of Shareholders and their votes shall be included in the quorum of the meeting and the results of voting. The general ballots papers of the meeting which was not held shall be valid at the repeat General Meeting of Shareholders. A shareholder shall not be entitled to vote at the General Meeting of Shareholders when considering a decision in respect of which he expressed his will in advance in writing.

6. If in the cases specified by this Law a shareholder is not entitled to vote when taking decisions on separate issues, the results of the voting on these separate issues shall be determined according to the number of votes of the shareholders present at the Meeting and entitled to vote on a specific issue.

7. Voting at the General Meeting of Shareholders shall be open. Secret voting shall be mandatory for all shareholders on the issues on which at least one shareholder requests a secret vote be taken, provided that he is supported by the shareholders whose shares carry at least 1/10 of the votes at this General Meeting of Shareholders.

8. A decision of the General Meeting of Shareholders shall be considered taken if more votes of the shareholders have been cast for it than against it, unless this Law or the Articles of Association of the company prescribe a larger majority.

9. The General Meeting of Shareholders shall not be entitled to take decisions on the issues that are not on the agenda, except when the meeting is attended by all the shareholders whose shares carry voting rights and no shareholder has voted in writing.

Article 28. Decisions Taken by a Qualified Majority Vote.

1. The General Meeting of Shareholders shall take the following decisions by a qualified majority vote that must be not less than 2/3 of all the votes carried by the shares held by the shareholders attending the Meeting:

1) amending of the Articles of Association of the company, except where otherwise stipulated by this Law;

2) determination of the class, number, nominal value and the minimum issue price of the shares issued by the company;

3) conversion of the company’s shares of one class into shares of another class, approval of the share conversion procedure;

4) replacement of a private limited liability company’s share certificates with shares;

5) appropriation of profit (loss);

6) building up, drawing on, reduction or liquidation of reserves;

7) issuance of convertible debentures;

8) increase of the authorised capital;

9) reduction of the authorised capital, except where otherwise stipulated by this Law;

10) reorganisation or split-off of the company or approval of the terms of reorganisation or split-off of the company;

11) transformation of the company;

12) restructuring of the company;

13) liquidation of the company and cancellation of the company’s liquidation, except where otherwise stipulated by this Law.

2. The decision to withdraw for all shareholders the pre-emption right in acquiring the company’s newly issued shares or convertible debentures of a specific issue shall require a qualified majority vote that must be not less than 3/4 of all the votes carried by the shares of the shareholders present at the General Meeting of Shareholders and entitled to vote when deciding on the issue.

3. The Articles of Association of the company may provide for a larger qualified majority than 2/3 of the votes required to take the decisions specified in paragraph 1 of this Article and a larger qualified majority than 3/4 of the votes required to take the decision referred to in paragraph 2 of this Article.

Article 29. Minutes of the General Meeting of Shareholders

1. Minutes shall be taken of all General Meetings of Shareholders. The minutes need not be taken where the decisions taken are signed by all shareholders of the company as well as in the cases when the company has a single shareholder.

2. The minutes shall be signed by the chairman and secretary of the General Meeting of Shareholders and may also be signed by the persons authorised by the General Meeting of Shareholders. Where the secretary of the Meeting is not elected, the minutes shall be signed by the chairman of the Meeting. Where all the shareholders attending the Meeting have voted in writing, the manager of the company shall draw up and sign the minutes recording the votes cast.

3. The minutes must be drawn up and signed not later than within 7 days after the date of the General Meeting of Shareholders.

4. The persons who attended the General Meeting of Shareholders shall be entitled to have access to the minutes and submit their comments or opinion in writing on the facts presented in the minutes and the drawing up of the minutes within 3 days from the moment of access thereto, but not later than within 10 days after the General Meeting of Shareholders.

5. The following documents shall be attached to the minutes: the list of registration of the shareholders who attended the General Meeting of Shareholders; the proxies and other documents certifying the persons’ voting right; the general ballot papers of the shareholders who voted in advance in writing; documentary proof of notification of the shareholders as regards the convening of the General Meeting of Shareholders; comments on the minutes and a conclusion on these comments given by the persons who signed the minutes.

6. Where all shares in the company are held by a single person, his written decisions shall be equivalent to the decisions of the General Meeting of Shareholders.

7. The minutes or other documents whereby the decisions of the General Meeting of Shareholders are executed shall be official documents. They shall be stored and processed according to the procedure laid down in the Law on Archives. Forgery of these documents shall be punishable under law.

Article 30. General Ballot Paper

1. Upon a written request of the shareholders holding the voting right, the company must prepare and, at least 10 days before the General Meeting of Shareholders, send the general ballot papers by registered mail or deliver them against acknowledgement of receipt to the shareholders who so requested.

2. The following must be indicated in the general ballot paper:

1) drafts of all the decisions proposed before the day of dispatch of the general ballot paper. The wording of the draft decisions must allow a shareholder to vote either “for” or “against” the decision;

2) candidates to the members of the company’s organs elected at the General Meeting of Shareholders, the firm which is a candidate to the elected firm of auditors. The candidates must be presented in the manner which would allow a shareholder to mark the candidate he votes for or the number of votes he gives to each candidate.

3. The filled-in general ballot paper must contain the full name and personal number of the shareholder who is a natural person, the name and code of the shareholder who is a legal person.

4. The filled-in general ballot papers shall be signed by a shareholder or another person entitled to vote by the shares held by this shareholder. If the filled-in general ballot paper is signed by the person who is not a shareholder, the document attesting the right to vote must be attached to the filled-in general ballot paper 5. The general ballot paper shall be deemed to be valid and may not be recalled if it meets the requirements laid down in paragraphs 3 and 4 of this Article and is received by the company before the General Meeting of Shareholders.

6. 6. If the general ballot paper does not meet the requirements laid down in paragraphs 3 and 4 of this Article, a shareholder shall be considered not to have voted in advance.

7. If the general ballot paper has been filled-in in a manner making it impossible to determine the will of the shareholder on a separate issue, the shareholder shall be considered not to have voted in advance.

Article 301. Proxy Voting

1. At the General Meeting of Shareholders, a proxy holder shall have the same rights as would be held by the shareholder represented by him.

2. At the General Meeting of Shareholders, a proxy holder may be authorised by more than one shareholder.

3. A proxy holder must vote at the General Meeting of Shareholders keeping to the instructions given by a shareholder. If the proxy holder is authorised to vote at the same General Meeting of Shareholders by more than one shareholder, he may vote differently according to the instructions given by each shareholder.

Article 302. Specifics of a Proxy Given by Means of Electronic Communications and Notice Thereof to the Public Limited Liability Company whose Shares are Admitted to Trading on the Regulated Market

1. A shareholder of the public limited liability company whose shares are admitted to trading on the regulated market may, by means of electronic communications, authorise a natural or legal person to participate and vote in his name at the General Meeting of Shareholders. Such a proxy of the shareholder need not be certified by a notary.

2. A shareholder must notify the public limited liability company whose shares are admitted to trading on the regulated market of a proxy given by means of electronic communications.

3. The proxy referred to in paragraph 1 of this Article and the notice of the given proxy specified in paragraph 2 of this Article must be executed in writing. They shall be submitted to the public limited liability company whose shares are admitted to trading on the regulated market by means of electronic communications.

4. The public limited liability company whose shares are admitted to trading on the regulated market must provide conditions for shareholders to submit the proxies specified in paragraph 1 of this Article and the notices of the given proxies indicated in paragraph 2 of this Article by means of electronic communications provided the security of the information transmitted is ensured and the identity of the shareholder may be established.

5. Only the requirements which are necessary for establishing the identity of the shareholder and proxy holder and for checking the content of voting instructions and only where these are proportionate to attaining the said goals may apply to the proxy referred to in paragraph 1 of this Article, the notice of the given proxy indicated in paragraph 2 of this Article and the voting instructions given to the proxy holder.

6. Paragraphs 1–5 of this Article shall mutatis mutandis apply to the withdrawal of a proxy.

7. If the shareholder’s shares of the public limited liability company whose shares are admitted to trading on the regulated market are kept in several securities accounts, the shareholder may authorise a separate proxy holder to attend and vote at the General Meeting of Shareholders in accordance with the rights carried by the shares kept in every securities account. In such a case, the authorisations given by the shareholder shall be valid for one General Meeting of Shareholders.

Article 303. Communication of Information to the Public Limited Liability Companies whose Shares are Admitted to Trading on the Regulated Market

1. The shareholder holding shares in the public limited liability company whose shares are admitted to trading on the regulated market, where the shares have been acquired in his own name, but for the benefit of other persons, must disclose before voting at the General Meeting of Shareholders to the company whose shares are admitted to trading on the regulated market the identity of the final customer, the number of shares that are put to the vote and the content of the voting instructions submitted to him or any other explanation regarding the participation agreed upon with the customer and voting at the General Meeting of Shareholders.

2. A shareholder indicated in paragraph 1 of this Article may put a part of the votes carried by shares to a different vote than when voting other shares.

Article 31. Formation of the Supervisory Board

1. The Supervisory Board shall be a collegial body supervising the activities of the company. The Supervisory Board shall be managed by its chairman.

2. The number of members of the Supervisory Board shall be set by the Articles of Association of the company. The Supervisory Board must have at least 3 and not more than 15 members.

3. The Supervisory Board shall be elected by the General Meeting of Shareholders. When electing the Supervisory Board members, each shareholder shall have the number of votes equal to the number of votes carried by the shares he owns multiplied by the number of members of the Supervisory Board being elected. The shareholder shall distribute the votes at his own discretion, giving them to one or several candidates. The candidates who receive the largest number of votes shall be elected. If the number of candidates who received the equal number of votes exceeds the number of vacancies on the Supervisory Board, a repeat voting shall be held in which each shareholder may vote only for one of the candidates who received the equal number of votes.

4. The Supervisory Board shall be elected for the period laid down in the Articles of Association of the company, which shall not be longer than 4 years. The Supervisory Board shall perform its functions for the period laid down in the Articles of Association or until a new Supervisory Board is elected, but not for longer than the date of the Annual General Meeting of Shareholders to be held during the final year of its term of office. The number of the terms of office of a member of the Supervisory Board shall not be limited.

5. The Supervisory Board shall elect the chairman of the Supervisory Board from among its members.

6. The following persons shall be prohibited from serving on the Supervisory Board:

a) the manager of the company;

2) member of the company’s Board;

3) a person who may not hold this office under legal acts.

7. The Supervisory Board or its members shall commence their activities after the close of the General Meeting of Shareholders which elected the Supervisory Board or its members.

8. Where the Articles of Association of the company are amended due to the formation of the Supervisory Board or increase in the number of its members, newly elected members of the Supervisory Board may commence their activities solely from the date of registration of the amended Articles of Association. In this case, a decision regarding the amendment of the Articles of Association may be adopted and election of the new members of the Supervisory Board may take place at the same General Meeting of Shareholders provided that this is included in the agenda of the Meeting.

9. The General Meeting of Shareholders may remove from office the entire Supervisory Board or its individual members before the expiry of the term of office of the Supervisory Board.

10. A member of the Supervisory Board may resign from office before the expiry of his term of office by giving a written notice thereof to the company at least 14 days in advance.

11. If a member of the Supervisory Board is removed from office, resigns or discontinues the performance of his duties for other reasons and the shareholders whose shares carry at least 1/10 of all votes object to the election of individual members of the Supervisory Board, the Supervisory Board shall lose its powers, and the entire Supervisory Board shall be subject to election. Where individual members of the Supervisory Board are elected, they shall be elected only until the expiry of the term of office of the current Supervisory Board.

12. The members of the Supervisory Board may be paid bonuses for their work on the Board according to the procedure laid down in Article 59 of this Law.

Article 32. Powers of the Supervisory Board and Decision-Making

1. The Supervisory Board shall:

1) elect the members of the Board (the manager of the company, if the Board is not formed) and remove them from office. If the company is operating at a loss, the Supervisory Board must consider the suitability of the Board members (if the Board is not formed, the manager of the company) for their office;

2) supervise the activities of the Board and the manager of the company;

3) submit its comments and proposals to the General Meeting of Shareholders on the company’s operating strategy, set of annual financial statements, draft of profit/loss appropriation and the annual report of the company as well as the activities of the Board and the manager of the company;

4) submit proposals to the Board and the manager of the company to revoke their decisions which are in conflict with laws and other legal acts, the Articles of Association of the company or the decisions of the General Meeting of Shareholders;

5) address other issues assigned to the scope of powers of the Supervisory Board by the Articles of Association of the company as well as by the decisions of the General Meeting of Shareholders regarding the supervision of the activities of the company and its management organs.

2. The Supervisory Board shall not be entitled to assign or delegate the functions assigned to the scope of its powers by this Law and the Articles of Association of the company to other organs of the company.

3. The Supervisory Board shall be entitled to ask the Board of the company and the manager of the company to submit the documents related to the activities of the company.

4. Members of the Supervisory Board must keep the commercial (industrial) secrets and confidential information of the company which they obtained while holding the office of members of the Supervisory Board.

5. 5. The meetings of the Supervisory Board shall be convened by the chairman of the Supervisory Board. The meetings of the Supervisory Board may also be convened by the decision taken by at least of 1/3 of the Supervisory Board members.

6. Members of the Supervisory Board shall have equal rights. During voting, each member shall have one vote. Where equal votes are cast “for” and “against”, the chairman of the Supervisory Board shall have the casting vote.

7. A member of the Supervisory Board may express his will “for” or “against” the decision put to vote upon familiarising himself with the draft thereof by taking a written vote or by voting by means of electronic communications, on the condition that the security of the information transmitted is ensured and it is possible to establish the identity of the person who has voted.

8. The Supervisory Board may take decisions, and its meeting shall be considered to have been held if attended by more than a half of the members of the Supervisory Board. The members of the Supervisory Board who have voted in advance shall also be considered to have attended the meeting. A decision of the Supervisory Board shall be taken if the number of votes cast for it exceeds the number of votes cast against, unless the Articles of Association of the company require a larger majority. A decision to remove a member of the Board from office may be taken if at least 2/3 of the Supervisory Board members present at the meeting vote for it.

9. Minutes must be taken of meetings of the Supervisory Board.

10. The working procedure of the Supervisory Board shall be laid down in the rules of procedure of the Supervisory Board adopted by it.

Article 33. Formation of the Board

1. The Board is a collegial management organ of the company.

2. The number of the Board members shall be laid down in the Articles of Association of the company. The Board must have at least 3 members.

3. The Board shall be elected by the Supervisory Board for a term specified in the Articles of Association of the company, which may not exceed 4 years. If the Supervisory Board is not formed, the Board shall be elected by the General Meeting of Shareholders according to the procedure laid down in paragraph 3 of Article 31 of this Law for the election of the Supervisory Board. If individual members of the Board are elected, they shall serve only until the expiry of the term of office of the current Board.

4. The Board shall elect the chairman of the Board from among its members.

5. The Board shall perform its functions for the period laid down in the Articles of Association or until a new Board is elected and commences its activities, but not longer than until the Annual General Meeting of Shareholders to be held during the final year of its term of office.

6. Only a natural person may be elected a member of the Board. The number of terms of office a member of the Board shall not be limited. The following persons may not be a member of the Board:

1) a member of the Supervisory Board of the company;

2) a person who may not hold this office under legal acts.

7. The Board or its members shall commence their activities after the close of the General Meeting of Shareholders or the meeting of the Supervisory Board which elected the Board or its members.

8. Where the Articles of Association of the company are amended due to the formation of the Board or increase in the number of its members, newly elected members of the Board may commence their activities solely from the date of registration of the amended Articles of Association. In this case, a decision regarding the amendment of the Articles of Association may be adopted and election of the new members of the Board may take place at the same General Meeting of Shareholders provided this is included in the agenda of the Meeting.

9. The Supervisory Board (if the Supervisory Board is not formed, the General Meeting of Shareholders) may remove from office the entire Board or its individual members before the expiry of their term of office.

10. A member of the Board may resign from office prior to the expiry of his term of office upon giving a written notice thereof to the company at least 14 days in advance.

11. Members of the Board may be paid bonuses for their work on the Board according to the procedure laid down in Article 59 of this Law.

Article 34. Powers of the Board

1. The Board shall consider and approve:

1) the operating strategy of the company;

2) the annual report of the company;

3) the management structure of the company and the positions of the employees;

4) the positions to which employees are recruited through competition;

5) regulations of branches and representative offices of the company.

2. The Board shall elect and remove from office the manager of the company, fix his salary and set other terms of the employment contract, approve his job description, provide incentives for and impose penalties against him.

3. The Board shall determine which information shall be considered to be the company’s commercial (industrial) secret and confidential information. Any information which must be publicly available under this Law and other laws may not be considered to be the commercial (industrial) secret and confidential information.

4. The Board shall take the following decisions:

1) decisions for the company to become an incorporator or a member of other legal entities;

2) decisions on the opening of branches and representative offices of the company;

3) decisions on the investment, disposal or lease of the fixed assets the book value whereof exceeds 1/20 of the authorised capital of the company (calculated individually for every type of transaction);

4) decisions on the pledge or mortgage of the fixed assets the book value whereof exceeds 1/20 of the authorised capital of the company (calculated for the total amount of transactions);

5) decisions on offering of surety or guarantee for the discharge of obligations of third parties the amount whereof exceeds 1/20 of the authorised capital of the company;

6) decisions on the acquisition of the fixed assets the price whereof exceeds 1/20 of the authorised capital of the company;

7) decisions on restructuring of the company in the cases laid down by the Law on Restructuring of Enterprises;

8) other decisions assigned to the scope of powers of the Board by this Law, the Articles of Association of the company or the decisions of the General Meeting of Shareholders.

5. The Articles of Association may provide that the Board must obtain the approval of the General Meeting of Shareholders before adopting the decisions referred to in subparagraphs 3, 4, 5 and 6 of paragraph 4 of this Article. The approval given by the General Meeting of Shareholders shall not release the Board from responsibility for the decisions adopted.

6. Before adopting a decision on investment of funds or other assets in another legal entity, the Board must notify thereof the creditors wherewith the company failed to settle within the prescribed time limit, if the aggregate amount of arrears to these creditors exceeds 1/20 of the authorised capital of the company.

7. The Board shall analyse and evaluate the information submitted by the manager of the company on:

1) the implementation of the operating strategy of the company;

2) the organisation of the activities of the company;

3) the financial status of the company;

4) the results of business activities, income and expenditure estimates, the stocktaking and other accounting data of changes in the assets.

8. The Board shall analyse and assess a set of the company’s annual financial statements and draft of profit/loss appropriation and shall submit them to the Supervisory Board and to the General Meeting of Shareholders together with the annual report of the company.

9. The Board shall be responsible for the convening and organisation of the General Meetings of Shareholders in due time.

10. The Board must submit to the Supervisory Board the documents as requested by it and related to the activities of the company.

11. Members of the Board must keep commercial (industrial) secrets of the company and confidential information which they obtained while holding the office of members of the Board.

12. The working procedure of the Board shall be laid down in the rules of procedure of the Board adopted by it.

Article 35. Adoption of Decisions of the Board

1. Each member of the Board shall have the right of initiative to convene the Board meeting.

2. During voting, each member shall have one vote. Where equal votes are cast “for” and “against”, the chairman of the Board shall have the casting vote.

3. A member of the Board may express his will “for” or “against” the decision put to vote in advance by taking a written vote or by means of electronic communications, on the condition that the security of the information transmitted is ensured and it is possible to establish the identity of the person who has voted.

4. The Board may adopt decisions and its meeting shall be deemed to have been held when the meeting is attended by more than 2/3 of the members of the Board, unless the Articles of Association of the company require a larger number of the members attending the meeting. The members of the Board who have voted in advance shall also be deemed to be present at the meeting. A decision of the Board shall be adopted if more than a half of the elected Board members vote for it, unless the Articles of Association of the company provide otherwise.

5. A member of the Board shall not be entitled to vote when the meeting of the Board discusses the issue related to his work on the Board or the issue of his responsibility.

6. Unless the manager of the company is a member of the Board, the Board shall invite him to every meeting of the Board and shall give him access to information on the issues on the agenda.

7. Minutes must be taken of the meetings of the Board.

Article 36. Repealed on 27 of July 2006.

Article 37. Manager of the Company

1. The manager of the company shall be a single-person management body of the company.

2. The manager of the company must be a natural person. A person may not be the manager of the company if he may not hold this office under legal acts.

3. The manager of the company shall be elected and removed from office by the Board (if the Board is not formed, by the Supervisory Board or, if the Supervisory Board is not formed either, by the General Meeting of Shareholders), which shall also fix his salary, approve his job description, provide incentives and impose penalties. The manager of the company shall assume office after the election, unless otherwise provided for in the contract concluded with him. A person authorised by the company’s body which elected the manager of the company or removed him from office must, within 5 days notify the manager of the Register of Legal Entities of the election or removal from office of the manager of the company as well as the expiry of his contract for other reasons.

4. An employment contract shall be concluded with the manager of the company. The contract with the manager of the company shall be signed on behalf of the company by the chairman of the Board or by another member authorised by the Board (if the Board is not formed, by the chairman of the Supervisory Board or another member authorised by the Supervisory Board or, if the Supervisory Board is not formed either, by a person authorised by the General Meeting of Shareholders). If the manager of the company is the chairman of the Board, the employment contract with him shall be signed by the member of the Board authorised by the Board. A contract on full material liability may be concluded with the manager of the company. If the body which elected the manager of the company adopts a decision on his removal from office, the employment contract concluded therewith shall be terminated. Labour disputes between the manager of the company and the company shall be settled by court.

5. In his activities, the manager of the company shall be guided by laws and other legal acts, the Articles of Association of the company, decisions of the General Meeting of Shareholders, decisions of the Supervisory Board and the Board, and his job description.

6. The manager of the company shall organise daily activities of the company, hire and dismiss employees, conclude and terminate employment contracts therewith, provide incentives and impose penalties.

7. Repealed on 25 November 2008.

8. The manager of the company shall act on behalf of the company and shall be entitled to enter into transactions at his own discretion, except where the Articles of Association of the company provide for a quantitative representation of the company. The manager of the company may conclude the transactions referred to in subparagraphs 3, 4, 5 and 6 of paragraph 4 of Article 34 of this Law, provided there is a decision of the Board of the company (if the Board is formed in the company) to enter into these transactions. If the Board is not formed in the company, the manager of the company shall adopt the decisions and carry out the actions specified in paragraphs 1, 3, 4, 5 , 6, 8, 9 and 10 of Article 34 of this Law.

9. The manager of the company must keep commercial (industrial) secrets and confidential information of the company which he learned while holding this office.

10. The manager of the company shall be responsible for:

1) organisation of activities and implementation of purposes of the company;
2) drawing up of the set of annual financial statements and drafting of the annual report of the company;

3) conclusion of a contract with a firm of auditors where the audit is mandatory under laws or the Articles of Association of the company;

4) submission of information and documents to the General Meeting of Shareholders, the Supervisory Board and the Board in the cases laid down in this Law or at their request;

5) submission of documents and particulars of the company to the manager of the Register of Legal Entities;

6) submission of the documents of a public limited liability company to the Securities Commission and the Central Securities Depository of Lithuania;

7) publication of the information referred to in this Law in the daily indicated in the Articles of Association;

8) submission of information to shareholders;

9) performance of other duties laid down in this Law and other laws and legal acts as well as in the Articles of Association and the staff regulations of the manager of the company.

11. The manager of a private limited liability company shall be responsible for management of personal securities accounts of holders of the shareholders’ uncertificated shares and registration of holders of certificated shares in the company, except when the accounting of the uncertificated shares is outsourced to account managers.

12. Where a single person acquires all shares in a company or the holder of all shares in a company divests of all or a part of the company’s shares to other persons, the manager of the company must notify the manager of the Register of Legal Entities thereof within 5 days after the day of receipt of the notice referred to in paragraph 4 of Article 14 of this Law.

13. The manager of the company must ensure that the auditor receives all the documents necessary to carry out the audit specified in the contract with the firm of auditors.

CHAPTER SIX

CAPITAL OF THE COMPANY

Article 38. Structure of the Equity Capital of the Company

1. The equity capital of a company shall consist of:

1) the amount of the paid-up authorised capital;

2) the amount of share premium;

3) the revaluation reserve;

4) the mandatory reserve;

5) the reserve for the acquisition of own shares;

6) other reserves;

7) the unappropriated result – profit/loss.

2. The amount of the authorised capital shall be equal to the aggregate amount of the nominal values of all shares subscribed for in the company.

3. If the equity capital of a company falls below 1/2 of the amount of the authorised capital as referred to in the Articles of Association, the Board (if the Board is not formed, the manager of the company) must convene the General Meeting of Shareholders within 3 months from the day on which it learned or ought to have learnt about the existing situation. This General Meeting of Shareholders must consider the issues regarding the decisions referred to in subparagraph 2 of paragraph 9 and paragraph 10 of Article 59 of this Law. The situation existing in the company must be remedied within 6 months from the day on which the Board learnt or ought to have learnt about the existing situation.

4. If, in the case referred to in paragraph 3 of this Article, the General Meeting of Shareholders fails to adopt a decision on remedying the situation existing in the company or such a situation is not remedied within 6 months from the day on which the Board learnt or ought to have learnt about the existing situation, the Board of the company (if the Board is not formed, the manager of the company) must, within 2 months from the General Meeting of Shareholders held, refer to court for reduction of the company’s authorised capital by the amount whereby the equity capital has fallen below the authorised capital. However, if following the reduction the authorised capital was less than the minimum amount of the authorised capital specified in Article 2 of this Law, it may be reduced only to the minimum amount of the authorised capital specified in Article 2 of this Law.

5. After a court’s decision on reduction of the company’s authorised capital becomes effective, the Board of the company (if the Board is not formed, the manager of the company) must make relevant amendments to the Articles of Association of the company changing the amount of the authorised capital and the number of shares or/and their nominal value, also cancel shares. First of all, the own shares acquired by the company shall be cancelled. Should this prove insufficient, the nominal values of the remaining shares shall be reduced or/and a portion of shares shall be cancelled. The number of shares shall be reduced for all the shareholders in proportion to the number of shares in the company owned by them at the close of the day of registration of the amended Articles of Association of the company in the Register of Legal Entities. The amended Articles of Association of the company signed by the chairman of the Board (if the Board is not formed, by the manager of the company) must be submitted to the manager of the Register of Legal Entities within 30 days after the coming into effect of the court’s decision. If shares are cancelled, a documentary proof of the cancellation thereof must be submitted to the manager of the Register of Legal Entities together with the documents prescribed by laws.

Article 39. Reserves and Share Premium

1. The company shall have the reserves formed from the profit available for appropriation as well as the revaluation reserve.

2. The mandatory reserve shall be formed from the profit available for appropriation. It must be not less than 1/10 of the amount of the authorised capital and may be used solely to cover the losses of the company. The portion of the mandatory reserve above 1/10 of the authorised capital may be reappropriated when appropriating the profit of the next financial year. Where the mandatory reserve is used to cover the losses, the amount thereof shall be restored from the profit available for appropriation according to the procedure laid down in paragraph 5 of Article 59 of this Law.

3. The reserve for the acquisition of own shares whose amount is specified in paragraph 6 of Article 54 of this Law shall be formed from the profit available for appropriation.

4. Other reserves shall be formed from the profit available for appropriation and shall be used for implementation of the specific purposes of a company. They may be used to cover the company’s losses and increase the authorised capital.

5. The reserves referred to in paragraphs 3 and 4 of this Article may be formed only after making a deduction to the mandatory reserve of the amount prescribed by paragraph 5 of Article 59 of this Law.

6. If the reserves referred to in paragraphs 3 and 4 of this Article have not been and are not intended to be used, they may be redistributed when appropriating profit of the next financial year.

7. The revaluation reserve shall be the amount of increase in the value of tangible fixed assets and financial assets resulting after the revaluation of assets. The revaluation reserve or a portion thereof may be used to increase the authorised capital. The revaluation reserve may not be used to reduce losses.

8. Share premium (the amount above nominal value) shall be a part of the equity capital of the company equal to the difference between the issue price and the nominal value of shares. Share premium may be used to increase the authorised capital and to cover losses of the company.

Article 40. Shares

1. Shares shall be the securities confirming the right of their holder (shareholder) to participate in the management of the company, unless otherwise stipulated by laws, the right to receive dividend, the right to a portion of company’s assets remaining after the liquidation thereof and other statutory rights.

2. All shares in companies shall be registered.

3. Shares shall be divided into classes according to the rights they grant to their holders.

4. The rights granted by shares of different classes must be indicated in the Articles of Association of the company. The nominal values and rights granted by all shares of the same class must be equal.

5. A share shall not be divided into parts. If one share belongs to several holders, all holders thereof shall be considered to be one shareholder. In this case, the shareholder shall be represented by one of the holders of te share under a written proxy executed by all owners and notarised. The holders of the share shall be jointly and severally liable for the shareholder’s obligations.

6. The nominal value of a share must be quoted in litas without centas.

7. Shares in public limited liability companies may only be uncertificated shares.

8. Shares in private limited liability companies can be both uncertificated shares and certificated shares.

9. The holder of an uncertificated share (shareholder) shall be a person in whose name a personal securities account has been opened, save for the exceptions laid down by laws.

10. The holder of a certificated share (shareholder) shall be a person indicated in the share.

11. A certificated share must indicate the following:

1) the word “Share”, the class and number of the share;

2) the name and code of a private limited liability company;

3) the nominal value of the share;

4) the amount of dividend on the preference share, its voting and other rights;

5) the date of issue of the share;

6) the full name and personal number of the share holder (the name, legal form, code and registered office of the legal person).

12. The Articles of Association of a private limited liability company may provide that the shareholders shall be issued share certificates instead of certificated shares.

13. A share certificate must indicate:

1) the words “Share Certificate” and the certificate number;

2) the name and code of a private limited liability company;

3) the number of shares represented by the certificate;

4) the nominal value of the share;

5) the class of shares;

6) the amount of dividend on the preference share, its voting and other rights;

7) the date of issue;

8) the full name and personal number of the share certificate holder (the name, legal form, code and registered office of the legal person).

14. A certificated share shall be endorsed by the signature of the chairman of the Board (if the Board is not formed, by the manager of the company).

15. The requirements for the certificated shares laid down in this Law shall apply to the accounting, transfer, exchange and declaration of the nullity of share certificates.

16. Shares may be offered for secondary trading only after they have been fully paid up at their issue price.

17. A company shall be prohibited from issuing shares other than those provided for in this Law as well as the shares which could be exchanged for bonds.

Article 41. Management of Personal Securities Accounts of Shareholders

1. Uncertificated shares of a company shall be recorded as entries in personal securities accounts of shareholders.

2. Personal securities accounts of shareholders of a public limited liability company shall be managed according to the procedure laid down in the legal acts regulating the securities market.

3. The Government of the Republic of Lithuania or its authorised institution shall lay down the rules of management of personal securities accounts of the shareholders of private limited liability companies who hold uncertificated shares and registration of holders of certificated shares with private limited liability companies. Personal securities accounts of shareholders of private limited liability companies who hold uncertificated shares shall be managed by the private limited liability company which has issued these shares. An agreement may be concluded by the private limited liability company for the transfer of management of personal securities accounts of shareholders to an account manager. The private limited liability company must grant its shareholders access to this agreement.

4. The account manager which has opened a personal securities account for a shareholder must produce an excerpt from this account at the request of the shareholder. The excerpt must state the number of shares and another information about the shares recorded in the account as prescribed by legal acts. At the shareholder’s request, a private limited liability company must produce an extract from the documents of registration of the holders of certificated shares, and the extract must state the number of the shares as well as another information about the recorded shares as prescribed by the legal acts.

5. A public limited liability company shall be entitled to obtain from account managers, according to the procedure laid down in the legal acts regulating the securities market, information about the shares of that company recorded in the shareholders’ personal securities accounts managed by the managers, the lists of shareholders and their particulars.

Article 42. Ordinary and Preference Shares

1. Ordinary shares shall constitute the majority of shares in a company. Preference shares may constitute not more than 1/3 of the authorised capital. The nominal values of all ordinary shares must be equal.

2. All ordinary shares shall carry a voting right. The right of holders of ordinary shares to the dividend shall be exercised only upon the exercise of relevant property rights of the holders of preference shares.

3. Only the holders of ordinary shares shall have the right to receive newly issued shares when the authorised capital of the company is increased according to the procedure laid down in this Law from the unappropriated profit of the company or the reserves formed from the appropriated profit. If the authorised capital is increased from the share premium or the revaluation reserve, the holders of both preference and ordinary shares shall have equal rights to receive the newly issued shares.

4. Ordinary shares of a company may not be converted into preference shares. The amount of the dividend for holders of ordinary shares may not be fixed by the company in the Articles of Association or share subscription agreement.

5. Preference shares of the company may be converted into the ordinary shares by a decision of the General Meeting of Shareholders if the Articles of Association of the company provide for a possibility of conversion and where such a decision is approved by a qualified majority vote of the holders of each class of shares taking a separate vote. When converting the preference shares with cumulative dividend into ordinary shares, the company must make a full settlement with the holders of the preference shares or undertake to cover the arrears before the close of the next financial year.v

6. The Articles of Association of the company issuing preference shares must stipulate a specific (fixed) amount (in percentage) of dividend on preference shares calculated on the basis of the nominal value of a share.

7. Preference shares may have a cumulative or non-cumulative dividend and carry a voting right or not carry it. This shall be established in the Articles of Association by indicating the classes of shares.

8. The holder of preference shares with a cumulative dividend shall be guaranteed the right to a dividend in the amount indicated in these shares.

9. If a portion of the profit available for appropriation as intended for dividend is not sufficient for the payment of the whole amount of the dividend established for holders of preference shares, they shall be paid a proportionately reduced amount. The amount not paid to the holders of the preference shares with a cumulative dividend shall be brought forward to the next financial year. The amount not paid to the holders of the preference shares with a non-cumulative dividend shall not be brought forward to the next financial year.

10. If for two consecutive financial years a company fails to allocate the full amount of dividend to holders of non-voting preference shares with a cumulative dividend, such shares shall acquire the voting right until the close of the financial year when the full settlement with the holders of these shares is made.

Article 43. Employee Shares

1. A company may, if the Articles of Association of the company so prescribe, issue ordinary shares having the status of employee shares. This issue may not be made before the expiry of the deadline of payment for the shares subscribed for at the time of incorporation of the company.

2. The right to acquire employee shares shall be vested in the employees of the company which has issued these shares, except for the employees who serve on the Supervisory Board or the Board or hold the office of the company manager.

3. The share subscription agreement must set a time limit for the holder of employee shares within which he may divest of the shares only to another employee of the company. This restriction may not exceed three years from the day of subscription for shares. After the expiry of the restriction period for the transfer of shares, employee shares shall become ordinary shares. If the employee shares are inherited, the status of these shares shall not change until the expiry of the restriction period for the transfer of shares.

4. An employee must pay for subscribed shares by making initial contributions in cash within a time limit laid down in the share subscription agreement. The remaining payments may be made through deductions from the earnings if desired so by the employee. It shall be prohibited to exert any pressure on the employee to purchase the shares of the company as well as to make deductions from earnings for payment of the shares which have not been subscribed for by him.

5. An employee must pay for the subscribed employee shares before the expiry of the restriction period for the transfer of shares.

Article 44. Subscription for Shares

1. Shares shall be subscribed for when a company and a natural or legal person conclude a share subscription agreement, with the exception of incorporation of the company. Under the share subscription agreement, one party shall undertake to offer a certain number of new shares and the other party shall undertake to pay the entire subscription price. The procedure of subscription for the shares of public limited liability companies issued in the course of the increase of the authorised capital and distributed by technical means of the operator of a regulated market as well as the procedures of pricing and payment shall be established by the Securities Commission.

2. A share subscription agreement shall also have a simple written form in cases when the full or partial payment of the subscription price is made by a contribution other than in cash, i.e. the real estate.

3. A share subscription agreement must state:

1) the name, legal form, code and registered office of the company;

2) the registered amount of the authorised capital;

3) the amount of increase in the authorised capital;

4) the date of the General Meeting of Shareholders which adopted the decision on increase of the authorised capital;

5) the date and number of a certificate of approval of a public limited liability company’s shares prospectus if the prospectus must be approved in accordance with the procedure laid down by the legal acts regulating the securities market;

6) the nominal value and issue price of a share, the number of shares of each class issued and the rights they carry;

7) the procedure for and time limits of payment for shares;

8) the procedure for allotting shares to the subscribers of shares in the event of oversubscription;

9) the possibility and procedure of increasing the authorised capital of the company in the event of undersubscription;

10) the full name, personal number and place of residence of a subscriber who is a natural person or the name, legal form, code and registered office of a legal person and the name and surname of its representative;

11) the number of subscribed shares according to their classes.

4. The company manager shall be responsible for drafting the share subscription agreement and the accuracy of the particulars.

5. If a company provides in the share subscription agreement incorrect or incomplete particulars referred to in paragraph 3 of this Article, the subscriber of a share shall be entitled to file a written request to return his contribution for the subscribed shares before the registration of the Articles of Association of the company amended as the result of the increase in the authorised capital. The company must return the subscriber’s contribution immediately without any deductions.

6. A company may not subscribe for own shares.

7. A subsidiary company may not subscribe for and acquire shares in a parent company. If the shares of a company are subscribed for by its subsidiary company, the shares shall be considered to have been subscribed by the company itself.

8. Members of the company’s organ who have adopted a decision for the company to subscribe for own shares or for shares in its parent company must pay for these shares themselves. Upon payment for the shares, they shall become the owners thereof.

9. A company may not make direct or indirect advance payments, give loans or offer security for the discharge of obligations to third parties if such actions aim at enabling other persons to acquire shares in that company.

10. The company manager shall be responsible for compliance with the terms referred to in paragraphs 8 and 9 of this Article.

Article 45. Payment for Shares

1. Payment for shares shall mean payment of the share issue price. Payment for shares may be made in cash and/or contributions other than in cash owned by the person paying for the shares. In the case specified in paragraph 5 of Article 52 of this Law, the newly issued shares must be paid for in cash.

2. The issue price of a share may not be less than its nominal value.

3. Contributions other than in cash may be assets, including property rights. The assets withdrawn from civil circulation as well as works and services may not be used as contributions other than in cash.

4. The initial contribution in cash of each subscriber for shares must be at least 1/4 of the aggregate amount of the nominal value of all the shares subscribed for and the share premium thereof. The remaining amount for the subscribed shares may be paid both in cash and by contributions other than in cash

5. If, in the case of increase of a company’s authorised capital, shares are fully or partially paid for by a contribution other than in cash, the contribution must be evaluated by an independent property valuer according to the procedure laid down by the legal acts regulating asset valuation. The requirements applicable to the asset valuation report shall be set forth in paragraph 8 of Article 8 of this Law. The asset valuation report must be submitted to the company before subscription for the shares. The asset valuation report must be submitted to the manager of the Register of Legal Entities together with other statutory documents for the registration of the Articles of Association amended as the result of the increase of the authorised capital.

6. A decision of the General Meeting of Shareholders on the increase of the authorised capital must indicate, inter alia, every person who pays for the shares by a contribution other than in cash (the full name, personal number and place of residence of a natural person; the name, legal form, code and registered office of a legal person), the nominal value and issue price of the shares which are paid for by a contribution other than in cash.

7. The sum of the nominal values of the shares which are paid up for by a contribution other than in cash may not exceed the value of a contribution other than in cash indicated in the asset valuation report.

8. The shares issued by a company must be fully paid up within the time limit laid down in the share subscription agreement. This time limit may not exceed 12 months from the conclusion of the share subscription agreement.

9. If the entire share subscription price is paid up by contributions other than in cash in the case of increase of the authorised capital, the entire contribution other than in cash must be transferred to the company within the time limit set for payment of initial contributions.

10. Shares shall be deemed to have been paid up when a subscriber pays the last contribution in cash or transfers the entire contribution other than in cash referred to in the share subscription agreement (the last portion of the contribution other than in cash) into the ownership of the company.

11. A company may not release a subscriber from his obligations to the company to pay for the shares subscribed for, except in the cases specified in paragraph 12 of Article 73 of this Law.

12. If a subscriber fails to pay for the shares within the time limit set in the share subscription agreement, it shall be deemed that the company itself acquired the shares and that the share subscription agreement entered into with that person is void; the contributions for the shares subscribed for shall not be returned. The company must, within 12 months after the expiry of the time period laid down for share subscription, divest of the shares to other persons or reduce the authorised capital by cancelling the shares.

Article 451. Specifics of Payment for Shares Otherwise than in Cash when Increasing the Company’s Authorised Capital

1. It shall be possible not to comply with the requirements for assessing the contributions paid otherwise than in cash as established in paragraph 5 of Article 45 of this Law if the shares are fully or partly paid up when increasing a company’s authorised capital:

1) by transferable securities or by money market instruments, where such transferable securities or money market instruments are traded on one or several markets considered as regulated under the Law on Markets in Financial Instruments and operate in the Republic of Lithuania or another European Union Member State, also in a state of the European Economic Area. The value of such transferable securities or money market instruments shall be their average weighted market price within 6 months prior the day of payment by such contributions made otherwise than in cash;

2) by a contribution made otherwise than in cash, except for the transferable securities or money market instruments, the value whereof has already been established by the independent asset valuer and if the evaluation of the contribution made otherwise than in cash has been performed according to the procedure laid down by the legal acts regulating asset valuation and the value of the contribution made otherwise than in cash has been established not earlier than 6 months prior to the day of payment by the contribution other than in cash.

2. A decision on the payment for shares by the contributions made otherwise than in cash in derogation of the requirements for evaluating a contribution made otherwise than in cash as prescribed by paragraph 5 of Article 45 of this Law shall be adopted by the Board of the Company (if the Board is not formed, by the company manager).

3. On the initiative of the Company Board (if the Board is not formed, the company manager), a contribution made otherwise than in cash must be evaluated by the independent asset valuer according to the procedure laid down by the legal acts regulating asset valuation and the asset valuation report must be prepared according to the requirements prescribed in paragraph 8 of Article 8 of this Law if:

1) the valuation of the transferable securities or money market instruments specified in subparagraph 1 of paragraph 1 of this Article has been influenced by exceptional circumstances which, prior to the day of payment by the contributions made otherwise than in cash and on the day of payment by the contributions made otherwise than in cash, would substantially alter the value of such a contribution made otherwise than in cash, including the cases when the transferable securities or money market instruments became illiquid;

2) new important circumstances have emerged, which, prior to the day of payment by a contribution made otherwise than in cash and on the day of payment by the contribution made otherwise than in cash, would substantially alter the value of the contribution made otherwise than in cash established in the manner specified in subparagraph 2 of paragraph 1 of this Article.

4. Without performing the valuation of a contribution made otherwise than in cash in the case specified in subparagraph 2 of paragraph 3 of this Article, one or more shareholders who, on the day of a decision on the increase of the authorised capital by the General Meeting of Shareholders (in a public limited liability company – at the close of the accounting day of the Meeting), hold at least 5% of the company‘s shares may demand the contribution made otherwise than in cash be evaluated by the independent asset valuer according to the procedure prescribed by the legal acts regulating asset valuation and the asset valuation report be drawn up according to the requirements specified in paragraph 8 of Article 8 of this Law. Such a shareholder or shareholders may lodge a claim prior to the day of payment by the contribution made otherwise than in cash if on the day of lodging the claim such a shareholder or shareholders still holds at least 5% of the company’s shares.

5. If payment by a contribution made otherwise than in cash is effected in derogation of the requirements for evaluating a contribution made otherwise than in case as set forth in paragraph 5 of Article 45 of this Law, a statement must be drawn up within 10 days from effecting payment by the contribution made otherwise than in cash. The statement shall indicate the following:

1) the number of the shares paid up by a contribution made otherwise than in cash, their nominal value, the description of each element of the assessed asset and the person who pays for the shares by the contribution made otherwise than in cash (the full name, personal number and place of residence of a natural person; the name, legal form, code number and the registered office of the legal person);

2) the value of the contribution made otherwise than in cash, the source of establishing the value and, when the shares are paid up in part or fully by a contribution made otherwise than in cash the value whereof has been established in the manner specified in subparagraph 2 of paragraph 1 of this Article, the method of establishment of the value;

3) the conclusion whether or not the established value of the contribution other than cash corresponds to the number of shares to be issued for this contribution according to the sum of their nominal value and share premium (the amount above the shares’ nominal value);

4) the conclusion that there have not arisen any exceptional circumstances or new important circumstances relating to the primary establishment of the value of the contribution made otherwise than in cash.

6. In the cases specified in paragraph 1 of this Article, the contribution made otherwise than in cash must be transferred to the company within the time limit for payment of initial contributions.

7. The asset valuation report specified in subparagraph 2 of paragraph 1, paragraphs 3 and 4 of this Article must, together with other statutory documents for the registration of the company’s Articles of Association amended as the result of the increase of the authorised capital, be submitted to the manager of the Register of Legal Entities. The statement referred to in paragraph 5 of this Article must be submitted to the manager of the Register of Legal Entities within one month from the effecting of payment by a contribution made otherwise than in cash.

8. The company manager shall be responsible for compliance with the provisions of this Article.

Article 46. Disposal of Shares

1. Certificated shares or share certificates shall be disposed of by transfer into the ownership of other persons making a relevant entry on the share or on the share certificate, i.e. the endorsement. The endorsement shall contain the particulars of the person to whom the share or share certificate is disposed of (the full name, personal number of a natural person; the name, registered office, legal form, code of a legal person) as well as the date of such an entry. The endorsement shall be signed by the persons disposing of and acquiring the share or of the share certificate.

2. The disposal of uncertificated shares shall be recorded by entries in personal securities accounts of the person who disposes of the shares and the person to whom the shares are disposed of.

3. Having entered into a transaction on the disposal of uncertificated shares, the parties to the transaction must provide their account managers with a written agreement indicating, inter alia, the following:

1) the name, legal form, code and registered office of the company the shares whereof are disposed of;

2) the number of the shares disposed of according to their classes and their nominal value;

3) in respect of shares of a public limited liability company, the share issue code assigned by the Central Securities Depository of Lithuania (if the public limited liability company whose shares are disposed of has issued shares of different issue);

4) the amount of dividend on preference shares, voting and other rights.

4. Any agreement which does not contain any of the particulars referred to in paragraph 3 of this Article shall be void from its conclusion, and the account managers shall not be entitled to make any entries thereunder.

5. The requirements laid down in paragraphs 3 and 4 of this Article shall not apply to the share disposal agreements concluded on a regulated market.

6. A person who subscribed for the shares before the registration in the Register of Legal Entities of the incorporation of a company or of the amendments to the Articles of Association as the result of the increase in the authorised capital may not transfer his shares to other persons.

7. A shareholder may not transfer his partly paid up shares to other persons.

8. A public limited liability company may not restrict the shareholders’ right to dispose of fully paid-up shares to another person according to the procedure laid down in this Law or other legal acts, except where the restriction period for the disposal of employee shares has not yet expired.

Article 47. Specifics of Disposal of Shares in Private Limited Liability Companies.

1. A shareholder must give a written notice to a private limited liability company of his intention to sell all or a part of the shares in a private limited liability company and indicate the number of shares being disposed of according to their classes and sale price.

2. The right of pre-emption to acquire all the shares offered for sale in a private limited liability company shall be vested in the shareholders who, on the day of receipt of the shareholder’s notice of his intention to sell shares by a private limited liability company, held shares in the company, unless the Articles of Association provide otherwise.

3. Within 5 days after the day of receipt of the shareholder’s notice of his intention to sell the shares, the manager of a private limited liability company must inform each shareholder of the company against a written acknowledgement of receipt or by a notice sent by registered mail indicating the number of shares offered for sale according to their classes, the proposed sale price and the time limit for the shareholder to notify the company of his wish to purchase the shares offered for sale. The time limit may not be less than 14 days and more than 30 days after the day of dispatch of the notice or the letter of the company.

4. Within 45 days after the day of receipt of the shareholder’s notice of his intention to sell the shares, the company manager must notify the shareholder of the wish of other shareholders to buy all of his shares offered for sale.

5. If one or more shareholders of a private limited liability company expressed their wish to purchase all shares of the private limited liability company offered for sale by the shareholder, the shareholder must sell these shares to the shareholders (one or more) who have expressed the wish, while the shareholders who have expressed the wish must purchase all these shares at the price not lower than that indicated in the notice, effecting the payment within 3 months from the day of receipt by the company of the notice of the intention to sell the shares, unless otherwise agreed upon with the shareholder selling the shares. The seller of the shares shall be entitled to require the buyer to furnish adequate security of the payment of the price of shares (bank guarantee, collateral, etc.).

6. If the demand of shares offered for sale exceeds their supply, the shares shall be allotted to the shareholders wishing to acquire new shares in proportion to the number of shares held by them.

7. If, within the time limits laid down in this Article, the manager of a private limited liability company informs the shareholder that other shareholders do not wish to acquire all the shares offered for sale or fails to inform, the shareholder shall be entitled to sell the shares at his own discretion at the price not lower than that indicated in his notice of the intention to sell the shares.

8. If shares in a private limited liability company are disposed of in any other statutory manner (other than by selling) or under the court decision, this Article shall not apply; however, in any case of share transfer, the number of shareholders in a private limited liability company may not exceed the number laid down in paragraph 4 of Article 2 of this Law.

Article 48. Invalidity and Replacement of the Shares Issued by the Company

1. The shares shall be invalid and shall not grant any property and non-property rights to their holders in the case of offering for secondary trading and acquisition of partly paid up shares of a company.

2. In the event of a change in the particulars indicated on a certificated share or a share certificate, a private limited liability company must replace the certificated shares or the share certificates held by the shareholders, except where the particulars of the holder change because of the disposal of the certificated share or the share certificate and are entered in the endorsement. A private limited liability company must immediately notify the shareholder of the replacement of certificated shares or share certificates against a written acknowledgement of receipt or by registered mail. A replaced share or share certificate shall be valid until new shares or share certificates are issued to shareholders, but not longer than for 3 months from the day of receipt of the notice. The new shares and share certificates shall remain in the custody of the private limited liability company until they are collected.

3. At the request of a shareholder, a private limited liability company must replace a damaged certificated share or a share certificate which is not suitable for trading, if the share or share certificate is identifiable.

4. The certificated shares or share certificates which have been lost, destroyed or are otherwise missing shall be replaced by a private limited liability company with other certificated shares or share certificates.

5. A notice of the certificated shares or share certificates which have not been returned to a private limited liability company within a prescribed time limit or of the certificated shares or share certificates which have been lost, destroyed or are otherwise missing must be published by the company manager in a daily indicated in the Articles of Association immediately after he learns or ought to have learnt about it. Such a notice must indicate the name and code of the private limited liability company and the number of the certificated share or the share certificate.

Article 49. Increase of the Authorised Capital

1. The authorised capital shall be increased by a decision of the General Meeting of Shareholders. Where a company has issued shares of different classes, the decision to increase the authorised capital shall be adopted if approved by a separate vote of the holders of each class of shares whose rights are affected by the increase in the authorised capital. The approval of holders of non-voting preference shares shall also be necessary for the adoption of the decision to increase the authorised capital by additional contributions by issuing preference shares.

2. The authorised capital shall be increased by issuing new shares or by increasing the nominal value of the issued shares.

3. A company may increase the authorised capital only after its authorised capital has been fully paid up (at the price of the last share issue).

4. A documentary proof of the decision to increase the authorised capital must be submitted to the manager of the Register of Legal Entities within 10 days from the adoption of the decision.

5. The shareholders of the company shall have the right of pre-emption to acquire the shares issued by the company in proportion to the nominal value of the shares owned by them at the close of the day of the General Meeting of Shareholders which adopted the decision to increase the authorised capital by additional contributions, save for the exceptions laid down in Article 57 of this Law. If the authorised capital of a company which has different classes of shares is increased by issuing the shares of one class, the holders of shares of another class shall acquire the right of pre-emption to acquire the shares issued by the company after this right has been exercised by the shareholders who hold the shares of the same class as the newly issued shares.

6. When not all the shares are subscribed for within the period intended for share subscription, the authorised capital may be increased by the amount of nominal values of the shares subscribed for if the decision of the General Meeting of Shareholders which adopted the decision to increase the authorised capital provides for such an option. On the basis of this decision, the Board of the company (if the Board is not formed, the company manager) must make relevant amendments to the Articles of Association of the company relating to the amount of the authorised capital and the number of shares and/or their nominal value and submit the amended Articles of Association to the manager of the Register of Legal Entities.

7. The authorised capital shall be deemed to have been increased only after the amended Articles of Association of a company are registered in the Register of Legal Entities. A decision of the General Meeting of Shareholders to increase the authorised capital, except for the decision to issue convertible debentures, shall be deemed to be void in the event of a failure to submit the amended Articles of Association of the company to the manager of the Register of Legal Entities within 6 months from the day of the General Meeting of Shareholders which adopted the decision to increase the authorised capital. If this time limit is not met, the contributions for the shares subscribed for must be immediately returned without any deductions at the written request of the subscriber.

8. Upon registration in the Register of Legal Entities of the Articles of Association amended as the result of the increase of the authorised capital, the manager of a private limited liability company must, according to the procedure laid down in the Articles of Association, notify all the shareholders of the procedure for collecting new certificated shares or share certificates. The shares shall remain in the custody of the company until they are collected. If the shares are uncertificated shares, new shares shall be recorded as entries in personal securities accounts of shareholders.

Article 50. Increase of the Authorised Capital by Additional Contributions

1. The authorised capital shall be increased by additional contributions of shareholders and other persons only by issuing new shares.

2. An insolvent public limited liability company may increase its authorised capital by additional contributions only if the new shares are acquired by its shareholders, employees and creditors.

3. The authorised capital of a company which has issued convertible debentures shall be increased by issuing new shares of the class and nominal value referred to in the decision to issue the convertible debentures to be exchanged for the convertible debentures if the holder thereof filed a written application to exchange the debentures for shares within the time limit laid down in the decision to issue the convertible debentures. Shares shall be granted in exchange for convertible debentures upon the expiry of the time limit laid down in the decision of the General Meeting of Shareholders to issue convertible debentures. Upon the expiry of the time limit laid down in the decision of the General Meeting of Shareholders to issue convertible debentures and upon filing by the debenture holders of written applications to exchange these debentures for shares, the Board of the company (if the Board is not formed, the company manager) must make relevant amendments to the amount of the authorised capital and the number of shares in the Articles of Association of the company and submit the amended Articles of Association to the manager of the Register of Legal Entities. In this case, the payment for the convertible debentures shall be considered to be the payment for the shares for which the debentures have been exchanged..

4. The Articles of Association of the company amended as the result of the increase of the authorised capital by additional contributions shall be registered in the Register of Legal Entities following subscription for shares and payment of initial contributions.

Article 51. Increase of the Authorised Capital out of the Company’s Funds

1. The authorised capital may be increased out of the company’s funds, i.e. the unappropriated profit, share premium or reserves (except for the reserve for own shares and the mandatory reserve). The authorised capital shall be increased out of the company’s funds by issuing new shares, which shall be transferred to the shareholders for no consideration or by increasing the nominal value of the previously issued shares.

2. The General Meeting of Shareholders shall adopt a decision to increase the authorised capital out of the company’s funds on the basis of the set of financial statements of the company. If the decision of the General Meeting of Shareholders to increase the authorised capital is adopted not later than 6 months after the close of the financial year, the decision may be adopted on the basis of the set of annual financial statements. If the decision to increase the authorised capital is adopted 6 months after the close of the financial year, the General Meeting of Shareholders must be submitted the set of interim financial reports drawn up at least 3 months before the General Meeting of Shareholders. The set of interim financial reports must be submitted to the manager of the Register of Legal Entities together with the statutory documents required for the registration of the amended Articles of Association.

3. If the balance sheet of a company shows losses, the authorised capital may be increased solely from the revaluation reserve.

4. Where a company increases its authorised capital out of the company’s funds by issuing new shares, the shareholders, except for the case laid down in paragraph 3 of Article 42 of this Law, shall be entitled to receive new ordinary shares for no consideration, with the number of the shares to be in proportion to the nominal value of the shares owned by them at the close of the day of the General Meeting of Shareholders which adopted the decision to increase the authorised capital (in respect of a public limited liability company – at the close of the rights accounting day).

Article 52. Reduction of the Authorised Capital

1. The authorised capital may be reduced by a decision of the General Meeting of Shareholders or, in the cases laid down in this Law, by the court decision. The decision of the General Meeting of Shareholders must indicate the purpose of the reduction of the authorised capital. The General Meeting of Shareholders of a company which has issued shares of different classes may adopt a decision to reduce the authorised capital where this decision is approved by a separate vote of the holders of the class of shares whose rights are affected by such reduction.

2. The authorised capital may be reduced only for the following purposes:

1) for the sole purpose of cancelling the losses recorded in the balance sheet of the company;

2) for the purpose of cancelling the shares acquired by the company;

3) for the purpose of payment of the company’s funds to the shareholders;

4) for the purpose of correcting the mistakes made in the course of formation or increase of the authorised capital.

3. The authorised capital may be reduced only in the following ways:

1) by reducing the nominal value of shares;

2) by cancelling the shares.

4. The reduced authorised capital of a company may not be less than the minimum amount of the authorised capital set in Article 2 of this Law.

5. Should the General Meeting of Shareholders adopt a decision to reduce the authorised capital for the sole purpose of cancelling the losses recorded in the balance sheet of a company, the decision to increase the authorised capital by additional contributions by issuing new shares may be adopted at the same General Meeting of Shareholders. If the authorised capital is increased to the amount held before the adoption of the decision to reduce the authorised capital or more, the provisions of Article 53 of this Law shall not apply.

6. A decision to reduce the authorised capital for the purpose of payment of the company’s funds to the shareholders may be adopted only at the Annual General Meeting of Shareholders. The decision shall be adopted upon approval of the set of annual financial statements and appropriation of the company’s profit available for appropriation and solely in the case when all of the following conditions are met:

1) the amount of the company’s mandatory reserve after the reduction of the authorised capital is not less than 1/10 of the authorised capital;

2) there are no unappropriated losses and long-term liabilities in the company’s set of annual financial statements. The requirement regarding long-term liabilities shall not apply in the presence of a written consent of all the creditors in respect whereof the company has the long-term liabilities.

7. A decision to reduce the authorised capital for the purpose of payment of the company’s funds to the shareholders may not be adopted if on the day of adoption of the decision the company is insolvent or if it would become insolvent upon paying the funds to the shareholders.

8. Upon reduction of the authorised capital for the purpose of payment of the company’s funds to the shareholders, the shareholders shall be paid only in cash. Cash may be paid to the shareholders not earlier than after the registration of the amended Articles of Association of the company in the Register of Legal Entities and must be paid out within one month from the day of registration of the amended Articles of Association of the company. The right to receive the payments shall be vested in the persons who, at the close of the day of the General Meeting of Shareholders which adopted the decision to reduce the authorised capital (in the case of a public limited liability company – at the close of the rights accounting day), were shareholders of the company or have such a right on another lawful ground, and the amounts of the payments must be proportionate to the sum of nominal values of the shares held by them. The persons who did not receive the payments within the one-month period set in this paragraph shall have the right to enforce from the Company as its creditors the payment of the amounts due to them. A company may recover the payment made to a shareholder if the shareholder was aware or ought to have been aware that the payment had been allocated and/or made unlawfully.

9. When reducing the authorised capital, a company must first cancel the shares which the company has issued and which have been acquired by the company itself or by its subsidiaries. The nominal value of the remaining shares or the number of shares shall be reduced for all the shareholders in proportion to the nominal value of shares owned by them at the close of the day of registration of the amended Articles of Association of the company in the Register of Legal Entities. After the registration of the amended Articles of Association of the company in the Register of Legal Entities, a public limited liability company must, within one working day, submit to the Central Securities Depository of Lithuania the documents required by the Depository for amending the entries in securities accounts.

10. A documentary proof of the decision to reduce the authorised capital must be submitted to the manager of the Register of Legal Entities within 10 days after the adoption of the decision.

11. The authorised capital shall be deemed to have been reduced only upon registration of the amended Articles of Association in the Register of Legal Entities. A decision of the General Meeting of Shareholders to reduce the authorised capital shall be deemed invalid if the amended Articles of Association of the company are not presented to the manager of the Register of Legal Entities within 6 months from the day of the General Meeting of Shareholders which adopted the decision to reduce the authorised capital, except in the case specified in paragraph 6 of Article 53 of this Law.

Article 53. Notifying of the Reduction of the Authorised Capital and Provision of Safeguards for the Discharge of Obligations

1. Each creditor of a company must be notified against a written acknowledgement of receipt or by registered mail of a decision to reduce the authorised capital of the company. Moreover, the decision to reduce the authorised capital of the company must be published in the daily indicated in the Articles of Association or each shareholder must be notified thereof against a written acknowledgement of receipt or by registered mail.

2. When reducing its authorised capital, a company must provide additional safeguards for the discharge of its obligations to each creditor who so requested, except for the cases laid down in paragraph 4 of this Article.

3. Additional safeguards for the discharge of obligations may be requested by the creditor whose rights arose prior to and did not expire before the day of notification by the manager of the Register of Legal Entities of the decision adopted by the General Meeting of Shareholders or by the court to reduce the authorised capital of the company. The company’s creditor may file his claims with the company within 2 months after the day of notification by the manager of the Register of Legal Entities of the decision to reduce the authorised capital of the company.

4. A company may refrain from providing additional safeguards for the discharge of obligations to its creditors if at least one of the following conditions is met:

1) the total amount of the creditors’ claims does not exceed 1/2 of the amount of the equity capital after the reduction of the authorised capital. This condition shall not apply if the authorised capital is reduced for the purpose of payment of the company’s funds to the shareholders;

2) the creditor’s claims are adequately secured by pledge, mortgage, surety or guarantee;

3) the authorised capital is reduced for the sole purpose of cancelling the losses recorded in the balance sheet of the company.

5. Disputes regarding the additional safeguards for the discharge of obligations in the event of reduction of a company’s authorised capital shall be settled by court.

6. The Articles of Association of a company amended as the result of the reduction of the authorised capital shall be submitted to the manager of the Register of Legal Entities after all the actions referred to in paragraphs 1 and 2 of this Article have been carried out, but not earlier than 3 months after the notification by the manager of the Register of Legal Entities of the decision adopted by the General Meeting of Shareholders or by the court to reduce the authorised capital of the company and not later than within 6 months after the adoption of the decision to reduce the authorised capital, except for the case specified in paragraph 7 of this Article The Articles of Association of the company amended as the result of the reduction of the authorised capital may be submitted to the manager of the Register of Legal Entities in derogation of the 3-month time limit laid down in this paragraph where:

1) the company has no liabilities to creditors and has published a notice of the reduction of the authorised capital as laid down in paragraph 1 of this Article;

2) the authorised capital is reduced for the sole purpose of cancelling the losses recorded in the balance sheet of the company;

3) the authorised capital is reduced for the purpose of correcting of the mistakes made in the course of formation or increase of the authorised capital.

7. If a dispute regarding the additional safeguards for the discharge of obligations is being heard in court, the Articles of Association amended as the result of the reduction of the authorised capital may not be submitted to the manager of the Register of Legal Entities until the court decision becomes effective.

8. If the amendments to the Articles of Association of a company as the result of the reduction of the authorised capital are registered in breach of the requirements of this Article as to the additional safeguards for the discharge of obligations to the creditors, the reduction of the authorised capital may be declared invalid by the court decision.

Article 54. Right of the Company to Acquire Own Shares

1. A company shall have the right to acquire own shares according to the procedure laid down in this Article by acting on its own or through a person acting on his own behalf, but for the benefit of this company and for the account of the company. When acquiring own shares, the company must ensure equal opportunities for all shareholders to transfer to the company their shares.

2. A company may acquire own shares by a decision of the General Meeting of Shareholders. The decision of the General Meeting of Shareholders must, inter alia, specify the following:

1) the purpose of the acquisition of shares;

2) the maximum number of the shares permitted for acquisition;

3) the time limit within which the company may acquire own shares. The time limit may not exceed 18 months;

4) the maximum and the minimum share acquisition price;

5) the procedure for selling own shares and the minimum sale price. The procedure for selling the shares must ensure equal opportunities for all shareholders to acquire the shares of the company.

3. The total nominal value of own shares being acquired by a company together with the nominal value of other own shares already held by the company may not exceed 1/10 of the authorised capital.

4. A company may not purchase own shares if this would result in the equity capital falling below the aggregate amount of the paid-up authorised capital, mandatory reserve and reserve for own shares.

5. A company shall be prohibited from acquiring partly paid up own shares, except for the case specified in paragraph 12 of Article 45 of this Law.

6. A company may acquire own shares if the reserve for own shares is formed in the company and the amount thereof is not less than the aggregate amount of the acquisition values of the own shares being acquired.

7. Having acquired own shares, a company may not exercise the property and non-property rights attached to the shares as laid down in this Law.

8. The acceptance of shares as a safeguard for discharge of an obligation shall be equivalent to the acquisition of own shares.

9. Where the shares of a company are subscribed for or acquired by its subsidiary company, the shares shall be deemed to have been subscribed for or acquired by the company whose shares are subscribed for or acquired.

10. Where the shares of a company are subscribed for or acquired by a person acting on his own behalf, but for the benefit of this company and for the account of the company, the shares shall be deemed to have been subscribed for or acquired by the company whose shares are subscribed for or acquired.

11. The shares of a company acquired in violation of the conditions referred to in paragraphs 2, 3, 4 and 6 of this Article must be disposed of into ownership of other persons within 12 months from the acquisition thereof. If the shares are not disposed of within this time limit, the authorised capital must be reduced accordingly, the shares must be cancelled and declared invalid.

12. If a company fails to declare the shares invalid and fails to cancel them as referred to in paragraph 11 of this Article, the shares shall be recognised as invalid and the authorised capital shall be reduced accordingly by a court’s decision. The right to refer to court shall be vested in the company manager, the Board, a shareholder and a creditor.

13. If a court passes a decision on the reduction of the authorised capital of a company, the Board of the company (if the Board is not formed, the company manager) must make relevant amendments to the Articles of Association of the company changing the amount of the authorised capital and the number of shares and accordingly cancelling the company’s own shares. The amended Articles of Association of the company must be submitted to the manager of the Register of Legal Entities within 30 days after the court’s decision becomes effective.

14. The company manager shall be responsible for compliance with the conditions referred to in paragraphs 3, 4, 5, 6, 7 and 11 of this Article.

Article 55. Debentures

1. A debenture of a company shall be a fixed-term non equity security under which the company which is the issuer of the debenture becomes the debtor of the debenture holder and assumes obligations for the benefit of the debenture holder. These obligations must be indicated in the decision to issue debentures and in the debenture subscription agreement.

2. A decision of the General Meeting of Shareholders to issue debentures and the debenture subscription agreement must indicate the nominal value of the debenture, the rate of annual interest, the fixed date of debenture redemption from which the debenture holder shall acquire the right to receive from the company the amount of funds made up of the nominal value of the debenture and the annual interest.

3. The debentures of one and the same issue shall grant their holders equal rights.

4. A decision to issue debentures shall be taken by the General Meeting of Shareholders by a simple majority of votes. The Articles of Association may provide that the decision to issue debentures shall be adopted the Board (if the Board is not formed, the company manager). The decision to issue convertible debentures shall be adopted according to the procedure laid down in Article 56 of this Law.

5. The debenture holder shall have the same rights as other creditors of the company.

6. Before issuing debentures offered for public trading, a public limited liability company must conclude an agreement with an intermediary of public trading in securities. Under the agreement, the intermediary of public trading in securities shall undertake to safeguard the interests of the holders of a certain debenture issue in their relations with the public limited liability company and the public limited liability company shall undertake to pay remuneration thereto. The intermediary of public trading in securities must safeguard the rights and legitimate interests of the debenture holders in the same way as he would safeguard his own rights and legitimate interests if he were the holder of all issued debentures. The intermediary of public trading in securities shall have the right to apply to court for the safeguarding of the rights of debenture holders.

7. Holders of over 1/2 of the debentures of a single specific issue shall have the right to:

1) dismiss the intermediary of public trading in securities safeguarding their interests and demand that the public limited liability company conclude an agreement with the intermediary of public trading in securities of their choice;

2) bring to the notice of the intermediary of public trading in securities safeguarding their interests that the violation committed by the public limited liability company in relation to the specific issue of debentures offered for public trading is not material and therefore certain actions are not needed to safeguard their interests (this provision shall not apply to the violations committed by the public limited liability company in relation to the debenture redemption and the payment of interest).

8. Where the debentures issued by a public limited liability company are secured by pledge of assets or mortgage, the intermediary of public trading in securities shall exercise the rights of the holder of security for the benefit of all debenture holders. Third parties may offer, either directly to the debenture holder or through the intermediary of public trading in securities, a surety or guarantee for the discharge of obligations of a public limited liability company arising out of the issue of debentures. In the event of a failure to discharge all or a part of these obligations, the intermediary of public trading in securities must transfer the funds received from the third parties to the debenture holders.

9. If the debenture holder or the intermediary of public trading in securities managing his securities accounts does not claim the redemption of the debenture within 3 years after the redemption date indicated in the debenture subscription agreement, the debenture holder shall forfeit the right of claim.

10. Debentures shall be book-entry and shall be represented by entries in personal securities accounts of their holders. The requirements laid down for uncertificated shares shall apply to the accounting of debentures and trading in debentures.

11. Private limited liability companies shall be prohibited from offering debentures for public trading.

Article 56. Convertible Debentures

1. A company may issue convertible debentures which, after the expiry of their redemption period, may be exchanged for the shares of the company.

2. A decision to issue convertible debentures shall be adopted by the General Meeting of Shareholders. Where there are several classes of shares in a company, the decision to issue convertible debentures shall be adopted if approved by a separate vote of the shareholders of each class. If the decision to issue convertible debentures indicates that the convertible debentures issued may be converted into preference shares, the decision shall also be subject to approval of the holders of non-voting preference shares adopted by a separate vote of the holders of these shares.

3. A decision of the General Meeting of Shareholders to issue convertible debentures shall at the same time be a decision to increase the authorised capital of the company by the amount equal to the sum of the nominal values of shares which may be exchanged for the convertible debentures.

4. A decision to issue convertible debentures and the debenture subscription agreement must, inter alia, indicate the following:

1) the nominal value of convertible debentures and the rights attached thereto;

2) the class, number and the nominal value of shares for which the convertible debentures shall be exchanged as well as the rights attached thereto;

3) the ratio at which convertible debentures shall be exchanged for shares. This ratio must be such that the issue price of the convertible debentures would be not less than the nominal value of shares for which they are exchanged;

4) the period during which the convertible debentures shall be exchanged for shares;

5) the interest and the procedure of payment thereof;

6) the date of redemption of the debentures.

5. A company with partly paid-up authorised capital shall not have the right to issue convertible debentures.

6. The shareholders of a company shall have the right of pre-emption to acquire the convertible debentures issued by the company in proportion to the nominal value of the shares owned by them at the close of the day of the General Meeting of Shareholders which adopted the decision to issue the convertible debentures (in respect of a public limited liability company – at the close of the rights accounting day), save for the exceptions laid down in Article 57 of this Law.

7. A documentary proof of the decision to issue convertible debentures must be submitted to the manager of the Register of Legal Entities within 10 days from the adoption thereof.

Article 57. Acquisition by the Right of Pre-emption of the Shares or Convertible Debentures Issued by a Company

1. A notice of the offer to acquire by the right of pre-emption the shares or convertible debentures of a public limited liability company and the time limit for exercising the right of pre-emption must be published in the daily indicated in the Articles of Association. The notice must be submitted to the manager of the Register of Legal Entities not later than on the first day of its publication in the daily referred to in the Articles of Association.

2. A notice of the offer to acquire by the right of pre-emption the shares or convertible debentures of a private limited liability company and the time limit for exercising the right of pre-emption must be published in the daily indicated in the Articles of Association or each shareholder must be notified thereof against a written acknowledgement of receipt or by registered mail. The notice must be submitted to the manager of the Register of Legal Entities not later than on the first day of publication in the daily referred to in the Articles of Association or delivery of the notice or dispatch of the registered letter.

3. The time limit set by the General Meeting of Shareholders for a shareholder to acquire shares or convertible debentures by the right of pre-emption may not be less than 14 days from the day of the publication by the manager of the Register of Legal Entities or from the day of the delivery of the notice or the dispatch of the registered letter to the shareholder of a private limited liability company.

4. Shareholders of a public limited liability company shall be entitled to dispose of their right of pre-emption to acquire the shares or convertible debentures issued by the public limited liability company to other persons according to the procedure laid down by the Securities Commission.

5. The shareholders’ right of pre-emption to acquire the shares or convertible debentures issued by a company may be withdrawn by a decision of the General Meeting of Shareholders. The General Meeting of Shareholders may adopt such a decision only if the person or persons (including the shareholders) who are entitled to acquire the shares or convertible debentures of the company are known to the General Meeting of Shareholders, except for the cases when the right of pre-emption to acquire shares or convertible debentures in the company is withdrawn as the result of the intention to publicly offer the shares or convertible debentures according to the procedure established in the Law on Securities. The decision of the General Meeting of Shareholders to withdraw the right of pre-emption must, inter alia, indicate the following:

1) the reasons for withdrawing the right of pre-emption;

2) the person or persons who are granted the right to acquire the shares or convertible debentures (the full name, personal number and place of residence of a natural person; the name, legal form, code and registered office of a legal person);

3) the number of the shares or convertible debentures issued which may be acquired by each of the above persons (where such data must be specified as prescribed by the conditions set in this paragraph).

6. The Board of the company (if the Board is not formed, the company manager) must submit a written notice to the General Meeting of Shareholders which is supposed to discuss the withdrawal of the right of pre-emption. The notice must indicate the following:

1) the reasons for withdrawing the right of pre-emption;

2) substantiation of the proposed issue price of the shares or convertible debentures issued;

3) the person or persons to whom it is proposed to grant the right to acquire the shares or convertible debentures (the full name, personal number and place of residence of a natural person; the name, legal form, code and registered office of a legal person and the full name, personal number and place of residence of its representative) and the number of the shares or convertible debentures issued which may be acquired by each of the above persons (where such data must be specified as prescribed by the conditions set in paragraph 5 of this Article).

7. The right of pre-emption to acquire the shares or convertible debentures issued by a company may only be withdrawn for all shareholders of the company.

8. A decision to withdraw the right of pre-emption must be submitted to the manager of the Register of Legal Entities within 10 days.

CHAPTER SEVEN

THE COMPANY’S FINANCIAL STATEMENTS AND APPROPRIATION OF PROFIT

Article 58. Set of the Company’s Financial Statements

1. The drawing up of the set of a company’s financial statements and the drafting of the annual report of the company shall be established by laws ad other legal acts.

2. The set of annual financial statements of a company shall be approved by the Annual General Meeting of Shareholders. If the audit of the company’s annual financial statements is mandatory under laws or provided for in the Articles of Association, only the audited set of annual financial statements shall be approved.

3. The set of annual financial statements of a company together with the annual report of the company and the auditor’s report (where the audit is mandatory under laws or provided for in the Articles of Association) must be submitted to the manager of the Register of Legal Entities within 30 days after the Annual General Meeting of Shareholders.

4. If, under laws, a company must draw up a set of consolidated annual financial statements and the consolidated annual report, the provisions of this Law concerning the set of a company’s annual financial statements and the annual report shall apply mutatis mutandis to such a set of financial statements and such an annual report.

Article 59. Appropriation of Profit (Loss)

1. Upon approval of the set of annual financial statements, the Annual General Meeting of Shareholders must appropriate the profit (loss) of the company available for appropriation.

2. A decision of the General Meeting of Shareholders on appropriation of profit (loss) must indicate:

1) the unappropriated profit (loss) of the preceding financial year at the close of the reporting financial year;

2) the net profit (loss) of the reporting financial year;

3) the profit (loss) of the reporting financial year not recognised in the profit (loss) account;

4) transfers from the reserves;

5) the shareholders’ contributions to cover the losses of the company (if the shareholders resolve to cover all or a part of the losses);

6) the total profit (loss) available for appropriation;

7) the share of profit allocated to the mandatory reserve;

8) the share of profit allocated to the reserve for acquiring own shares;

9) the share of profit allocated to other reserves;

10) the share of profit for the payment of dividends;

11) the share of profit for the payment of annual bonuses to members of the Board and the Supervisory Board, payment of incentives to employees and other allocations;

12) unappropriated profit (loss) at the close of the reporting financial year and brought forward to the next financial year.

3. A company’s profit (loss) available for appropriation shall comprise the aggregate amount of the profit (loss) of the reporting financial year and the unappropriated profit (loss) for the previous financial year at the close of the reporting financial year, transfers from reserves and the shareholders’ contributions to cover the losses.

4. If the aggregate of the amounts referred to in paragraph 3 of this Article is positive, the General Meeting of Shareholders must appropriate the profit available for appropriation according to the procedure laid down in this Article.

5. If the mandatory reserve is less than 1/10 of the authorised capital, deductions to this reserve shall be compulsory and may not be less than 1/20 of the net profit of the reporting financial year until the amount of the mandatory reserve reaches the amount laid down in this Law.

6. A company may allocate not more than 1/5 of the net profit of the reporting financial year for the purposes referred to in subparagraph 11 of paragraph 2 of this Article.

7. If a company fails to pay the statutory taxes within the established time limits, it may not pay the dividend, annual bonuses to members of he Board and the Supervisory Board and incentives to its employees. It shall be prohibited to pay the bonuses to the members of the Supervisory Board and the Board in advance.

8. If the aggregate amount of the unappropriated profit (loss) for the previous financial year at the close of the reporting financial year and the profit (loss) of the reporting financial year is negative, i.e. losses are incurred, the General Meeting of Shareholders must adopt a decision to cover these losses by crediting the amounts transferred to the profit (loss) available for appropriation in the following sequence:

1) the amounts transferred from the reserves unused during the reporting financial year;

2) the amounts transferred from the mandatory reserve;

3) the amounts transferred from the share premium.

9. Should the transferred amounts laid down in paragraph 8 of this Article be insufficient to cover the losses:

1) the remaining unappropriated loss shall be brought forward to the next financial year if the equity capital of the company is at least 1/2 of the amount of the authorised capital indicated in the Articles of Association;

2) the shareholders may cover the losses by shareholders’ contributions and the equity capital of the company must be restored in such a manner that it would be not less than 1/2 of the authorised capital indicated in the Articles of Association.

10. Where the General Meeting of Shareholders fails to adopt a decision to cover the losses by shareholders’ contributions or where such a decision is adopted, but the equity capital is not restored to the amount equal to 1/2 of the authorised capital indicated in the Articles of Association, the General Meeting of Shareholders must decide on:

1) the reduction of the authorised capital; however, the reduced authorised capital may not be less than the minimum amount of the authorised capital laid down in Article 2 of this Law, or

2) the transformation into a legal person provided for in Article 72 of this Law, or

3) the liquidation of the company.

Article 60. Dividends

1. The dividend shall be a share of profit allocated to a shareholder in proportion to the nominal value of the shares owned by him. If a share is not fully paid-up and the time limit for the payment has not expired yet, the dividend of the shareholder shall be reduced in proportion to the amount of the unpaid share price. If the share is not fully paid-up and the time limit for the payment has expired, no dividend shall be paid. The Articles of Association may establish that the dividend on fully paid-up shares shall be reduced if the last payment was made in the financial year for which the dividend is allocated.

2. Dividends allocated by a decision of the General Meeting of Shareholders shall be the liability of the company to its shareholders. A shareholder shall have the right to claim the payment of dividend as the creditor of the company. The company shall have the right to recover the dividend paid out to the shareholder if the shareholder was aware or ought to have been aware that the dividend was allocated and/or paid unlawfully.

3. The General Meeting of Shareholders may not adopt a decision to allocate and pay dividends if at least one of the following conditions is met:

1) the company is insolvent or would become
insolvent upon payment of dividends;
2) the aggregate amount of profit (loss) of the reporting financial year available for appropriation is negative (losses have been incurred);

3) the equity capital of the company is lower or upon payment of dividends would become lower than the aggregate amount of the authorised capital of the company, the mandatory reserve, the revaluation reserve and the reserve for own shares of a company.

4. A company must pay the allocated dividends within one month from the day of adoption of a decision on profit appropriation. Payment of dividends in advance shall be prohibited.

5. A company shall pay the dividends in cash.

6. The persons who were the shareholders of a company at the close of the day when the General Meeting of Shareholders declared the dividends or were entitled to receive the dividends on other legal grounds shall be entitled to the dividend.

CHAPTER EIGHT

REORGANIZATION, SPLIT-OFF, TRANSFORMATION AND LIQUIDATION OF THE COMPANY

Article 61. Reorganisation of the Company

1. Companies shall be reorganised in the manner laid down in the Civil Code.

2. A company may be reorganised or take part in the reorganisation only after its authorised capital has been fully paid up (at the price of the last share issue).

Article 62. Adoption of a Decision on the Reorganisation of a Company

1. A decision on reorganisation shall be adopted by the General Meeting of Shareholders of every company being reorganised and the company involved in the reorganisation. Where the company has different classes of shares, the decision shall be adopted if approved by a separate vote of each class of shareholders (as well as the holders of non-voting shares).

2. A decision on reorganisation may be adopted not earlier than 30 days after the publication of the prepared terms of reorganisation in the daily indicated in the Articles of Association.

3. A decision on reorganisation must approve the terms of reorganisation and amend the Articles of Association of the continuing companies or adopt the Articles of Association of the new companies to be formed after the reorganisation.

4. A documentary proof of the decision of the General Meeting of Shareholders to reorganise a company must, within five days, be submitted to the manager of the Register of Legal Entities.

Article 63. Terms of Reorganisation

1. The Boards of the companies being reorganised and the companies involved in reorganisation (if the Boards are not formed, the company managers) must, subject to obtaining of the approval of the General Meeting of Shareholders, draw up the terms of reorganisation of the company indicating, inter alia, the following:

1) the information concerning every company being reorganised and involved in the reorganisation as required under Article 2.44 of the Civil Code as well as the name, legal form and registered office of every new company formed after the reorganisation;

2) the mode of reorganisation (merger by acquisition, merger by the formation of a new company, division by acquisition, division by the formation of a new company);

3) the companies wound up after the reorganisation and the companies continuing after the reorganisation;

4) the exchange ratio of shares of the companies wound up after the reorganisation for the shares of the companies continuing after the reorganisation and the substantiation thereof, the number of shares of the companies continuing after the reorganisation according to their classes and their nominal value as well as the rules of share allocation to the shareholders;

5) the procedure for and time limits of the issue of shares to the shareholders of the companies continuing after the reorganisation;

6) the price difference, paid out in cash, between the shares held by the shareholders and the shares to be received in the companies continuing after the reorganisation;

7) the moment from which the shareholders of a company being wound up after the reorganisation shall be entitled to participate in the profits of the company continuing after the reorganisation and all terms related to the granting of this right;

8) the moment from which the rights and obligations of the company being wound up after the reorganisation shall be assumed by the company continuing after the reorganisation;

9) the moment from which the contractual rights and obligations of the company being wound up after the reorganisation shall be assumed by the company continuing the activities after the reorganisation and the transactions shall be included into the accounting of this company;

10) the rights granted by the company continuing after the reorganisation to the holders of shares of different classes, debentures and other securities;

11) in case of division of the company, the exact description of the assets, rights and obligations of the company being divided and the allocation thereof to the companies continuing after the reorganisation;

12) the special rights granted to members of the bodies of the companies being reorganised and involved in the reorganisation and to the experts carrying out the evaluation of the terms of reorganisation.

2. The terms of reorganisation must be assessed by the firm of auditors wherewith every company involved in the reorganisation and being reorganised enters into a contract. If a single firm of auditors is to be contracted, such a firm of auditors must be approved by the manager of the Register of Legal Entities.

3. The firm of auditors must draw up the report on assessment of the terms of reorganisation indicating, inter alia, the following:

1) the conclusions whether the share exchange ratio is fair and justified;

2) the methods used to determine the share exchange ratio and the conclusions on the appropriateness of these methods for and their impact on the determination of the value of the shares;

3) a description of the difficulties encountered during the assessment.

4. The report on assessment of the terms of reorganisation must de drawn up and submitted to the company at least 30 days before the General Meeting of Shareholders which has on its agenda the issue of adoption of the decision on reorganisation of the Company.

5. Assessment of the terms of reorganisation shall not be performed and the report on assessment of the terms of reorganisation shall not be drawn if all the shareholders of the company being reorganised and involved in the reorganisation have so agreed. The agreement of the company’s shareholders shall be executed in any form in which the shareholders’ right to vote at the General Meeting of Shareholders is exercised.

6. In addition to the terms of reorganisation, the amended Articles of Association of the companies continuing after the reorganisation or the Articles of Association of the new companies formed after the reorganisation must also be drawn up.

7. The proposals regarding the terms of reorganisation may be submitted by the Supervisory Board, the Board, the company manager and the shareholders holding the shares of the company the nominal value whereof is at least 1/3 of the authorised capital.

8. The terms of reorganisation must be submitted to the manager of the Register of Legal Entities not later than on the first day of publication of the drawing up thereof in the daily specified in the Articles of Association. In addition to the terms of reorganisation, the manager of the Register of Legal Entities must also be provided with the report on assessment of the terms of reorganisation, except for the case specified in paragraph 5 of this Article.

9. From the day of publication of the drawing up of the terms of reorganisation, the company being wound up after the reorganisation shall acquire the status of the company being reorganised, and the company continuing after the reorganisation shall acquire the status of the company involved in the reorganisation.

Article 64. Report on the Intended Reorganisation

1. The Board of every public limited liability company being reorganised and involved in the reorganisation (if the Board is not formed, the manager) must draw up a detailed written report. The report must indicate the purposes of reorganisation, explain the terms of reorganisation, the continuity of activities and indicate the time limits of reorganisation, the legal and economic grounds of the terms of reorganisation, in particular the share exchange ratio and the rules determining the allocation of shares to the shareholders of the companies continuing after the reorganisation. The report must be submitted to the manager of the Register of Legal Entities at least 30 days before the General Meeting of Shareholders which has on its agenda the issue of adoption of the decision on reorganisation of the company. The report must contain information on the drawing up of the report on assessment of the terms of reorganisation and the particulars of the manager of the Register of Legal Entities storing the documentary files of the public limited liability companies being reorganised and involved in the reorganisation.

2. In case of division of a public limited liability company, the report specified in paragraph 1 of this Article about the intended reorganisation shall not be drawn up if all the shareholders of every company being reorganised by division and involved in the reorganisation agree thereto. The agreement of the shareholders of the public limited liability company shall be executed in the form specified in paragraph 5 of Article 63 of this Law.

3. Paragraph 1 of this Article shall apply to private limited liability companies only if so requested by the shareholders who hold at least 1/10 of all the votes.

Article 65. Notification of the Intended Reorganisation

1. Every company being reorganised and involved in the reorganisation must publish the drawn-up terms of reorganisation three times with at least 30-day intervals between publications in the daily indicated in the Articles of Association or publish them once at least 30 days before the General Meeting of Shareholders on the reorganisation of the company in the daily indicated in the Articles of Association and notify all creditors of the company in writing. The publication or the notice must include the particulars listed in subparagraphs 1, 2, 3, 8 and 9 of paragraph 1 of Article 63 and indicate the place and time at which the documents listed in paragraph 2 of this Article may be accessed.

2. At least 30 days before the General Meeting of Shareholders the agenda of which provides for the adoption of the decision on reorganisation of the company, each shareholder and creditor of the company must be given access to the following documents at the registered office of each company being reorganised and involved in the reorganisation:

1) the terms of reorganisation;

2) the amended Articles of Association of the continuing companies or the Articles of Association of new companies formed after the reorganisation;

3) the sets of annual financial statements for the last three years and annual reports of the companies being reorganised and involved in the reorganisation. If the terms of reorganisation were drawn up 6 months after the close of the financial year of at least one company involved in the reorganisation, the set of interim financial reports must be drawn up according to the same rules as those used for the drawing up of the previous set of annual financial statements and must be submitted to the shareholders. The set of interim financial reports shall not be drawn up earlier than 3 months before the drawing up of the terms of reorganisation. In the event of division, the set of interim financial reports shall not be drawn if all the shareholders of every company being reorganised and involved in the reorganisation agree thereto. The agreement of the shareholders of the company shall be executed in the form specified in paragraph 5 of Article 63 of this Law;

4) the reports on assessment of the terms of reorganisation, except for the case specified in paragraph 5 of Article 63 of this Law;

5) the reorganisation reports on the intended reorganisation drawn up by the Boards (if the Board is not formed, the company manager) of the companies being reorganised and involved in the reorganisation.

3. At the request of a shareholder and a creditor, a company must submit copies of the documents referred to in paragraph 2 of this Article. The copies of documents shall be made available to the shareholder free of charge.

4. The manager of the company being reorganised and involved in the reorganisation must notify the shareholders of the company (by attaching a written notice to the documents referred to in paragraph 2 of this Article and making an oral announcement at the General Meeting of Shareholders) of the material changes in the assets, rights and obligations during the period between the drawing up of the terms of reorganisation and the General Meeting of Shareholders the agenda of which contains the issue of adoption of a decision on reorganisation of the company. The manager of each company being reorganised and involved in the reorganisation must notify the managers of other companies involved in the reorganisation of the material changes in the assets, rights and obligations of the company so that they could give a notice thereof to the shareholders of those companies.

Article 66. Additional Safeguards for the Discharge of Obligations to the Creditors of the Companies Being Reorganised and Involved in the Reorganisation

1. Each company being reorganised and involved in the reorganisation must provide additional safeguards for the discharge of obligations to each creditor who so requests, where his rights arose and did not expire before the publication of the drawn-up terms of reorganisation and there is a ground for believing that, taking into consideration the financial status of the company being reorganised or involved in the reorganisation as well as the company continuing after the reorganisation which shall take over the liabilities under the terms of the reorganisation, the reorganisation will hinder the discharge of an obligation.

2. The creditors of a company may submit their claims from the first day of publication of the terms of reorganisation until the General Meeting of Shareholders the agenda whereof provides for the adoption of a decision on reorganisation of the company.

3. A company may refrain from providing additional safeguards for the discharge of obligations if the discharge of its liabilities to the creditor is adequately secured by pledge, mortgage, surety or guarantee. Disputes over the additional safeguards for the discharge of obligations shall be settled by court.

4. The documents for the registration of the companies continuing after the registration or the Articles of Association thereof as well as the documents for the removal from the register of the companies being wound up after the registration may not be submitted to the manager of the Register of Legal Entities if no additional safeguards for the discharge of obligations have been provided to the creditor who so requested as laid down in paragraphs 1 and 2 of this Article as well as before a court’s decision becomes effective if the dispute over additional safeguards for the discharge of obligations is being heard in court.

5. Holders of debentures of the company being reorganised or involved in the reorganisation shall have the rights of creditors referred to in paragraphs 1 and 2 of this Article, and the company shall have the rights and obligations referred to in paragraphs 1, 3 and 4 of this Article in respect of the holders of the debentures.

Article 67. Exchange of Shares in the Course of Reorganisation of Companies

1. The shares of the companies being reorganised must be exchanged for the shares of the companies continuing after the reorganisation (when reorganising the newly formed companies and the companies continuing after the reorganisation), except for the case provided for in paragraph 3 of this Article.

2. The shares of the companies continuing after the reorganisation may be allocated to the shareholders of the companies being wound up after the reorganisation in proportion to the authorised capital of the companies being reorganised or otherwise.

3. Where, in the event of a company’s division, the shares in the companies continuing after the reorganisation are allocated to the shareholders of the company being divided otherwise than in proportion to their participation in the authorised capital of that company, the shareholders holding the shares the nominal value whereof is less than 1/10 of the authorised capital of the company being divided shall have the right to require, within 45 days after the adoption of a decision on reorganisation of the company by the General Meeting of Shareholders, that their shares be redeemed by the company being divided before the completion of the reorganisation. The provisions of Article 54 of this Law shall not apply to such redemption of the shares. Paragraph 4 of this Article shall apply to the redeemed shares. The price paid for the shares being redeemed shall be determined taking into account the average market price of these shares over the period of six months immediately preceding the adoption of a decision on reorganisation of the company by the General Meeting of Shareholders. Disputes over the amount of the consideration for shares shall be settled in court. If the nominal value of the shares required to be redeemed exceeds 1/10 of the authorised capital of the company being divided, the reorganisation of the company under the approved terms of reorganisation may not be continued.

4. Own shares acquired by a company being wound up after the reorganisation or the shares of a company being wound up after the reorganisation acquired by a person acting in his own name, but for the benefit of the company and for the account thereof as well as the shares of a company being wound up after the reorganisation acquired by the company continuing after the reorganisation or by a person acting in his own name, but for the benefit of this company and for the account of this company shall not be exchanged for shares of the company continuing after the reorganisation.

5. Where the shares are exchanged for new shares in the companies continuing after the reorganisation, the difference in the share price may be paid in cash to the shareholders of the companies being wound up after the reorganisation. Cash payments may not exceed 10% of the nominal value of the new shares allocated to the shareholders in the companies continuing after the reorganisation.

Article 68. Succession to the Assets, Rights and Obligations of the Companies Being Reorganised

1. The companies continuing after the reorganisation shall be the successors to all assets, rights and obligations of the reorganised companies upon registration of the newly formed companies or registration of the amended Articles of Association of the companies continuing after the reorganisation in the Register of Legal Entities, unless otherwise provided by the terms of reorganisation. The assets, rights and obligations shall be assigned to the companies in compliance with the terms of reorganisation.

2. Where any assets of a company being divided are not assigned under the terms of reorganisation to any of the companies continuing after the reorganisation, such assets or the proceeds from the sale thereof shall be succeeded to by all companies continuing after the reorganisation in proportion to the share of the equity capital assigned to each of those companies under the terms of reorganisation.

3. Where any obligation of a company being divided is not assigned under the terms of reorganisation to any of the companies continuing after the reorganisation, all companies continuing after the reorganisation shall be jointly and severally liable for it. The liability of each of these companies for the obligation shall be limited to the amount of the equity capital assigned to each of them under the terms of reorganisation.

4. Where any obligation of the Company being divided is assigned under the terms of reorganisation to one of the companies continuing after the reorganisation, that company shall be liable for this obligation. If the company fails to discharge of the obligation or any part thereof and no additional safeguards have been provided, according to the procedure set forth by in this Law, to the creditors who so requested, all other companies continuing after the reorganisation shall be jointly and severally liable for the failure to discharge the obligation (or any part thereof). The liability of each of these companies shall be limited to the amount of the equity capital assigned to each of them under the terms of reorganisation.

5. Where a company being reorganised has issued securities other than shares, the holders of these securities shall be granted the participation in the companies continuing after the reorganisation at least equivalent to the rights they had in the reorganised company.

6. Paragraph 5 of this Article shall not apply where the holder of securities other than shares agrees to the change of his rights as well as where the holder of redeemable securities other than shares is entitled to require redemption of these securities under the terms of reorganisation. The redeemable securities other than shares must be redeemed within 2 months from the completion of the reorganisation, but not later than their maturity date set in a decision on issuance of these securities.

Article 69. Completion of Reorganisation

1. Reorganisation shall be deemed completed when all the new companies formed after the reorganisation are registered or the amended Articles of Association of all the companies continuing after the reorganisation are registered.

2. Prior to submission of documents of the company continuing after the reorganisation to the manager of the Register of Legal Entities, the General Meeting of Shareholders of this company shall be convened if the terms of reorganisation so provide. Both the shareholders of the company continuing after the reorganisation and the shareholders of the companies being wound up after the reorganisation shall be entitled to attend this General Meeting of Shareholders and vote if they have been allocated the shares of the company continuing after the reorganisation under the terms of reorganisation.

3. A new company formed after the reorganisation shall be registered after the General Meeting of Shareholders of this company is held and elects the company’s organs elected by the General Meeting of Shareholders under the Articles of Association and after the Board (if the Articles of Association provide for the election of the Board) and the company manager are elected as well as after the statutory documents are submitted to the manager of the Register of Legal Entities.

4. The General Meeting of Shareholders referred to in paragraphs 2 and 3 of this Article may decide all issues within the powers of the General Meeting of Shareholders.

5. The reorganised company shall be wound up upon its removal from the Register of Legal Entities.

6. Members of the management organs of the reorganised company and the company involved in the reorganisation who drew up and exercised the terms of reorganisation as well as the experts who evaluated the terms of reorganisation under the agreement between the company and the firm of auditors must reimburse the damage they inflicted on the shareholders of those companies according to the procedure prescribed by laws.

Article 70. Merger by Acquisition by the Company Holding at Least 90% of the Shares in the Company Being Acquired

1. Subparagraphs 4, 5, 6 and 7 of paragraph 1, paragraphs 2, 3, 4 and 5 of Article 63, Article 64, subparagraphs 4 and 5 of paragraph 2 of Article 65 and paragraphs 1, 2, 3 and 5 of Article 67 of this Law shall not apply to the merger by acquisition where the company continuing after the reorganisation is the holder of all shares in the company being acquired.

2. Paragraphs 2, 3, 4 and 5 of Article 63, Article 64 and subparagraphs 4 and 5 of paragraph 2 of Article 65 of this Law shall not apply to the merger by acquisition where the company continuing after the reorganisation holds at least 90% of the shares in the company being acquired. In this case, the company, if requested so by other shareholders of the company being acquired, must redeem their shares before the completion of the reorganisation. The provisions of paragraph 3 of Article 67 of this Law shall apply to the redemption of shares.

Article 71. Split-off of a Company

1. A part of the company continuing after the reorganisation may be split off and one or more new companies of the same legal form may be formed on the basis of the assets, rights and obligations assigned to this part.

2. The provisions of the Civil Code and this Law regulating reorganisation by division shall apply mutatis mutandis to the split-off referred to in paragraph 1 of this Article.

Article 72. Transformation

1. A public limited liability company may be transformed into a legal person of the following legal forms:

1) private limited liability company;

2) state enterprise;

3) municipal enterprise;

4) agricultural company;

5) co-operative company;

6) general partnership;

7) limited partnership;

8) individual enterprise;

9) public establishment.

2. A private limited liability company may be transformed into a public limited liability company or another legal person of one of the legal forms listed in subparagraphs 2–9 of paragraph 1 of this Article.

3. A company shall be transformed pursuant to the Civil Code, this Law and the law regulating the legal persons of a new legal form.

4. An insolvent company may not be transformed.

5. A decision on transformation of a Company shall be taken by the General Meeting of Shareholders. Where a company has shares of different classes, the decision on transformation of the company shall be adopted subject to a separate vote by the holders of each class of shares (as well as the holders of non-voting shares).

6. The documents of incorporation of the legal person of a new legal form must be approved and the organs elected by the meeting of members must be elected (formed) by a decision on the transformation of a company adopted by the General Meeting of Shareholders. The decision of the General Meeting of Shareholders must, inter alia, indicate the following:

1) the name, legal form and registered office of the legal person of a new legal form;

2) the purposes of the legal person of a new legal form;

3) the procedure, terms and time limits for a shareholder of the company being transformed to become a member of the legal person of a new legal form.

7. A notification of a decision on transformation of a company must be published in the daily indicated in the Articles of Association three times with at least 30-day intervals between the publications or it must be published once in the daily indicated in the Articles of Association, notifying every creditor of the Company thereof in writing. The notification must contain the particulars of the company specified in Article 2.44 of the Civil Code as well as the name, legal form and registered office of the legal person of a new legal form.

8. While transforming a public limited liability company into a legal person of a different legal form, a general securities account for the public limited liability company in the Central Securities Depository of Lithuania must be closed, inter alia, before the registration of the documents of incorporation of the legal person of a new legal form. In the case of a public limited liability company considered to be an issuer of securities under the Law on Securities, inter alia, a tender offer to buy up the shares of the public limited liability company must be submitted and realised.

9. The provisions of the Law on Securities shall apply to the tender offer referred to in of paragraph 8 of this Article, unless this paragraph provides otherwise. The tender offer shall be submitted by the shareholders who voted for the decision on transformation of a public limited liability company. One or more shareholders shall be entitled to fulfil this obligation for other shareholders. The shareholders who voted against the decision on transformation of the public limited liability company or did not vote at all shall be entitled to sell their shares at the time of the tender offer.

10. A documentary proof of a decision on transformation of a company must be submitted to the manager of the Register of Legal Entities not later than on the first day of publication.

11. A company shall acquire the legal status of a company being transformed from the day of a decision on transformation of the company.

12. When transforming a legal person of another legal form into a company, the assets transferred for the shares of this company must be evaluated by an independent property valuer in the manner laid down by the legal acts regulating asset valuation. Asset valuation reports shall be subject to paragraph 8 of Article 8 of this Law. The asset valuation report for the assets transferred for the shares of the company must be submitted to the manager of the Register of Legal Entities at least 10 days before the adoption of a decision on transformation.

13. When transforming a legal person of another legal form into a company, the authorised capital of the Company must be not less that the minimum capital specified in Article 2 of this Law. If the assets of a legal person of another legal form which is being transformed into a company prove insufficient to form this legal person’s minimum authorised capital prescribed by Article 2 of this Law or the liabilities exceed the value of the assets, the members of the legal person being transformed shall be entitled to pay additional contributions.

14. When transforming a private limited liability company as well as a legal person of another legal form provided for by laws into a public limited liability company, in addition to other actions laid down in this Law and other laws, it shall be necessary:

1) to approve the shares prospectus in the cases and in accordance with the procedure laid down by the legal acts regulating the securities market;

2) to select the firm of auditors.

15. A company may be transformed into a state enterprise where all of its shares are held by the State.

16. A company may be transformed into a municipal enterprise where all of its shares are held by a municipality.

17. A company may be transformed into an agricultural company if it has at least 2 shareholders and its income from agricultural products and the services provided for agriculture over the last financial year constitute over 50% of all the sales revenue.

18. A company may be transformed into a co-operative company if it has at least 5 shareholders.

19. A company may be transformed into a general partnership if it has at least 2, but not more than 20 shareholders.

20. A company may be transformed into a limited partnership if it has at least 3, but not more than 20 shareholders.

21. A company may be transformed into an individual enterprise if all shares in the company are held by a single natural person.

22. The incorporation documents of a legal person of a new legal form shall be registered in the Register of Legal Entities, and the data of the Register of Legal Entities shall be amended upon election (formation) of the management organs of the legal person of a new legal form, provision of additional safeguards for the discharge of obligations to the creditors who so requested and emergence of the circumstances provided for in the laws as well as submission of the statutory documents. The amended incorporation documents shall become invalid if they are not submitted to the manager of the Register of Legal Entities within six months from adoption of a decision on transformation of the company.

23. Transformation shall be deemed completed on the day of registration of the amended incorporation documents of a legal person of a new legal form in the Register of Legal Entities.

Article 73. Liquidation of a Company

1. A company may be liquidated on the grounds laid down in the Civil Code for the liquidation of legal persons.

2. A decision on liquidation of a company shall be adopted by the General Meeting of Shareholders or a court in the cases specified by the Civil Code.

3. The General Meeting of Shareholders may not adopt a decision on liquidation of an insolvent company.

4. A bankrupt company shall be liquidated according to the procedure laid down in the Enterprise Bankruptcy Law.

5. The General Meeting of Shareholders or a court, having adopted a decision on liquidation of a company, or the manager of the Register of Legal Entities, where a decision on liquidation of the company is adopted by the court on the initiative of the manager, must elect (appoint) the liquidator.

6. From the day of adoption of a decision on liquidation of a company by the General Meeting of Shareholders, the company shall acquire the status of a company in liquidation. Upon his election (appointment), the liquidator shall assume the rights and duties of the company manager and the Board. The company manager and the Board shall lose their powers as of the appointment of the liquidator. The General Meeting of Shareholders may be convened according to the procedure laid down in this Law.

7. The documents of a company in liquidation used by it in dealings with third parties must, inter alia, indicate its legal status “in liquidation”.

8. The General Meeting of Shareholders may fix another date (other than the date of adoption of a decision) as of which a decision on liquidation of a company shall become effective, though this date may not precede the date of adoption of the decision on liquidation of the company.

9. If a company is liquidated because of the expiry of the duration of the company, the General Meeting of Shareholders must, at least three months before such an expiry, adopt a decision on liquidation of the company and elect the liquidator or adopt a decision on extension of the period of duration and amend the Articles of Association of the company. In this case, upon adoption of the decision on liquidation of the company, the company shall acquire the status of a company in liquidation on the next day after the expiry of the period of duration laid down in the Articles of Association. If the General Meeting of Shareholders fails to elect the liquidator within the prescribed time limits, the shareholders whose holdings in the company entitle them to at least 1/10 of all votes as well as the manager of the Register of Legal Entities shall be entitled to refer to court for the appointment of the liquidator.

10. The liquidator shall publish a notification of the liquidation of a company 3 times with at least 30-day intervals between the publications in the daily indicated in the Articles of Association or publish it once in the daily indicated in the Articles of Association and notify all the creditors of the company thereof in writing. The publication or notice must include all the particulars of the company referred to in Article 2.44 of the Civil Code.

11. Not later than on the first day of publication of the notification of the liquidation of a company, the liquidator must submit the documents confirming a decision on liquidation of the company and the particulars of the liquidator to the manager of the Register of Legal Entities.

12. When a company is being liquidated, the persons who have subscribed, but have not paid for the shares must make payments for the shares according to the procedure laid down in the share subscription agreement. The subscribers may be released from their duty to pay the outstanding contributions by the amount of the assets of the company in liquidation which would be allocated to them only where the grounds for the liquidation of the company is the invalidation of the company’s incorporation pursuant to Article 2.114 of the Civil Code and the company is capable of satisfying its liabilities to the creditors.

13. A company in liquidation must first make settlement with its creditors according to the sequence of satisfaction of creditors’ claims laid down in the Civil Code. Upon settlement with the creditors of the company in liquidation, the accrued dividend shall be paid to the holders of preference shares with a cumulative dividend. The remaining assets of the company in liquidation shall be allocated to the shareholders in proportion to the nominal value of the shares held by them. Any subsequently discovered assets of the company shall be allocated in the same manner. If different rights are attached to the shares of the company, this must be taken into account when allocating the assets.

14. The assets of a company may be allocated to the shareholders at least 2 months from the completion of all actions laid down in paragraph 10 of this Article.

15. In the event of judicial disputes over the payment of a company’s debts, the assets of the company may not be allocated to the shareholders until the disputes are settled by court and settlement with the creditors is effected.

16. A decision on cancelling the liquidation of a company may be adopted by the General Meeting of Shareholders which adopted a decision on the liquidation of the company or by a court. The decision on liquidation of the company may not be revoked if at least one shareholder received a share of assets of the company in liquidation.

17. The documentary proof of a decision on liquidation of a company as well as on cancelling the liquidation must be submitted to the manager of the Register of Legal Entities.

Article 74. Powers of the Liquidator

1. The liquidator shall have the rights and duties of the Board and the company manager. Only a natural person may be the liquidator and he shall be subject to the same requirements as those applicable to the company manager.

2. In addition to other duties laid down by this Law and the Civil Code, the following functions shall be assigned to the sphere of competence of the liquidator:

1) to draw up the opening balance sheet at the start of liquidation;

2) to allocate to the shareholders the assets of the company remaining after settlement with the creditors of the company and to draw up the documents of transfer thereof;

3) in the event of liquidation of a public limited liability company, to close a general securities account for the public limited liability company in the Central Securities Depository of Lithuania;

4) to hand over the documents of the liquidated company for storage according to the procedure laid down in the Law on Documents and Archives;

5) to draw up a liquidation statement of the company. The liquidation statement shall describe the process of liquidation and shall confirm the completion of all actions related thereto;

6) to submit the liquidation statement of the company and other documents necessary for the removal of the liquidated company from the Register to the manager of the Register of Legal Entities.

3. If the company’s liquidation lasts for a period exceeding 12 months, the liquidator shall, not later than within three months, draw up the set of annual financial statements and the liquidation report after the close of every financial year. The set of annual financial statements and the liquidation report shall be approved by the General Meeting of Shareholders. Access to these documents must be granted to all shareholders and creditors.

4. The liquidator may be dismissed according to the procedure laid down in the Civil Code.

5. A decision on temporary substitution of the liquidator during his vacation or temporary incapacity for work shall be adopted by the General Meeting of Shareholders, a court or the manager of the Register of Legal Entities which have elected (appointed) the liquidator according to the procedure laid down in this Law. A person substituting for the liquidator shall be subject to the same requirements as those applicable to the liquidator.

CHAPTER NINE

BRANCHES OF FOREIGN COMPANIES

Article 75. Establishment, Operation and Termination of Activities of Branches of Foreign Companies

1. The following shall be considered as branches of foreign companies:

1) branches of the companies established in the Member States of the European Union;

2) branches of the companies established in the states referred to in Article 77 and Section 8 of Annex XXII to the Agreement on the European Economic Area;

3) branches of the legal persons established in the states not referred to in subparagraphs 1 and 2 of this Article, where the legal forms thereof are similar to those of companies.

2. A branch of a foreign company shall be deemed established upon registration thereof in the Register of Legal Entities.

3. Only the documents referred to in Article 76 of this Law and the particulars referred to in Article 77 shall be submitted to the Register of Legal Entities. The manager of the branch of a foreign company shall be responsible for the submission of the documents and particulars to the Register of Legal Entities.

4. The documents of branches of foreign companies used in dealings with third parties must contain the information referred to in Article 2.44 of the Civil Code about the foreign company which has established the branch and indicate the register which accumulates and stores the data on the branch of the foreign company as well as the code of the branch of the foreign company. The register where the foreign company is registered shall not be indicated if the law applicable to the foreign company does not require such registration.

5. The information referred to in paragraph 4 of this Article must also be available on the website of the branch of the foreign company if there is one.

6. The activities of the branch of the foreign company shall be governed by the Civil Code, this Law and other laws and legal acts of the Republic of Lithuania.

7. A notice of termination of activities of the branch of a foreign company must be published by the branch manager three times with at least 30-day intervals in at least one of the main dailies of the Republic of Lithuania or the notice must be published in the daily once and all creditors must be notified thereof in writing. The publication or notice must contain the particulars referred to in paragraph 4 of this Article and indicate a time limit for the filing of creditors’ claims, which may not be less than 2 months from the date of publication.

8. Upon publication of a notice of termination of activities of the branch of a foreign company, the creditors of the branch of the foreign company shall be entitled to demand the discharge of an obligation or require that the foreign company which owns the branch provide additional safeguards for the discharge of obligations. Disputes over the discharge of obligations or additional safeguards shall be settled in court.

9. The documents relating to the removal of the branch of a foreign company from the Register may not be submitted to the manager of the Register of Legal Entities if obligations have not been discharged or additional safeguards for the discharge of the obligations have not been provided to the creditors who so requested; neither may the above documents be submitted before the effective date of a court’s ruling if a dispute over the discharge of the obligations or additional safeguards is being heard in court.

10. Until the removal from the Register, the documents of the branch of a foreign company which has terminated its activities shall be transferred for storage according to the procedure laid down for enterprises in the Law on Documents and Archives.

Article 76. Documents of a Foreign Company and its Branch to be Submitted to the Register of Legal Entities

1. The following documents of a foreign company and its branch shall be submitted to the Register of Legal Entities:

1) an excerpt from the register where the file of the foreign company is stored confirming that the foreign company is registered in the register;

2) the documents of incorporation of the foreign company, the Memorandum of Association and the Articles of Association, if these are separate documents, as well as all amendments to these documents;

3) the set of annual financial statements of the foreign company which has been drawn up, audited and disclosed according to the law of the state in which the foreign company is established;

4) the documents attesting to the procedures applied to an insolvent company.

2. If the set of annual financial statements of the foreign companies referred to in subparagraph 3 of paragraph 1 of Article 75 of this Law is drawn up according to the requirements other than those applied in the European Union, the set of annual financial statements of the branch of the foreign company must be drawn up and submitted to the Register of Legal Entities instead of the set of annual financial statements of the foreign company referred to in subparagraph 3 of paragraph 1 of this Article. The set of annual financial statements of the branch of the foreign company shall be drawn up according to the procedure laid down in the legal acts of the Republic of Lithuania regulating the accounting and drawing up of financial statements.

3. The documents referred to in subparagraphs 1 and 2 of paragraph 1 of this Article must be legalised according to the procedure laid down in the legal acts, save for the cases laid down in treaties.

4. The foreign companies referred to in subparagraphs 1 and 2 of paragraph 1 of Article 75 of this Law, where they have established more than one branch, may select the branch the file whereof will be used to store the documents referred to in paragraph 1 of this Article. In such a case, the files of other branches must indicate the name, code and register manager of this selected branch.

5. In addition to the documents referred to in paragraph 1 of this Article, the foreign companies referred to in subparagraph 3 of paragraph 1 of Article 75 of this Law must at least once a year submit to the Register of Legal Entities a document evidencing the amount of the subscribed capital of the foreign company if the amount of the subscribed capital is not specified in the documents referred to in subparagraph 2 of paragraph 1 of this Article.

Article 77. Particulars of a Foreign Company and its Branch in the Register of Legal Entities

1. The following particulars of a foreign company and its branch shall be entered in the Register of Legal Entities:

1) the address of the branch;

2) the operation of the branch;

3) the name and legal form of the foreign company as well as the name of the branch if different from the name of the foreign company;

4) the particulars of the persons who, as members of the organs of the foreign company, act on behalf of the foreign company in dealings with third parties and in judicial proceedings, the dates of their appointment and expiry of their term of office as well as the sample signatures of these persons;

5) the information whether the persons referred to in subparagraph 4 of this paragraph may, when acting on behalf of the foreign company, act at their own discretion or must act jointly, the extent of their rights, the expiry of powers, if such is laid down;

6) the particulars of the manager of the branch, the dates of his appointment and expiry of the term of office as well as the sample signature;

7) the date of appointment of liquidators of the foreign company if the company is in liquidation, the particulars of the liquidators, the extent of their rights and sample signatures;

8) the date of winding up of the foreign company;

9) the date of termination of activities of the branch.

2. In addition to the particulars laid down in paragraph 1 of this Article, the Register of Legal Entities shall also indicate, in respect of the branches of the foreign companies referred to in subparagraphs 1 and 2 of paragraph 1 of Article 75 of this Law, the register where the file of a foreign company is stored and the company’s number in that register.

3. In addition to the particulars laid down in paragraph 1 of this Article, the following particulars of branches of the foreign companies referred to in subparagraph 3 of paragraph 1 of Article 75 of this Law shall be entered in the Register of Legal Entities:

1) the law applicable to the foreign company;

2) the legal form, registered office and field of activities of the foreign company;

3) if registration is required under the law applicable to the foreign company, the register in which the foreign company is registered and its registration number in that register;

4) the amount of the subscribed capital of the foreign company if this amount is not indicated in the documents of incorporation of the foreign company.

CHAPTER TEN

FINAL PROVISIONS AND ENTRY INTO FORCE OF THE LAW

Article 78. Final Provisions

1. Provisions of paragraphs 3 and 4 of Article 22, Articles 261, 262, 302 and 303 of this Law shall not apply to the collective investment undertakings specified in the Law on the Collective Investment Undertakings, except for collective investment undertakings of the closed-ended type.

2. If the public distribution of the transferrable securities issued by a public limited liability company falls outside the scope of legal acts regulating the securities market and the total sales value of these securities amounts to LTL 350 000 within the period of 12 months, an information document must be drawn up before their public distribution indicating the information about the public limited liability company and the offered transferrable securities and granting access to it to the persons intending to acquire the securities. The Securities Commission shall provide details of the content of the information document and specify the cases when the drawing up of the document is not required.

Article 79. Entry into Force and Implementation of the Law

1. This Law shall enter into force on 1 January 2004.

2. From the entry into force of this Law, the Law of the Republic of Lithuania on Companies No I-528 (Official Gazette No 55-1046, No102-2050, 1994; No 21-492, No 41-993, No 107-2393, 1995; No 1-4, No 100-2257, No 126-2947, 1996; No 69-1739, 1997; No 36-961, No 115-3246, 1998; No 86-2562, 1999; No 15-380, No 28-760, 2000; No 34-1125, 2001) shall apply to reorganisation and liquidation of the companies decisions on the reorganisation and liquidation whereof were taken prior to 30 June 2001.

3. The Law of the Republic of Lithuania on Companies No VIII-1835 (Official Gazette No 64-1914, No 113-3614, 2000; No 112-4081, 2001; No 43-1607, No 72-3013, No 101-4495, No 124-5628, 2002) shall apply to reorganisation and liquidation of the companies decisions on the reorganisation and liquidation whereof were taken from 1 July 2001 until the entry into force of this Law.

4. Upon entry into force of this Law, the term “the head of a company’s administration” used in other legal acts shall correspond to the term “the company manager”.

5. The provisions laid down in this Law for the registration of companies in the Register of Legal Entities and the duty of the manager of the Register of Legal Entities to publish the facts which are to be made public under this Law shall enter into force from the commencement of operation of the Register of Legal Entities.

6. Until the commencement of operation of the Legal Entities Register:

1) the companies, their branches and representative offices as well as their documents and particulars shall be registered in and accumulated in the Register of Enterprises of the Republic of Lithuania;

2) the documents which must be submitted to the manager of the Register of Legal Entities according to the procedure laid down in this Law shall be submitted to the manager of the Register of Enterprises;

3) the time limits which must, in the cases specified by this Law, run from the publication by the manager of the Register of Legal Entities of the facts referred to in this Law shall run from the receipt of relevant documents in the Register of Enterprises.

7. From the commencement of operation of the Register of Legal Entities:

1) the documents and particulars stored in the Register of Enterprises shall be considered as the documents and particulars of the Register of Legal Entities;

2) the companies, their branches and representative offices registered in the Register of Enterprises shall be considered to have been registered in the Register of Legal Entities.

I promulgate this Law passed by the Seimas of the Republic of Lithuania.

PRESIDENT OF THE REPUBLIC VALDAS ADAMKUS

Annex to

the Republic of Lithuania

Law on Companies

EU LEGAL ACTS IMPLEMENTED BY THIS LAW

1. First Council Directive 68/151/EEC of 9 March 1968 on co-ordination of safeguards which, for the protection of the property rights of members and others, are required by member states of companies within the meaning of second paragraph of article 58 of the treaty, with a view to making such safeguards equivalent throughout the community (OJ 2004 special edition, Chapter 17, Volume 1, p.3)

2. Second Council Directive 7791/EEC of 13 December 1976 on co-ordination of safeguards which, for the protection of the property rights of members and others, are required by member states of companies within the meaning of second paragraph of article 58 of the treaty, in respect of the formation of public limited liability companies and the maintenance and alteration of their capital, with a view to making such safeguards equivalent throughout the community (OJ 2004 special edition, Chapter 17, Volume 1, p.3)

3. Third Council Directive 78/855/EEC of 9 October 1978 based on article 54 (3) (g) of the treaty concerning mergers of public limited liability companies (OJ 2004 special edition, Chapter 17, Volume 1, p. 42).

4. Sixth Council Directive 82/891/EEC of 17 December 1982 based on article 54 (3) (g) of the treaty, concerning the division of public limited liability companies (OJ 2004 special edition, Chapter 17, Volume 1, p. 50).

5. Eleventh Council Directive 89/666/EEC of 21 December 1989 concerning disclosure requirements in respect of branches opened in a member state by certain types of Company governed by the law of another state (OJ 2004 special edition, Chapter 17, Volume 1, p. 100).

6. Twelfth Council Company Law Directive 89/667/EEC of 21 December 1989 on single-member private limited-liability companies (OJ 2004, special edition, Chapter 17, Volume 1, p. 104).

7. Council Directive 92/101/EEC of 23 November 1992 amending Directive 77/91/EEC on the formation of public limited-liability companies and the maintenance and alteration of their capital (OJ 2004 special edition, Chapter 17, Volume 1, p. 126).

8. Directive 2003/58/EC of the European Parliament and of the Council of 15 July 2003 amending Council Directive 68/151/EEC, as regards disclosure requirements in respect of certain types of companies (OJ 2004 special edition, Chapter 17, Volume 1, p. 304).

9. Directive 2006/68/EC of the European Parliament and of the Council of 6 September 2006 amending Council Directive 77/91/EEC as regards the formation of public limited liability companies and the maintenance and alteration of their capital (OJ 2006 L 264 p. 32).

10. Directive 2007/63/EC of the European Parliament and of the Council of 13 November 2007 amending Council Directives 78/855/EEC and 82/891/EEC as regards the requirement of an independent expert’s report on the occasion of merger or division of public limited liability companies(OJ 2007 L 3000, p. 47).

11. Directive 2007/63/EC of the European Parliament and of the Council of 11 July 2007 on the exercise of certain rights of shareholders in listed companies (OJ 2007 L 184, p. 17).

Aug 142014
 

Lithuanian Criminal Code lists all the actions regarded as crimes and misdemeanors in Lithuania and establishes the system of punishments.

The Code consists of two major parts. Articles 1 to 98 describe the general system of Lithuanian criminal justice and punishments for crimes. Articles after 99 describes particular crimes or midemeanors and the possible punishments. Crimes are categorized into chapters according to their type. Generally the higher up the chapter is the more grave that type of crimes is considered to be (e.g. articles 99-113 list crimes against humanity and war crimes).

Translation of the Civil Code of The Republic of Lithuania provided by the chancery of Seimas (Parliament):

REPUBLIC OF LITHUANIA CRIMINAL CODE

GENERAL PROVISIONS

CHAPTER I

GENERAL PROVISIONS

Article 1. Purpose of the Criminal Code of the Republic of Lithuania

1. The Criminal Code of the Republic of Lithuania shall be a uniform criminal law having the purpose of defending human and citizen’s rights and freedoms, public and the state’s interests against criminal acts by criminal law means.

2. This Code shall:

1) define which acts are crimes and misdemeanours and prohibit them;

2) establish penalties, penal and reformative sanctions for the acts provided for by this Code as well as compulsory medical treatment;

3) establish grounds for and conditions of criminal liability as well as the grounds for and conditions of releasing the persons who have committed criminal acts may be released from criminal liability or a penalty.

3. The provisions of this Code have been harmonised with provisions of the legal acts of the European Union specified in Annex to this Code.

Article 2. Basic Provisions of Criminal Liability

1. A person shall be held liable under this Code only when the act committed by him is forbidden by a criminal law in force at the time of commission of the criminal act.

2. Ignorance of the law shall not release a person from criminal liability.

3. A person shall be held liable under a criminal law only when he is guilty of commission of a criminal act and only if at the time of commission of the act the conduct of the person could have been reasonably expected to conform to the requirements of law.

4. Only a person whose act as committed corresponds to a definition of a body of a crime or misdemeanour provided for by a criminal law shall be liable under the criminal law.

5. Penalties, penal or reformative sanctions and compulsory medical treatment shall be imposed only in accordance with the law.

6. No one may be punished for the same criminal act twice.

CHAPTER II

VALIDITY OF A CRIMINAL LAW

Article 3. Term of Validity of a Criminal Law

1. The criminality of an act and punishability of a person shall be determined by a criminal law in force at the time of the commission of that act. The time of the commission of a criminal act shall be the time of an act (or omission) or the time of occurrence of the consequences provided for by the criminal law, where the occurrence of those consequences was desired at a different time.

2. A criminal law nullifying the criminality of an act, commuting a penalty or in otherwise mitigating legal circumstances for the person who committed the criminal act shall have a retroactive effect, i.e., it shall apply to the persons who committed the criminal act prior to the coming into force of such a law, also to the persons serving a sentence and those with previous convictions.

3. A criminal law establishing the criminality of an act, imposing a more severe penalty upon or otherwise aggravating legal circumstances of the person who has committed the criminal act shall have no retroactive effect. The provisions of this Code establishing liability for genocide (Article 99), treatment of persons prohibited under international law (Article 100), killing of persons protected under international humanitarian law (Article 101), deportation of the civil population of an occupied state (Article 102), causing bodily harm to, torture or other inhuman treatment of persons protected under international humanitarian law (Article 103), forcible use of civilians or prisoners of war in the armed forces of the enemy (Article 105) and prohibited military attack (Article 111) shall constitute an exception.

4. Only the penal or reformative sanctions as well as medical treatment measures provided for by a criminal law in force at the time of passing of a court judgement shall be imposed.

Article 4. Validity of a Criminal Law in Respect of the Persons who have Committed Criminal Acts within the Territory of the State of Lithuania or Onboard the Ships or Aircrafts Flying the Flag or Displaying Marks of Registry of the State of Lithuania

1. The persons who have committed criminal acts within the territory of the state of Lithuania or onboard the ships or aircrafts flying the flag or displaying marks of registry of the State of Lithuania shall be held liable under this Code.

2. The place of commission of a criminal act shall be the place in which a person acted or ought to have acted or could have acted or the place in which the consequences provided for by a criminal law occurred. The place of commission of a criminal act by accomplices shall be the place in which the criminal act was committed or, if one of the accomplices acted elsewhere, the place where he acted.

3. A single criminal act committed both in the territory of the State of Lithuania and abroad shall be considered to have been committed in the territory of the Republic of Lithuania if it was commenced or completed or discontinued in this territory.

4. The issue of criminal liability of the persons who enjoy immunity from criminal jurisdiction under international legal norms and commit a criminal act in the territory of the Republic of Lithuania shall be decided in accordance with treaties of the Republic of Lithuania and this Code.

Article 5. Criminal Liability of Citizens of the Republic of Lithuania and Other Permanent Residents of Lithuania for the Crimes Committed Abroad

Citizens of the Republic of Lithuania and other permanent residents of Lithuania shall be held liable for the crimes committed abroad under this Code.

Article 6. Criminal Liability of Aliens for the Crimes Committed Abroad against the State of Lithuania

The aliens who do not have a permanent residence in the Republic of Lithuania shall be liable under a criminal law where they commit crimes abroad against the State of Lithuania as provided for in Articles 114-128 of this Code.

Article 7. Criminal Liability for the Crimes Provided for in Treaties

Persons shall be liable under this Code regardless of their citizenship and place of residence, also of the place of commission of a crime and whether the act committed is subject to punishment under laws of the place of commission of the crime where they commit the following crimes subject to liability under treaties:

1) crimes against humanity and war crimes (Articles 99-113);

2) trafficking in human beings (Article 147);

3) purchase or sale of a child (Article 157);

4) production, storage or handling of counterfeit currency or securities (Article 213);

5) money or property laundering (Article 216);

6) act of terrorism (Article 250);

7) hijacking of an aircraft, ship or fixed platform on a continental shelf (Article 251);

8) hostage taking (Article 252);

9) unlawful handling of nuclear or radioactive materials or other sources of ionising radiation (Articles 256, 256(1) and 257);

10) the crimes related to possession of narcotic or psychotropic, toxic or highly active substances (Articles 259-269);

11) crimes against the environment (Articles 270, 270(1), 271, 272, 274).

Article 8. Criminal Liability for the Crimes Committed Abroad

1. A person who has committed abroad the crimes provided for in Articles 5 and 6 of this Code shall be held criminally liable only where the committed act is recognised as a crime and is punishable under the criminal code of the state of the place of commission of the crime and the Criminal Code of the Republic of Lithuania. Where a person who has committed a crime abroad is prosecuted in the Republic of Lithuania, but a different penalty is provided for this crime in each country, the person shall be subject to a penalty according to laws of the Republic of Lithuania, however it may not exceed the maximum limit of penalty specified in the criminal laws of the state of the place of commission of the crime.

2. A person who has committed the crimes provided for in Articles 5, 6, and 7 of the Criminal Code of the Republic of Lithuania shall not be held liable under this Code where he:

1) has served the sentence imposed by a foreign court;

2) has been released from serving the entire or a part of the sentence imposed by a foreign court;

3) has been acquitted or released from criminal liability or punishment by a foreign court’s judgement, or no penalty has been imposed by reason of the statute of limitation or on other legal grounds provided for in that state.

Article 9. Extradition

1. A citizen of the Republic of Lithuania who has committed a criminal act in the Republic of Lithuania or in the territory of another state may be extradited to the foreign state or surrendered to the International Criminal Court solely in accordance with a treaty to which the Republic of Lithuania is party or a resolution of the United Nations Security Council.

2. An alien who has committed a criminal act in the Republic of Lithuania or in the territory of another state shall be extradited to the respective state or surrendered to the International Criminal Court solely in accordance with a treaty to which the Republic of Lithuania is party or a resolution of the United Nations Security Council.

3. It shall be allowed not to extradite a citizen of the Republic of Lithuania or an alien where:

1) the committed act is not regarded as a crime or misdemeanour under this Code;

2) the criminal act has been committed in the territory of the State of Lithuania;

3) the person is being prosecuted for a crime of political nature;

4) the person has been convicted of the criminal act committed, acquitted or released from criminal liability or penalty;

5) the person may be subject to capital punishment for the committed crime in another state;

6) the statute of limitations for the passing or execution of a judgement of conviction has expired;

7) the person is released from penalty under an act of amnesty or by granting clemency;

8) there exist other grounds provided for by treaties to which the Republic of Lithuania is party.

4. The persons who have been granted asylum in accordance with laws of the Republic of Lithuania shall not be punishable under a criminal law of the Republic of Lithuania for the criminal acts for which they were prosecuted abroad and shall not be extradited to foreign states, except in the cases provided for by Article 7 of this Code.

Article 9(1). Surrender of a Person under the European Arrest Warrant

1. On the basis of the European arrest warrant, a citizen of the Republic of Lithuania or an alien who is suspected of commission of a criminal act in the issuing Member State or who has been imposed a custodial sentence, but has not served it shall be surrendered to the issuing Member State.

2. A citizen of the Republic of Lithuania or an alien shall be surrendered under the European arrest warrant only where the criminal act committed by him is punishable, according to laws of the issuing Member State, by a custodial sentence of at least one year and where the European arrest warrant has been issued in connection with the execution of a custodial sentence which has already been imposed, only where the duration of the sentence imposed is at least four months.

3. A citizen of the Republic of Lithuania or an alien shall not be surrendered to the issuing Member State where:

1) surrender of the person under the European arrest warrant would violate fundamental human rights and/or freedoms;

2) the person has been released in the Republic of Lithuania from penalty for the act which has been committed by him and on which the European arrest warrant is based under an act of amnesty or by granting clemency.

3) the person was convicted in the Republic of Lithuania or another state for the criminal act which he had committed and on which the European arrest warrant is based, and the sentence imposed has been served, is currently being served or may no longer be executed under the law of the sentencing Member State;

4) at the time of commission of a criminal act, the person was not of the age at which the act committed by him becomes subject to criminal liability according to criminal laws of the Republic of Lithuania;

5) the act committed does not constitute a crime or misdemeanour under this Code, within the exception of the cases when the European arrest warrant has been issued for the criminal act provided for in paragraph 2 of Article 2 of Council Framework Decision 2002/584/JHA of 13 June 2002 on the European arrest warrant and the surrender procedures between Member States, and the criminal laws of the issuing Member State provide for a custodial sentence of at least three years for this criminal act;

6) the person has been acquitted or released from criminal liability or punishment in the Republic of Lithuania or another Member State of the European Union for the criminal act which he has committed and on which the European arrest warrant is based;

7) the European arrest warrant has been issued for a criminal act which falls within the jurisdiction of the Republic of Lithuania under its own criminal law, and the statute of limitation for the passing of a judgement of conviction as provided for in Article 95 of this Code and the statute of limitations for the execution of the judgement of conviction as provided for in Article 96 of this Code have expired;

8) the criminal act has been committed outside the territory of the issuing Member State, and criminal law of the Republic of Lithuania could not apply to the same act where it would have been committed outside the territory of the State of Lithuania or not onboard a ship or aircraft flying the flag or displaying marks of registry of the State of Lithuania.

4. A citizen of the Republic of Lithuania or an alien may, taking into consideration facts of a case and interests of justice, be surrendered to the issuing Member State where:

1) criminal proceedings have been initiated in the Republic of Lithuania in respect of the criminal act which the person has committed and on which the European arrest warrant is based;

2) initiation of criminal proceedings in the Republic of Lithuania in respect of the criminal act committed by the person has been refused, or the criminal proceedings initiated have been terminated;

3) the European arrest warrant has been issued for the purposes of execution of a custodial sentence imposed on a citizen of the Republic of Lithuania or a person permanently residing in the Republic of Lithuania, and the Republic of Lithuania undertakes execution of this sentence;

4) the criminal act has been committed in the territory of the State of Lithuania or onboard a ship or aircraft flying the flag or displaying marks of registry of the State of Lithuania;

5) the European arrest warrant lacks the information required for the taking of a decision on the person’s surrender, and the issuing Member State fails to provide it within the time limit laid down.

5. Where the European arrest warrant has been issued for the purposes of execution of a custodial sentence imposed upon a citizen of the Republic of Lithuania or an alien, and this sentence has been imposed in absentia and where the person concerned has not been informed of the place and date of the hearing, the citizen of the Republic of Lithuania or the alien may be surrendered subject to the condition that the issuing Member State will ensure a retrial of the case at the person’s request, and the person will be present at the judgement.

6. Where the European arrest warrant has been issued for a criminal act which, under the laws of the issuing Member State, is punishable by custodial life sentence, a citizen of the Republic of Lithuania or an alien shall be surrendered subject to the condition that the laws of the issuing Member State provide for a possibility for the convict to apply for release from such penalty or mitigation thereof not later than upon serving twenty years of the custodial sentence.

7. Where the European arrest warrant has been issued for the purposes of prosecution, a citizen of the Republic of Lithuania or a permanent resident of the Republic of Lithuania may be surrendered subject to the condition that the person against whom the issuing Member State has passed a judgement will be returned to the Republic of Lithuania in order to serve the custodial sentence imposed on him at the request of the person surrendered or where the Prosecutor General’s Office of the Republic of Lithuania requires so.

CHAPTER III

CRIME AND MISDEMEANOUR

Article 10. Types of Criminal Acts

Criminal acts shall be divided into crimes and misdemeanours.

Article 11. Crime

1. A crime shall be a dangerous act (act or omission) forbidden under this Code and punishable with a custodial sentence.

2. Crimes shall be committed with intent and through negligence. Premeditated crimes are divided into minor, less serious, serious and grave crimes.

3. A minor crime is a premeditated crime punishable, under the criminal law, by a custodial sentence of the maximum duration of three years.

4. A less serious crime is a premeditated crime punishable, under the criminal law, by a custodial sentence of the maximum duration in excess of three years, but not exceeding six years of imprisonment.

5. A serious crime is a premeditated crime punishable, under the criminal law, by a custodial sentence of the duration in excess of three years, but not exceeding ten years of imprisonment.

6. A grave crime is a premeditated crime punishable, under the criminal law, by a custodial sentence of the maximum duration in excess of ten years.

Article 12. Misdemeanour

A misdemeanour shall be a dangerous act (act or omission) forbidden under this Code which is punishable by a non-custodial sentence, with the exception of arrest.

Article 13. Age at which a Person Becomes Liable under the Criminal Law

1. A person who, prior to the time of commission of a crime or misdemeanour, had attained the age of sixteen years or, in the cases provided for in paragraph 2 of this Law, fourteen years shall be considered liable under this Code.

2. A person who, prior to the time of commission of a crime or misdemeanour, had attained the age of fourteen shall be held liable for murder (Article 129), serious impairment to health (Article 135), rape (Article 149), sexual harassment (Article 150), theft (Article 178), robbery (Article 180), extortion of property (Article 181), destruction of or damage to property (paragraph 2 of Article 187), seizure of a firearm, ammunition, explosives or explosive materials (Article 254), theft, racketeering or other illicit seizure of narcotic or psychotropic substances (Article 263), damage to vehicles or roads and facilities thereof (Article 280).

3. A person who, prior to the time of commission of the dangerous act provided for by this Code, had not attained the age of fourteen years may be subject to reformative sanctions or other measures in accordance with the procedure laid down by laws of the Republic of Lithuania.

Article 14. Forms of Guilt

A person shall be found guilty of commission of a crime or misdemeanour where he has committed this act with intent or through negligence.

Article 15. Premeditated Crime and Misdemeanour

1. A crime or misdemeanour shall be premeditated where it has been committed with a specific or general intent.

2. A crime or misdemeanour shall be committed with a specific intent where:

1) when committing it, the person was aware of the dangerous nature of the criminal act and desired to engage therein;

2) when committing it, the person was aware of the dangerous nature of the criminal act, anticipated that his act or omission might cause the consequences provided for by this Code and desired that they arise.

3. A crime or a misdemeanour shall be committed with a general intent where, when committing it, the person was aware of the dangerous nature of the criminal act, anticipated that his act or omission might cause the consequences provided for by this Code and, though he did not desire that they arise, consciously allowed the consequences to arise.

Article 16. Commission of a Crime and Misdemeanour through Negligence

1. A crime or misdemeanour shall be committed through negligence where it has been committed through a criminally false assumption or criminal negligence.

2. A crime or a misdemeanour shall be committed through a criminally false assumption if the person who committed the act had anticipated that his act or omission may cause the consequences provided for by this Code, but recklessly expected to avoid them.

3. A crime or a misdemeanour shall be committed through criminal negligence if the person who committed it had not anticipated that his act or omission might cause the consequences provided for by this Code, although the person could and ought to have anticipated such a result based the circumstances of the act and his personal traits.

4. A person shall be punishable for commission of a crime or misdemeanour through negligence solely in the cases provided for separately in the Special Part of this Code.

Article 17. Legal Incapacity

1. A person shall be considered legally incapacitated where, at the time of commission of an act forbidden under this Code, he was unable to appreciate the dangerous nature of the act or to control his behaviour as a result of a mental disorder.

2. A person found legally incapacitated by a court shall not be held liable under this Code for a committed dangerous act. The court may apply to him the compulsory medical treatment provided for in Article 98 of this Code.

Article 18. Diminished Capacity

1. A court shall find a person to be of diminished capacity where, at the time of commission of an act forbidden under this Code, he lacked a capacity sufficient to fully appreciate the dangerous nature of the criminal act or to control his behaviour as a result of a mental disorder, even though the disorder is not a sufficient ground for finding him legally incapacitated.

2. A person who has committed a misdemeanour, a negligent or minor or less serious premeditated crime and whom a court finds to be of diminished capacity shall be liable under a criminal law, however, a penalty imposed upon him may be commuted under Article 59 of this Code, or he may be released from criminal liability and be subject to the penal sanctions provided for in Article 67 of this Code or the compulsory medical treatment provided for in Article 98 of this Code.

3. A person who has committed a serious or a grave crime and is found by a court to be of diminished capacity shall be held liable under a criminal law, however a penalty imposed upon him may be commuted under Article 59 of this Code.

Article 19. Person’s Liability for a Criminal Act Committed under the Influence of Alcohol, Narcotic, Psychotropic or Other Psychoactive Substances

1. A person who has committed a criminal act under the influence of alcohol, narcotic, psychotropic or other psychoactive substances shall not be released from criminal liability.

2. A person who committed a misdemeanour, a negligent or minor or less serious premeditated crime as a result of intoxication against his will and hence lacked a capacity sufficient to fully appreciate the dangerous nature of the criminal act or to control his behaviour at the time of his conduct shall be released from criminal liability.

3. A person who has committed a serious or a grave crime under the conditions indicated in paragraph 2 of this Article shall be held liable under a criminal law, however the penalty imposed upon him may be commuted under Article 59 of this Code.

Article 20. Criminal Liability of a Legal Entity

1. A legal entity shall be held liable solely for the criminal acts the commission whereof is subject to liability of a legal entity as provided for in the Special Part of this Code.

2. A legal entity shall be held liable for the criminal acts committed by a natural person solely where a criminal act was committed for the benefit or in the interests of the legal entity by a natural person acting independently or on behalf of the legal entity, provided that he, while occupying an executive position in the legal entity, was entitled:

1) to represent the legal entity, or

2) to take decisions on behalf of the legal entity, or

3) to control activities of the legal entity.

3. A legal entity may be held liable for criminal acts also where they have been committed by an employee or authorised representative of the legal entity as a result of insufficient supervision or control by the person indicated in paragraph 2 of this Article.

4. Criminal liability of a legal entity shall not release from criminal liability a natural person who has committed, organised, instigated or assisted in commission of the criminal act.

5. The State, a municipality, a state and municipal institution and agency as well as international public organisation shall not be held liable under this Code.

CHAPTER IV

STAGES AND FORMS OF A CRIMINAL ACT

Article 21. Preparation for Commission of a Crime

1. Preparation for the commission of a crime shall be a search for or adaptation of means and instruments, development of an action plan, engagement of accomplices or other intentional creation of the conditions facilitating the commission of the crime. A person shall be held liable solely for preparation to commit a serious or grave crime.

2. A person shall be held liable for preparation to commit a crime according to paragraph 1 of this Article and an article of this Code providing for an appropriate completed crime. A penalty imposed upon such a person may be commuted under Article 62 of this Code.

Article 22. Attempt to Commit a Criminal Act

1. An attempt to commit a criminal act shall be an intentional act or omission which marks the direct commencement of a crime or misdemeanour where the act has not been completed by reason of the circumstances beyond the control the offender.

2. An attempt to commit a criminal act shall also occur when the offender is not aware that his act cannot be completed, because his attempt is directed at an inappropriate target or he is applying improper means.

3. A person shall be held liable for an attempt to commit a criminal act according to paragraph 1 or 2 of this Article and an article of this Code providing for an appropriate completed crime. A penalty imposed upon such a person may be commuted under Article 62 of this Code.

Article 23. Voluntary Renunciation of Completion of a Criminal Act

1. A person shall voluntarily renounce completion of a crime or a misdemeanour when he voluntarily terminates an initiated criminal act while being aware that it can be completed.

2. A person who voluntarily renounces completion of a crime or misdemeanour shall be held liable under this Code solely in cases where the committed act constitutes the body of another crime or misdemeanour.

3. When several persons participate in the commission of a criminal act, the organiser or abettor who voluntarily renounces completion of the act shall not be liable under this Code if he has made every effort within his reasonable power to prevent commission by his accomplices of the criminal act which he had organised or instigated, and this act has not been committed or has not caused any consequences. Moreover, an accessory shall not be held liable under this Code if he voluntarily refused to participate in a criminal act, informed thereof other accomplices or law enforcement institutions and that act has not been committed or it has been committed without his assistance.

4. A person who attempted to voluntarily renounce completion of a crime or misdemeanour, but failed to avoid the criminal act or its consequences shall be held liable under a criminal law, however, a penalty imposed upon him may be commuted under Article 59 of this Code.

Article 24. Complicity and Types of Accomplices

1. Complicity shall be the intentional joint participation in the commission of a criminal act of two or more conspiring legally capable persons who have attained the age specified in Article 13 of this Code.

2. Accomplices in a criminal act shall include a perpetrator, an organiser, an abettor and an accessory.

3. A perpetrator shall be a person who has committed a criminal act either by himself or by involving legally incapacitated person or the persons who have not yet attained the age specified in Article 13 of this Code or other persons who are not guilty of that act. If the criminal act has been committed by several persons acting together, each of them shall be considered a perpetrator/co-perpetrator.

4. An organiser shall a person who has formed an organised group or a criminal association, has been in charge thereof or has co-ordinated the activities of its members or has prepared a criminal act or has been in charge of commission thereof.

5. An abettor shall be a person who has incited another person to commit a criminal act.

6. The accessory shall be a person who has aided in the commission of a criminal act through counselling, issuing instructions, providing means or removing obstacles, protecting or shielding other accomplices, who has promised in advance to conceal the offender, hide the instruments or means of commission of the criminal act, the traces of the act or the items acquired by criminal means, also a person who has promised in advance to handle the items acquired or produced in the course of the criminal act.

Article 25. Forms of Complicity

1. Forms of complicity shall be a group of accomplices, an organised group or a criminal association.

2. A group of accomplices shall be one in which two or more persons agree, at any stage of the commission of a criminal act, on the commission, continuation or completion of the criminal act, where at least two of them are perpetrators.

3. An organised group shall be one in which two or more persons agree, at any stage of the commission of a criminal act, on the commission of several crimes or of one serious or grave crime, and in committing the crime each member of the group performs a certain task or is given a different role.

4. A criminal association shall be one in which three or more persons linked by permanent mutual relations and division of roles or tasks join together for the commission of a joint criminal act – one or several serious and grave crimes. An anti-state group or organisation and a terrorist group shall be considered equivalent to a criminal association.

Article 26. Criminal Liability of Accomplices

1. Accomplices shall be held liable solely for the criminal acts as committed by the perpetrator which are covered by their intent.

2. Where a perpetrator’s criminal act was discontinued at the stage of preparation for commission of or an attempt to commit it, an organiser, an abettor and an accessory shall be held liable for complicity in preparation or attempt to commit the criminal act.

3. Where there are the circumstances eliminating, mitigating or aggravating the liability of one of accomplices, they shall not be taken into account when determining the criminal liability of other accomplices

4. An organiser, an abettor or an accessory shall be held liable under an article of the Code which provides for liability for an act committed by a perpetrator and under paragraph 4, 5 or 6 of Article 24 of this Code.

5. Members of a criminal association shall be held liable under Article 249 of this Code as perpetrators regardless of their roles in the commission of a criminal act which is covered by their intent.

Article 27. Repeat Offence

1. Repeat offence shall mean a situation when a person already convicted for the commission of a premeditated crime, where his prior conviction has not expired yet or has not been expunged in accordance with the procedure laid down by laws, repeatedly commits one or several premeditated crimes. Such a person shall be considered a repeat offender.

2. Repeat offence shall be considered dangerous, and the offender may be recognised as a dangerous repeat offender by a court where this person:

1) commits a new grave crime while having an unexpired conviction for the commission of a grave crime;

2) already being a repeat offender, commits a new grave crime;

3) already being a repeat offender, where at least one of the crimes constituting a repeat offence is a grave crime, commits a new serious crime;

4) commits a new serious crime while having three prior convictions for the commission of serious crimes.

3. When passing a judgement of conviction for the most recent crime committed, a court may recognise a person as a dangerous repeat offender having regard to the offender’s personality, the extent to which criminal intentions have been accomplished, the nature of participation in the commission of the crimes and other circumstances of the case.

4. When deciding on the recognition of a person as a dangerous repeat offender, a court shall have no regard to prior convictions for the crimes committed by the person before the age of 18 years, the crimes committed through negligence, the crimes for which conviction has expired or has been expunged, also the crimes committed abroad for which no liability is provided under criminal laws of the Republic of Lithuania.

5. The recognition of a person as a dangerous repeat offender shall no longer be valid if his prior convictions expire or are expunged.

CHAPTER V

CIRCUMSTANCES ELIMINATING CRIMINAL LIABILITY

Article 28. Self-Defence

1. A person shall have the right to self-defence. He may exercise this right regardless of whether he had the possibility of avoiding the attempt or applying for assistance to other persons or authorities.

2. A person shall not be held liable under this Code where he, while acting within the limits permitted by self-defence, committed an act formally having the features of a crime or misdemeanour provided for in a criminal law when defending himself or another person, property, inviolability of a dwelling, other rights, interests of society or the State against an initiated or imminent dangerous attempt.

3. The limits of self-defence shall be exceeded when a murder is committed or a serious health impairment is caused with a specific intent, where defence has been clearly disproportionate to the nature and dangerousness of an attempt. The limits of self-defence shall not be considered to have been exceeded by reason of extreme confusion or fright caused by the dangerous attempt or an act committed in the course of defence against breaking into a dwelling.

4. A person who has exceeded the limits of self-defence shall be held criminally liable, however a penalty imposed upon him may be commuted under Article 62 of this Code.

Article 29. Arrest of a Person Who has Committed a Criminal Act

1. A person shall not be held liable under this Code for his actions when he causes property damage, a minor health impairment or a serious health impairment through negligence to a person who is actively attempting to escape the arrest by chasing, attempting to stop, preventing the escape or by other actions, and a serious health impairment when arresting on the spot of a crime a person who has committed or attempted to commit a premeditated murder, provided it was not otherwise possible to arrest the person who has committed the criminal act.

2. Actions of a person restraining the resistance of a person who has committed a criminal act shall be subject to the rules for self-defence as stipulated in Article 28 of this Code.

Article 30. Discharge of Professional Duty

1. A person shall not be held liable under this Code for the damage caused in charge of professional duty, provided he has not exceeded the authority granted to him by laws or other legal acts.

2. A person shall be held liable under this Code for the damage caused in charge of professional duty where he has exceeded the authority granted to him by laws or other legal acts, however a penalty imposed upon him may be commuted under Article 59 of this Code.

Article 31. Immediate Necessity

1. A person shall not be held liable under the criminal law for an act committed in an attempt to avert the danger which threatens him, other persons or their rights, public or state interests, where this danger could not have been averted by other means and where the damage caused is less than the damage attempted to be averted.

2. A person who creates a dangerous situation by his actions may invoke the provisions of immediate necessity only when the dangerous situation arose through negligence.

3. A person may not justify a failure to perform a duty by invoking the provisions of immediate necessity, where he is under the obligation to act under the conditions of an increased degree of danger according to his profession, the position held or due to other circumstances.

Article 32. Performance of an Assignment of a Law Enforcement Institution

1. A person acting lawfully according to the mode of conduct imitating a criminal act shall not be held liable under this Code.

2. A person shall not be held criminally liable where he participated in the activities of a criminal association or an organised group and in the criminal acts committed by it while performing another lawful assignment of a law enforcement institution and did not exceed the limits of this assignment.

3. A person shall be held criminally liable where, while acting according to the mode of conduct imitating a criminal act or performing another assignment of a law enforcement institution, he exceeded the limits of this assignment, however a penalty imposed upon him may be commuted under Article 59 of this Code.

4. Law enforcement institutions shall be the police, other bodies of pre-trial investigation and the prosecutor’s office, also entities of operational activities.

Article 33. Execution of an Order

1. A person shall not be held criminally liable for an act which he committed while executing a lawful order, ordinance or instruction.

2. A person shall be held criminally liable where he executed an order, ordinance or instruction known to be unlawful.

3. A person who refuses to execute an order, ordinance or instruction which is unlawful shall not be held criminally liable. Such a person may be held liable under this Code only if the act committed by him constitutes the body of another criminal act.

Article 34. Justifiable Professional or Economic Risk

1. A person shall not be held liable under this Code for the actions which, although they incur the consequences provided for by a criminal law, have been carried out with a justifiable professional or economic risk and for a publicly beneficial purpose.

2. The risk shall be deemed justifiable where the committed act is in line with the contemporary science and technology, and it was not possible to attain the specified objective by carrying out the actions not involving risk, and where the person taking the risk has taken the necessary precautions to prevent damage to the interests protected by the law.

Article 35. Scientific Experiment

1. A person who incurs damage while conducting a lawful scientific experiment shall not be held liable under this Code where the experiment was conducted in compliance with scientifically approved methods, the problem under investigation is of an exceptional scientific significance and the researcher has taken the necessary precautions to prevent damage to the interests protected by the law.

2. No scientific experiment shall be permitted without the voluntary consent of the person participating in the experiment, who must be informed of the possible consequences.

3. A pregnant woman, her foetus, young child, a mentally ill person and a person in confinement may not be subjected to scientific experiments, with the except of the cases provided for by the law.

CHAPTER VI

RELEASE FROM CRIMINAL LIABILITY

Article 36. Release from Criminal Liability When a Person or Criminal Act Loses Its Dangerousness

A person who commits a criminal act shall be released from criminal liability where a court acknowledges that before opening of the hearing of the case in the court this person or the act committed thereby had lost its dangerous character due to a change in circumstances.

Article 37. Release from Criminal Liability due to Minor Relevance of a Crime

A person who commits a crime may be released from criminal liability by a court where the act is recognised as being of minor relevance due to the extent of the damage incurred, the object of the crime or other peculiarities of the crime.

Article 38. Release from Criminal Liability upon Reconciliation between the Offender and the Victim

1. A person who commits a misdemeanour, a negligent crime or a minor or less serious premeditated crime may be released by a court from criminal liability where:

1) he has confessed to commission of the criminal act, and

2) voluntarily compensated for or eliminated the damage incurred to a natural or legal person or agreed on the compensation for or elimination of this damage, and

3) reconciles with the victim or a representative of a legal person or a state institution, and

4) there is a basis for believing that he will not commit new criminal acts.

2. A repeat offender, a dangerous repeat offender, also a person who had already been released from criminal liability on the basis of reconciliation with the victim, where less than four years had lapsed from the day of reconciliation until the commission of a new act, may not be released from criminal liability on the grounds provided for in paragraph 1 of this Article.

3. If a person released from criminal liability under paragraph 1 of this Article commits a misdemeanour or a negligent crime within the period of one year or fails, without valid reasons, to comply an agreement approved by a court on the terms and conditions of and procedure for compensating for the damage, the court may revoke its decision on the release from criminal liability and decide to prosecute the person for all the criminal acts committed.

4. If a person released from criminal liability under paragraph 1 of this Article commits a new premeditated crime within the period of one year, the previous decision releasing him from criminal liability shall become invalid and a decision shall be adopted on the prosecution of the person for all the criminal acts committed.

Article 39. Release from Criminal Liability on the Basis of Mitigating Circumstances

A person who commits a misdemeanour or a negligent crime may be released from criminal liability by a reasoned decision of a court where:

1) he commits the criminal act for the first time, and

2) there are at least two mitigating circumstances provided for in paragraph 1 of Article 59 of this Code, and

3) there are no aggravating circumstances.

Article 39(1). Release from Criminal Liability When a Person Actively Assisted in Detecting the Criminal Acts Committed by Members of an Organised Group or a Criminal Association

1. A person who is suspected of participation in the commission of criminal acts by an organised group or a criminal association or belonging to a criminal association may be released from criminal liability where he confesses his participation in the commission of such a criminal act or his membership of the criminal association and where he actively assists in detecting the criminal acts committed by members of the organised group or the criminal association.

2. Paragraph 1 of this Article shall not apply to a person who participated in the commission of a premeditated murder or who had already been released from criminal liability on such grounds, also to the organiser or leader of an organised group or a criminal association.

Article 40. Release from Criminal Liability on Bail

1. A person who commits a misdemeanour, a negligent crime or a minor or less serious intentional crime may be released by a court from criminal liability subject to a request by a person worthy of a court’s trust to transfer the offender into his responsibility on bail. Bail may be set with or without a surety.

2. A person may be released from criminal liability by a court on bail where:

1) he commits the criminal act for the first time, and

2) he fully confesses his guilt and regrets having committed the criminal act, and

3) at least partly compensates for or eliminates the damage incurred or undertakes to compensate for such where it has been incurred, and

4) there is a basis for believing that he will fully compensate for or eliminate the damage incurred, will comply with laws and will not commit new criminal acts.

3. A bailsman may be parents of the offender, close relatives or other persons worthy of a court’s trust. When taking a decision, the court shall take account of the bailsman’s personal traits or nature of activities and a possibility of exerting a positive influence on the offender.

4. The term of bail shall be set from one year up to three years.

5. When requesting to release a person on bail with a surety, a bailsman shall undertake to pay a surety in the amount specified by a court. Taking account of a bailsman’s personal traits and his financial situation, the court shall specify the amount of the surety or decide on release from criminal liability on bail without a surety. The bail bond shall be returned upon the expiry of the term of bail where a person subject to bail does not commit a new criminal act within the term of bail as laid down by the court.

6. A bailsman shall have the right to withdraw from bail. In this case, a court shall, taking account of the reasons for a withdrawal from bail, decide on the return of a surety, also on a person’s criminal liability for the committed criminal act, appointment of another bailsman or the person’s release from criminal liability.

7. If a person released from criminal liability on bail commits a new misdemeanour or negligent crime during the term of bail, a court may revoke its decision on the release from criminal liability and shall decide to prosecute the person for all the criminal acts committed.

8. If a person released from criminal liability on bail commits a new premeditated crime during the term of bail, the previous decision releasing him from criminal liability shall become invalid and the court shall decide to prosecute the person for all the criminal acts committed.

CHAPTER VII

PENALTY

Article 41. Penalty and Purpose Thereof

1. A penalty shall be a measure of compulsion applied by the State, which is imposed by a court’s judgement upon a person who has committed a crime or misdemeanour.

2. The purpose of a penalty shall be:

1) to prevent persons from committing criminal acts;

2) to punish a person who has committed a criminal act;

3) to deprive the convicted person of the possibility to commit new criminal acts or to restrict such a possibility;

4) to exert an influence on the persons who have served their sentence to ensure that they comply with laws and do not relapse into crime;

5) ensure implementation of the principle of justice.

Article 42. Types of Penalties

1. The following penalties may be imposed on a person who commits a crime:

1) deprivation of public rights;

2) deprivation of the right to be employed in a certain position or to engage in a certain type of activities;

3) community service;

4) a fine;

5) restriction of liberty;

6) arrest;

7) fixed-term imprisonment;

8) life imprisonment.

2. The following penalties may be imposed on a person who commits a misdemeanour:

1) deprivation of public rights;

2) deprivation of the right to be employed in a certain position or to engage in a certain type of activities;

3) community service;

4) a fine;

5) restriction of liberty;

6) arrest.

3. Only one penalty may be imposed on a person for the commission of one crime or misdemeanour.

4. In the cases provided for in Articles 63 and 64 of this Code, two penalties may be imposed.

5. If more than two penalties of a different type are imposed for several committed crimes, a court shall, when imposing a final combined sentence, select two penalties from those imposed: one of them being the most severe penalty, and the other one selected at the discretion of the court.

6. In addition to a penalty and on the basis of Articles 67, 68, 72, 721 and 722 of this Code, one or more of the following penal sanctions may be imposed upon a person who commits a criminal act – a prohibition to exercise a specific right, confiscation of property, prohibition to approach the victim, participation in the programmes addressing violent behaviour.

7. The types of penalties in respect of legal entities and peculiarities of imposition of penalties upon minors shall be stipulated by Articles 43 and 90 of this Code.

Article 43. Types of Penalties in Respect of Legal Entities

1. The following penalties may be imposed upon a legal entity for the commission of a criminal act:

1) a fine;

2) restriction of operation of the legal entity;

3) liquidation of the legal entity.

2. Having imposed a penalty upon a legal entity, a court may also decide to announce this judgement in the media.

3. Only one penalty may be imposed upon a legal entity for one criminal act.

4. The sanctions of articles of the Special Part of this Code shall not specify the penalties to which legal entities are subject. In imposing a penalty upon a legal entity, a court shall refer the list of penalties specified in paragraph 1 of this Article.

Article 44. Deprivation of Public Rights

1. Deprivation of public rights shall be deprivation of the right to be elected or appointed to an elected or appointed position at state or municipal institutions and agencies, undertakings or non-state organisations.

2. Deprivation of public rights shall not be specified in the sanction of an article. A court shall impose this penalty when the sanction of the article provides for the penalty of deprivation of the right to be employed in a certain position or to engage in a certain type of activities and a criminal act has been committed in abuse of public rights.

3. When imposing the penalty of deprivation of public rights, a court shall indicate which right is to be deprived. Public rights may be deprived for a period from one year up to five years. The term of this penalty shall be counted in years and months.

Article 45. Deprivation of the Right to be Employed in a Certain Position or to Engage in a Certain Type of Activities

1. A court shall order deprivation of the right to be employed in a certain position or to engage in a certain type of activities in the cases provided for in the Special Part of this Code, where the offender commits a criminal act in the field of his occupational or professional activities or where, considering the nature of the criminal act committed, the court comes to the conclusion that the convicted person may not preserve the right to be employed in a certain position or to engage in a certain type of activities.

2. The right to be employed in a certain position or to engage in a certain type of activities may be deprived for a period from one year up to five years. The term of this penalty shall not be specified the sanction of an article. It shall be specified by a court when imposing the penalty. The term of the penalty shall be counted in years and months.

3. Where the penalty of deprivation of the right to be employed in a certain position or to engage in a certain type of activities is imposed in conjunction with imprisonment or arrest, it shall be imposed for the entire term of imprisonment or arrest and for a period ordered by a court to commence after the term of imprisonment or arrest has been served.

Article 46. Community Service

1. Community service shall be ordered by a court in the cases provided for in the Special Part of this Code. The penalty of community service may be imposed only with the consent of the convict.

2. Community service may be imposed for a period from one month up to one year. The term of the penalty shall be counted in months. A person sentenced to perform community service shall be under the obligation to work for the community without remuneration from 10 to 40 hours per month during the time period set by the court.

3. The sanction of an article shall not indicate the time of performance and number of hours of community service. This shall be determined by a court when imposing the penalty, however this time may not exceed 480 hours for a crime and 240 hours for a misdemeanour.

4. The service to be performed by the convict shall be selected by the institution executing the penalty assisted by executive bodies of municipalities and/or a county governor’s administration.

5. Where for objective reasons a person is not able to perform the community service imposed on him by this Article, a court may release him from this penalty and impose in lieu thereof a penal sanction provided for in Chapter IX of this Code.

6. Where a person fails, for valid reasons, to perform the required number of hours of community service within a time limit laid down by a court, the court may extend the time limit for performing community service until the person performs the required number of hours.

7. Where a person evades performance of community service, the institution executing the penalty shall warn the convict of possible legal consequences. Where the person continues evading the serving of the penalty of community service upon receiving the warning, a court may, on the recommendation of the institution executing the penalty, replace community service with a fine or arrest. Community service shall be replaced with a fine or arrest in accordance with the rules specified in Articles 47, 49 and 65 of this Code.

8. Where, after a judgement becomes effective, a person refuses to perform community service, a court shall, on the recommendation of the institution executing the penalty, replace community service with a fine or arrest in accordance with the rules specified in Articles 47, 49 and 65 of this Code.

Article 47. Fine

1. A fine shall be a pecuniary penalty imposed by a court in the cases provided for in the Special Part of this Code.

2. A fine shall be calculated in the amounts of minimum standard of living (MSL). The minimum amount of a fine shall be one MSL.

3. The amounts of a fine shall be determined as follows:

1) for a misdemeanour – up to the amount of 50 MSLs.

2) for a minor crime – up to the amount of 100 MSLs;

3) for a less serious crime – up to the amount of 200 MSLs;

4) for a serious crime – up to the amount of 300 MSLs;

5) for a negligent crime – up to the amount of 75 MSLs.

4. The amount of a fine for a legal entity shall be up to 50 000 MSLs.

5. The sanction of an article shall not indicate the amount of a fine for a committed criminal act. It shall be specified by a court when imposing the penalty.

6. Where a person does not possess sufficient funds to pay a fine imposed by a court, the court may, in compliance with the rules stipulated in Article 65 of this Code and subject to the convict’s consent, replace this penalty with community service.

7. Where a person evades voluntary payment of a fine and it is not possible to recover it, a court may replace the fine with arrest. When replacing the fine with arrest, the court shall act in compliance with the rules stipulated in Article 65 of this Code.

Article 48. Restriction of Liberty

1. The penalty of restriction of liberty shall be imposed by a court in the cases provided for in the Special Part of this Code.

2. Restriction of liberty may be imposed for a period from three months up to two years. The term of the penalty shall be counted in years and months.

3. The persons sentenced to restriction of liberty shall be under the obligation:

1) not to change their place of residence without giving a notice to a court or the institution executing the penalty;

2) to comply with mandatory and prohibitive injunctions of the court;

3) to give an account, in accordance with the established procedure, of compliance with the prohibitive and mandatory injunctions.

4. A court may impose one or more prohibitive or mandatory injunctions in respect of a person upon whom the penalty of restriction of liberty has been imposed.

5. A court may impose the following prohibitive injunctions:

1) to refrain from visiting certain places;

2) to refrain from communicating with certain individuals or groups of individuals;

3) not to own, use, acquire, store on one’s own or transfer for safekeeping to other persons certain items.

6. A court may impose the following mandatory injunctions:

1) to stay at home at a certain time;

2) to compensate, fully or in part, for the property damage incurred by a criminal act or to eliminate such damage with his own work;

3) to take up employment or register at a labour exchange, to study;

4) to undergo a treatment against alcohol addition, drug addiction, addiction to toxic substances or a sexually transmitted disease, where the convict agrees therefor;

5) to work for no remuneration for up to 200 hours within a period laid down by a court, but not exceeding the term of restriction of liberty at health care, social care and guardianship establishments or non-state organisations caring for the disabled, the aged or other persons in need of assistance.

7. At the request of a person or other participants in criminal proceedings, a court may impose upon him other prohibitive or mandatory injunctions not provided for under a criminal law in place of those indicated in paragraphs 5 and 6 of this Article, where, in the opinion of the court, this would have a positive effect on his behaviour.

8. The number of prohibitive and mandatory injunctions imposed by a court in respect of the convict shall not be specified, however they must be co-ordinated.

9. Where for objective reasons the convict is not able to comply with the specified mandatory injunctions, a court may, on the recommendation of the institution executing the penalty, release him from this penalty and impose in its place a penal sanction provided for in Chapter IX of this Codes.

10. Where a person evades the serving of the penalty of restriction of liberty, this penalty shall be replaced with arrest in accordance with the rules specified in Articles 49 and 65 of this Code.

Article 49. Arrest

1. Arrest shall be imposed by a court in the cases provided for in the Special Part of this Code.

2. Arrest shall mean a short-term imprisonment served in a short-term detention facility. The term of arrest shall be counted in days.

3. Arrest shall be imposed for a period from 15 up to 90 days for a crime and from 10 to 45 days for a misdemeanour.

4. The term of arrest for a criminal act shall not be indicated in the sanction of an article. It shall be specified by a court when imposing the penalty.

5. If arrest is imposed for a period of 45 days or less, a court may order to serve it on days of rest. Where a person violates this procedure for serving arrest, the court may decide that the procedure be changed to the regular procedure for serving arrest.

6. Arrest shall not be imposed upon pregnant women and may be not imposed upon the persons raising a child under the age of 3 years taking into consideration interests of the child.

Article 50. Fixed-term Imprisonment

1. Fixed-term imprisonment shall be imposed by a court in the cases provided for in the Special Part of this Code. The term of the penalty shall be counted in years, months and days.

2. The penalty of a fixed-term imprisonment may be imposed for a period from three months up to ten years. In the case of imposing the penalty according to Article 64 of this Code, when a new crime is committed before a sentence for the previous crime is served, a custodial sentence for a period of up to 25 years may be imposed.

3. Convicted persons shall serve a custodial sentence in open colonies, houses of correction and prisons. The place where the penalty is to be served shall be selected by a court taking into consideration the personality of the offender, the nature and dangerousness of the committed crime. The procedure for and conditions of serving the custodial sentence shall be laid down by the Penal Code.

Article 51. Life Imprisonment

1. The penalty of life imprisonment shall be imposed by a court in the cases provided for in the Special Part of this Code.

2. If a criminal law provides for a possibility of commutation of the penalty of life imprisonment, the custodial sentence may be commuted to a term of not less than 25 years.

3. Convicted persons shall serve the penalty of life imprisonment in a prison. Having served the first ten years of the sentence of life imprisonment, convicted persons may, in the cases and in accordance with the procedure laid down by laws, be transferred to a house of correction. The procedure for and conditions of serving the penalty of life imprisonment shall be laid down by the Penal Code.

Article 52. Restriction of Operation of a Legal Entity

1. When imposing the penalty of restriction of operation of a legal entity, a court shall prohibit the legal entity from engaging in certain activities or order it to close a certain division of the legal entity.

2. Operation of a legal entity may be restricted for a period from one year up to five years. The term of this penalty shall be counted in years and months.

Article 53. Liquidation of a Legal Entity

When imposing the penalty of liquidation of a legal entity, a court shall order the legal entity to terminate, within the time limit laid down by the court, the entire economic, commercial, financial or professional activity and to close all divisions of the legal entity.

CHAPTER VIII

IMPOSITION OF A PENALTY

Article 54. Basic Principles of Imposition of a Penalty

1. A court shall impose a penalty according to the sanction of an article of the Special Part of this Code providing for liability for a committed criminal act and in compliance with provisions of the General Part of this Code.

2. When imposing a penalty, a court shall take into consideration:

1) the degree of dangerousness of a committed criminal act;

2) the form and type of guilt;

3) the motives and objectives of the committed criminal act;

4) the stage of the criminal act;

5) the personality of the offender;

6) the form and type of participation of the person as an accomplice in the commission of the criminal act;

7) mitigating and aggravating circumstances.

3. Where imposition of the penalty provided for in the sanction of an article is evidently in contravention to the principle of justice, a court may, taking into consideration the purpose of the penalty, impose a commuted penalty subject to a reasoned decision.

Article 55. Imposition of a Penalty upon a Person Prosecuted for the First Time for a Minor or Less Serious Premeditated Crime

A court shall generally impose a non-custodial sentence upon a person prosecuted for the first time for a minor or less serious premeditated crime. In the event of imposition of a custodial sentence, the court must justify its decision.

Article 56. Imposition of a Penalty upon a Repeat Offender for the Commission of a Premeditated Crime

1. A court shall generally impose a custodial sentence upon a repeat offender for the commission of a premeditated crime.

2. For the commission of a premeditated crime, a dangerous repeat offender shall be imposed a penalty more severe than the average custodial sentence prescribed by the sanction of an article for the committed crime. Another penalty may be imposed upon a dangerous repeat offender only on the grounds provided for in Article 62 of this Code.

Article 57. Imposition of a Penalty for Preparation for Commission of and an Attempt to Commit a Criminal Act

1. A penalty for preparation for commission of or an attempt to commit a crime or a misdemeanour shall be imposed according to the general procedure and having regard to the dangerousness of the actions performed by the offender, the degree of accomplishment of the criminal intent and the reasons for which the criminal act was not accomplished.

2. Preparation for commission of or an attempt to commit a criminal act may, based on Article 62 of this Code, be subject to a more lenient penalty than the one provided for the completed criminal act.

Article 58. Imposition of a Penalty upon Accomplices in a Criminal Act

1. A penalty shall be imposed upon accomplices in a crime or misdemeanour in accordance with the general procedure and taking into consideration the type and form of participation of the person as an accomplice in the commission of the criminal act as well as the role and nature of participation therein.

2. Members of an organised group for the commission of a crime shall be generally imposed a more severe penalty than to members of a group of accomplices.

Article 59. Mitigating Circumstances

1. The following shall be considered as mitigating circumstances:

1) the offender has provided assistance to the victim or otherwise actively avoided or attempted to avoid more serious consequences;

2) the offender has confessed to commission of an act provided for by a criminal law and sincerely regrets or has assisted in the detection of this act or identification of the persons who participated therein;

3) the offender has voluntarily compensated for or eliminated the damage incurred;

4) the criminal act has been committed due to a very difficult financial condition or desperate situation of the offender;

5) the act has been committed as a result of mental or physical coercion, where such a coercion does not eliminate criminal liability;

6) the commission of the act has been influenced by a provoking or venturesome behaviour of the victim;

7) the act has been committed at the request of the victim, who is in a desperate situation;

8) the act has been committed in violation of conditions of arrest of a person who has committed the criminal act, direct necessity, discharge of professional duty or performance of an assignment of law enforcement institutions, conditions of industrial or economic risk or lawfulness of a scientific experiment;

9) the act has been committed by exceeding the limits of self-defence, where a criminal law provides for liability for exceeding the limits of self-defence;

10) the act has been committed in a state of extreme agitation caused by unlawful actions of the victim;

11) the act has been committed by a person of diminished legal capacity;

12) the act has been committed by a person intoxicated by alcohol or drugs against his will;

13) a voluntary attempt to renounce commission of the criminal act has been unsuccessful.

2. A court may also recognise as mitigating other circumstances which have not been indicated in paragraph 1 of this Article.

3. When imposing a penalty, a court shall not take into consideration a mitigating circumstance which is provided for in a law as constituting the body of a crime.

Article 60. Aggravating Circumstances

1. The following shall be considered as aggravating circumstances:

1) the act has been committed by a group of accomplices. Taking into consideration the nature and extent of participation of each accomplice in the commission of the criminal act, a court shall have the right not to recognise this circumstance as aggravating;

2) the act has been committed by an organised group;

3) the act has been committed by reason of disorderly conduct or for mercenary reasons;

4) the act has been committed by torturing the victim or subjecting him to taunting;

5) the act has been committed against a young child;

6) the act has been committed against a person in a helpless state owing to an illness, disability, old age or for other reasons, in the absence of the person’s request;

7) the act has been committed against a woman known to be pregnant;

8) the act has been committed by taking advantage of a public or other person’s disaster;

9) the act has been committed by a person under the influence of alcohol, narcotic, psychotropic or other psychoactive substances, where these circumstances influenced the commission of the criminal act;

10) the act has been committed in a publicly dangerous manner or by using explosives, explosive materials or firearms;

11) the committed act has caused grave consequences;

12) the act has been committed in order to express hatred towards a group of persons or a person belonging thereto on grounds of age, sex, sexual orientation, disability, race, nationality, language, descent, social status, religion, convictions or views.

2. When imposing a penalty, a court shall not take into consideration an aggravating circumstance which is provided for in a law as constituting the body of a crime.

Article 61. Imposition of a Penalty in the Presence of Mitigating and/or Aggravating Circumstances

1. When imposing a penalty, a court shall take into consideration whether only mitigating circumstances or only aggravating circumstances, or both mitigating and aggravating circumstances have been established and shall assess the relevance of each circumstance.

2. Having assessed mitigating and/or aggravating circumstances, the amount, nature and interrelation thereof, also other circumstances indicated in paragraph 2 of Article 54, a court shall make a reasoned choice of a more lenient or more severe type of a penalty as well as the measure of the penalty with reference to the average penalty.

3. The average penalty provided for by a law shall be determined as the aggregate of the minimum and maximum measure of a penalty provided for in the sanction of an article, which is subsequently divided by half. Where the sanction of the article prescribes no minimum measure of a penalty for a committed criminal act, the average penalty shall be determined on the basis of the minimum measure of a penalty fixed for that type of penalties.

4. Where the offender voluntarily confesses to commission of a crime, sincerely regrets it and actively assists in the detection of the crime as well as there are no aggravating circumstances, a court shall impose upon him a custodial sentence not exceeding the average penalty provided for in the sanction of an article for the committed crime or a non-custodial sentence.

5. A court may impose a custodial sentence not exceeding the average penalty provided for in the sanction of an article for the committed crime upon a person who participated in the commission of a premeditated murder, where he makes a confession regarding all the criminal acts committed by him and actively assists in the detection of the premeditated murder committed by members of an organised group or a criminal association.

6. Paragraph 5 of this Article shall not apply to the organiser or leader of a premeditated murder, organised group or criminal association.

Article 62. Imposition of a More Lenient Penalty than Provided for by a Law

1. Where, a person who has committed a criminal act freely and voluntarily gives himself up or reports this act, confesses to commission thereof and sincerely regrets and/or assists pre-trial investigators and a court in detecting the criminal act and has fully or partially compensated for or eliminated the incurred property damage, a court may, having considered all the circumstances of the case, impose for every criminal act a more lenient penalty than provided for by a law.

2. Having considered all the circumstances of a case, a court may impose for every criminal act a more lenient penalty than provided for by a law also in the presence of mitigating circumstances, at least partial compensation for or elimination of property damage, if any has been incurred, and where:

1) the offender maintains the persons suffering from a grave illness or are disabled and no one else can look after them, or

2) the offender maintains young children and there would be no one to look after them if the penalty provided for by a law was imposed; or

3) the offender as an accomplice had only a secondary role in the commission of the criminal act; or

4) the act was discontinued at the stage of preparation to commit the crime or at the stage of an attempt to commit the criminal act; or

5) the act has been committed by exceeding the limits of self-defence, or

6) the act has been committed in violation of conditions of arrest of the person who has committed the criminal act, direct necessity, discharge of professional duty or performance of an assignment of law enforcement institutions, conditions of industrial or economic risk or lawfulness of a scientific experiment.

3. In the presence of the conditions indicated in paragraphs 1 and 2 of this Article, a court may:

1) impose a more lenient penalty than the minimum penalty provided for in the sanction of an article for a criminal act committed; or

2) impose a more lenient penalty than stipulated in paragraph 2 of Article 56 of this Code, or

3) impose a more lenient type of penalty than provided for in the sanction of an article for a criminal act committed.

4. A court may also, according to paragraph 3 of this Article, impose a more lenient penalty than provided for by a law upon a person who participated in the commission of a premeditated murder, where he makes a confession regarding all the criminal acts committed by him and actively assists in detecting a premeditated murder committed by members of an organised group or criminal association and where:

1) the murder has been committed as a result of a threat or coercion; or

2) the offender as an accomplice had only a secondary role in the commission of the murder, or

3) the act has been discontinued at the stage of preparation for the commission of the murder or at the stage of attempting to commit the murder.

Article 63. Imposition of a Penalty for the Commission of Several Criminal Acts

1. Where several criminal acts have been committed, a court shall impose a penalty for each criminal act separately and subsequently impose a final combined sentence. When imposing a final combined sentence, the court may impose either a consolidated sentence or a fully or partially cumulative sentence.

2. Where a consolidated sentence is imposed, a more severe penalty shall cover a more lenient penalty and the final combined sentence shall be equal to the most severe penalty imposed for all the separate criminal acts.

3. Where a fully cumulative sentence is imposed, all more lenient sentences which have been imposed shall be added to the most severe penalty imposed for one of the committed criminal acts.

4. Where a partially cumulative sentence is imposed, more lenient penalties shall be added in part to the most severe penalty imposed for one of the committed criminal acts.

5. A court shall impose a consolidated sentence where:

1) there is a full concurrence of criminal acts;

2) where the committed criminal acts differ markedly in their degree of dangerousness and are assigned to different types or categories of criminal acts according to Articles 10 or 11 of this Code;

3) where a custodial sentence for a period of twenty years or life imprisonment has been imposed for the commission of one of the criminal acts.

6. Where imposing a final sentence a part of the imposed sentences may be consolidated, whereas others may only be fully or partially accumulated, a court shall combine sentences by way of consolidation and accumulation of sentences. A court shall make a choice of the procedure for combining sentences upon assessing the nature and dangerousness of the committed criminal acts.

7. When a penalty is imposed on the grounds provided for in paragraph 1 of this Article, a final combined sentence may not exceed twenty years of imprisonment, whereas in the cases when a penalty of another type is imposed, the penalty may not exceed the maximum penalty established for this kind of penalty in this Code.

8. A court may not impose a combined sentence of a type which has not been imposed for the individual criminal acts.

9. A penalty shall be imposed according to the rules stipulated in this Article also in the cases when following the passing of a judgement it is established that a person had committed one more crime or misdemeanour prior to the passing of the judgement in the first case. In this case, the fully or partially served sentence imposed by the previous judgement shall be included in the term of the sentence.

10. A person shall not be considered to have committed several criminal acts where he has committed a continuous criminal act.

Article 64. Imposition of a Penalty in the Event of Commission of a New Criminal Act before a Sentence is Served

1. Where a convicted person commits a new criminal act before serving an imposed sentence, or where a person who has been given a suspended sentence commits a new criminal act during the period of suspension of the sentence, or where a person released on parole commits a new criminal act during the undischarged term of the sentence, a court shall impose a combined sentence upon imposing a penalty for the new crime or misdemeanour. When imposing a combined sentence, the court may impose a fully or partially cumulative sentence.

2. When imposing a fully cumulative sentence, a court shall add the entire part of the sentence not served yet to a penalty imposed by a new judgement.

3. When imposing a partially cumulative sentence, a court shall add a part of the undischarged term of a sentence not served yet to a penalty imposed by a new judgement. Where the part of the undischarged term of the sentence is larger, a part of the penalty imposed by the new judgement shall be added to the former part.

4. When a penalty is imposed on the grounds provided for in paragraph 1 of this Article, a combined sentence may not exceed twenty-five years of imprisonment, whereas in the cases when a penalty of another type is imposed, the penalty may not exceed the maximum penalty established for this kind of penalty in this Code.

5. Where a penalty of life imprisonment is imposed for one of the crimes committed, sentences shall be combined by consolidation and the combined sentence shall be life imprisonment.

Article 65. Rules of Cumulation of Sentences and Replacement of Penalties

1. The cumulation of imposed sentences as well as replacement of some penalties with others shall be governed by the following rules:

1) one day of imprisonment shall be held equivalent to:

a) one day of arrest (1:1);

b) two days of restriction of liberty (1:2);

2) one day of arrest shall be held equivalent to:

a) a fine in the amount of 2 MSLs (1:2);

b) six hours of community service (1:6);

c) two days of restriction of liberty (1:2);

3) one day of restriction of liberty shall be held equivalent to:

a) three hours of community service (1:3);

b) a fine in the amount of 1 MSL (1:1);

4) a fine in the amount of 1 MSL shall be held equivalent to six hours of community service.

2. When imposing a combined sentence in the cases provided for in Articles 63 and 64 of this Code, a court shall replace a more severe penalty with a more lenient one. A fine may not be substituted and shall be imposed in conjunction with another penalty. Double replacement of penalties shall be prohibited.

Article 66. Inclusion of the Period of Remand in a Penalty Imposed

1. When imposing a penalty upon a person subject to remand/arrest, a court must include this period in the term of an imposed penalty.

2. The period of remand/arrest shall be included in the term of an imposed penalty in accordance with the rules set forth in paragraph 1 of Article 65 of this Code, where one day of remand/arrest shall be held equivalent to one day of imprisonment or arrest, a fine in the amount of two MSLs, six hours of community service, two days of restriction of liberty.

CHAPTER IX

PENAL SANCTIONS AND IMPOSITION THEREOF

Article 67. Purpose and Types of Penal Sanctions

1. Penal sanctions must assist in implementing the purpose of a penalty.

2. An adult person released from criminal liability on the grounds provided for in Chapter VI of this Code or released from a penalty on the grounds provided for in Chapter X of this Code may be subject to the following penal sanctions:

1) prohibition to exercise a special right;

2) compensation for or elimination of property damage;

3) unpaid work;

4) payment of a contribution to the fund of crime victims;

5) confiscation of property;

6) prohibition to approach the victim;

7) participation in the programmes addressing violent behaviour.

3. Prohibition to exercise a special right, confiscation of property, prohibition to approach the victim, participation in the programmes addressing violent behaviour may be imposed in conjunction with a penalty.

4. A minor released from criminal liability on the grounds provided for in Chapter VI or Chapter XI of this Code or released from a penalty on the grounds provided for in Chapter X of this Code may be subject to confiscation of property.

5. A legal entity may be subject to confiscation of property.

6. When imposing two or more penal sanctions, the compatibility of the sanctions and the possibility of their corrective effect upon the convicted person must be taken into consideration.

Article 68. Prohibition to Exercise a Special Right

1. A court may prohibit a person from exercising special rights (the right to drive land vehicles, air- or water-borne vehicles, the right to hold and carry a weapon, the right to hunt, the right to fish, etc.) in the cases when a person committed a criminal act while exercising these rights.

2. A court shall prohibit to exercise special rights for a period from one year up to three years. The term shall be counted in years, months and days.

3. When prohibiting a person from exercising special rights, a court shall specify which right or rights he is prohibited from exercising as well as the term of validity of such a prohibition.

Article 69. Compensation for or Elimination of Property Damage

1. A court shall order compensation for or elimination of property damage when damage has been caused to a person, property or the natural environment as a result a crime or misdemeanour.

2. The amounts received by the victim from insurance or other institutions to cover the damage incurred shall not be included in the amount of the damage to be compensated for.

3. Damage must be compensated for or eliminated within a time limit laid down by a court.

Article 70. Unpaid Work

1. A court shall order performance of 20 up to 100 hours of unpaid work at health care, social care and guardianship or other state or non-state bodies and organisations. When imposing unpaid work, a court shall lay down a time limit for performance thereof. This term may not be longer than one year.

2. Unpaid work shall be performed only subject to the consent of a person.

Article 71. Payment of a Contribution to the Fund of Crime Victims

A court may order payment of a contribution in the amount from 5 up to 25 MSLs to the fund of crime victims. The contribution must be paid within a time limit laid down by the court.

Article 72. Confiscation of Property

1. Confiscation of property shall be the compulsory uncompensated taking into the ownership of a state of any form of property subject to confiscation and held by the offender, his accomplice or other persons.

2. Confiscation of property shall be applicable only in respect of the property used as an instrument or a means to commit a crime or as the result of a criminal act. A court must confiscate:

1) the money or other items of material value delivered to the offender or his accomplice for the purpose of commission of the criminal act;

2) the money and other items of material value used in the commission of the criminal act;

3) the money and other items of material value obtained as a result of the commission of the criminal act.

3. The property transferred to other natural or legal persons shall be confiscated regardless of whether or not those persons are subject to criminal liability, where:

1) the property has been transferred to them for the purpose of commission of a criminal act;

2) when acquiring the property, they were aware, or ought to have been aware and could have been aware that this property, money or the valuables newly acquired by means thereof have been gained from of a criminal act.

4. The property transferred to other natural or legal persons may be confiscated regardless of whether or not a person who has transferred the property is subject to criminal liability, where this person ought to and could have been aware that that property may be used for the commission of a serious or grave crime.

5. Where the property which is subject to confiscation has been concealed, consumed, belongs to third parties or cannot be taken for other reasons, a court shall recover from the offender, his accomplices or other persons indicated in paragraphs 2, 3 and 4 of this Article a sum of money equivalent to the value of the property subject to confiscation.

6. Minors shall be subject only to the compulsory confiscation of property provided for in paragraphs 2 and 3 of this Article.

7. When ordering confiscation of property, a court must specify the items subject to confiscation or the monetary value of the property subject to confiscation.

Article 721. Prohibition to Approach the Victim

1. A court may impose a prohibition to approach the victim where this is necessary with a view to protecting the legitimate interests of the victim.

2. Upon imposition of prohibition to approach the victim, the offender shall be prohibited, until the expiry of a time limit laid down by a court, from communicating and seeking contacts with the victim, visiting the indicated places at which the victim is usually present.

3. Upon imposition of prohibition to approach the victim and where the offender and the victim share the same residential premises, a court shall place the offender under the obligation to reside separately until the expiry of a time limit laid down by the court or until solving of the issue of granting of the right to live in those residential premises to the victim or to the offender.

Article 722. Participation in the Programmes Addressing Violent Behaviour

A court shall place under the obligation to participate in violence correction programmes the persons who have committed criminal acts in respect of a close relative or family member. This instruction must be complied with within a time limit laid down by the court.

Article 73. Imposition of Penal Sanctions

1. A court shall impose penal sanctions in compliance with provisions of this Chapter.

2. Penal sanctions shall not be combined with penalties and shall be executed separately.

Article 74. Legal Consequences of Non-Compliance with Penal Sanctions

1. Any penal sanction imposed by a court and provided for in subparagraphs 2, 3 and 4 of paragraph 2 of Article 67 of this Code which the person cannot comply with for valid reasons may, at his request, be replaced with another penal sanction. Where a person does not give his consent to perform unpaid work following the coming into effect of a court judgement, the court shall, on the recommendation of the institution executing the penal sanction, replace unpaid work with another penal sanction.

2. In respect of a person who evades compliance with the penal sanction imposed upon him (with the exception of property confiscation), a court may, on the recommendation of the institution executing the penalty, impose a penalty according to Article 243 of this Code. In this case, imposition of the penalty shall not release the convict from the duty to comply with the imposed penal sanction.

CHAPTER X

SUSPENSION OF A SENTENCE AND RELEASE FROM A PENALTY

Article 75. Suspension of a Sentence

1. Where a person is sentenced to imprisonment for a term not exceeding three years for the commission of one or several minor or less serious premeditated crimes or not exceeding six years for the crimes committed through negligence, a court may suspend the imposed sentence for a period ranging from one to three years. The sentence may be suspended where the court rules that there is a sufficient basis for believing that the purpose of the penalty will be achieved without the sentence actually being served.

2. When suspending a sentence, a court shall impose on the convict a penal sanction provided for in Chapter IX of this Code and/or one or more of the following mandatory injunctions:

1) to compensate for or eliminate the property damage incurred by a crime;

2) to offer an apology to the victim;

3) to provide assistance to the victim during the latter’s medical treatment;

4) to take up employment or register at a labour exchange, not to change employment without the consent of the court;

5) to undertake studies, resume studies or acquire a specialty;

6) to undergo a treatment against alcohol addition, drug addiction, addiction to toxic substances or a sexually transmitted disease, where the convict agrees therefor;

7) not to leave his place of residence for a period exceeding seven days without the consent of the institution supervising suspension of the sentence.

3. When imposing the mandatory injunctions provided for in paragraph 2 of this Article, a court shall lay down a time limit within which the convict must comply therewith.

4. Where, during the period of suspension of sentence, the convicted person:

1) complied with the penal sanction and/or the mandatory injunctions imposed by a court, committed no violations provided for in subparagraph 3 of this paragraph, and there is a basis for believing that in the future the person will abide by the law and will not commit any further criminal acts, the court shall release the convicted person from a penalty upon the expiry of the term of suspension of sentence;

2) complies with the penal sanction and/or mandatory injunctions imposed by the court, however committed other offences and was imposed administrative penalties or disciplinary sanctions, the court may extend the period of suspension of the sentence for one year;

3) fails, without valid reasons, to comply with the penal sanction and/or mandatory injunctions imposed by the court or violates public order, abuses alcohol or commits other offences for which administrative penalties or disciplinary sanctions have been imposed upon him at least twice, the court shall, on the recommendation of the institution supervising the conduct of the convicted person, warn the convicted person that suspension of the sentence may be revoked. Where the convicted person further fails to comply with the penal sanction and/or mandatory injunctions imposed by the court or commits offences, the court shall, on the recommendation of the institution supervising the conduct of the convicted person, rule on the revocation of suspension of the sentence and execution of the sentence;

4) commits a new criminal act, the court shall impose a penalty upon him according to the rules provided for in Article 64 of this Code.

Article 76. Release from a Penalty due to an Illness

1. A person who committed a criminal act may be released from a penalty where, before a judgement is passed by a court, he contracts a terminal illness rendering him unable to serve the sentence. In such a case, the court shall, when passing a judgement of conviction, impose a penalty upon this person and release him from serving the sentence The court shall decide this issue taking into consideration the gravity of the committed criminal act, the personality of the convicted person and the nature of the illness.

2. A person who contracts a terminal illness following the passing of a judgement may be released from serving the undischarged term of the sentence. The court shall decide this issue taking into consideration the gravity of the committed criminal act, the personality of the convicted person, his conduct while serving the sentence, the nature of the illness and the period of the sentence already served.

3. A person who, following the commission of a criminal act or imposition of a penalty, starts to suffer from a mentally disorder rendering him incapable of understanding the nature of his actions or controlling them shall be released from serving the undischarged term of the sentence. When releasing this person from a penalty, the court shall decide whether to subject him to compulsory medical treatment. In the event of convalescence of this person, he may be ordered to serve the undischarged term of the sentence. In such a case, the period during which the person was undergoing compulsory medical treatment shall be included in the term of imprisonment on a day-for-day basis.

Article 77. Release from a Custodial Sentence on Parole and Replacement of the Undischarged Term of the Custodial Sentence with a More Lenient Penalty

1. A court may release a person serving a custodial sentence on parole or substitute the undischarged term of the custodial sentence with a more lenient penalty (with the exception of a fine), where this person:

1) has served:

a) at least one half of the imposed sentence for a negligent or minor or less serious premeditated crime; or

b) at least two thirds of the imposed sentence for a serious crime; or

b) at least three fourths of the imposed sentence for a grave crime, or where the person is a repeat offender; or

d) at least one third of the imposed sentence for a negligent or minor or less serious premeditated crime committed by a pregnant woman, also a single father (mother) raising a child under the age of seven years or two or more minor children, where his (her) parental powers have not been restricted by a court in respect of these children;

2) has fully compensated for the property damage incurred by a crime or has compensated for or eliminated a part thereof and has undertaken to fully compensate for or eliminate it over the undischarged term of the sentence;

3) proved by his conduct and work during the period of serving the custodial sentence that he may be released on parole or his custodial sentence may be replaced with a more lenient penalty.

2. When releasing a person on parole, a court may impose one or more mandatory injunctions provided for in paragraph 2 of Article 75 of this Code. The court shall also lay down a time limit within which the convicted person must comply with the imposed mandatory injunctions. This period may not exceed the undischarged term of the sentence.

3. Release on parole and replacement of the undischarged term of the custodial sentence with a more lenient penalty shall not apply to:

1) a dangerous repeat offender;

2) a person sentenced to life imprisonment;

3) a person who had already been released on parole and committed a new premeditated crime during the undischarged term of the sentence.

4. Where a person released on parole from a custodial sentence has complied with the mandatory injunctions imposed by a court and had not committed the violations provided for in paragraph 5 of this Article until the expiry of the term of the custodial sentence, he shall be considered to have served the sentence.

5. Where a person released on parole from a custodial sentence fails, without valid reasons, to comply with the mandatory injunctions imposed by a court or violates public order, abuses alcohol or commits other offences for which administrative penalties or disciplinary sanctions have been imposed upon him at least twice, the court shall, on the recommendation of the institution supervising the conduct of the convicted person, warn the convicted person that release on parole from the custodial sentence may be revoked. Where, having been warned, the convicted person further fails to comply with the mandatory injunctions imposed by the court or commits offences, the court shall, on the recommendation of the institution supervising the conduct of the convicted person, rule on the revocation of release on parole from the custodial sentence and serving of the undischarged term of the sentence.

6. Where a person released on parole from a custodial sentence or a person in respect of whom a custodial sentence has been replaced with a more lenient penalty commits a new criminal act during the undischarged term of the sentence, a court shall impose a penalty upon him according to the rules provided for in Article 64 of this Code.

Article 78. Amnesty

1. A person who commits a criminal act may be released from serving the entire or a part of the sentence by an amnesty act passed by the Seimas.

2. The grounds for, conditions of and procedure for granting amnesty shall be laid down in the act of amnesty.

Article 79. Clemency

1. A convicted person may be released from serving the entire or a part of the sentence where the President of the Republic grants his clemency plea.

2. The procedure for granting clemency shall be laid down by the President of the Republic.

CHAPTER XI

PECULIARITIES OF CRIMINAL LIABILITY OF MINORS

Article 80. Purpose of Peculiarities of Criminal Liability of Minors

Peculiarities of criminal liability of minors as provided for in this Chapter and paragraphs 2 and 3 of Article 13, paragraph 4 of Article 27 and paragraph 4 of Article 97 of this Code shall have the following purpose:

1) to ensure correspondence of liability to the age and social maturity of these persons;

2) to restrict the possibilities of imposition of a custodial sentence and broaden the possibilities of imposition of reformative sanctions against these persons;

3) to help a minor to alter his manner of living and conduct by co-ordinating a penalty for the committed criminal act with the development and education of his personality and elimination of reasons for the unlawful conduct;

4) to prevent a minor from committing new criminal acts.

Article 81. Application of Provisions of the Chapter

1. Provisions of this Chapter shall apply to the persons who were under the age of 18 years at the time of commission of a criminal act.

2. Provisions of Articles 90-94 of this Code, also the reformative sanctions provided for in subparagraphs 1, 2, 3 and 5 of paragraph 1 of Article 82 may be applied against a person who was 18 years old at the time of commission of a criminal act, however was below the age of 21 years where a court, having taken into consideration the nature of and reasons for the committed criminal act as well as other circumstances of the case, and, where necessary, clarifications or conclusion of a specialist, decides that such a person is equal to a minor according to his social maturity and application of peculiarities of criminal liability against him would correspond to the purpose provided for in Article 80 of this Code.

Article 82. Reformative Sanctions against Minors

1. A minor who has committed a misdemeanour or crime and has been released from criminal liability or a penalty may be subject to the following reformative sanctions:

1) a warning;

2) compensation for or elimination of property damage;

3) unpaid reformative work;

4) placement for upbringing and supervision with parents or other natural or legal persons caring for children;

5) restriction on conduct;

6) placement in a special reformative facility.

2. A court may impose against a minor not more than three mutually compatible reformative sanctions.

3. (Repealed).

Article 83. Warning

1. A warning may be issued to a minor as an independent reformative sanction or in conjunction with other such sanctions.

2. When imposing against a minor this reformative sanction, a court shall state to him in writing the possible legal consequences ensuing from the commission of new criminal acts.

Article 84. Compensation for or Elimination of Property Damage

1. Compensation for or elimination of property damage shall be ordered only when a minor has resources which he can independently dispose of or when he is capable of eliminating the damage by his own work.

2. Property damage must be compensated for or eliminated by one’s work within a time limit laid down by a court.

Article 85. Unpaid Reformative Work

1. Unpaid reformative work shall be imposed for a period of 20 up to 100 hours to be performed at health care, custody and guardianship or other state or non-state bodies and organisations, work at which may be of a reformative character.

2. Unpaid reformative work shall be performed subject to the consent of a minor.

3. Unpaid work may not be imposed against a minor where he is placed in a special reformative facility.

Article 86. Placement for Upbringing and Supervision with Parents or Other Natural or Legal Persons Caring for Children

1. Placement for upbringing and supervision with parents or other natural or legal persons caring for children shall be ordered for a period from six months up to three years, but not after a minor reaches the age of 18 years.

2. The sanction indicated in paragraph 1 of this Article may be imposed in the cases when:

1) the parents or other persons agree to bring up and supervise the minor, have no negative influence on the minor themselves, have a possibility to provide favourable conditions for the development of his personality and agree to provide the necessary information to the institutions supervising the execution of the above sanction;

2) the minor agrees that the indicated persons bring him up and supervise him and promises to obey them and behave properly.

3. Placement for upbringing and supervision with parents or other persons may be ordered for a minor as an independent sanction or in combination with other reformative sanctions. This sanction may not be imposed where a minor is placed in a special reformative facility.

Article 87. Restriction on Conduct

1. A restriction on conduct may be imposed for a term from thirty days up to twelve months. The term of this sanction shall be counted in days and months.

2. A court may impose the following mandatory injunctions upon a minor:

1) to be at home at a certain time;

2) to study, resume studies or take up employment;

3) to acquire certain knowledge or learn prohibitions (traffic safety regulations, school student’s regulations, etc.);

4) to undergo a complete course of treatment against alcohol addition, drug addiction, addiction to toxic substances or a sexually transmitted disease. This mandatory injunction shall be imposed at the request of parents or guardians subject to the consent of the minor;

5) to participate in the social education or rehabilitation measures organised by state or non-state bodies and organisations.

3. A court may impose upon a minor the following prohibitive injunctions:

1) not to gamble;

2) not to engage in a certain type of activities;

3) not to drive a motor vehicle (motorcycle, self-propelled vehicle, etc.);

4) not to visit the places that have a negative effect on the behaviour of the minor, or not to communicate with the people who exert a negative influence on him;

5) not to change his place of residence without giving a notice to the institutions supervising execution of this sanction.

4. A minor must, in accordance with the established procedure, give an account of his compliance with mandatory and prohibitive injunctions.

5. A restriction on a minor’s conduct may be imposed against the minor as an independent reformative sanction or in conjunction with other such sanctions. This sanction may not be imposed where a minor is placed in a special reformative facility.

Article 88. Placement in a Special Reformative Facility

1. The term for placement in a special reformative facility may be fixed for a period of six months up to three years, but not for longer than until a minor reaches the age of 18 years.

2. The specific term of placement into a special reformative facility shall be laid down by a court upon taking into consideration the personality of the minor, the repetitive character of his criminal conduct, the type of sanctions previously applied, and other circumstances of the case.

3. Placement in a special reformative facility may be ordered in respect of a minor as an independent sanction or in combination with a warning or compensation for or elimination of property damage.

Article 89. Legal Consequences of Non-Compliance with Reformative Sanctions

1. Where a minor against whom a reformative sanction has been imposed fails to comply or complies inappropriately with the sanction and for this reason has been warned at least twice, a court may, on the recommendation of the institution supervising the execution of this sanction, replace that sanction with any other reformative sanction, with the exception of placement in a special reformative facility.

2. Where a minor against whom two or three reformative sanctions have been imposed fails to comply or complies inappropriately with the sanctions and for this reason has been warned at least twice, a court may, on the recommendation of the institution supervising the execution of these sanctions, replace them with other reformative sanctions, including placement in a special reformative facility.

Article 90. Special Features of the Penalties Imposed upon Minors

1. A minor may be subject solely to the following penalties:

1) community service;

2) a fine;

3) restriction of liberty;

4) arrest;

5) fixed-term imprisonment.

2. Minors may not be imposed more than 240 hours of community service.

3. A fine may be imposed only against a minor already employed or possessing his own property. A minor may be subject to a fine in the amount of up to 50 MSLs.

4. A minor may be subject to arrest for a period of five up to forty-five days.

5. The period of a custodial sentence in respect of a minor may not exceed ten years.

Article 91. Special Features of Imposition of a Penalty upon a Minor

1. A court shall impose a penalty upon a minor according to the basic principles of imposition of penalties and the special features provided for in this Chapter.

2. In imposing a penalty upon a minor, a court shall, in addition to the circumstances listed in paragraph 2 of Article 54 of this Code, take into consideration the following:

1) the living and upbringing conditions of the minor;

2) the state of health and social maturity of the minor;

3) previously imposed sanctions and effectiveness thereof;

4) the minor’s conduct following the commission of a criminal act.

3. A court may impose a fixed-term imprisonment upon a minor where there is a basis for believing that another type of penalties is not sufficient to alter the minor’s criminal dispositions, or where the minor has committed a serious or grave crime. In the event of imposition of a custodial sentence against a minor, the minimum penalty shall be equal to one half of the minimum penalty provided for by the sanction of an article of this Code according to which the minor is prosecuted.

Article 92. Suspension of a Sentence in Respect of a Minor

1. Where a minor is sentenced to imprisonment for one or several crimes committed through negligence or to imprisonment for a term not exceeding four years for the commission of one or several premeditated crimes, a court may suspend the imposed sentence for a period ranging from one to three years. The sentence may be suspended where the court rules that there is a sufficient basis for believing that the purpose of the penalty will be achieved without the sentence actually being served.

2. When suspending a sentence, a court shall impose against a minor one or several reformative sanctions, with the exception of placement in a special reformative facility.

3. Where, during the period of suspension of a sentence, a convicted minor:

1) complied with the reformative sanctions imposed by a court, committed no violations provided for in subparagraph 3 of this paragraph, and there is a basis for believing that in the future the person will abide by the law and will not commit new criminal acts, the court shall release the convicted person from a penalty upon the expiry of the period of suspension of the sentence;

2) complies with the reformative sanctions imposed by the court, however committed other offences and was imposed administrative penalties or disciplinary sanctions, the court may extend the period of suspension of the sentence for one year;

3) fails, without valid reasons, to comply with the reformative sanctions imposed by the court or violates public order, abuses alcohol or commits other offences for which administrative penalties or disciplinary sanctions have been imposed upon him at least twice, the court shall, on the recommendation of the institution supervising the conduct of the convicted person, warn the convicted person that suspension of the sentence may be revoked. Where, having been warned, the convicted person further fails to comply with the reformative sanctions imposed by the court or commits offences, the court shall, on the recommendation of the institution supervising the conduct of the convicted person, rule on the revocation of suspension of the sentence and execution of the sentence;

4) commits a new criminal act, the court shall impose a penalty upon him according to the rules provided for in Articles 64, 90 and 91 of this Code.

Article 93. Release of a Minor from Criminal Liability

1. A minor who commits a misdemeanour, or a negligent crime, or a minor or less serious premeditated crime for the first time may be released by a court from criminal liability where he:

1) has offered his apology to the victim and has compensated for or eliminated, fully or in part, the property damage incurred by his work or in monetary terms; or

2) is found to be of diminished capacity; or

3) pleads guilty and regrets having committed a criminal act or there are other grounds to believe that in the future the minor will abide by the law and will not commit new criminal acts.

2. Having released a minor from criminal liability on the grounds provided for in paragraph 1 of this Article, a court shall impose against him the reformative sanctions provided for in Article 82 of this Code.

Article 94. Release on Parole from a Custodial Sentence of a Person under the Age of 18 Years at the Time of Commission of a Criminal Act and Replacement of the Custodial Sentence in Respect Thereof with a More Lenient Penalty

1. A court may release on parole a person serving a custodial sentence for a criminal act at the time of commission whereof he was under the age of 18 years or a person who, according to paragraph 2 of Article 81 of this Code, was subject to special features of criminal liability of minors or replace this sentence with a more lenient penalty (with the exception of a fine) where:

1) the person has served:

a) at least one half of the imposed sentence for a negligent or minor or less serious premeditated crime; or

b) at least two thirds of the imposed sentence for a serious or grave crime;

2) the person has fully compensated for or eliminated the property damage incurred or has compensated for or eliminated a part thereof and has undertaken to fully compensate for or eliminate it over the undischarged term of the sentence or a more lenient penalty imposed;

3) the person’s conduct, learning and/or and work during the period of serving the custodial sentence proves that he may be released on parole or the custodial sentence may be replaced with a more lenient penalty.

2. When releasing on parole from a custodial sentence the person indicated in paragraph 1 of this Article, a court may impose one or more mandatory or prohibitive injunctions provided for in Article 87 of this Code. The court shall also lay down a time limit within which the person must perform the indicated mandatory injunctions and comply with the indicated prohibitive injunctions. This period may not exceed the undischarged term of the sentence.

3. Where a person released on parole from a custodial sentence has complied with the mandatory injunctions imposed by a court and has not violated the specified prohibitive injunctions until the expiry of the term of the custodial sentence, he shall be considered to have served the sentence.

4. Where a person released on parole from a custodial sentence fails, without valid reasons, to comply with the mandatory injunctions imposed by a court or violates the imposed prohibitive injunctions, the court shall, on the recommendation of the institution supervising the conduct of the person, warn him that release on parole from the custodial sentence may be revoked. Where, having been warned, the person further fails to comply with the mandatory injunctions imposed by the court or violates the imposed prohibitive injunctions, the court shall, on the recommendation of the institution supervising the conduct of that person, rule on the revocation of release on parole from the custodial sentence and serving of the undischarged term of the sentence.

5. Where a person released on parole from a custodial sentence or a person in respect of whom a custodial sentence has been replaced with a more lenient penalty commits a new criminal act during the undischarged term of the sentence, a court shall impose a penalty against him according to the rules specified in Article 64 of this Code.

CHAPTER XII

STATUTE OF LIMITATIONS OF CRIMINAL LIABILITY

Article 95. Statute of Limitations of a Judgement of Conviction

1. A person who has committed a criminal act may not be subject to a judgement of conviction where:

1) the following period has lapsed:

a) two years, in the event of commission of a misdemeanour;

b) five years, in the event of commission of a negligent or minor premeditated crime;

c) eight years, in the event of commission of a less serious premeditated crime;

d) ten years, in the event of commission of a serious crime;

e) fifteen years, in the event of commission of a grave crime;

f) twenty years, in the event of commission of a crime relating to a premeditated homicide;

2) during the period laid down in subparagraph 1 of paragraph 1 of this Article, the person did not hide from pre-trial investigation or a trial and did not commit a new criminal act.

2. The statute of limitations shall be calculated from the commission of a criminal act until the passing of a judgement.

3. Where the person who has committed a criminal act hid from pre-trial investigation or a trial, the calculation of the statute of limitations shall cease. The calculation of the statute of limitations shall resume from the day when the person is arrested or when he arrives to serve the sentence and confesses to commission of a crime. However, a judgement of conviction may not be passed where fifteen years have lapsed since the commission of the crime by the person and twenty years have lapsed since the commission of a crime relating to a premeditated homicide, and calculation of the statute of limitations has not ceased due to commission of a new crime.

4. Where a person commits a new criminal act before the expiry of the terms indicated in this Article, the calculation of the statute of limitations shall cease. In such a case, the calculation of the statute of limitations in respect of the first criminal act shall commence from the day when a new crime or misdemeanour was committed.

5. The following crimes provided for in this Code shall have no statute of limitations:

1) genocide (Article 99);

2) treatment of persons prohibited under international law (Article 100);

3) killing of the persons protected under international humanitarian law (Article 101);

4) deportation of civilians of an occupied state or transfer of the civilian population of an occupying state (Article 102);

5) causing bodily harm to, torture or other inhuman treatment of the persons protected under international humanitarian law (Article 103);

6) violation of norms of international humanitarian law concerning protection of civilians and their property in time of war (Article 104);

7) forcible use of civilians or prisoners of war in the armed forces of the enemy (Article 105);

8) destruction of protected objects or plunder of national valuable properties (Article 106);

9) aggression (Article 110);

10) prohibited military attack (Article 111);

11) use of prohibited means of warfare (Article 112).

Article 96. Statute of Limitations for Execution of a Judgement of Conviction

1. A judgement of conviction shall not be executed where:

1) it has not been executed:

a) within two years following imposition of a penalty for a misdemeanour; or

b) within three years following imposition of a non-custodial sentence or a custodial sentence for a term not exceeding two years; or

c) within five years following imposition of a custodial sentence for a term not exceeding five years; or

d) within ten years following imposition of a custodial sentence for a term not exceeding ten years; or

e) within fifteen years following imposition of a custodial sentence for a term exceeding ten years or imposition of the sentence of life imprisonment, and

2) during the period specified in subparagraph 1 of paragraph 1 of this Article, the convicted person did not evade the serving of the sentence and did not commit a new criminal act.

2. The statute of limitations for execution of a judgement of conviction shall be calculated from the coming into effect of the judgement until the commencement of execution of the judgement.

3. Where, after a judgement becomes effective, the convicted person evades the serving of the sentence, the calculation of the statute of limitations shall cease. In this case, the calculation of this period shall resume from the day the convicted person arrives to serve the sentence or is arrested. However, a judgement may not be executed where fifteen years have lapsed since its coming into effect, and twenty years have lapsed in the case of imposition of a custodial sentence for a period exceeding ten years or of a life imprisonment, and calculation of the statute of limitations has not ceased due to commission of a new criminal act.

4. Where the convicted person commits a new criminal act before the expiry of the statute of limitations for execution of a judgement of conviction, the calculation of the statute of limitations shall cease. In this case, calculation of the statute of limitations for execution of the judgement of conviction shall commence from the commission of a new crime or misdemeanour.

5. When imposing a penalty for a new criminal act, a court shall act in compliance with the rules stipulated in Article 64 of this Code.

CHAPTER XII

PREVIOUS CONVICTION

Article 97. Previous Conviction

1. The persons convicted of commission of a crime in respect of whom a judgement of conviction passed by a court of the Republic of Lithuania has become effective shall be considered as persons having previous conviction. The court shall take previous conviction into consideration when imposing a penalty for the commission of a new criminal act, deciding the issue of the offender’s release from a penalty or criminal liability, release on parole or replacement of a penalty with a more lenient one, also when identifying the person as a repeat offender.

2. Previous conviction may be a basis for restricting only those rights and freedoms of citizens whose restriction is provided for by laws of the Republic of Lithuania.

3. The following persons shall be considered as having previous conviction:

1) the persons given a suspended sentence – during the period of suspension of the sentence;

2) the persons convicted of negligent crimes – during the period of serving the sentence;

3) the persons convicted of premeditated crimes who have actually served the imposed sentence – during the period of serving the sentence and during the following period commencing after they have served the sentence or have been released from serving the sentence:

a) for three years if convicted of a minor or less serious crime;

b) for five years if convicted of a serious crime;

c) for eight years if convicted of a grave crime;

d) for ten years if they are dangerous repeat offenders.

4. The terms of validity of previous conviction following serving of the sentence or release from serving the sentence in respect of the minors convicted of the crimes provided for in subparagraph 3 of paragraph 3 of this Article shall be reduced by half.

5. The terms stipulated in subparagraph 3 of paragraph 3 and in paragraph 4 of this Article shall be calculated from fully serving of the imposed sentence or release from serving the sentence.

6. Upon the expiry of the time limits laid down in this Article, previous conviction shall expire and the persons shall be considered as having no criminal record.

7. After the lapse of a least one half of the term of conviction, a court may, at the request of the convicted person, reduce the term of conviction or expunge the conviction.

8. Where a person who has a previous conviction commits a new crime or misdemeanour, calculation of the term until the expiry of previous conviction shall cease. In such a case, calculation of the term until the expiry of the conviction for the previous criminal act shall commence from the serving of the penalty for the new crime or misdemeanour. The person shall be considered as having previous conviction for each criminal act until the expiry of conviction for the most serious of the acts.

Chapter XIV

Compulsory Medical Treatment

Article 98. Compulsory Medical Treatment

1. The persons who are recognised by a court as being legally incapacitated or of diminished capacity as well as the persons who, after committing a criminal act or having been imposed a penalty, start to suffer from a mental disorder rendering them incapable of understanding the nature of their actions or controlling them may be subjected by the court to the following compulsory medical treatment measures:

1) out-patient observation under the conditions of primary mental health care;

2) in-patient observation under the conditions of a general observation at specialised mental health care establishments;

3) in-patient observation under the conditions of an enhanced observation at specialised mental health care establishments;

4) in-patient observation under the conditions of a strict observation at specialised mental health care establishments.

2. A court shall commit a person to an out-patient observation where it is not necessary to subject the person to observation and in-patient treatment due to the dangerousness of the committed act and his mental state or where this person may continue out-patient treatment after his mental state improves following in-patient treatment.

3. A court shall impose an in-patient observation under the conditions of a general observation to a person who needs to be under observation and undergo treatment at a specialised in-patient treatment establishment due to his mental disorder.

4. A court shall impose an in-patient observation under the conditions of an enhanced observation to a person who needs to be under observation and undergo treatment at a specialised in-patient treatment establishment due to the dangerousness of the committed act and his mental disorder.

5. A court shall impose an in-patient observation under the conditions of a strict observation to a person who has committed an attempt against a person’s life or health, is particularly dangerous to surrounding people due to his mental disorder and needs to be under observation and undergo treatment at a specialised in-patient treatment establishment.

6. A court shall not fix any period of time for compulsory medical treatment. It shall be applied until the person is cured or his mental state improves and he no longer represents a danger. At least once every six months, a court must make a determination on the basis of the findings of a health care establishment as regards extension of compulsory medical treatment, change of type thereof or discontinuation thereof.

7. Where there is no necessity to subject a person to compulsory medical treatment, also where a court cancels application thereof, the person may be transferred by the court into the custody or guardianship of his relatives or other persons and may concurrently be subjected to medical observation.

SPECIAL PART

CHAPTER XV

CRIMES AGAINST HUMANITY AND WAR CRIMES

Article 99. Genocide

A person who, seeking to physically destroy, in whole or in part, the persons belonging to any national, ethnic, racial, religious, social or political group, organises, is in charge of or participates in their killing, torturing, causing bodily harm to them, hindering their mental development, their deportation or otherwise inflicting on them the conditions of life bringing about the death of all or a part of them, restricts the birth of the persons belonging to those groups or forcibly transfers their children to other groups

shall be punished by imprisonment for a term of five up to twenty years or by life imprisonment.

Article 100. Treatment of Persons Prohibited under International Law

A person who intentionally, by carrying out or supporting the policy of the State or an organisation, attacks civilians on a large scale or in a systematic way and commits their killing or causes serious impairment to their health; inflicts on them such conditions of life as bring about their death; engages in trafficking in human beings; commits deportation of the population; tortures, rapes, involves in sexual slavery, forces to engage in prostitution, forcibly inseminates or sterilises; persecutes any group or community of persons for political, racial, national, ethnic, cultural, religious, sexual or other reasons prohibited under international law; detains, arrests or otherwise deprives them of liberty, where such a deprivation of liberty is not recognised, or fails to report the fate or whereabouts of the persons; carries out the policy of apartheid

shall be punished by imprisonment for a term of five up to twenty years or by life imprisonment.

Article 101. Killing of Persons Protected under International Law

Any person who, in violation of norms of international humanitarian law in time of war or during an international armed conflict, occupation or annexation, orders to kill or kills: the persons who had surrendered by laying down their arms or not having any means of resistance; the wounded, the sick or seamen of a sinking war ship; prisoners of war; the civilians present in an occupied, annexed or captured territory or in the territory of hostilities or other persons under international protection in time of war

shall be punished by imprisonment for a period of ten up to twenty years or by life imprisonment.

Article 102. Deportation of Civilians of an Occupied State or Transfer of the Civilian Population of an Occupying State

A person who, in time of war or during an international armed conflict or under the conditions of occupation or annexation, orders to deport or carries out deportation of the civilian population from an occupied or annexed territory to the territory of an occupying or annexing country or of a third country; orders to transfer or transfers the civilian population of the occupying state to the territory of the occupied country

shall be punished by imprisonment for a term of three up to fifteen years.

Article 103. Causing Bodily Harm to, Torture or Other Inhuman Treatment of Persons Protected under International Humanitarian Law

A person who, in time of war or during an armed international conflict or under the conditions of occupation or annexation and in violation of norms of international humanitarian law, inflicts a serious bodily harm to or an illness upon or tortures the wounded, the sick, seamen of a sinking warship, prisoners of war, civilians or other persons protected under international humanitarian law, conducts a biological or medical experiment with them, unlawfully takes their organ or tissue for transplanting purposes, unlawfully takes their blood or subjects them to other inhuman treatment, imposes upon them criminal penalties without a judgement of an independent and impartial court or without guarantees of defence in court or commits an outrage on the remains of the fallen;

shall be punished by imprisonment for a term of three up to twelve years.

Article 104. Violation of Norms of International Humanitarian Law Concerning Protection of Civilians and Their Property in Time of War

A person who, in time of war or during an armed international conflict or under the conditions of occupation or annexation and in violation of norms of international humanitarian law, drives out the civilian population from their homes or resettles them or forces them to change their religion; rapes women, involves them in sexual slavery or forces them to engage in prostitution; forcibly sterilises or inseminates them; utilises means of intimidation or terror; takes hostages; applies collective punishment; confines in a concentration camp; separates children from their parents or guardians; threatens death by starvation; imposes criminal penalties without a judgement of an independent and impartial court or without guarantees of defence in court; confiscates their property or conducts mass expropriation thereof for purposes other than military necessity; imposes unjustifiably large contributions and requisitions

shall be punished by imprisonment for a term of three up to fifteen years.

Article 105. Forcible Use of Civilians or Prisoners of War in the Armed Forces of the Enemy

1. A person who, in time of war, during an armed international conflict, occupation or annexation and in violation of international humanitarian law, forces civilians or prisoners of war to serve in the armed forces of their enemy, uses them as a human shield in a military operation, conscripts or recruits children under the age of 18 years into the armed forces or uses them in a military operation

shall be punished by imprisonment for a term of three up to ten years.

2. A person who conscripts or recruits children under the age of 18 years into military service in the military groups not belonging to the armed forces of the State or uses them in a military operation

shall be punished by imprisonment for a term of three up to twelve years.

Article 106. Destruction of Protected Objects or Plunder of National Valuable Properties

A person who issues an order not justifiable by military necessity to destroy or destroys the historic monuments, objects of culture, art, education, upbringing, science or religion protected by treaties or national legal acts, plundered national valuable properties in an occupied or annexed territory and causes extensive damage

shall be punished by imprisonment for a term of three up to twelve years.

Article 107. Delay in Repatriation of Prisoners of War

A person who, after the signing of a peace treaty or cessation of hostilities, unjustifiably delays the release or repatriation of prisoners of war

shall be punished by imprisonment for a term of up to three years or a fine.

Article 108. Delay in Release of Interned Civilians or Impeding Repatriation of Other Civilians

A person who, after cessation of hostilities, unjustifiably delays the release of interned civilians or does not permit other civilians to repatriate to their Homeland from the territory of an armed conflict, where they so wish

shall be punished by imprisonment for a term of up to three years or a fine.

Article 109. Unlawful Use of the Emblem of the Red Cross, Red Crescent, Red Crystal and the United Nations Organization or Another Universally Recognised Emblem (Sign) or Designation

A person who unlawfully uses the emblem of the Red Cross, Red Crescent, Red Crystal, the United Nations Organization or another universally recognised emblem (sign) or designation during an international or other than international armed conflict

shall be punished by imprisonment for a term of up to three years or a fine.

Article 110. Aggression

Any person who causes an aggression against another state or is in command thereof

shall be punished by imprisonment for a period of ten up to twenty years or by life imprisonment.

Article 111. Prohibited Military Attack

1. A person who orders to carry out or carries out a military attack prohibited under international humanitarian law against civilians, medical or civil defence personnel, a military or civilian hospital, a first-aid post, a vehicle carrying wounded or sick persons, the personnel of the International Red Cross Committee or a National Red Cross or Red Crescent Society, a military attack against an undefended settlement or a demilitarised zone, a military attack without selecting a specific target and being aware that it could result in civilian casualties or destruction of a civilian object, or a military attack against the combatants who had clearly withdrawn from the battle and had given up resistance

shall be punished by imprisonment for a term of five up to fifteen years.

2. A person who orders to carry out or carries out a military attack contravening international humanitarian law against a target posing a considerable danger to the environment and people, such as a nuclear plant, a dam, a facility for the storage of toxic substances or another object, while being aware that it could cause grave consequences, or a military attack using weapons of mass destruction

shall be punished by imprisonment for a period of ten up to twenty years or by life imprisonment.

Article 112. Use of Prohibited Means of Warfare

A person who, in violation of treaties to which the Republic of Lithuania is party or universally accepted international practices regarding means of warfare or methods of warfare, orders the use of or uses in hostilities prohibited means of warfare or methods of warfare

shall be punished by imprisonment for a term of three up to ten years.

Article 113. Marauding

A person who orders the plundering of or plunders property on the battlefield from the fallen or the wounded

shall be punished by imprisonment for a term of up to five years.

CHAPTER XVI

CRIMES AGAINST THE INDEPENDENCE, TERRITORIAL INTEGRITY AND CONSTITUTIONAL ORDER OF THE STATE OF LITHUANIA

Article 114. Coup d’Etat

1. A person who organises or participates in a conspiracy to carry out a coup d’etat, or participates in a coup d’etat

shall be punished by imprisonment for a term of four up to twenty years.

2. A person who, in the course of committing an act provided for in paragraph 1 of this Article, uses armed force or where his act causes serious consequences

shall be punished by imprisonment for a period of ten up to twenty years or by life imprisonment.

3. A person who participates in a coup d’etat provided for in paragraphs 1 and 2 shall be released from criminal liability where he voluntarily provides to a state institution a significant information about the coup d’etat being prepared.

Article 115. Attempt on the Life of the President of the Republic of Lithuania

A person who makes an attempt on the life of the President of the Republic of Lithuania

shall be punished by imprisonment for a period of ten up to twenty years or by life imprisonment.

Article 116. Attempt on the Life of a Representative of Another State or International Public Organisation

A person who makes an attempt on the life of a representative of another state or international public organisation officially present in the Republic of Lithuania

shall be punished by imprisonment for a period of ten up to twenty years or by life imprisonment.

Article 117. Treason

A citizen of the Republic of Lithuania who, in time of war or following declaration of a state of war, allies with the enemy or assists the enemy in carrying out activities against the State of Lithuania

shall be punished by imprisonment for a term of three up to fifteen years.

Article 118. Assistance to Another State in Carrying out Activities Hostile to the Republic of Lithuania

A person who assists another state or organisation thereof in carrying out activities hostile to the Republic of Lithuania – its constitutional order, sovereignty, territorial integrity, defence or economic power

shall be punished by imprisonment for a term of up to seven years.

Article 119. Espionage

1. A person who, for the purpose of communicating it to a foreign state or organisation thereof, seizes, purchases or otherwise collects the information constituting a state secret of the Republic of Lithuania or communicates this information to a foreign state, organisation thereof or their representative

shall be punished by imprisonment for a term of two up to ten years.

2. A person who, in performing an assignment of another state or organisation thereof, seizes, purchases or otherwise collects or communicates the information constituting a state secret of the Republic of Lithuania or another information of interest to the intelligence of a foreign state

shall be punished by imprisonment for a term of three up to fifteen years.

Article 120. Collaboration

A citizen of the Republic of’ Lithuania who, under the conditions of occupation or annexation, aids bodies of the illegitimate government to consolidate the occupation or annexation, suppress the resistance of the Lithuanian population or otherwise assists the illegitimate government in carrying out activities against the Republic of Lithuania

shall be punished by imprisonment for a term of up to five years.

Article 121. Creation of Anti-constitutional Groups or Organisations and Participation in Activities Thereof

A person who created organisations or armed groups with the aim of unlawfully altering the constitutional system of the State of Lithuania, making an attempt against its independence, infringing upon territorial integrity or who participated in the activities of such organisations or groups

shall be punished by imprisonment for a term of three up to ten years.

Article 122. Public Incitement to Infringe upon the Sovereignty of the Republic of Lithuania by Using Violence

A person who publicly incites infringement upon the sovereignty of the Republic of Lithuania by using violence – altering of its constitutional order, overthrowing of the legitimate government, making an attempt against its independence or infringement upon territorial integrity, formation of armed groups for these purposes or commission of other crimes provided for in this Chapter and having the aim of threatening the State of Lithuania

shall be punished by imprisonment for a term of up to five years.

Article 123. Abuse of Authority

A person who, while authorised to represent the Republic of Lithuania in relations with another state or an organisation of another state or an international public organisation, abuses his authority or deliberately fails to perform his duties or performs them inappropriately and thus commits an act contravening the interests of the Republic of Lithuania, which incurs or could have incurred major damage,

shall be punished by imprisonment for a term of up to eight years.

Article 123(1). Violation of International Sanctions

1. A person who violates the international sanctions implemented in the Republic of Lithuania and thus causes major damage to interests of the Republic of Lithuania

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by imprisonment for a term of up to five years.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 124. Unlawful Possession of the Information Constituting a State Secret

A person who unlawfully acquires or conveys the information constituting a state secret of the Republic of Lithuania or unlawfully holds in possession the material items whose content or information thereon constitutes a state secret of the Republic of Lithuania, in the absence of characteristics of espionage,

shall be punished by a fine or by arrest or by imprisonment for a term of up to three years.

Article 125. Disclosure of a State Secret

1. A person who discloses the information constituting a state secret of the Republic of Lithuania, where this information was entrusted to him or he gained access thereto through his service, work or in the course of performance of public functions, but in the absence of characteristics of espionage,

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by imprisonment for a term of up to three years.

2. The act provided for in paragraph 1 of this Article shall be a crime also where it has been committed through negligence.

Article 126. Loss of a State Secret

1. A person who destroys, damages or loses a document, article or another material item entrusted to him through his service, work or in the course of performance of public functions whose content or information thereon constitutes a state secret of the Republic of Lithuania

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by imprisonment for a term of up to two years.

2. The act provided for in paragraph 1 of this Article shall be a crime also where it has been committed through negligence.

Article 127. Desecration of State Symbols

A person who publicly tears down, tatters, breaks, destroys, soils or otherwise desecrates the state flag or state emblem of the Republic of Lithuania or publicly ridicules the national anthem of Lithuania

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

Article 128. Desecration of Symbols of a Foreign State, the European Union or an International Public Organisation

A person who tears down, tatters, breaks, destroys, soils or otherwise desecrates an officially displayed state emblem or flag of a foreign state, the flag of the European Union or an international public organisation

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

CHAPTER XVII

CRIMES AGAINST HUMAN LIFE

Article 129. Murder

1. A person who murders another person

shall be punished by imprisonment for a term of seven up to fifteen years.

2. A person who murders

1) to a young child;

2) to a person in a helpless state;

3) to his close relative or family member;

4) to a pregnant woman;

5) to two or more persons;

6) by torturing or in another particularly cruel manner;

7) in a manner endangering other persons’ lives;

8) by reason of disorderly conduct;

9) for mercenary reasons;

10) by reason of performance of official or citizen’s duties by the victim;

11) in order to conceal another crime;

12) in order to acquire the victim’s organ, tissue or cells;

13) in order to express hatred towards a group of persons or a person belonging thereto on grounds of age, sex, sexual orientation, disability, race, nationality, language, descent, social status, religion, convictions or views

shall be punished by imprisonment for a period of eight up to twenty years or by life imprisonment.

Article 130. Murder in a State of Passion

A person who murders a person in a state of sudden passion due to the victim’s conduct which is unlawful or particularly offensive in respect of him or a person close tom him

shall be punished by imprisonment for a term of up to six years.

Article 131. Infanticide

A mother who kills her new-born child in a state resulting after giving birth to the child

shall be punished by arrest or imprisonment for a term of up to five years.

Article 132. Negligent Homicide

1. A person who commits a homicide through negligence

shall be punished by arrest or by imprisonment for a term of up to four years.

2. A person who commits a homicide of two or more through negligence

shall be punished by imprisonment for a term of up to six years.

3. A person who commits the act provided for in paragraph 1 or 2 of this Article in violation of the special conduct security rules as specified by legal acts

shall be punished by imprisonment for a term of up to eight years.

4. A legal entity shall also be held liable for an act provided for in paragraph 3 of this Article.

Article 133. Abetting a Suicide or Procuring a Suicide

A person who abets a person to commit a suicide or procures the person’s suicide by a cruel or deceitful conduct

shall be punished by a restriction of liberty or by arrest or by imprisonment for a term of up to four years.

Article 134. Aiding a Suicide

A person who, at the request of a terminally ill person, aids his suicide

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by community service or by arrest or by imprisonment for a term of up to four years.

Chapter XVIII

CRIMES AGAINST HUMAN HEALTH

Article 135. Severe Health Impairment

1. A person who causes bodily harm or an illness to a person resulting in the victim’s loss of eyesight, hearing, ability to speak, ability to reproduce, pregnancy or other serious mutilation, contracting of a terminal illness or a long-lasting illness posing a threat to his life or seriously affecting his mental health or in the loss of a considerable part of professional or general capacity for work or in a permanent disfigurement of the victim’s body

shall be punished by imprisonment for a term of up to ten years.

2. A person who causes a serious bodily injury or illness

1) to a young child;

2) to a person in a helpless state;

3) to his close relative or family member;

4) to a pregnant woman;

5) to two or more persons;

6) by torturing or in another particularly cruel manner;

7) in a manner endangering other persons’ lives;

8) by reason of disorderly conduct;

9) for mercenary reasons;

10) by reason of performance of official or citizen’s duties by the victim;

11) in order to conceal another crime;

12) in order to acquire the victim’s organ, tissue or cells;

13) in order to express hatred towards a group of persons or a person belonging thereto on grounds of age, sex, sexual orientation, disability, race, nationality, language, descent, social status, religion, convictions or views

shall be punished by imprisonment for a term of two up to twelve years.

Article 136. Severe Health Impairment Caused in a State of Passion

A person who causes a serious bodily harm to a person in a state of sudden passion due to the victim’s conduct which is unlawful or particularly offensive in respect of him or a person close to him

shall be punished by arrest or by imprisonment for a term of up to four years.

Article 137. Severe Health Impairment Caused Through Negligence

1. A person who causes a serious bodily harm or illness to a person through negligence

shall be punished by arrest or by imprisonment for a term of up to three years.

2. A person who causes a serious bodily harm or illness to two or more persons through negligence

shall be punished by imprisonment for a term of up to five years.

3. A person who commits the act provided for in paragraph 1 or 2 of this Article in violation of the special conduct security rules as specified by legal acts

shall be punished by imprisonment for a term of up to seven years.

4. A legal entity shall also be held liable for an act provided for in paragraph 3 of this Article.

Article 138. Non-Severe Health Impairment

1. A person who causes bodily harm or an illness to a person resulting in the victim’s loss of a small part of his professional or general capacity for work or in a long-lasting illness, but without developing the after-effects indicated in paragraph 1 of Article 135 of this Code

shall be punished by a restriction of liberty or by arrest or by imprisonment for a term of up to three years.

2. A person who causes a bodily harm or illness which is not serious

1) to a young child;

2) to a person in a helpless state;

3) to his close relative or family member;

4) to a pregnant woman;

5) to two or more persons;

6) by torturing or in another particularly cruel manner;

7) in a manner endangering other persons’ lives;

8) by reason of disorderly conduct;

9) for mercenary reasons;

10) by reason of performance of official or citizen’s duties by the victim;

11) in order to conceal another crime;

12) in order to acquire the victim’s organ, tissue or cells;

13) in order to express hatred towards a group of persons or a person belonging thereto on grounds of age, sex, sexual orientation, disability, race, nationality, language, descent, social status, religion, convictions or views

shall be punished by imprisonment for a term of up to five years.

Article 139. Non-Severe Health Impairment through Negligence

1. A person who causes bodily harm or an illness to a person through negligence resulting in the victim’s loss of a small part of his professional or general capacity for work or in a long-lasting illness, but without developing the after-effects indicated in paragraph 1 of Article 135 of this Code

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to one year.

2. A person who causes a bodily harm or illness which is not serious to two or more persons through negligence

shall be punished by arrest or by imprisonment for a term of up to one years.

3. A person shall be held liable for an act provided for in paragraph 1 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

Article 140. Causing Physical Pain or a Negligible Health Impairment

1. A person who, by beating or other violent actions, causes to a person physical pain or a negligible bodily harm or a short-term illness

shall be punished by community service or by restriction of liberty or by arrest or by imprisonment for a term of up to one year.

2. A person who commits the act indicated in paragraph 1 of this Article in respect of a young child or by torturing the victim

shall be punished by imprisonment for a term of up to two years.

3. A person shall be held liable for an act provided for in paragraph 1 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

Article 141. Interpretation of Concepts

Characteristics of the cases of health impairment provided for in Articles 135, 138 and 140 of this Chapter shall be defined by the rules for determining the extent of health impairment as approved by the Government of the Republic of Lithuania or an institution authorised by it.

CHAPTER XIX

CRIMES ENDANGERING HUMAN HEALTH AND LIFE

Article 142. Illegal Abortion

1. A doctor who has the right to perform abortions and performs an abortion at the request of a patient, in the presence of contraindications or in the event of performing it not at a health care establishment

shall be punished by community service or by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by restriction of liberty or by imprisonment for a term of up to two years.

2. A health care specialist who does not have the right to perform abortions and performs an abortion at a health care establishment at the request of a patient

shall be punished by community service or by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by restriction of liberty or by imprisonment for a term of up to three years.

3. A person who does not have the right to perform abortions and terminates pregnancy at the request of a pregnant woman

shall be punished by arrest or by imprisonment for a term of up to four years.

Article 143. Compelling a Woman to Have an Illegal Abortion

A person who compels a pregnant woman to have an illegal abortion by exerting a mental coercion on the victim or persons close to her

shall be punished by a restriction of liberty or by arrest or by imprisonment for a term of up to three years.

Article 144. Leaving a Person in a Life-Threatening Situation Without Providing Assistance

A person who, having raised a threat or while having the duty to take care of the victim, fails to provide assistance to him in a situation posing a threat to this person’s life, although he was in a position to provide him with assistance

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

Article 145. Threatening to Murder or Cause a Severe Health Impairment to a Person or Terrorisation of a Person

1. A person who threatens to murder a person or cause a severe health impairment to him, where there is a sufficient basis for believing that the threat may be fulfilled

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two year.

2. Any person who terrorises a person by threatening to blow him up, to set him on fire or to commit another act dangerous to his life, health or property or who systematically intimidates the person by using mental coercion

shall be punished by imprisonment for a term of up to four years.

3. A person shall be held liable for the acts provided for in paragraphs 1 and 2 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

4. A legal entity shall also be held liable for the acts provided for in this Article.

Chapter XX

CRIMES AGAINST HUMAN LIBERTY

Article 146. Unlawful Deprivation of Liberty

1. A person who unlawfully deprives a person of his liberty, in the absence of characteristics of hostage taking,

shall be punished by a fine or by arrest or by imprisonment for a term of up to three years.

2. A person who commits the act provided for in paragraph 1 of this Article by using violence or posing a threat to the victim’s life or health or by holding the victim in captivity for a period exceeding 48 hours

shall be punished by arrest or by imprisonment for a term of up to four years.

3. A person who unlawfully deprives a person of his liberty by committing him to a psychiatric hospital for reasons other than an illness

shall be punished by arrest or by imprisonment for a term of up to five years.

Article 147. Trafficking in Human Beings

1. A person who sells, purchases or otherwise conveys or acquires a person or recruits, transports or holds in captivity a person by using physical violence or threats or by otherwise depriving him of a possibility of resistance or by taking advantage of the victim’s dependence or vulnerability or by resorting to deceit or by paying or granting other material benefit to a person who actually has the victim under his control, where the offender is aware of or seeks involvement of the victim in prostitution or gaining profit from this person’s prostitution or using him for pornography purposes or forced labour shall be punished by imprisonment for a term of two up to ten years.

2. A person who commits the act provided for in paragraph 1 of this Article in respect of two or more victims or by participating in an organised group or seeking to acquire the victim’s organ, tissue or cells shall be punished by imprisonment for a term of four up to twelve years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 147(1). Use for Forced Labour

1. A person who, by using physical violence or threats or by otherwise depriving of a possibility of resistance or by taking advantage of a person’s dependence unlawfully forces him to perform a certain work

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

2. A person who commits the act indicated in paragraph 1 of this Article by forcing a person to work under the conditions of slavery or under other inhuman conditions

shall be punished by arrest or by imprisonment for a term of up to eight years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 148. Restriction of Freedom of a Person’s Actions

1. A person who demands that a person carry out unlawful actions or refrain from performing lawful actions or otherwise behave according to instructions of the offender by using mental coercion in respect of the victim or persons close to him

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

2. A person shall be held liable for an act provided for in paragraph 1 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

3. A legal entity shall also be held liable for an act provided for in this Article.

CHAPTER XXI

CRIMES AND MISDEMEANOURS AGAINST FREEDOM OF A PERSON’S SEXUAL SELF-DETERMINATION AND INVIOLABILITY

Article 149. Rape

1. A person who has sexual intercourse with a person against his will by using physical violence or threatening the immediate use thereof or by otherwise depriving of a possibility of resistance or by taking advantage of the helpless state of the victim

shall be punished by imprisonment for a term of up to seven years.

2. A person who rapes another person with a group of accomplices

shall be punished by imprisonment for a term of up to ten years.

3. A person who rapes a minor

shall be punished by imprisonment for a term of three up to ten years.

4. A person who raped a young child

shall be punished by imprisonment for a term of three up to fifteen years.

5. A person shall be held liable for an act provided for in paragraph 1 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

6. A legal entity shall also be held liable for an act provided for in paragraphs 3 and 4 of this Article.

Article 150. Sexual Assault

1. A person who, against a person’s will, satisfies his sexual desires through anal, oral or interfemoral intercourse by using physical violence or by threatening the immediate use thereof or by otherwise depriving the victim of a possibility of resistance or by taking advantage of the helpless state of the victim

shall be punished by arrest or by imprisonment for a term of up to seven years.

2. A person who carries out the actions provided for in paragraph 1 of this Article together with a group of accomplices

shall be punished by imprisonment for a term of up to eight years.

3. A person who carries out the actions provided for in paragraph 1 of this Article in respect of a minor

shall be punished by imprisonment for a term of two up to ten years.

4. A person who carries out the actions provided for in paragraph 1 of this Article in respect of a young child

shall be punished with imprisonment for a term of three up to thirteen years.

5. A person shall be held liable for an act provided for in paragraph 1 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

6. A legal entity shall also be held liable for an act provided for in paragraphs 3 and 4 of this Article.

Article 151. Sexual Abuse

1. A person who, by threatening to resort to violence, using other mental coercion or by taking advantage of a person’s dependency, compels the person to have sexual intercourse with or otherwise satisfy sexual desires of the offender or a third person

shall be punished by arrest or by imprisonment for a term of up to three years.

2. A person who carries out the actions provided for in paragraph 1 of this Article in respect of a minor

shall be punished by imprisonment for a term of up to five years.

3. A person shall be held liable for an act provided for in paragraph 1 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

4. A legal entity shall also be held liable for an act provided for in paragraph 2 of this Article.

Article 151(1). Satisfaction of Sexual Desires by Violating a Minor’s Freedom of Sexual Self-Determination and/or Inviolability

1. A person who has sexual intercourse or otherwise satisfied his sexual desires with a minor upon offering, promising to provide or upon providing to him in consideration money or a consideration of another form, in the absence of characteristics of a rape, sexual assault or sexual abuse,

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

2. A father, mother, guardian, custodian or another lawful representative of a child or another person holding statutory powers in respect of a minor who has sexual intercourse or otherwise satisfied his sexual desires with that minor, in the absence of characteristics of a rape, sexual assault or sexual abuse,

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to four years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 152. Sexual Harassment

1. A person who, in seeking sexual contact or satisfaction, harasses a person subordinate to him in office or otherwise by vulgar or comparable actions or by making offers or hints shall be considered to have committed a misdemeanour and

shall be punished by a fine or by restriction of liberty or by arrest.

2. A person shall be held liable for an act provided for in paragraph 1 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

Article 153. Sexual Molestation of a Child

A person who molests a child

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

CHAPTER XXII

CRIMES AND MISDEMEANOURS AGAINST A PERSON’S DIGNITY AND HONOUR

Article 154. Libel

1. A person who spreads false information about another person that could arouse contempt for this person or humiliate him or undermine trust in him

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to one year.

2. A person who libels a person accusing him of commission of a serious or grave crime or in the media or in a publication

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

3. A person shall be held liable for the acts provided for in this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

Article 155. Insult

1. A person who publicly humiliates a person in an abusive manner by an action, word of mouth or in writing

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to one year.

2. A person who insults a person in a manner other than publicly shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by arrest.

3. A person shall be held liable for the acts provided for in this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

CHAPTER XXIII

CRIMES AND MISDEMEANOURS AGAINST A CHILD AND A FAMILY

Article 156. Abduction of a Child or Exchange of Children

1. A person who abducts another person’s young child or exchanges infants

shall be punished by arrest or by imprisonment for a term of up to eight years.

2. A father, mother or a close relative who abducts their own or their relatives’ young child from a children’s establishment or from a person with whom the child lawfully resides

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two year.

Article 157. Purchase or Sale of a Child

1. A person who offers to purchase or otherwise acquire a child or sells, purchases or otherwise conveys or acquires a child, or recruits, transports or holds in captivity a child, while being aware or seeking his involvement in prostitution or gaining profit from his prostitution or his use for pornography purposes or forced labour, shall be punished by imprisonment for a term of three up to twelve years.

2. A person who commits the act provided for in paragraph 1 of this Article in respect of two or more children or young children or by participating in an organised group or seeking to acquire the victim’s organ, tissue or cells shall be punished by imprisonment for a term of five up to fifteen years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 158. Desertion of a Child

A father, mother or a guardian or another lawful representative of a child who deserts a young child being unable to look after himself thus leaving him without due care, with the intent to abandon him,

shall be punished by community service or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

Article 159. Involvement of a Child in a Criminal Act

A person who, by persuading, requesting, paying, threatening, deceiving or otherwise, involves a child in a criminal act

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

Article 160. Involvement of a Child in the Use of Medicine or Other Intoxicating Means

A person who involves a child in the use of medicine or other non-narcotic intoxicating means for purposes other than medical treatment,

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

Article 161. Involvement of a Child in Abuse of Alcohol

1. A person who involves a child in abuse of alcohol

shall be punished by community service or by a fine or by restriction of liberty or by imprisonment for a term of up to two years.

2. A person who intoxicated a child with alcohol shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

Article 162. Use of a Child for Pornography

1. A person who involves a child in pornographic events or uses a child for the production of pornographic material or gains profit from such activities of the child

shall be punished by a fine or by arrest or by imprisonment for a term of up to five years.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 163. Abuse of the Rights or Duties of Parents, a Guardian or Custodian or Other Lawful Representatives of a Child

A person who abuses the rights of a father, mother, guardian or custodian or other lawful representatives of a child by physically or mentally harassing a child, leaving him for long periods without care or by maltreating him in a similar cruel manner

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to five years.

Article 164. Evasion of a Child’s Maintenance

A person who evades his duty as established by a decision of a court to maintain a child, pay for the maintenance of the child or provide another required support to the child

shall be punished by community service or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

CHAPTER XXIV

CRIMES AGAINST INVIOLABILITY OF A PERSON’S PRIVATE LIFE

Article 165. Unlawful Violation of Inviolability of a Person’s Dwelling

1. A person who unlawfully, in a secret or open manner by resorting to deceit or violence or otherwise against the will of an owner or the persons authorised by him, intrudes into another person’s residential house, apartment or other residential premises or fixtures thereof, including the dwelling’s guarded territory,

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two year.

2. A person shall be held liable for an act provided for in this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

Article 166. Violation of Inviolability of a Person’s Correspondence

1. A person who unlawfully intercepts a postal item or package sent by post or via a provider of courier services or unlawfully intercepts, records or observes a person’s messages transmitted by electronic communications networks or unlawfully records, wiretaps or observes a person’s conversations transmitted by electronic communications networks or otherwise violates inviolability of a person’s correspondence

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two year.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 167. Unlawful Collection of Information about a Person’s Private Life

1. A person who unlawfully collects information about a person’s private life

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 168. Unauthorised Disclosure or Use of Information about a Person’s Private Life

1. A person who, without another person’s consent, makes public, uses for his own benefit or for the benefit of another person information about the private life of another person, where he gains access to that information through his service or profession or in the course of performance of a temporary assignment or he collects it through the commission of an act provided for in Articles 165-167 of this Code,

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

2. A legal entity shall also be held liable for an act provided for in this Article.

3. A person shall be held liable for an act provided for in this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

CHAPTER XXV

CRIMES AND MISDEMEANOURS AGAINST A PERSON’S EQUAL RIGHTS AND FREEDOM OF CONSCIENCE

Article 169. Discrimination on Grounds of Nationality, Race, Sex, Descent, Religion or Belonging to Other Groups

A person who carries out the actions aimed at hindering, on grounds of sex, sexual orientation, race, nationality, language, descent, social status, religion, convictions or views, a group of persons or a person belonging thereto to participate on a par with other persons in political, economic, social, cultural, labour or other activities or at restricting the rights and freedoms of such a group of persons or of the person belonging thereto

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

Article 170. Incitement against Any National, Racial, Ethnic, Religious or Other Group of Persons

1. A person who, for the purposes of distribution, produces, acquires, sends, transports or stores the items ridiculing, expressing contempt for, urging hatred of or inciting discrimination against a group of persons or a person belonging thereto on grounds of sex, sexual orientation, race, nationality, language, descent, social status, religion, convictions or views or inciting violence, a physical violent treatment of such a group of persons or the person belonging thereto or distributes them

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to one year.

2. A person who publicly ridicules, expresses contempt for, urges hatred of or incites discrimination against a group of persons or a person belonging thereto on grounds of sex, sexual orientation, race, nationality, language, descent, social status, religion, convictions or views

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

3. A person who publicly incites violence or a physical violent treatment of a group of persons or a person belonging thereto on grounds of sex, sexual orientation, race, nationality, language, descent, social status, religion, convictions or views or finances or otherwise supports such activities

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

4. A legal entity shall also be held liable for the acts provided for in this Article.

*Article 1701. Creation and Activities of the Groups and Organisations Aiming at Discriminating a Group of Persons or Inciting against It

1. A person who creates a group of accomplices or an organised group or organisation aiming at discriminating a group of persons on grounds of sex, sexual orientation, race, nationality, language, descent, social status, religion, convictions or views or inciting against it or participates in the activities of such a group or organisation or finances or otherwise supports such a group or organisation

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to one year.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 171. Disturbance of Religious Ceremonies or Religious Celebrations

A person who, through the use of taboo words, carrying out of defiant actions, making threats, taunting or other indecent actions, disrupted the services or other ceremonies or celebrations held by a religious community or society recognised by the State shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

CHAPTER XXVI

CRIMES AGAINST PERSONS’ VOTING RIGHTS AND THE PROCEDURE OF ELECTIONS OF THE PRESIDENT OF THE REPUBLIC OF LITHUANIA, ELECTIONS TO THE SEIMAS, THE EUROPEAN PARLIAMENT AND MUNICIPAL COUNCILS OR THE PROCEDURE FOR CONDUCTING REFERENDUMS

Article 172. Hindering the Exercise of the Right of Elections or Referendums

A person who, through the use of mental coercion or by bribing or by deceit, hinders a person to exercise his right to elect, to be elected or to participate in a referendum

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

Article 173. Forgery of an Election or Referendum Document or Use of a Forged Election or Referendum Document

1. A person who, for the purpose of influencing the results of elections or a referendum, forges a voters’ list, a list of the citizens having the right to participate in the referendum, a vote counting record, an election or referendum ballot, produces a large number of false election or referendum ballots or uses a forged or false election or referendum document

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two year.

2. A person who commits the act provided for in paragraph 1 of this Article, where it results in the annulment of elections or a referendum or significantly influences the results of the elections or the referendum

shall be punished by imprisonment for a term of up to three years.

Article 174. Incorrect Counting of Election Votes

1. A person who, for the purpose of influencing the results of elections or a referendum, incorrectly counts and records election votes or votes of the citizens participating in the referendum

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two year.

2. A person who commits the act provided for in paragraph 1 of this Article, where it results in the annulment of elections or a referendum or significantly influences the results of the elections or the referendum

shall be punished by arrest or by imprisonment for a term of up to three years.

Article 175. Destruction, Spoiling, Seizure or Concealment of an Election or Referendum Document

A person who destroys, spoils, seizes or conceals a list of voters or the citizens having the right to participate in a referendum, an election or referendum ballot or a vote counting record, where this results in the annulment of the elections or the referendum or significantly influences the results of the elections or the referendum

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

CHAPTER XXVII

CRIMES AND MISDEMEANOURS AGAINST A PERSON’S SOCIAL RIGHTS

Article 176. Violation of Requirements of Safety and Health Protection at Work

1. An employee or a person authorised by him who violates the requirements of safety or health protection at work as stipulated in legislation on safety at work or other legal acts, where this results in an accident involving people, a breakdown or causes other serious consequences,

shall be punished by a fine or by imprisonment for a term of up to eight years.

2. An employee or a person authorised by him who commits the act provided for in paragraph 1 of this Article, where it could have resulted in an accident involving people, a breakdown or caused other serious consequences, shall be considered to have committed a misdemeanour and

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by a fine or by restriction of liberty or by arrest.

3. The acts provided for in paragraph 1 of this Article shall be criminal also where they have been committed through negligence.

Article 177. Hindering the Activities of Trade Unions

A person who hinders the lawful activities of a trade union or a member thereof shall be considered to have committed a misdemeanour and

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by a fine or by restriction of liberty.

CHAPTER XXVIII

CRIMES AND MISDEMEANOURS AGAINST PROPERTY, PROPERTY RIGHTS AND PROPERTY INTERESTS

Article 178. Theft

1. A person who seizes another’s property

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

2. A person who openly seizes another’s property in an open manner or seizes another’s property by breaking into premises, a storage facility or a guarded territory or seizes another’s property publicly from a person’s clothes, handbag or other carried item (pick-pocketing) or a vehicle

shall be punished by a fine or by arrest or by restriction of liberty or by imprisonment for a term of up to six years.

3. A person who seizes another’s property of a high value or the valuables of a considerable scientific, historical or cultural significance or seizes another’s property by participating in an organised group

shall be punished by imprisonment for a term of up to eight years.

4. A person who seizes another’s property of a low value shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

5. A person shall be held liable for the acts provided for in paragraphs 1 and 4 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

Article 179. Unlawful Use of Energy and Communications Services

1. A person who uses heat, gas, water, telecommunications or other items having an economic value by unlawfully connecting to energy supply or a communications network or a storage facility, by distorting meter readings or by other unlawful means and thereby incurs property damage to another person

shall be punished by community service or by a fine or by restriction of liberty or by imprisonment for a term of up to two years.

2. A person who commits the act indicated in paragraph 1 of this Article and thereby incurs major property damage to another person

shall be punished by imprisonment for a term of up to six years.

3. A person who commits the act indicated in paragraph 1 of this Article and thereby incurs minor property damage to another person shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

4. A legal entity shall also be held liable for the acts provided for in this Article.

5. A person shall be held liable for the acts provided for in paragraphs 1 and 3 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

Article 180. Robbery

1. A person who, through the use of physical violence or by threatening the immediate use thereof or by otherwise depriving of a possibility of resistance or by taking advantage of the helpless state of the victim, seizes another’s property

shall be punished by arrest or by imprisonment for a term of up to six years.

2. A person who commits the robbery by breaking into premises or using a weapon other than a firearm, a knife or another item specially designed to injure a person

shall be punished by imprisonment for a term of up to seven years.

3. A person who commits a robbery by using a firearm or an explosive or, having committed a robbery, seizes a property of a high value or the valuables of a considerable scientific, historical or cultural significance or commits the robbery by participating in an organised group

shall be punished by imprisonment for a term of two up to ten years.

Article 181. Extortion of Property

1. A person who, without a lawful ground therefor, openly or secretly for own benefit or for the benefit of other persons demands property from another person, asks to grant a property right or to release from a property obligation or to carry out other property‑related actions or to refrain from such actions by threatening to use physical violence against the victim or another person, to damage or destroy his property, to publish a compromising or other information whose disclosure is undesired or through the use of other mental coercion

shall be punished by arrest or by imprisonment for a term of up to six years.

2. A person who, when extorting property, uses physical violence, deprives a person of his liberty, destroys or damages his property or otherwise incurs major property damage thereto

shall be punished by imprisonment for a term of up to eight years.

3. A person who extorts a property of a high value or the valuables of a considerable scientific, historical or cultural significance or extorts property by participating in an organised group

shall be punished by imprisonment for a term of three up to ten years.

Article 182. Swindling

1. A person who, by deceit, acquires another’s property for own benefit or for the benefit of other persons or acquires a property right, avoids a property obligation or annuls it

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

2. A person who, by deceit and for own benefit or for the benefit of other persons, acquires another’s property of a high value or a property right or the valuables of a considerable scientific, historical or cultural significance or avoids a property obligation of a high value or annuls it or swindles by participating in an organised group

shall be punished by imprisonment for a term of up to eight years.

3. A person who, by deceit and for own benefit or for the benefit of other persons, acquires another’s property of a low value or acquires a property right, avoids a property obligation of a low value or annuls it shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

4. A person shall be held liable for the acts provided for in paragraphs 1 and 3 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

5. Legal entities shall also be held liable for the acts provided for in paragraphs 1 and 2 of this Article.

Article 183. Misappropriation of Property

1. A person who misappropriates another’s property or property right entrusted to him or held at his disposal

shall be punished by community service or by a fine or by imprisonment for a term of up to three years.

2. A person who misappropriates another’s property or property right of a high value entrusted to him or held at his disposal or the valuables of a considerable scientific, historical or cultural significance

shall be punished by imprisonment for a term of up to ten years.

3. A person who misappropriates another’s property or property right of a low value entrusted to him or held at his disposal shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by arrest.

4. Legal entities shall also be held liable for the acts provided for in paragraphs 1 and 2 of this Article.

5. A person shall be held liable for the acts provided for in paragraphs 1 and 3 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

Article 184. Squandering of Property

1. A person who squanders another’s property or property right entrusted to him or held at his disposal

shall be punished by community service or by a fine or by restriction of liberty or by imprisonment for a term of up to two years.

2. A person who squanders another’s property or property right of a high value entrusted to him or held at his disposal or the valuables of a considerable scientific, historical or cultural significance

shall be punished by imprisonment for a term of up to seven years.

3. A person who squanders another’s property or property right of a low value entrusted to him or held at his disposal shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by arrest.

4. The acts provided for in paragraphs 1 and 2 of this Article shall be criminal also where they have been committed through negligence.

5. A person shall be held liable for the acts provided for in paragraphs 1 and 3 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

6. A legal entity shall also be held liable for an act provided for in paragraphs 1 and 2 of this Article.

Article 185. Misappropriation of a Found Item

A person who misappropriates a found treasure, the valuables of a considerable scientific, historical or cultural significance, another found item of a high value or another’s property of a high value coming into his possession by chance

shall be punished by community service or by a fine or by arrest or by imprisonment for a term of up to two years.

Article 186. Causing Property Damage by Deceit

1. A person who, by deceit, evades settlement for the works received, the goods delivered, the services rendered or obligatory payments and thereby incurs major property damage to another person

shall be punished by community service or by a fine or by restriction of liberty or by imprisonment for a term of up to two years.

2. A person who, by deceit, incurs minor property damage to another person shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

3. A legal entity shall also be held liable for an act provided for in paragraph 1 of this Article.

4. A person shall be held liable for the acts provided for in paragraphs 1 and 2 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

Article 187. Destruction of or Damage to Property

1. A person who destroys or damages another’s property

shall be punished by community service or by a fine or by restriction of liberty or by imprisonment for a term of up to two years.

2. A person who destroys or damages another’s property in a generally dangerous manner or by taking apart or damaging an installation or assembled units, where this could have caused harm to people, or destroys or damages another’s property of a high value or the valuables of a considerable scientific, historical, or cultural significance

shall be punished by arrest or by imprisonment for a term of up to five years.

3. A person who destroys or damages another’s property of a low value shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

4. A person shall be held liable for the acts provided for in paragraphs 1 and 3 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

Article 188. Destruction of or Damage to Property through Negligence

1. A person who destroys or damages through negligence another’s property and incurs major property damage to the victim or destroys or damages the valuables of a considerable scientific, historical or cultural significance

shall be punished by community service or by a fine or by restriction of liberty or by imprisonment for a term of up to two years.

2. A person who commits the act provided for in paragraph 1 of this Article in violation of the special conduct security rules as specified by legal acts

shall be punished by a fine or by arrest or by imprisonment for a term of up to three years.

3. A person shall be held liable for the acts provided for in paragraphs 1 and 2 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

4. A legal entity shall also be held liable for an act provided for in paragraph 2 of this Article.

Article 189. Acquisition or Handling of the Property Obtained by Criminal Means

1. A person who acquires, uses or handles a property while being aware that this property has been obtained by criminal means

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

2. A person who acquires, uses or handles a property of a high value or the valuables of a considerable scientific, historical or cultural significance while being aware that that property or the valuable properties have been obtained by criminal means

shall be punished by a fine or by arrest or by imprisonment for a term of up to four years.

3. A person who acquires, uses or handles a property of a low value while being aware that this property has been obtained by criminal means shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by arrest.

4. A legal entity shall also be held liable for an act provided for in paragraphs 1 and 2 of this Article.

Article 190. Interpretation of the Value of a Property

The property provided for in this Chapter shall be considered to be of a considerable value where its value exceeds the amount of 250 MSLs and of a low value where its value exceeds the amount of 1 MSL, but does not exceed the amount of 3 MSLs.

CHAPTER XXIX

CRIMES AGAINST INTELLECTUAL AND INDUSTRIAL PROPERTY

Article 191. Misappropriation of Authorship

1. A person who publishes or publicly announces as his own a literary, scientific or artistic work (including computer software and databases) or a part thereof created by another person

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two year.

2. A person who, by taking advantage of his official position or by resorting to mental coercion, forces the author of a literary, scientific or artistic work (including computer software and databases) or a part thereof to acknowledge another person as the co-author or successor to author’s rights or to renounce the right of authorship

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 192. Unlawful Reproduction of a Literary, Scientific or Artistic Work or an Object of Related Rights, Distribution, Transportation or Storage of Illegal Copies Thereof

1. A person who unlawfully reproduces a literary, scientific or artistic work (including computer software and databases) or an object of related rights or a part thereof for commercial purposes or distributes, transports or stores for commercial purposes illegal copies thereof, where the total value of the copies exceeds, according to the prices of legal copies or, in the absence thereof, according to the prices of originals of the reproduced works, the amount of 100 MSLs,

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two year.

*2. A person who commits the act indicated in paragraph 1 of this Article, where the total value of the illegal copies exceeds, according to the prices of legal copies or, in the absence thereof, according to the prices of originals of the reproduced works, the amount of 250 MSLs,

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

*Note: Paragraph 1, the Article has been supplemented with paragraph 2, paragraph 2 shall be renumerated as paragraph 3.

Article 193. Destruction or Alteration of Information about Management of Author’s Rights or Related Rights

1. A person who, without authorisation of the entity of author’s rights or related rights and for commercial purposes, destroys or alters information about management of author’s rights or related rights, where this information helps to identify a work, the author of the work, another entity of author’s rights or the performer, performance of the work, a phonogram, the producer of the phonogram, another entity of related rights, also information about the terms and conditions of and procedure for using the work, performance thereof or the phonogram, including all figures or codes communicating the information indicated in copies of the work, performance record or the phonogram or presented at the time of their publication

shall be punished by a fine or by arrest or by imprisonment for a term of up to one year.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 194. Unlawful Removal of Technical Protection Means of Author’s Rights or Related Rights

1. A person who unlawfully removes any technical protection means used by entities of author’s rights or related rights for the exercise or protection of their rights or produces, imports, exports, stores, transports or distributes for commercial purposes the devices providing a possibility to remove the technical protection means (decoders, decoding cards or other devices) or a software, passwords, codes or other similar data

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 195. Violation of Industrial Property Rights

1. A person who violates the exclusive rights of a patent owner or a design owner or the right of a legal entity to the legal entity’s name

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

2. A legal entity shall also be held liable for an act provided for in this Article.

CHAPTER XXX

CRIMES AGAINST SECURITY OF ELECTRONIC DATA AND INFORMATION SYSTEMS

Article 196. Unlawful Influence on Electronic Data

1. A person who unlawfully destroys, damages, removes or modifies electronic data or a technical equipment, software or otherwise restricts the use of such data thereby incurring major damage

shall be punished by community service or by a fine or by imprisonment for a term of up to four years.

2. A person who commits the act provided for in paragraph 1 of this Article in respect of the electronic data of an information system of strategic importance for national security or of major importance for state government, the economy or the financial system

shall be punished by a fine or by arrest or by imprisonment for a term of up to six years.

3. A person who commits the act provided for in this Article thereby incurring minor damage shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

4. A legal entity shall also be held liable for the acts provided for in this Article.

Article 197. Unlawful Influence on an Information System

1. A person who unlawfully disturbs or terminates the operation of an information system thereby incurring major damage

shall be punished by a fine or by arrest or by imprisonment for a term of up to four years.

2. A person who commits the act provided for in paragraph 1 of this Article in respect of an information system of strategic importance for national security or of major importance for state government, the economy or the financial system

shall be punished by a fine or by arrest or by imprisonment for a term of up to six years.

3. A person who commits the act provided for in this Article thereby incurring minor damage shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

4. A legal entity shall also be held liable for the acts provided for in this Article.

Article 198. Unlawful Interception and Use of Electronic Data

1. A person who unlawfully observes, records, intercepts, acquires, stores, appropriates, distributes or otherwise uses the electronic data which may not be made public

shall be punished by a fine or by imprisonment for a term of up to four years.

2. A person who unlawfully observes, records, intercepts, acquires, stores, appropriates, distributes or otherwise uses the electronic data which may not be made public and which are of strategic importance for national security or of major importance for state government, the economy or the financial system

shall be punished by imprisonment for a term of up to six years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 198(1). Unlawful Connection to an Information System

1. A person who unlawfully connects to an information system by damaging the protection means of the information system

shall be punished by community service or by a fine or by arrest or by imprisonment for a term of up to one year.

2. A person who unlawfully connects to an information system of strategic importance for national security or of major importance for state government, the economy or the financial system

shall be punished by a fine or by arrest or by imprisonment for a term of up to three years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 198(2). Unlawful Disposal of Installations, Software, Passwords, Login Codes and Other Data

1. A person who unlawfully produces, transports, sells or otherwise distributes the installations or software, also passwords, login codes or other similar data directly intended for the commission of criminal acts or acquires or stores them for the same purpose

shall be punished by community service or by a fine or by arrest or by imprisonment for a term of up to three years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

CHAPTER XXXI

CRIMES AND MISDEMEANOURS AGAINST THE ECONOMY AND BUSINESS ORDER

Article 199. Smuggling

1. A person who, when transporting across the state border of the Republic of Lithuania the items which must be declared at the customs and whose value exceeds the amount of 250 MSLs, fails to go through the customs control or otherwise avoids this control or transports across the state border of the Republic of Lithuania, without an authorisation, movable cultural properties or antiques

shall be punished by a fine or by imprisonment for a term of up to eight years.

2. A person who, without going through the customs control or otherwise avoiding it or without an authorisation, transports across the state border of the Republic of Lithuania firearms, ammunition, explosives, explosive, radioactive materials or other strategic goods, toxic, highly active, narcotic or psychotropic substances or precursors of narcotic or psychotropic substances

shall be punished by imprisonment for a term of three up to ten years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 199(1). Deceit of the Customs

1. A person who brings into the Republic of Lithuania from a Member State of the European Union the items which must be declared at the customs and whose value exceeds the amount of 250 MSLs and fails to go through the customs control of the Republic of Lithuania or another Member State of the European Union or otherwise avoids this control

shall be punished by a fine or by imprisonment for a term of up to eight years.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 199(2). Unlawful Possession of the Goods Subject to Excise Duties

1. A person who, in violation of the established procedure, acquires, stores, transports, forwards, uses or handles the goods subject to excise duties whose value exceeds the amount of 250 MSLs

shall be punished by a fine or imprisonment for a term of up to seven years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 200. Unlawful Failure to Bring Goods or Products outside the Republic of Lithuania

1. A person who unlawfully fails to bring beyond the state border of the Republic of Lithuania the goods or products whose value exceeds the amount of 250 MSLs and which ought to have been brought outside the Republic of Lithuania according to transit or export documents

shall be punished by imprisonment for a term of up to seven years.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 201. Unlawful Production, Storage, Transportation or Handling of Strong Home-Made Alcoholic Beverages, Non-denatured, Denatured or Technical Ethyl Alcohol, Dilutions (Mixtures) Thereof and Equipment for Production Thereof

1. A person who, for the purposes of handling, unlawfully produces, stores, transports strong home-made alcoholic beverages, non-denatured, denatured or technical ethyl alcohol, dilutions (mixtures) thereof or handles them or produces, stores, transports or handles equipment for the production of strong home-made alcoholic beverages

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two year.

2. A person who, for the purposes of handling, unlawfully produces, stores, transports fifty or more litres of strong home-made alcoholic beverages, non-denatured, denatured or technical ethyl alcohol, dilutions (mixtures) thereof or handles them

shall be punished by a fine or by imprisonment for a term of up to five years.

3. A person who, for the purpose other than handling, unlawfully produces, stores, transports ten or more litres of strong home-made alcoholic beverages or non-denatured, denatured or technical ethyl alcohol, dilutions (mixtures) thereof shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty.

Article 202. Unauthorised Engagement in Economic, Commercial, Financial or Professional Activities

1. A person who undertakes economic, commercial, financial or professional activities in the form of a business or on a large scale without holding a licence (authorisation) to engage in the activities for which it is required or by other unlawful means

shall be punished by community service or by a fine or by restriction of liberty or by imprisonment for a term of up to four years.

2. A person who engages in prohibited economic, commercial, financial or professional activities

shall be punished by imprisonment for a term of up to four years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 203. Unlawful Activities of a Legal Entity

1. A person who, on a large scale, engages in the activities not provided for in the founding documents of a public legal entity

shall be punished by a fine or by arrest or by imprisonment for a term of up to one year.

2. A person who establishes or is in charge of a legal entity used as a cover for unlawful activities

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

3. A legal entity shall also be held liable for an act provided for in paragraph 1 of this Article.

Article 204. Use of Another’s Trademark or Service Mark

1. A person who, without holding an authorisation, identifies a large quantity of goods with another’s trademark or presents them for handling or makes use of another’s service mark and thereby incurs major damage

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by imprisonment for a term of up to two years.

2. A person who, without holding an authorisation, identifies a small quantity of goods with another’s trademark or presents them for handling or makes use of another’s service mark and thereby incurs damage shall be considered to have committed a misdemeanour and

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by community service or by a fine or by restriction of liberty.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 205. Misleading Declaration about the Activities of a Legal Entity

1. A person who, on behalf of a legal entity, presents in an official report or in an application misleading data concerning the activities or assets of the legal entity and thereby misleads a government institution, international public organisation, creditor, member of the legal entity or another person who suffers major property damage as a result thereof

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 206. Use of a Credit, Loan or Targeted Support Not in Accordance with Its Purpose or the Established Procedure

1. A person who, upon obtaining a credit, loan or targeted support in the amount of 150 MSLs or more, uses it not in accordance with its purpose or the established procedure

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to one year.

2. A person who, upon obtaining a credit or loan, uses it not in accordance with its purpose or the established procedure and fails to repay it within the established time limit thereby incurring major property damage to the creditor, guarantor or another person

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 207. Credit Fraud

1. A person who, by deceit, obtains a credit, loan, subsidy, warranty or bank guarantee statement or another credit obligation

shall be punished by a fine or by arrest or by imprisonment for a term of up to three years.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 208. Dishonesty of a Debtor

1. A person who, owing to a difficult economic situation or insolvency, when facing obvious bankruptcy and being unable to meet all creditors’ claims, meets claims of only one or several of them or secures claims of one or several creditors and thereby incurs property damage to the remaining creditors

shall be punished by a fine or by imprisonment for a term of up to two years.

2. A person who, owing to a difficult economic situation or insolvency, when facing obvious bankruptcy, conceals, squanders, conveys, transfers abroad or sells his property at an unjustifiably low price, while it could have been utilised to repay debts, and thereby incurs property damage to creditors

shall be punished by a fine or by imprisonment for a term of up to three years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 209. Criminal Bankruptcy

A person who brings an undertaking to bankruptcy by deliberate mismanagement and thereby incurs major property damage to creditors

shall be punished by imprisonment for a term of up to three years.

Article 210. Commercial Espionage

A person who unlawfully acquires the information considered to be a commercial secret or communicates this information to another person

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

Article 211. Disclosure of a Commercial Secret

A person who discloses the information considered to be a commercial secret which was entrusted to him or which he accessed through his service or work, where this act incurs major property damage to the victim,

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

Article 212. Interpretation of Concepts

1. In this Chapter, the indicated major property damage shall be a damage exceeding the amount of 150 MSLs.

2. The value of the items (goods) indicated in Articles 199, 1991, 1992 and 200 of this Chapter shall be calculated according to their customs value, including the taxes to be paid.

3. The strong home-made alcoholic beverages indicated in Article 201 of this Chapter shall be the alcoholic beverages whose ethyl alcohol strength by volume exceeds 18%.

4. The legal entities indicated in this Chapter shall be any legal entities, with the exception of the State, a municipality, a state and municipal institution and agency as well as an international public organisation.

CHAPTER XXXII

CRIMES AND MISDEMEANOURS AGAINST THE FINANCIAL SYSTEM

Article 213. Production, Storage or Handling of Counterfeit Currency or Securities

1. A person who produces counterfeit or forges genuine currency or securities of Lithuania or another state which are in circulation or which have been officially approved, but have not been issued into circulation yet or acquires, stores or handles counterfeit or forges genuine currency or securities of Lithuania or another state which are in circulation or which have been officially approved, but have not been issued into circulation yet or produces, acquires, stores or handles the equipment, software or special materials for the production of counterfeit currency or securities or for the forgery of genuine currency or securities

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to four years.

2. A person who produces, forges, acquires, stores or handles, in a large quantity or of a high value, counterfeit or forged currency or securities which are in circulation in Lithuania or another state or which have been officially approved, but have not been issued into circulation yet

shall be punished by imprisonment for a term of three up to ten years.

3. A person who, upon obtaining as genuine, handles a small quantity of counterfeit or forged currency or securities which are known to be such and are in circulation in Lithuania or another state

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

4. A person who, while being authorised to produce genuine currency, but in violation of the established procedure for or conditions of producing currency, produces the currency which is in circulation in Lithuania or another state or which has been officially approved, but has not been issued into circulation yet, also a person who stores, acquires or handles such currency while being aware that it has been produced in violation of the procedure for or conditions of producing currency,

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by a fine or by arrest or by imprisonment for a term of up to four years.

5. A legal entity shall also be held liable for the acts provided for in this Article.

Article 214. Production of a Counterfeit Electronic Means of Payment, Forgery of a Genuine Electronic Means of Payment or Unlawful Possession of an Electronic Means of Payment or Data Thereof

1. A person who produces one or more counterfeit electronic means of payment or parts thereof or forges one or more genuine electronic means of payment or unlawfully acquires, stores, transfers or handles one or more another person’s, counterfeit or forged electronic means of payment or unlawfully acquires, stores, transfers or handles data of one or more electronic means of payment or data of the means of identification of the user thereof sufficient to initiate a financial operation or produces, acquires, stores, transfers or handles the equipment, software or other means directly intended or adapted for the production of counterfeit electronic means of payment or parts thereof or for the forgery of genuine electronic means of payment

shall be punished by a fine or by arrest or by imprisonment for a term of up to six years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 215. Unlawful Use of an Electronic Means of Payment or Data Thereof

1. A person who unlawfully initiates or performs one or more financial operations with the help of one or more another person’s, counterfeit or forged electronic means of payment or by unlawfully using one or more another person’s electronic means of payment or data of the means of identification of the user thereof or by using the data of one or more identification means which are known to be counterfeit or recognises as lawful the unlawful use of one or more another person’s, counterfeit or forged electronic means of payment, which is known to be unlawful,

shall be punished by a fine or by arrest or by imprisonment for a term of up to six years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 216. Money or Property Laundering

1. A person who, seeking to conceal or legalise the money or property of his own or another person while being aware that they have been obtained by criminal means, performs financial operations with this property or money or a part thereof, enters into transactions or uses them in economic, commercial activities or makes a false declaration that they have been obtained lawfully

shall be punished by imprisonment for a term of up to seven years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 217. Trade in Securities by Using Non-Public Information

1. A person who, having access to a non-public information about the events essential for the issuer or other non-public information relating to the issuer or securities thereof, enters into a transaction on the securities of this issuer directly or via intermediaries of public trading in securities or communicates this information to third parties or recommends or offers third parties to acquire or to convey the securities of the issuer whereto the non-public information is related to, where this incurs major property damage,

shall be punished by restriction of liberty or by a fine or by imprisonment for a term of up to two years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 218. Manipulating the Price of Securities

1. A person who, seeking to arbitrarily increase or reduce the market price of securities, circulates a false or incomplete information regarding the issuer or securities thereof and thereby incurs major property damage

shall be punished by restriction of liberty or by a fine or by imprisonment for a term of up to three years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 219. Failure to Pay Taxes

1. A person who, upon filing a tax return or submitting a report approved in accordance with the established procedure or another document, fails to timely pay the taxes calculated according thereto after he is reminded by an institution authorised by the State about the duty to pay taxes

shall be punished by a fine or by imprisonment for a term of up to four years.

2. A person who, having committed the act indicated in paragraph 1 of this Article, fails to pay taxes in the amount of over 500 MSLs as payable by him

shall be punished by imprisonment for a term of two up to six years.

3. A person who, having committed the act indicated in paragraph 1 of this Article, fails to pay taxes in the amount not exceeding 10 MSLs as payable by him shall be considered to have committed a misdemeanour

shall be punished by community service or by a fine or by restriction of liberty.

4. A legal entity shall also be held liable for the acts provided for in this Article.

Article 220. Provision of Inaccurate Data on Income, Profit or Assets

1. A person who, seeking to evade payment of taxes, provides data on the person’s income, profit, assets or the use thereof that are known to be inaccurate in a tax return or in a report approved in accordance with the approved procedure or another document and submits such information to an institution authorised by the State

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by imprisonment for a term of up to three years.

2. A person who commits the act indicated in paragraph 1 of this Article having the aim of evading payment of taxes in the amount not exceeding 10 MSLs shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 221. Failure to File a Tax Return or to Submit a Report or Another Document

1. A person who fails, in accordance with the procedure laid down by legal acts, to timely file with an institution authorised by the State a tax return or to submit thereto a report approved in accordance with the established procedure or another document concerning a person’s income, profit or assets after this state institution reminds him in writing of the duty to submit them shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by arrest.

2. A person who commits the act indicated in paragraph 1 of this Article seeking to avoid payment of taxes or making of other payments in the amount exceeding 500 MSLs

shall be punished by a fine or by imprisonment for a term of up to three years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 222. Fraudulent Management of Accounts

1. A person who fraudulently manages the accounts required by legal acts or conceals, destroys or damages accounting documents, where this disables, fully or in part, determination of the person’s activities, the amount or structure of the assets, equity or liabilities thereof,

shall be punished by a fine or by arrest or by imprisonment for a term of up to four years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 223. Negligent Management of Accounts

1. A person who is under the obligation, but fails to manage the accounts required by legal acts or negligently manages the accounts required by legal acts or fails to store the accounting documents for a period stipulated by laws, where this disables, fully or in part, determination of the person’s activities, the amount or structure of the assets, equity or liabilities thereof,

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 224. Production, Storage or Handling of Counterfeit or Forged Postage Stamps, Travel or Other Tickets, Tax Stamps or Other Official Marking Signs

1. A person who produces, stores or handles counterfeit or forged postage stamps, travel or other tickets, tax stamps or other official marking signs

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

2. A person who produces, stores or handles, in a large quantity or of a high value, counterfeit or forged postage stamps, travel or other tickets, tax stamps or other official marking signs

shall be punished by imprisonment for a term of up to four years.

CHAPTER XXXIII

CRIMES AND MISDEMEANOURS AGAINST CIVIL SERVICE AND PUBLIC INTEREST

Article 225. Bribery

1. A civil servant or a person equivalent thereto who, for own benefit or for the benefit of other persons, directly or indirectly accepts, promises or agrees to accept a bribe, demands or provokes giving it for a lawful act or inaction in exercising his powers

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type activities or by imprisonment for a term of up to four years.

2. A civil servant or a person equivalent thereto who, for own benefit or for the benefit of other persons, directly or indirectly accepts, promises or agrees to accept a bribe, demands or provokes giving it for an unlawful act or inaction in exercising his powers

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by imprisonment for a term of up to six years.

3. A civil servant or a person equivalent thereto who, for own benefit or for the benefit of other persons, directly or indirectly accepts, promises or agrees to accept a bribe in the amount exceeding 250 MSLs, demands or provokes giving it for a lawful or unlawful act or inaction in exercising his powers

shall be punished by imprisonment for a term of two up to eight years.

4. A civil servant or a person equivalent thereto who, for own benefit or for the benefit of other persons, directly or indirectly accepts, promises or agrees to accept a bribe in the amount less than 1 MSLs, demands or provokes giving it for a lawful or unlawful act or inaction in exercising his powers shall be considered to have committed a misdemeanour and

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities.

5. A legal entity shall also be held liable for the acts provided for in this Article.

Article 226. Bribery of an Intermediary

1. A person who, by taking advantage of his social status, office, powers, family relationship, contacts or other likely influence on a state or municipal institution or agency, international public organisation, a servant thereof or a person equivalent thereto, promises to exert an influence, in return for a bribe, on the respective institution, agency or organisation, civil servant or person equivalent thereto to ensure their lawful or unlawful act or inaction

shall be punished by arrest or by imprisonment for a term of up to three years.

2. A person who commits the act provided for in paragraph 1 of this Article in return for a bribe of a low value shall be considered to have committed a misdemeanour and

shall be punished by a fine or by arrest.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 227. Graft

1. A person who, whether directly or indirectly, offers, promises to give or gives a bribe to a civil servant or a person equivalent thereto for a desired lawful act or inaction in exercising his powers or to an intermediary seeking to achieve the same results

shall be punished by restriction of liberty or by a fine or by arrest or by imprisonment for a term of up to two years.

2. A person who commits the actions provided for in paragraph 1 of this Article by offering, promising to give or giving a bribe in the amount exceeding 250 MSLs or who commits these actions seeking an unlawful act by a civil servant to be bribed or a person equivalent thereto in exercising his powers

shall be punished by imprisonment for a term of up to four years.

3. A person who, for the purpose of grafting a civil servant or a person equivalent thereto, offers, promises or gives to him or to an intermediary a bribe in the amount less than 1 MSL shall be considered to have committed a misdemeanour and

shall be punished by restriction of liberty or by a fine or by arrest.

4. A person shall be released from criminal liability for grafting where he was demanded or provoked to give a bribe and he, upon offering, promising or giving the bribe and before the delivery of a notice of suspicion raised again him, notifies a law enforcement institution thereof or offers, promises or gives the bribe with the law enforcement institution being aware thereof.

5. A legal entity shall also be held liable for the acts provided for in paragraphs 1, 2 and 3 of this Article.

Article 228. Abuse of Office

1. A civil servant or a person equivalent thereto who abuses his official position or exceeds his powers, where this incurs major damage to the State, an international public organisation, a legal or natural person,

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by a fine or by arrest or by imprisonment for a term of up to four years.

2. A person who commits the act provided for in paragraph 1 of this Article seeking material or another personal gain, in the absence of characteristics of bribery,

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by imprisonment for a term of up to six years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 228(1). Unlawful Registration of Rights to an Item

A civil servant or a person equivalent thereto who, while performing the functions of a registrar in a public register, registers rights to an item

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by a fine or by arrest or by imprisonment for a term of up to five years.

Article 229. Failure to Perform Official Duties(

A civil servant or a person equivalent thereto who fails to perform his duties through negligence or performs them inappropriately, where this incurs major damage to the State, a legal or natural person,

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by a fine or by arrest or by imprisonment for a term of up to two years.

Article 230. Interpretation of Concepts

1. The civil servants indicated in this Chapter shall be the persons employed in civil service, namely, state politicians, public administration civil servants according to the Law on Civil Service as well as other persons who, while working at state or municipal institutions or agencies, at judicial, law enforcement, national audit and supervisory institutions as well as equivalent institutions, perform the functions of a government representative or hold administrative powers, also official candidates for such office.

2. A person holding appropriate powers at a foreign state institution, an international public organisation or international judicial institutions, also official candidates for such office shall be held equivalent to a civil servant.

3. Moreover, a person who works at any state, non-state or private body, undertaking or organisation or engages in professional activities and holds appropriate administrative powers or has the right to act on behalf of this body, undertaking or organisation or provides public services shall also be held equivalent to a civil servant.

CHAPTER XXXIV

CRIMES AND MISDEMEANOURS AGAINST JUSTICE

Article 231. Hindering the Activities of a Judge, Prosecutor, Pre-trial Investigation Officer, Lawyer or Bailiff

1. A person who, in any manner, hinders a judge, prosecutor, pre-trial investigation officer, lawyer or an officer of the International Criminal Court or of another international judicial institution in performing the duties relating to investigation or hearing of a criminal, civil, administrative case or a case of the international judicial institution or hinders a bailiff in executing a court judgement

shall be punished by community service or by a fine or by restriction of liberty or by imprisonment for a term of up to two years.

2. A person who commits the act indicated in paragraph 1 of this Article by using violence or another coercion

shall be punished by a fine or by arrest or by imprisonment for a term of up to four years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 232. Contempt of Court

A person who publicly, in an abusive manner by an action, word of mouth or in writing, humiliates a court or a judge executing justice by reason of their activities

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

Article 233. Influence on a Witness, Victim, Expert, Specialist or Translator

1. A person who, in any manner, seeks to influence a witness, victim, expert, specialist or translator so that they would give false testimony, present false conclusions, clarifications or incorrect translations during a pre-trial investigation or in court or before the International Criminal Court or at another international judicial institution or hinders their arrival when summoned to a pre-trial investigation officer, a prosecutor, the court or the International Criminal Court or another international judicial institution

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two year.

2. A person who, in any manner, seeks to influence a witness, expert, specialist or translator so that they would give false testimony, present false conclusions, clarifications or incorrect translations during impeachment proceedings to a special investigation commission formed by the Seimas or to the Seimas or hinders their arrival when summoned to the special investigation commission formed by the Seimas or to the Seimas

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two year.

3. A person who commits the acts indicated in paragraphs 1 and 2 of this Article by using violence or another coercion

shall be punished by arrest or by imprisonment for a term of up to four years.

4. A legal entity shall also be held liable for the acts provided for in this Article.

Article 234. Influence on the Victim to Reconcile with the Offender

A person who seeks to influence the victim, a representative of the State or a legal entity to reconcile with the offender, where this involves the use of violence or another coercion,

shall be punished by arrest or by imprisonment for a term of up to four years.

Article 235. False Testimony, Conclusions and Translation

1. A person who, during a pre-trial investigation, in court or before the International Criminal Court or at another international judicial institution, gives false testimony as a witness or the victim, presents false conclusions or clarifications as an expert or a specialist or as a translator makes a false translation or a translation known to be incorrect

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two year.

2. A person who, during impeachment proceedings, gives false testimony as a witness, presents false conclusions or clarification as an expert or a specialist or as a translator makes a false translation or a translation known to be incorrect to a special investigation commission formed by the Seimas or to the Seimas or who submits a false notice, clarification, information or data to an ad hoc investigation commission of the Seimas or to a Seimas committee whereto the Seimas has granted the powers of an ad hoc investigation commission

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two year.

3. A person who commits the act indicated in paragraph 1 of this Article accusing a person of commission of a serious or grave crime

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to five years.

4. The victim or a witness shall not be held liable for giving false testimony where, under laws, he has the right to refuse to give testimony, however was not made familiar with this right before questioning.

Article 236. False Denunciation or Report about a Non‑Existent Crime

1. A person who falsely denounces before an authority or officer empowered to initiate prosecution an innocent person to have committed a criminal act, where this results in initiation of prosecution against the person, or who reports a crime known to be non‑existent

shall be punished by community service or by a fine or by imprisonment for a term of up to two years.

2. A person who carries out the actions provided for in paragraph 1 of this Article and forges evidence for the initiation of prosecution against the person

shall be punished by a fine or by arrest or by imprisonment for a term of up to five years.

Article 237. Concealment of a Crime or the Perpetrator

1. A person who, without prior arrangement, conceals, destroys or obliterates the evidence, tools or means of a serious or grave crime committed by another person, the items obtained by criminal means, other articles which are connected with the concealed crime and which have evidential value or conceals the perpetrator

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two year.

2. The close relatives and family members of the perpetrator shall not be held liable for the acts provided for in this Article.

Article 238. Failure to Report a Crime

1. A person who, without a valid reason, fails to report to a law enforcement agency or to a court a grave crime known to him, either in progress or already committed,

shall be punished by community service or by a fine or by arrest or by imprisonment for a term of up to one year.

2. The close relatives and family members of the perpetrator shall not be held liable for a failure to report a crime.

Article 239. Disrupting the Work of a Place of Detention

1. A person who, while held in detention, in custody or serving the sentence of arrest, a custodial sentence or the sentence of life imprisonment, terrorises another person or persons confined in a place of detention

shall be punished by imprisonment for a term of up to six years.

2. A person who, while held in detention, in custody or serving the sentence of arrest, a custodial sentence or the sentence of life imprisonment, organises riots among other persons confined in a place of detention, where they result in a serious bodily harm or loss of life or incur major property damage or cause other serious consequences, also a person who takes an active part in such riots

shall be punished by imprisonment for a term of three up to fifteen years.

Article 240. Freeing a Prisoner

A person who, through the use of violence against guards or abuse of trust or by deceit, frees a person held in detention, in custody or serving the sentence of arrest or a custodial sentence or the sentence of life imprisonment

shall be punished by arrest or by imprisonment for a term of up to six years.

Article 241. Escape of a Prisoner

1. A person who, while held in detention, in custody or serving the sentence of arrest, a custodial sentence or the sentence of life imprisonment, escapes from his place of detention

shall be punished by arrest or by imprisonment for a term of up to three years.

2. A person who carries out the actions provided for in paragraph 1 of this Article by using violence against guards or other persons or incurring major property damage to his place of detention

shall be punished by imprisonment for a term of up to five years.

Article 242. Evasion of Serving the Sentence of Arrest or Imprisonment or of Return to the Place of Pre-Trial Detention

A person who, having been sentenced to arrest or imprisonment, but not yet arrested, evades serving of the imposed penalty or, having been temporarily released from a short-term detention facility or a place of detention or a place of pre-trial detention, fails to timely return without a valid reason

shall be punished by a fine or by imprisonment for a term of up to two years.

Article 243. Evasion of Serving a Non-Custodial Sentence or of Complying with Penal Sanctions

A person who evades serving of a non-custodial sentence or complying with a penal sanction (with the exception of confiscation of property) shall be considered to have committed a misdemeanour and

shall be punished by a fine or by arrest.

Article 244. Failure to Comply with a Penalty Imposed upon a Legal Entity

The employee of a legal entity who is responsible for compliance with a penalty imposed upon this legal entity and who fails to comply therewith shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by arrest.

Article 245. Failure to Comply with a Court’s Decision Not Associated with a Penalty

A person who fails to comply with a court’s decision not associated with a penalty shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

Article 246. Conveyance, Concealment, Destruction of or Damage to a Distrained or Seized Property or the Property Subject to a Temporary Restriction of the Right of Ownership

1. A person who conceals, destroys or damages a distrained or seized property which has been entrusted to him or a property which is subject to a temporary restriction of the right of ownership or who unlawfully conveys this property to another person

shall be punished by community service or by a fine or by arrest or by imprisonment for a term of up to three years.

2. A person who conceals, destroys or damages a distrained or seized property of a high value which has been entrusted to him or a property of a high value which is subject to a temporary restriction of the right of ownership or who unlawfully conveys this property to another person

shall be punished by imprisonment for a term of up to seven years.

Article 247. Unauthorised Disclosure of Pre-Trial Investigation Data

A person who discloses pre-trial investigation data prior to the hearing of a case at a court sitting without the authorisation of a judge, prosecutor or pre-trial investigation officer investigating this case shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

Article 248. Interpretation of Concepts

1. Close relatives shall be parents (adoptive parents), children (adopted children), brothers, sisters, grand parents and grand children.

2. Family members of the perpetrator shall be the parents (adoptive parents), children (adopted children), brothers, sisters and their spouses living together with him, also the spouse of the perpetrator or the person living with him in common law (partnership) and parents of the spouse.

3. Law enforcement institutions shall be the police, other bodies of pre-trial investigation and the prosecutor’s office, also entities of operational activities.

4. The property as provided for in this Chapter shall be considered to be of a high value where its value exceeds the amount of 250 MSLs.

CHAPTER XXXV

CRIMES AGAINST PUBLIC SECURITY

Article 249. Criminal Association

1. A person who participates in the activities of a criminal association

shall be punished by imprisonment for a term of three up to fifteen years.

2. A person who participates in the activities of a criminal association armed with firearms, explosives or explosive materials

shall be punished by imprisonment for a term of six up to twenty years or by life imprisonment.

3. A person who organises the criminal associations provided for in paragraph 1 or 2 of this Article or is the leader thereof

shall be punished by imprisonment for a period of ten up to twenty years or by life imprisonment.

4. A legal entity shall also be held liable for the acts provided for in this Article.

Article 250. Act of Terrorism

1. A person who places explosives in a place of people’s residence, work or gathering or in a public place with the intent to cause an explosion, causes an explosion or sets on fire

shall be punished by imprisonment for a term of up to ten years.

2. A person who carries out the actions provided for in paragraph 1 of this Article, where this results in impairment to the victim’s health or destruction of or damage to a vehicle or a structure or the equipment located in the structure,

shall be punished by imprisonment for a term of three up to twelve years.

3. A person who causes an explosion, sets on fire or otherwise destroys or damages a building or an installation, where this poses a threat to the life or health of a large number of people, or who spreads radioactive, biological or harmful chemical substances, products or micro organisms

shall be punished by imprisonment for a term of three up to fifteen years.

4. A person who carries out the actions provided for in paragraph 3 of this Article, where they are directed against a strategic object or cause serious consequences,

shall be punished by imprisonment for a period of ten up to twenty years or by life imprisonment.

5. A person who forms a group of accomplices or an organised group for the carrying out of the actions provided for in this Article or participates in the activities thereof, also finances or provides material assistance or other support to such a group

shall be punished by imprisonment for a term of four up to ten years.

6. A person who forms a terrorist group whose purpose is, by carrying out of the actions provided for in this Article, to intimidate people or to unlawfully demand that the State, institutions thereof or international organisations carry out certain actions or refrain from them or participates in the activities thereof, also finances or provides material assistance or other support to such a group

shall be punished by imprisonment for a term of ten up to twenty years.

7. A legal entity shall also be held liable for the acts provided for in this Article.

Article 250(1). Incitement of Terrorism

1. A person who, by making public declarations orally, in writing or in the media, promotes or incites an act of terrorism or other crimes relating to terrorism or expresses contempt for victims of terrorism

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 251. Hijacking of an Aircraft, Ship or Fixed Platform on a Continental Shelf

1. A person who hijacks an aircraft, ship or fixed platform on a continental shelf

shall be punished by arrest or by imprisonment for a term of up to five years.

2. A person who hijacks an aircraft, ship or fixed platform on a continental shelf by using physical violence or threatening the use of violence

shall be punished by imprisonment for a term of three up to eight years.

3. A person who hijacks an aircraft, ship or fixed platform on a continental shelf by using a firearm, explosive or another means posing a threat to the life or health of the crew or passengers of the aircraft or ship or the persons present on the fixed platform on a continental shelf

shall be punished by imprisonment for a term of five up to ten years.

4. A person who hijacks an aircraft, ship or fixed platform on a continental shelf, where this results in an accident, breakdown or causes other grave consequences,

shall be punished by imprisonment for a period of ten up to twenty years or by life imprisonment.

5. A legal entity shall also be held liable for the acts provided for in this Article.

Article 252. Hostage Taking

1. A person who kidnaps or holds hostage a person and demands that an international organisation, the State or institution thereof carry out any action or refrain from actions, also a person who threatens the immediate killing or causing bodily harm to the person held hostage unless he is provided conditions to avoid detention,

shall be punished by imprisonment for a term of three up to ten years.

2. A person who commits the act provided for in paragraph 1 of this Article, where he kidnaps or holds hostage two or more persons,

shall be punished by imprisonment for a term of three up to fifteen years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

CHAPTER XXXVI

CRIMES AND MISDEMEANOURS RELATING TO POSSESSION OF WEAPONS, AMMUNITION, EXPLOSIVES, EXPLOSIVE OR RADIOACTIVE MATERIALS OR MILITARY EQUIPMENT

Article 253. Unauthorised Possession of Firearms, Ammunition, Explosives or Explosive Materials

1. A person who, without an authorisation, acquires, stores, carries, transports or handles a firearm, ammunition, explosives or explosive materials

shall be punished by arrest or by imprisonment for a term of up to five years.

2. A person who, without an authorisation, produces, acquires, stores, carries, transports or handles at least three firearms, the ammunition, explosives or explosive materials of a large explosive power or in a large quantity

shall be punished by imprisonment for a term of four up to eight years.

Article 253(1). Unauthorised Intermediation in the Transfer of Military Equipment

1. A person who, without an authorisation, acts as an intermediary in transferring military equipment to a state non-Member State of the European Union

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by a fine or by arrest or by imprisonment for a term of up to three years.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 254. Seizure of a Firearm, Ammunition, Explosives or Explosive Materials

1. A person who seizes a firearm, ammunition, explosives or explosive materials

shall be punished by arrest or by imprisonment for a term of up to seven years.

2. A person who, by using physical or mental violence, seizes a firearm, ammunition, explosives or explosive materials or, in any manner, seizes more than two firearms, the ammunition, explosives or explosive materials of a large explosive power or in a large quantity

shall be punished by imprisonment for a term of six up to ten years.

Article 255. Violation of the Regulations Governing the Storage of a Firearm, Ammunition, Explosives or Explosive Materials

1. A person who violates the regulations governing the storage of a lawfully held firearm, ammunition, explosives or explosive materials and thereby provides conditions for another person to make unlawful use thereof shall be considered to have committed a misdemeanour and

shall be punished by a fine or by arrest or by deprivation of the right to be employed in a certain position or to engage in a certain type of activities.

2. A person shall be held liable under this Article only where the acts provided for have been committed through negligence.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 256. Unlawful Possession of Nuclear or Radioactive Materials or Other Sources of Ionising Radiation

1. A person who seizes or otherwise unlawfully acquires, produces, transports, stores, uses or disarranges the nuclear or radioactive materials or other sources of ionising radiation of any form and in any physical condition

shall be punished by arrest or by imprisonment for a term of up to four years.

2. A person who commits the acts indicated in paragraph 1 of this Article, where this causes serious consequences,

shall be punished by imprisonment for a term of two up to ten years.

3. The acts provided for in paragraphs 1 and 2 of this Article shall be criminal also where they have been committed through negligence.

4. A legal entity shall also be held liable for the acts provided for in this Article.

Article 256(1). Threat to Use or Otherwise Influence or Unlawfully Acquire Nuclear or Radioactive Materials or Other Sources of Ionising Radiation

1. A person who threatens to use or otherwise influence the nuclear or radioactive materials or other sources of ionising radiation of any form and in any physical condition so that they pose a threat to human life, health or the environment or threatens to seize or otherwise unlawfully acquire these sources

shall be punished by arrest or by imprisonment for a term of up to four years.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 257. Violation of the Regulations Governing Lawful Possession of Nuclear or Radioactive Materials or Other Sources of Ionising Radiation

1. A person who violates the regulations governing the storage, use and transportation of the nuclear or radioactive materials or other sources of ionising radiation of any form and in any physical condition, where this could have caused serious consequences,

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

2. A legal entity shall also be held liable for an act provided for in this Article.

3. The act provided for in this Article shall be considered as criminal also where it has been committed through negligence.

Article 257(1). Production of Installations for the Production of Explosive Materials, Explosives or Radioactive Materials or Development or Distribution of Production Technologies or Specifications Thereof

A person who unlawfully produces, stores, transports, transfers or handles machinery or other installations directly intended or adapted for the production of explosive materials, explosives or radioactive materials or unlawfully develops or distributes technologies or specifications of the production of explosive materials, explosives or radioactive materials

shall be punished by a fine or by arrest or by imprisonment for a term of up to four years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 258. Unlawful Possession of a Non-Firearm

1. A person who unlawfully produces for the purpose of handling or handles a non-firearm or another device adapted for causing bodily harm to people

shall be punished by a fine or by arrest or by imprisonment for a term of up to one year.

2. A person who unlawfully acquires or carries a non-firearm or another device adapted for causing bodily harm to people shall be considered to have committed a misdemeanour and

shall be punished by a fine or by arrest.

CHAPTER XXXVII

CRIMES AND MISDEMEANOURS RELATING TO POSSESSION OF NARCOTIC OR PSYCHOTROPIC, TOXIC OR HIGHLY ACTIVE SUBSTANCES

Article 259. Unlawful Possession of Narcotic or Psychotropic Substances for the Purpose Other than Distribution

1. A person who unlawfully produces, processes, acquires, stores, transports or forwards narcotic or psychotropic substances for the purpose other than selling or otherwise distributing them

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

2. A person who unlawfully produces, processes, acquires, stores, transports or forwards a small quantity of narcotic or psychotropic substances for the purpose other than selling or otherwise distributing them shall be considered to have committed a misdemeanour and

shall be punished by community service or by restriction of liberty or by a fine or by arrest.

3. A person who voluntarily applies to a health care establishment for medical aid or addresses a state institution in order to submit the narcotic or psychotropic substances which have been unlawfully produced, acquired, stored for the purpose other than distribution shall be released from criminal liability for the production, acquisition and storage of the consumed or submitted narcotic or psychotropic substances.

Article 260. Unlawful Possession of Narcotic or Psychotropic Substances for the Purpose of Distribution Thereof or Unlawful Possession of a Large Quantity of Narcotic or Psychotropic Substances

1. A person who unlawfully produces, processes, acquires, stores, transports or forwards narcotic or psychotropic substances for the purpose of selling or otherwise distributing them or sells or otherwise distributes narcotic or psychotropic substances

shall be punished by imprisonment for a term of two up to eight years.

2. A person who unlawfully produces, processes, acquires, stores, transports or forwards a large quantity of narcotic or psychotropic substances for the purpose of selling or otherwise distributing them or sells or otherwise distributes a large quantity of narcotic or psychotropic substances

shall be punished by imprisonment for a term of eight up to ten years.

3. A person who unlawfully produces, processes, acquires, stores, transports, forwards, sells or otherwise distributes a very large quantity of narcotic or psychotropic substances

shall be punished by imprisonment for a term of ten up to fifteen years.

4. A legal entity shall also be held liable for the acts provided for in this Article.

Article 261. Distribution of Narcotic or Psychotropic Substances among Minors

A person who distributes narcotic or psychotropic substances among minors

shall be punished by imprisonment for a term of three up to twelve years.

Article 262. Production of Installations for the Production of Narcotic or Psychotropic Substances or Development of Technologies or Specifications for the Production of Narcotic or Psychotropic Substances

A person who unlawfully produces, stores, transports or handles machinery or other installations for the production of narcotic or psychotropic substances or unlawfully develops or distributes technologies or specifications for the production of narcotic or psychotropic substances

shall be punished by a fine or by arrest or by imprisonment for a term of up to four years.

Article 263. Theft, Extortion or Other Unlawful Taking Possession of Narcotic or Psychotropic Substances

1. A person who steals, takes possession of by deceit (fraud) or misappropriates the narcotic or psychotropic substances entrusted to him or held at his disposal

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by arrest or by imprisonment for a term of up to five years.

2. A person who extorts or seizes narcotic or psychotropic substances through the use of physical or mental violence

shall be punished by imprisonment for a term of three up to ten years.

3. A person who, by carrying out the actions indicated in paragraph 1 or 2 of this Article, takes possession of a large quantity of narcotic or psychotropic substances or takes possession of narcotic or psychotropic substances by participating in an organised group

shall be punished by imprisonment for a term of five up to fifteen years.

Article 264. Inducing the Use of Narcotic or Psychotropic Substances

1. A person who assists a person in the acquisition of, forces, induces or otherwise habituates a person to the use of narcotic or psychotropic substances for purposes other than medical treatment

shall be punished by arrest or by imprisonment for a term of up to five years.

2. A person who assists a minor in the acquisition of, forces, induces or otherwise habituates him to the use of narcotic or psychotropic substances for purposes other than medical treatment

shall be punished by imprisonment for a term of three up to ten years.

Article 265. Illegal Cultivation of Poppies or Hemp

1. A person who, in violation of the established procedure, grows a large quantity of poppies, hemp or other plants listed as narcotic or psychotropic substances

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to five years.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 266. Unlawful Possession of Category I Precursors of Narcotic or Psychotropic Substances

1. A person who unlawfully produces, acquires, stores, transports, forwards or sells or otherwise handles Category I precursors of narcotic or psychotropic substances

shall be punished by a fine or by arrest or by imprisonment for a term of up to four years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 267. Unlawful Possession of Highly Active or Toxic Substances

1. A person who unlawfully produces, acquires, stores, transports, handles highly active or toxic substances

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

2. A person who unlawfully produced, acquired, stored, transported or handles toxic chemical substances used as chemical weapons, chemical substances or precursors thereof for the production of chemical weapons or for other purposes prohibited by the Law on the Prohibition of Chemical Weapons

shall be punished by a fine or by arrest or by imprisonment for a term of up to five years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 267(1). Creation or Unlawful Possession of Biological Weapons

1. A person who unlawfully creates, produces, acquires, stores, transports, sells or otherwise conveys biological weapons or the micro organisms or other biological substances or toxins used for production thereof

shall be punished by a fine or imprisonment for a term of up to seven years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 268. Violation of the Regulations Governing Lawful Possession of Psychotropic, Highly Active or Toxic Substances

1. A person who violates the regulations governing the production, storage, accounting, issuance, transportation or forwarding of narcotic, psychotropic, highly active or toxic substances, where this results in the seizure of these substances or their becoming an object of illegal trade otherwise,

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by a fine or by arrest or by imprisonment for a term of up to two years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

3. A person shall be held liable under this Article only where the acts provided for have been committed through negligence.

Article 269. Interpretation of Concepts

1. The narcotic and psychotropic substances indicated in this Chapter shall be the substances entered in the lists of narcotic and psychotropic substances approved by the Ministry of Health of the Republic of Lithuania.

2. The quantity of narcotic or psychotropic substances to be considered as small, large and very large shall be determined on the basis of the recommendations approved by the Ministry of Health of the Republic of Lithuania.

CHAPTER XXXVIII

CRIMES AND MISDEMEANOURS AGAINST THE ENVIRONMENT AND HUMAN HEALTH

Article 270. Violation of the Regulations Governing Environmental Protection or the Use of Natural Resources

1. A person who violates the regulations governing environmental protection or the use of natural resources, where this poses a threat to the life or health of a large number of people or this could have caused major damage to the fauna, flora or other serious consequences to the environment,

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

2. A person who commits the act indicated in paragraph 1 of this Article, where this causes major damage to the fauna, flora or other serious consequences to the environment,

shall be punished by a fine or by arrest or by imprisonment for a term of up to six years.

3. A person who violates the regulations governing environmental protection or the use of natural resources as stipulated by legal acts, where this caused minor damage to the fauna, flora or other negligible consequences to the environment, shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

4. A legal entity shall also be held liable for the acts provided for in this Article.

5. The acts provided for in paragraph 1 of this Article shall be criminal also where they have been committed through negligence.

Article 270(1). Illicit Trade in the Substances Depleting the Ozone Layer

1. A person who unlawfully sells or otherwise handles the substances depleting the ozone layer

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 271. Destruction or Devastation of Protected Areas or Protected Natural Objects

1. A person who destroys or devastates a state park, strict reserve, reserve, the area of landscape or another natural area protected by the State or a natural object

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to five years.

2. The acts provided for in paragraph 1 of this Article shall be criminal also where they have been committed through negligence.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 272. Illegal Hunting or Fishing or Other Use of Wild Fauna Resources

1. A person who undertakes hunting or fishing during a prohibited period, in prohibited places or in a prohibited manner, by prohibited tools, means or otherwise unlawfully uses or destroys wild fauna resources and causes major damage to the fauna

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

2. A person who unlawfully destroys, injures or takes from the natural environment the wild fauna of strictly protected species, acquires, stores, transports, handles or uses for commercial purposes the wild fauna of strictly protected species, parts thereof or the products made thereof, where this act does not cause major damage to the species conservation status of the wild fauna of strictly protected species and such act is associated with a small amount of the wild fauna of strictly protected species,

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

3. A person who unlawfully destroys, injures, takes from the natural environment, catches or otherwise acquires, stores, processes, transports, handles or otherwise uses a large amount of the wild fauna of protected species, parts thereof or the products made thereof or causes by this act major damage to the species conservation status of the wild fauna of protected species or commits this act for commercial purposes

shall be punished by a fine or by arrest or by imprisonment for a term of up to four years.

4. A person who unlawfully produces, acquires, stores, transports or handles electric or ultrasonic fishing devices shall be considered to have committed a misdemeanour and

shall be punished by a fine or by restriction of liberty or by arrest.

5. A legal entity shall also be held liable for the acts provided for in this Article.

6. The acts provided for in paragraphs 1, 2 and 3 of this Article shall be criminal also where they have been committed through negligence.

Article 273. Unauthorised Forest Logging or Destruction of Marshes

1. A person who, without an authorisation, cuts down or otherwise destroys an area of more than one hectare of own forest or drains a marsh

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 274. Unlawful Picking, Destruction, Handling or Other Possession of Protected Wild Flora, Fungi or Parts Thereof

1. A person who unlawfully destroys, injures, takes from the natural environment or otherwise picks or acquires, stores, processes, transports, handles or otherwise uses a large amount of the wild flora, fungi of protected species, parts thereof or the products made thereof or causes by this act major damage to the species conservation status of the wild flora or fungi of protected species or commits this act for commercial purposes

shall be punished by a fine or by arrest or by imprisonment for a term of up to three years.

2. A person who unlawfully destroys, injures, takes from the natural environment or otherwise picks the wild flora, fungi of strictly protected species, acquires, stores, transports, handles or uses for commercial purposes the wild flora, fungi of strictly protected species, parts thereof or the products made thereof, where this act does not cause major damage to the species conservation status of the wild flora or fungi of strictly protected species and such an act is associated with a small amount of the wild flora or fungi of strictly protected species, shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine.

3. A legal entity shall also be held liable for the acts provided for in this Article.

4. The acts provided for in paragraphs 1 and 2 of this Article shall be criminal also where they have been committed through negligence.

Article 275. Unauthorised Pharmaceutical Activities

1. A person who, without an authorisation, manufactures medicines or medicinal substances for the purpose of handling them, where the use thereof could have posed a threat to human health or life, also a person who handles these pharmaceutical products

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

2. A person who, without an authorisation, manufactures medicines or medicinal substances for the purpose of handling them, also a person who handles these pharmaceutical products, where the use thereof results in a person’s death or a serious impairment to a person’s health

shall be punished by imprisonment for a term of up to eight years.

3. The acts provided for in paragraph 1 of this Article shall be criminal also where they have been committed through negligence.

4. A person shall be held liable under paragraph 2 of this Article only where the acts provided for have been committed through negligence.

5. A legal entity shall also be held liable for the acts provided for in this Article.

Article 276. Production of or Trading in the Products Harmful to Human Health or Life

1. A person who produces, for the purpose of handling, food products of a substance evidently inappropriate for and harmful to human health or life or containing harmful additives, also a person who sells or otherwise handles such products

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

2. A person who produced, for the purpose of handling, food products of a substance evidently inappropriate for and harmful to human health or life or containing harmful additives, also a person who sells or otherwise handles such products, where consumption thereof results in a person’s death or a serious impairment to a person’s health,

shall be punished by imprisonment for a term of up to eight years.

3. The act provided for in paragraph 1 of this Article shall be criminal also where it has been committed through negligence.

4. A person shall be held liable under paragraph 2 of this Article only where the acts provided for have been committed through negligence.

5. A legal entity shall also be held liable for the acts provided for in this Article.

Article 277. Violation of the Regulations Governing Control of Epidemics or Contagious Diseases

1. A person who violates requirements of the legal acts regulating health care or the regulations of control of contagious disease prevention, where this results in the spread of a disease or causes an epidemic,

shall be punished by a fine or by arrest or by imprisonment for a term of up to three years.

2. A person who, having been informed by a medical establishment about his illness and warned of the protective measures which he must observe while communicating with people, exposes another person to the danger of becoming infected with a dangerous infectious disease shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

3. A person shall be held liable under this Article only where the acts provided for have been committed through negligence.

4. A legal entity shall also be held liable for an act provided for in paragraph 1 of this Article.

Article 2771. Interpretation of Concepts

The wild fauna, flora and fungi of strictly protected species shall be as follows:

1) the wild fauna, flora and fungi of protected species listed among the protected fauna, flora and fungi species as entered in the Red Data Book of Lithuania and attributed to the categories of 0(Ex), 1(E) and 2(V);

2) the wild fauna and flora of the species listed in Annexes A and B of Council Regulation (EC) No 338/97 of 9 December 1996 on the protection of species of wild fauna and flora by regulating trade therein;

3) the wild fauna and flora of the protected species listed in Annex IV of Council Directive 92/43/EEC of 21 May 1992 on the conservation of natural habitats and of wild fauna and flora;

4) the wild birds referred to in Annex I of Council Directive 79/409/EEC of 2 April 1979 on the conservation of wild birds and in Article 4(2) of this Directive.

CHAPTER XXXIX

CRIMES AND MISDEMEANOURS AGAINST TRAFFIC SAFETY

Article 278. Improper Maintenance or Repair of Vehicles or Roads, the Facilities Located Thereon

1. A person who inappropriately performs the maintenance or repairs of railway vehicles, water- or air-borne vehicles or roads, the alarm or communications facilities located on the roads, a gas pipeline, oil pipeline, power or communications lines, where this causes serious bodily harm to a person or incurs major property damage,

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by arrest or by imprisonment for a term of up to five years.

2. A person who commits the act provided for in paragraph 1 of this Article, where this results in a person’s death or causes serious bodily harm to persons or incurs massive property damage,

shall be punished by imprisonment for a term of three up to eight years.

3. A person who commits the act provided for in paragraph 1 of this Article, where this does not cause serious consequences, but there exists a real threat thereof, shall be considered to have committed a misdemeanour and

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by a fine or by arrest.

4. A person shall be held liable under paragraphs 1 and 2 of this Article only where the acts provided for have been committed through negligence.

5. The act provided for in paragraph 3 of this Article shall be criminal also where it has been committed through negligence.

Article 279. Violation of International Flight Regulations

A member of the crew of an aircraft or another facility designed for flying who violates the international flight regulations by flying into the Republic of Lithuania or flying out of the Republic of Lithuania

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

Article 280. Damage to Vehicles or Roads, the Facilities Located Thereon

1. A person who dismantles or damages a vehicle or a road, a gas pipeline, oil pipeline, power or communications line, a facility, communications or alarm equipment located therein, where this poses a threat of serious consequences,

shall be punished by arrest or by imprisonment for a term of up to three years.

2. A person who carries out the actions indicated in paragraph 1 of this Article, where this results in a person’s death or causes a serious bodily harm to a person or incurs major property damage,

shall be punished by imprisonment for a term of up to ten years.

3. The acts provided for in paragraph 1 of this Article shall be criminal also where they have been committed through negligence.

4. A legal entity shall also be held liable for the acts provided for in this Article.

Article 281. Violation of the Regulations Governing Road Traffic Safety or Operation of Vehicles

1. A person who, while driving a road vehicle, violates the regulations governing road traffic safety or operation of vehicles, where this results in an accident causing a non-severe impairment to another person’s health,

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by a fine or by arrest or by imprisonment for a term of up to two years.

2. A person who drives a road vehicle under the influence of alcohol, narcotic, psychotropic or other psychoactive substances and violates the regulations governing road traffic safety or operation of vehicles, where this results in an accident causing a non-severe impairment to another person’s health or the victim suffers major property damage,

shall be punished by a fine or by arrest or by imprisonment for a term of up to three years.

3. A person who, while driving a road vehicle, violates the regulations governing road traffic safety or operation of vehicles, where this results in an accident causing a severe impairment to another person’s health,

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by a fine or by arrest or by imprisonment for a term of up to five years.

4. A person who commits the act indicated in paragraph 3 of this Article under the influence of alcohol, narcotic, psychotropic or other psychoactive substances

shall be punished by imprisonment for a term of up to six years.

5. A person who, while driving a road vehicle, violates the regulations governing road traffic safety or operation of vehicles, where this results in an accident causing a person’s death,

shall be punished by imprisonment for a term of up to eight years.

6. A person who commits the act indicated in paragraph 5 of this Article under the influence of alcohol, narcotic, psychotropic or other psychoactive substances

shall be punished by imprisonment for a term of three up to ten years.

7. A person shall be held liable under paragraphs 1-6 of this Article only where the acts provided for have been committed through negligence.

8. It shall be considered that a person is under the influence of alcohol where his blood contains 0.4 promiles or more of alcohol.

9. The road vehicles indicated in this Article shall be automobiles of all types, tractors, other self-propelled vehicles, trolleybuses, motorbikes and other mechanical vehicles.

Article 282. Violation of the Regulations Governing Traffic Order or Safety

1. A person who, while not driving a vehicle, violates the regulations governing traffic order or safety, where this results in a person’s death or a severe impairment to a person’s health,

shall be punished by arrest or by imprisonment for a term of up to five years.

2. A person shall be held liable under this Article only where the acts provided for have been committed through negligence.

CHAPTER XL

CRIMES AND MISDEMEANOURS AGAINST PUBLIC ORDER

Article 283. Riots

1. A person who organises or provokes a group of people to engage in public violence, destruction of property or other grave violations of public order, also a person who, during the riots, uses violence, destroys property or otherwise gravely violates public order

shall be punished by arrest or by imprisonment for a term of up to five years.

2. A person who, when carrying out the actions provided for in paragraph 1 of this article, uses a firearm or explosives or resists a police officer or another person performing the functions of public administration

shall be punished by imprisonment for a term of up to six years.

Article 284. Violation of Public Order

1. A person who, by defiant conduct, threats, taunting or acts of vandalism, demonstrates disrespect to the surrounding people or the environment in a public place and thereby disrupts public peace or order

shall be punished by community service or by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to two year.

2. A person who disturbs public peace or order through the use of taboo words or by indecent conduct in a public place shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

Article 285. False Report about a Danger Threatening the Community or Occurred Disaster

1. A person who falsely reports or spreads the news about a danger threatening the community or a major disaster, where this causes public confusion or incurs major property damage,

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

2. A person who falsely reports or spreads the news about a danger threatening the community or a major disaster, where this results in the call-out of special services,

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

CHAPTER XLI

CRIMES AND MISDEMEANOURS AGAINST THE ACTIVITIES OF A CIVIL SERVANT OR A PERSON PERFORMING THE FUNCTIONS OF PUBLIC ADMINISTRATION

Article 286. Resistance against a Civil Servant or a Person Performing the Functions of Public Administration

A person who, through the use of physical violence or threatening the immediate use thereof, resists a civil servant or another person performing the functions of public administration

shall be punished by community service or by a fine or by imprisonment for a term of up to three years.

Article 287. Threatening a Civil Servant or a Person Performing the Functions of Public Administration

1. A person who, by using mental coercion, demands that a civil servant or a person performing the functions of public administration carry out actions or refrain therefrom for the benefit of the offender or other persons

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

2. A person who commits the act provided for in paragraph 1 of this Article through the use of physical violence

shall be punished by a fine or by arrest or by imprisonment for a term of up to five years.

Article 288. Interference with the Activities of a Civil Servant or a Person Performing the Functions of Public Administration

A civil servant, public figure, representative of a political or public organisation who, by taking advantage of his influence, interferes with the activities of a civil servant or a person performing the functions of public administration seeking to force him to refrain from lawful actions or carry out unlawful actions for own benefit or for the benefit of other persons

shall be punished by community service or by a fine or by arrest or by imprisonment for a term of up to two years.

Article 289. Adoption of the Name of a Civil Servant or a Person Performing the Functions of Public Administration

A person who, upon adopting the name of a civil servant or a person performing the functions of public administration, carries out unlawful actions

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

Article 290. Insulting a Civil Servant or a Person Performing the Functions of Public Administration

A person who insults a civil servant or a person performing the functions of public administration in exercising his duties

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

CHAPTER XLII

CRIMES AND MISDEMEANOURS AGAINST GOVERNMENT ORDER

Article 291. Illegal Crossing of the State Border

1. A person who illegally crosses the state border of the Republic of Lithuania

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

2. An alien who unlawfully enters the Republic of Lithuania seeking to exercise the right of asylum shall be released from criminal liability under paragraph 1 of this Article.

3. An alien who commits the act provided for in paragraph 1 of this Article with the intent of illegally crossing into a third state from the Republic of Lithuania shall be released from criminal liability according to paragraph 1 of this Article where he is, in accordance with the established procedure, subject to deportation back to the state from the territory whereof he illegally crosses the state border of the Republic of Lithuania or to the state whose citizen he is.

Article 292. Unlawful Transportation of Persons across the State Border

1. A person who unlawfully transports across the state border of the Republic of Lithuania an alien not having a permanent place of residence in the Republic of Lithuania or transports or conceals in the territory of the Republic of Lithuania such an alien who has illegally crossed the state border of the Republic of Lithuania

shall be punished by a fine or by arrest or by imprisonment for a term of up to six years.

2. A person who commits the acts provided for in paragraph 1 of this Article for mercenary reasons or where this poses a threat to human life,

shall be punished by imprisonment for a term of up to eight years.

A person who organises the acts provided for in paragraph 1 of this Article

shall be punished by imprisonment for a term of four up to ten years.

4. A legal entity shall also be held liable for the acts provided for in this Article.

Article 293. Organisation of Travels of Citizens of the Republic of Lithuania Abroad for the Purpose of Staying There Illegally or Abandoning Them without Assistance

1. A person who organises the travels of citizens or permanent residents of the Republic of Lithuania abroad for the purposes of applying for asylum or undertaking illegal employment or staying abroad illegally for other reasons or by making a false promise of a legal status abroad

shall be punished by arrest or by imprisonment for a term of up to seven years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 294. Self-Willed Conduct

1. A person who, by disregarding the procedure established by the law, wilfully exercises an existing or alleged right of his own or another person which is disputed or recognised, though not exercised yet, and incurs major damage to the person’s rights or legitimate interests

shall be punished by a fine or by arrest or by imprisonment for a term of up to three years.

2. A person who acts wilfully by using physical or mental coercion against the victim or a person close thereto

shall be punished by arrest or by imprisonment for a term of up to five years.

3. A person shall be held liable for an act provided for in paragraph 1 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

Article 295. Unlawful Installation of Special Equipment or Use Thereof for the Collection of Information

A person who unlawfully installs or uses special equipment for the purpose of spying on a person, collecting information about a state or municipal institution, agency or an employee thereof, a political party, public organisation or a member thereof, another legal or natural person

shall be punished by a fine or by arrest or by imprisonment for a term of up to four years.

Article 296. Seizure or Other Unlawful Acquisition of an Official Secret

A person who seizes, purchases or otherwise unlawfully acquires a material item whose content or information thereon constitutes an official secret or transfers the item or information thus acquired to a third party, in the absence of characteristics of espionage or provision of assistance to a foreign state,

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

Article 297. Disclosure of an Official Secret

1. A person who discloses the information constituting an official secret which was entrusted to him or which he accessed through his service or work, in the absence of characteristics of espionage or assistance to a foreign state in carrying out activities hostile to the Republic of Lithuania, shall be considered to have committed a misdemeanour and

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type of activities or by a fine or by restriction of liberty.

2. The act provided for in this Article shall be considered as criminal also where it has been committed through negligence.

Article 298. Unlawful Change of a Land Boundary Marking

A person who unlawfully removes, transfers, remakes or erects a land boundary marking or a geodesic, geological or geophysical mark shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by arrest.

Article 299. Failure to Render Assistance to Ships in the Event of a Collision at Sea

A ship’s captain who fails to render assistance to ships colliding at sea, where assistance could have been rendered without exposing the ship, the crew and passengers to a serious danger,

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

CHAPTER XLIII

CRIMES AND MISDEMEANOURS AGAINST GOVERNMENT ORDER RELATING TO FORGERY OF DOCUMENTS OR MEASURING DEVICES

Article 300. Forgery of a Document or Possession of a Forged Document

1. A person who produces a false document, forges a genuine document or stores, transports, forwards, uses or handles a document known to be false or a genuine document known to be forged

shall be punished by a fine or by arrest or by imprisonment for a term of up to three years.

2. A person who produces a false identity card, passport, driving licence or state social insurance certificate or forges a genuine identity card, passport, driving licence or state social insurance certificate or stores, transports, forwards, uses or handles an identity card, passport, driving licence or state social insurance certificate known to be false or a genuine identity card, passport, driving licence or state social insurance certificate known to be forged

shall be punished by arrest or by imprisonment for a term of up to four years.

3. A person who commits the acts provided for in paragraph 1 or 2 of this Article, where this incurs major damage, or produces a large quantity of false identity cards, passports, driving licences or state social insurance certificates or forges a large quantity of genuine identity cards, passports, driving licences or state social insurance certificates or stores, transports, forwards, uses or handles a large quantity of identity cards, passports, driving licences or state social insurance certificates known to be false or genuine identity cards, passports, driving licences or state social insurance certificates known to be forged

shall be punished by imprisonment for a term of up to six years.

4. A legal entity shall also be held liable for the acts provided for in this Article.

Article 301. Forgery of a Seal, Stamp or Form

1. A person who forges a genuine seal, stamp or form or produces a false seal, stamp or special accounting document form of a natural or legal person or uses a seal, stamp or form known to be forged or handles it

shall be punished by a fine or by arrest or by imprisonment for a term of up to three years.

2. A person who carries out the actions provided in paragraph 1 of this Article in the form of a business or where these actions interfere with the activities of a natural or legal person or incur major damage to the State or the natural or legal person or who forges or stores a large quantity of counterfeit or forged seals, stamps or special account document forms

shall be punished by arrest or by imprisonment for a term of up to five years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 302. Seizure of a Seal, Stamp or Document or Use of the Seized Seal, Stamp or Document

1. A person who seizes or, without having a legal ground therefor, acquires, stores, transports, forwards, uses or handles a seal, stamp, document or special accounting document form

shall be punished by a fine or by arrest or by imprisonment for a term of up to six years.

2. A person who commits the acts provided for in paragraph 1 of this Article in the form of a business or seizes or, without having a legal ground therefor, acquires, stores, transports, forwards, uses or handles a large quantity of seals, stamps or special account document forms of a natural or legal person or where this incurs major damage to the State or the natural or legal person

shall be punished by imprisonment for a term of up to six years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 302(1). Production, Storage, Transportation, Forwarding or Handling of Equipment for the Forgery of Seals, Stamps, Documents or Special Accounting Document Forms

1. A person who produces, stores, transports, forwards or handles the equipment, software or other means directly intended or adapted for the production of counterfeit seals, stamps, documents or special accounting document forms or for the forgery of genuine seals, stamps, documents or special accounting document forms

shall be punished by arrest or by imprisonment for a term of up to five years.

2. A person who commits the acts provided for in paragraph 1 of this Article in the form of a business or where this incurs major damage to the State or a natural or legal person,

shall be punished by imprisonment for a term of up to six years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 303. Destruction or Concealment of a Seal, Stamp or Document

1. A person who destroys or conceals a seal, stamp, document or special accounting document form of a natural or legal person, where this incurs major damage,

shall be punished by community service or by a fine or by arrest or by imprisonment for a term of up to two years.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 304. Provision of False Information for the Purpose of Acquisition of a Document

1. A person who, for the purpose of obtaining a document or an authentication certificate of a forged document, supplies an establishment or an employee thereof with false information shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by arrest.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 305. Release and Use of Measuring Devices without Undergoing State Metrological Control or Alteration of Parameters Thereof

1. A person who releases or uses a measuring device subject to state metrological control without an examination, calibration mark or other recording of the results of control or who alters the parameters of the measuring device after it undergoes state metrological control

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 306. Seizure, Forgery or Handling of the Stamp of a Lithuanian State Control Mark or of a Control Mark Provided for in a Treaty to which the Republic of Lithuania is Party or Belonging to a Foreign State or the Use of a Counterfeit Stamp

1. A person who seizes, unlawfully alters, produces, uses or handles the stamp of a Lithuanian state control mark or of a control mark provided for in a treaty to which the Republic of Lithuania is party or belonging to a foreign state

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

2. A legal entity shall also be held liable for an act provided for in this Article.

Article 306(1). Forgery, Unlawful Destruction or Alteration of a Number Plate of a Vehicle

1. A person who forges, unlawfully destroys or alters the number plate of a vehicle

shall be punished by a fine or by arrest or by imprisonment for a term of up to two years.

2. A legal entity shall also be held liable for an act provided for in this Article.

CHAPTER XLIV

CRIMES AND MISDEMEANOURS AGAINST MORALITY

Article 307. Gaining Profit from Another Person’s Prostitution

1. A person who gained profit from another person’s prostitution or from procuration for prostitution

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to four years.

2. A person who organises or is in charge of prostitution or transports a person with his consent for prostitution to the Republic of Lithuania or from the Republic of Lithuania

shall be punished by imprisonment for a term of up to six years.

3. A person who gains profit from the prostitution of a minor or organises or is in charge of the prostitution of the minor or transports the minor with his consent for prostitution to the Republic of Lithuania or from the Republic of Lithuania

shall be punished by imprisonment for a term of two up to eight years.

4. A legal entity shall also be held liable for the acts provided for in this Article.

Article 308. Involvement in Prostitution

1. A person who involves a person in prostitution

shall be punished by a fine or by restriction of liberty or by arrest or by imprisonment for a term of up to three years.

2. A person who involves in prostitution a person dependent on him financially, subordinate in office or otherwise or involves a person in prostitution by using physical or mental coercion or by deceit or who, in any manner, involves in prostitution a minor

shall be punished by imprisonment for a term of two up to seven years.

3. A legal entity shall also be held liable for the acts provided for in this Article.

Article 308(1). Prohibited Biomedical Research Involving a Human Being or Human Embryo

1. A person who conducted prohibited biomedical research involving a human being or human embryo

shall be punished by deprivation of the right to be employed in a certain position or to engage in a certain type activities or by a fine or by imprisonment for a term of up to two years.

2. A legal entity shall also be held liable for the acts provided for in this Article.

Article 309. Possession of Pornographic Material

1. A person who, for the purpose of distribution, produces or acquires pornographic material or distributes such material

shall be punished by community service or by a fine or by restriction of liberty or by imprisonment for a term of up to one year.

2. A person who produces, acquires, stores, demonstrates, advertises or distributes pornographic material displaying a child or presenting a person as a child

shall be punished by a fine or by imprisonment for a term of up to two years.

3. A person who, for the purpose of distribution, produces or acquires or distributes a large quantity of pornographic material displaying a young child

shall be punished by imprisonment for a term of up to five years.

4. A person who demonstrates or advertises pornographic material shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

5. A legal entity shall also be held liable for the acts provided for in paragraphs 1, 2 and 3 of this Article.

Article 310. Cruel Treatment of Animals

A person who treats an animal with cruelty, where this results in the death or mutilation of the animal, or who tortures an animal

shall be punished by community service or by a fine or by arrest or by imprisonment for a term of up to one year.

CHAPTER XLV

CRIMES AND MISDEMEANOURS AGAINST THE MEMORY OF THE DECEASED

Article 311. Desecration of the Remains of the Deceased

1. A person who unlawfully takes the remains of the deceased or a part thereof or ridicules the remains of the deceased or desecrates them

shall be punished by community service or by restriction of liberty or by arrest or by imprisonment for a term of up to two years.

2. A person who unlawfully reopens a grave and desecrates the remains of the deceased or ridicules them or takes the articles present there

shall be punished by arrest or by imprisonment for a term of up to three years.

Article 312. Desecration of a Grave or Another Place of Public Respect

1. A person who destroys or otherwise desecrates a grave or destroys a monument or desecrates another place of public respect

shall be punished by community service or by restriction of liberty or by arrest or by imprisonment for a term of up to one year.

2. A person who carries out acts of vandalism in a cemetery or another place of public respect or desecrates a grave or another place of public respect for rasist, nationalist or religious reasons

shall be punished by community service or by a fine or by imprisonment for a term of up to three years.

Article 313. Contempt for the Memory of the Deceased

1. A person who, with the intent of expressing contempt for the deceased or the persons close to him, disturbs the peace of a funeral shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

2. A person who publicly makes false statements about the deceased, which could arouse contempt for or undermine respect to the memory of the deceased, shall be considered to have committed a misdemeanour and

shall be punished by community service or by a fine or by restriction of liberty or by arrest.

3. A person shall be held liable for the acts provided for in paragraphs 1 and 2 of this Article only subject to a complaint filed by the victim or a statement by his authorised representative or at the prosecutor’s request.

CHAPTER XLVI

CRIMES AND MISDEMEANOURS AGAINST NATIONAL DEFENCE SERVICE

Article 314. Evasion of a Draft into Mandatory Military Service

1. A draftee who evades a regular draft into mandatory military service by impairing his health, simulating an illness, forging documents or using other means of deception

shall be punished by arrest or by imprisonment for a term of up to three years.

2. A draftee who evades a draft into mandatory military service, in the absence of the characteristics indicated in paragraph 1 of this Article, shall be considered to have committed a misdemeanour and

shall be punished by a fine or by arrest.

Article 315. Evasion of a Draft into Military Service During Martial Law

A draftee or an active reserve serviceman who evades a draft into military service during martial law

shall be punished by imprisonment for a term of up to five years.

Article 316. Evasion of Fulfilling of Military Service

1. A serviceman who evades fulfilling of active military service by impairing his health or by simulating an illness, forging documents or using other means of deception

shall be punished by imprisonment for a term of up to three years.

2. A person who commits the act provided for in paragraph 1 of this Article during martial law or while performing a military assignment or where this act causes serious consequences

shall be punished by imprisonment for a term of four up to eight years.

Article 317. Failure to Execute an Order

1. A serviceman who fails to execute a commander’s order or who refuses to execute it or who otherwise fails to comply with the commander’s order

shall be punished by arrest or by imprisonment for a term of up to two years.

2. A person who commits the act provided for in paragraph 1 of this Article during martial law or while performing a military assignment or where this act causes serious consequences

shall be punished by imprisonment for a term of two up to six years.

3. A serviceman who fails to execute a clearly unlawful order of a commander shall not be held criminally liable.

Article 318. Threats or Violence Against a Commander

1. A serviceman who threatens a commander with violence by reason of his military duties

shall be punished by arrest or by imprisonment for a term of up to two years.

2. A serviceman who uses physical violence against a commander by reason of his military duties

shall be punished by imprisonment for a term of up to three years.

3. A serviceman who commits the act provided for in paragraphs 1 and 2 of this Article during martial law or while performing a military assignment or where this act causes serious consequences

shall be punished by imprisonment for a term of three up to eight years.

Article 319. Violent Actions against a Subordinate

1. A commander who, in performing military duties, uses physical violence against a subordinate serviceman

shall be punished by arrest or by imprisonment for a term of up to two years.

2. A commander who commits the act indicated in paragraph 1 of this Article, where this causes serious consequences,

shall be punished by imprisonment for a term of three up to eight years.

Article 320. Terrorisation of a Serviceman

1. A serviceman who unlawfully demands that another serviceman behave according to his instruction or who humiliates another serviceman by using mental coercion

shall be punished by arrest or by imprisonment for a term of up to two years.

2. A serviceman who humiliates or terrorises another serviceman by using physical violence or a weapon

shall be punished by imprisonment for a term of up to five years.

3. A serviceman who commits the act indicated in paragraphs 1 and 2 of this Article, where this causes serious consequences,

shall be punished by imprisonment for a term of four up to eight years.

Article 321. Unlawful Order and Execution Thereof

A serviceman who issues a clearly unlawful order or forces another serviceman to execute such an order, also a serviceman who executes a clearly unlawful order, where this causes serious consequences,

shall be punished by imprisonment for a term of two up to eight years.

Article 322. Absence without Leave

1. A serviceman who wilfully leaves his unit or place of service or fails to timely arrive at his unit or place of service without valid reasons, where the absence lasts for a period exceeding three days, but not exceeding ten days,

shall be punished by arrest or by imprisonment for a term of up to two years.

2. A serviceman who commits the act indicated in paragraph 1 of this Article during martial law or while performing a military assignment

shall be punished by imprisonment for a term of two up to eight years.

Article 323. Desertion

1. A serviceman who leaves his unit or place of service for a period exceeding ten days or who fails to arrive at his unit or place of service for this period or, irrespective of the duration of the absence, acts in such a manner with the intent of avoiding military service,

shall be punished by imprisonment for a term of up to five years.

2. A serviceman who commits the act indicated in paragraph 1 of this Article during martial law or while performing a military assignment

shall be punished by imprisonment for a term of four up to eight years.

Article 324. Loss of National Defence Property

A serviceman who, through negligence, loses a weapon, ammunition, explosives, explosive materials, a vehicle or another military equipment entrusted to him for the purposes of service

shall be punished by arrest or by imprisonment for a term of up to three years.

Article 325. Violation of Guard Duty Rules

A person who violates requirements of the legal acts regulating guard duty during martial law or while performing a military assignment, where this act causes serious consequences,

shall be punished by imprisonment for a term of up to five years.

Article 326. Violation of State Border Guard Duty Rules

1. A serviceman who violates rules of the guard duty of the Republic of Lithuania state border while performing this duty during martial law, where this causes serious consequences,

shall be punished by imprisonment for a term of up to five years.

2. A person shall be held liable under this Article only where the acts provided for have been committed through negligence.

Article 327. Violation of Duty Rules

1. A serviceman who violated requirements of the legal acts regulating duty at a unit (with the exception of guard duty), where this causes serious consequences,

shall be punished by imprisonment for a term of up to three years.

2. A person shall be held liable under this Article only where the acts provided for have been committed through negligence.

Article 328. Abandoning a Sinking Warship

The captain of a warship who abandons it when it is sinking and fails to perform all of his duties

shall be punished by imprisonment for a term of up to five years.

Article 329. Loss or Dishonouring the Flag of a Military Unit

A serviceman who loses or dishonours the flag of a unit

shall be punished by arrest or by imprisonment for a term of up to two years.

Article 330. Interpretation of Concepts

1. A serviceman shall be a citizen of the Republic of Lithuania fulfilling mandatory (either initial or active reserve), professional, or volunteer military service.

2. A draftee shall mean a military conscript who has not fulfilled initial mandatory or alternative service by the specified age in accordance with the procedure and in a manner established by Law on Military Conscription and has not been released from it.

Annex to

the Criminal Code of the Republic of Lithuania

EU LEGAL ACTS IMPLEMENTED BY THIS LAW

1. Council Regulation (EC) No 338/97 of 9 December 1996 on the protection of species of wild fauna and flora by regulating trade therein (OJ 2004 Special edition, Chapter 15, Volume 03, p. 136).

2. Council framework Decision 2000/383/JHA of 29 May 2000 on increasing protection by criminal penalties and other sanctions against counterfeiting in connection with the introduction of the euro (OJ 2004 Special edition, Chapter 19, Volume 01, p. 187).

3. Council Framework Decision 2001/888/JHA of 6 December 2001 amending Framework Decision 2000/383/JHA on increasing protection by criminal penalties and other sanctions against counterfeiting in connection with the introduction of the euro (OJ 2004 Special edition, Chapter 19, Volume 04, p. 182).

4. Council Framework Decision 2001/413/JHA of 28 May 2001 combating fraud and counterfeiting of non-cash means of payment (OJ 2004 Special edition, Chapter 15, Volume 06, p. 123).

5. Council Framework Decision 2001/500/JHA of 26 June 2001 on money laundering, the identification, tracing, freezing, seizing and confiscation of instrumentalities and the proceeds of crime (OJ 2004 Special edition, Chapter 19, Volume 04, p. 158).

6. Council Framework Decision 2002/475/JHA of 13 June 2002 on combating terrorism (OJ 2004 Special edition, Chapter 19, Volume 06, p. 18).

7. Council Framework Decision 2002/584/JHA of 13 June 2002 on the European arrest warrant and the surrender procedures between Member States (OJ 2004 Special edition, Chapter 19, Volume 06, p. 34).

8. Council Framework Decision 2002/629/JHA of 19 July 2002 on combating trafficking in human beings (OJ 2004 Special edition, Chapter 19, Volume 06, p. 52).

9. Council Directive 2002/90/EC of 28 November 2002 defining the facilitation of unauthorised entry, transit and residence (OJ 2004 Special edition, Chapter 19, Volume 06, p. 64).

10. Council framework Decision 2002/946/JHA of 28 November 2002 on the strengthening of the penal framework to prevent the facilitation of unauthorised entry, transit and residence (OJ 2004 Special edition, Chapter 19, Volume 06, p. 61).

11. Council Framework Decision 2003/568/JHA of 22 July 2003 on combating corruption in the private sector(OJ 2004 Special edition, Chapter 19, Volume 06, p. 182).

12. Council framework Decision 2004/68/JHA of 22 December 2003 on combating the sexual exploitation of children and child pornography (OJ 2004 Special edition, Chapter 19, Volume 07, p. 10).

13. Directive 2004/23/EC of the European Parliament and of the Council of 31 March 2004 on setting standards of quality and safety for the donation, procurement, testing, processing, preservation, storage and distribution of human tissues and cells (OJ 2004 Special edition, Chapter 15, Volume 08, p. 291).

14. Council Framework Decision 2004/757/JHA of 25 October 2004 laying down minimum provisions on the constituent elements of criminal acts and penalties in the field of illicit drug trafficking (OJ 2004 L 335, p. 8).

15. Council Framework Decision 2005/212/JHA of 24 February 2005 on Confiscation of Crime-Related Proceeds, Instrumentalities and Property (OJ 2005 L 68, p. 49).

16. Council Framework Decision 2005/222/JHA of 24 February 2005 on attacks against information systems (OJ 2005 L 69, p. 67).

17. Council Framework Decision 2005/667/JHA of 12 July 2005 to strengthen the criminal-law framework for the enforcement of the law against ship-source pollution (OJ 2005 L 255, p. 164).

18. Directive 2005/35/EC of the European Parliament and of the Council of 7 September 2005 on ship-source pollution and on the introduction of penalties for infringements (OJ 2005 L 255, p. 11).

19. Directive 2008/99/EC of the European Parliament and of the Council of 19 November 2008 on the protection of the environment through criminal law (OJ 2008 L 238, p. 28).

Aug 142014
 

Lithuanian Civil Code regulates each person’s rights and duties, family relations, property, inheritance, damages, contracts and commercial transactions.

The Civil Code consists of 6 books and each article number is preceded by the book number. Book 1 is for general provisions, Book 2 describes persons, companies and their rights, Book 3 is for family law, Book 4 establishes property rights and limitations, Book 5 deals with inheritance and Book 6 (the largest one) describes all forms of contracts.

Translation of the Civil Code of The Republic of Lithuania provided by the chancery of Seimas (Parliament):

CIVIL CODE OF THE REPUBLIC OF LITHUANIA

18 July 2000 No VIII-1864
Vilnius

(Last amended on 21 June 2011 No XI-1484)

BOOK ONE

GENERAL PROVISIONS

Part I

Civil laws and their application

Chapter I

Civil laws and the relationships they regulate

Article 1.1. Relationships regulated by the Civil Code of the Republic of Lithuania

1. The Civil Code of the Republic of Lithuania shall govern property relationships and personal non-property relationships related with the aforesaid relations, as well as family relationships. In the cases provided for by laws, other personal non-property relationships shall likewise be regulated by this Code.

2. The provisions established by this Code shall apply to property relationships based on the legal subordination of persons to state institutions and directly resultant from their exercise of functions of state power (realization of subordination), or from the performance of persons’ obligations established by laws towards the state, or from the infliction of administrative or criminal sanctions established by laws, including relationships in the field of taxation and other obligatory payments or dues to the state or to its institutions, also in the field of the state budget, as well as to any other relationships governed by the provisions of public law to the extent that these relationships are not regulated by the relevant laws, also in the cases when it is expressly prescribed by this Code.

3. Labour relationships shall be regulated by special laws. The provisions of this Code shall apply to labour relations to the extent that they are not regulated by special laws.

Article 1.2. Principles of legal regulation of civil relationships

1. Civil relationships shall be regulated in accordance with the principles of equality of their subjects’ rights, inviolability of property, freedom of contract, non-interference in private relations, legal certainty, proportionality, and legitimate expectations, prohibition to abuse a right, as well as the principles of comprehensive judicial protection of civil rights.

2. No civil rights may be limited, except in the cases established by laws, or on the basis of a court judgment made in accordance with laws, where such limitation is necessary to protect public order, the principles of good morals, likewise the health and life of people, property of persons, their rights and lawful interests.

Article 1.3. Sources of civil law

1. The sources of the Civil law shall be the Constitution of the Republic of Lithuania, the present Code, other laws and international treaties of the Republic of Lithuania.

2. In the eventuality of contradictions between the present Code and other laws, the provisions of this Code shall apply, except in cases where this Code gives priority to the provisions of other laws.

3. When implementing legal acts of the European Union, other laws may lay down the norms, regulating civil legal relationships, other than those laid down by this Code. In this case the Civil Code shall apply to the extent other laws do not specify otherwise.

4. Civil relationships may be regulated by the decisions of the Government and legal acts of other state institutions only in the cases and to the extent expressly indicated by laws. Where legal acts of the Government or those of the other state institutions contradict the provisions of the present Code or the norms of other laws, the provisions of the Civil Code, or those of the other laws shall prevail.

5. A court has the right to declare a legal act or a part thereof void if it contradicts the Civil Code or another law in those cases where the supervision of the conformity of this act to the Constitution or to other laws is not within the competence of the Constitutional Court. The court, having recognized such a legal act to be void, shall within 3 days send a copy of its judgement to the institution or the official that has passed the legal act concerned. The res judicata court judgement shall be published in accordance with the procedure set out for officially announcing legal acts.

Article 1.4. Customs

1. In the cases established by laws or agreed on in contracts, civil relationships shall be regulated by customs.

2. Customs may not be applied if they are contrary to the mandatory legal norms or to the principles of good faith, reasonableness and justice.

Article 1.5. Application of the criteria of justice, reasonableness and good faith

1. In exercise of their rights and performance of their duties, the subjects of civil relationships shall act according to the principles of justice, reasonableness and good faith.

2. In the cases when laws do not prevent subjects of civil legal relationships from determining their mutual rights and duties upon agreement between themselves, these subjects shall act in accordance with the principles of justice, reasonableness and good faith.

3. If laws or an agreement between the parties provide for certain issues to be decided by a court according to its discretion, the court shall act in accordance with the principles of justice, reasonableness and good faith.

4. In interpreting and applying laws, the court shall be guided by the principles of justice, reasonableness and good faith.

Article 1.6. Ignorance of laws or improper understanding thereof

Ignorance of laws or improper understanding thereof shall not exempt from the application of the sanctions established therein, and shall not justify the failure to comply with the requirements of laws, likewise improper compliance therewith.

Article 1.7. The effect of civil laws

1. Civil laws and the other legal acts regulating civil relationships shall enter into force only upon their publication within the procedure established by the laws.

2. Civil laws and other legal acts regulating civil relationships shall have no retroactive effect.

Article 1.8. Analogy of a statute and law

1. Civil relationships not regulated by the norms of the Civil law shall be governed by civil laws that regulate similar relationships (analogy of statute).

2. In absence of relevant civil laws regulating similar relationships, general principles of law shall be applied (analogy of law).

3. Special norms, i.e. those establishing exceptions to general rules, may not be applied by analogy.

Article 1.9. Principles of interpretation of the Civil Code provisions

1. In order to ensure the integrity of the present Code and the conformity of its separate structural parts, the provisions of this Code in the process of their application shall be interpreted by taking into account the structure and system of this Code.

2. The words and word combinations used in this Code shall be interpreted according to their general meaning, except in those cases where it is clear from the context that a word or word combination is used in a special – legal, technical or any other – meaning. In the cases of non-conformity between the general and the special meaning of a word, priority shall be given to the special meaning.

3. In determining the right meaning of an applicable norm, the purposes and tasks of the Civil Code and the norm concerned shall be taken into consideration.

Chapter II

Private international law

Section one

General provisions

Article 1.10. Application of foreign law

1. Foreign law shall apply to civil relationships where it is so provided for by the international treaties of the Republic of Lithuania, agreements between the parties or the laws of the Republic of Lithuania.

2. A reference to foreign law shall include all the provisions applicable to the facts of a case under that law. The application of a provision of foreign law may not be precluded solely because of the provision being attributed to public law.

3. A reference to an applicable foreign law means a reference to the national material law of the state concerned, but not a reference to the private international law of that state, except in cases provided for by this Code.

4. Where the legal system of the state to which the renvoi is made by the provisions of this Code comprises different legal systems based on the criteria of division into several territorial units, a reference to an applicable foreign law shall mean a reference to the legal system of the relevant territory determined in accordance with the criteria established in the law of that foreign state.

5. Where the legal system of the state to which renvoi is made by the provisions of this Code comprises several legal systems applied to different categories of persons, the applicable legal systems shall be determined in accordance with the criteria established in the law of that foreign state.

6. Where the criteria foreseen in paragraphs 4 and 5 of this Article may not be identified within the scope of the applicable foreign law, the law of the legal system to which the relevant case is most closely connected shall apply.

Article 1.11. Limitation of the application of foreign law

1. The provisions of foreign law shall not be applied where the application thereof might be inconsistent with the public order established by the Constitution of the Republic of Lithuania and other laws. In such instances, the civil laws of the Republic of Lithuania shall apply.

2. Mandatory provisions of laws of the Republic of Lithuania or those of any other state most closely related with a dispute shall be applicable regardless of the fact that another foreign law has been agreed upon by the parties. In deciding on these issues, the court shall take into consideration the nature of these provisions, their purpose and the consequences of application or non-application thereof.

3. In accordance with this Code, the applicable foreign law may not be given effect where, in the light of all attendant circumstances of the case, it becomes evident that the foreign law concerned is clearly not pertinent to the case or its part, with the case in question being more closely connected with the law of another state. This provision shall not apply where the applicable law is determined by the agreement of the parties.

Article 1.12. Determination of the content of foreign law

1. In the cases established by the international treaties of the Republic of Lithuania or by the laws of the Republic of Lithuania, the application, interpretation and determination of the content of foreign law shall be performed by the court ex officio (on its own initiative).

2. In the instances where the application of foreign law is established upon agreement between the parties, the burden of proof in relation to the content of the applicable foreign law in accordance with its official interpretation, practice of application and the law doctrine in the relevant foreign state, shall be imposed on the disputing party that refers to the foreign law. Upon request of the disputing party, the court may provide assistance in collecting information on the applicable foreign law.

3. If the court or the disputing party that refers to foreign law fails to perform the obligation indicated in paragraphs 1 and 2 of this Article, the law of the Republic of Lithuania shall apply.

4. In the exceptional cases where it is necessary to take immediate interim measures to protect the rights or the property of a person, the court may decide on the urgent questions by applying the law of the Republic of Lithuania pending the determination of the law applicable to the dispute and the content thereof.

Article 1.13. International treaties

1. Where the provisions established in the international treaties of the Republic of Lithuania are different from those determined by the present Code and other laws of the Republic of Lithuania, the provisions of the international treaties of the Republic of Lithuania shall apply.

2. The international treaties of the Republic of Lithuania shall apply to civil relationships directly, except in cases where an international treaty establishes that a special national legal act is necessary for its application.

3. The provisions of international treaties shall be applied and interpreted in accordance with their international character and the necessity to guarantee a unified interpretation and application thereof.

Article 1.14. Referring back and referring to the law of a third state (renvoi)

1. If the applicable foreign law refers back to the Lithuanian law, that reference shall be observed only in the instances provided for by this Code or the foreign law.2. If the applicable foreign law refers to the law of a third state, that reference shall be observed only in the instances provided for by this Code or the law of the third state.

3. If in the matters of determining the civil legal status of a person, the applicable foreign law refers back to the law of the Republic of Lithuania, such reference shall be observed.

4. Paragraphs 1, 2 and 3 of this Article shall not apply in the instances where the applicable law has been chosen by the parties to a transaction, likewise in determining the applicable law to the form of a transaction and to non-contractual obligations.

5. Where the provisions of this Chapter provide for the application of an international treaty (convention), the matters of renvoi, i.e. referring back and referring to the law of a third state, shall be decided in accordance with the provisions of the applicable international treaty (convention).

SeCTION two

Law applicable to THE civil legal status of natural persons

Article 1.15. Civil capacity of foreign citizens and stateless persons

1. Foreign citizens in the Republic of Lithuania shall possess the same civil capacity as the citizens of the Republic of Lithuania. Exceptions to this rule may be established by the laws of the Republic of Lithuania.

2. The time of birth and death of foreign citizens shall be determined in accordance with the law of the state where was the domicile of the foreign citizens (Article 2.12 of this Code) at the moment of their birth or death.

3. Stateless persons shall possess the same civil capacity as the citizens of the Republic of Lithuania. Special exceptions to this rule may be established by the laws of the Republic of Lithuania.

4. The time of birth and death of stateless persons shall be determined in accordance with the law of the state where was the domicile of the stateless persons at the moment of their birth or death.

Article 1.16.Civil active capacity of foreign citizens and stateless persons

1. Civil active capacity of foreign citizens or stateless persons shall be governed by the laws of their state of domicile.

2. If such persons have no domicile or it cannot be determined with certainty, their legal active capacity shall be determined in accordance with the laws of the state within the territory of which these persons formed a relevant transaction.

3. If a person has residence in more than one state, the law of the state with which he is the most closely connected shall apply.

4. The ascertainment of incapacity or limited capacity of foreign citizens and stateless persons with permanent residence in the Republic of Lithuania shall be governed by the laws of the Republic of Lithuania.

5. A change of domicile shall not affect civil active capacity if that capacity was acquired prior to the change of domicile.

Article 1.17. Prohibition to invoke incapacity

1. A party to a transaction, who is incapable under the law of the state of his domicile may not invoke his incapacity if he was capable under the law of the state in which the transaction was formed, unless the other party was or should have been aware of the first party’s incapacity under the law of the state of the latter’s domicile.

2. Provisions of paragraph 1 of this Article shall not apply to family law and the law of succession, as well as to real rights.

Article 1.18. Declaration of foreign citizens and stateless persons to be missing or dead

Foreign citizens and stateless persons shall be acknowledged missing or declared dead in accordance with the law of the state of their last known domicile.

SECTION three

Law applicable to legal persons or any other organiSations

Article 1.19. Civil capacity of foreign legal persons or any other organisations

1. Civil capacity of foreign legal persons or any other organisations shall be governed by the laws of the state where these persons or organizations are founded.

2. If the procedure of founding a foreign legal person or any other organisation has been violated, its civil capacity shall be determined by the law of the state of its actual functioning.

3. Irrespective of the state of foundation of a legal person or any other organisation, the civil capacity of its subdivisions shall be determined in accordance with the law of the Republic of Lithuania if the head office, principal place of business or other activity of the subdivision is located in the Republic of Lithuania.

4. Merger, association or transfer of the head office of legal persons or any other organizations, one of which is located in the Republic of Lithuania and the other in a foreign state, shall have effect on their civil capacity in the Republic of Lithuania only if implemented in conformity with the laws of both states concerned.

Article 1.20. Issues regulated in accordance with the applicable law

1.The following shall be regulated in accordance with the applicable law determined in Article 1.19 of this Code:

1) the legal nature (legal form and status) of a legal person or any other organization;

2) foundation, reorganization and liquidation of a legal person or any other organization;

3) the name of a legal person or any other organization;

4) the system and competence of the bodies of a legal person or any other organization;

5) civil liability of a legal person or any other organization;

6) the power to represent a legal person or any other organization;

7) legal effects of the violation of laws or incorporation documents;

2. Protection against infringement of the business name of a legal person or any other organization registered in the Republic of Lithuania shall be governed by the law of the Republic of Lithuania.

Article 1.21. Law applicable to the representative offices and branches of foreign legal persons or any other organizations

1. Representative offices and branches of foreign legal persons or any other organizations registered in the Republic of Lithuania shall be governed by the law of the Republic of Lithuania.

2. At least one of the persons acting on behalf of a representative office or a branch shall be bound to reside in the Republic of Lithuania. This provision shall not apply to representative offices or branches, established in the Republic of Lithuania, of the legal persons or other organizations of the member states of the European Union and the states of the European Economic Area.

3. The rights and obligations (competence) of the persons acting on behalf of a representative office or a branch registered in the Republic of Lithuania shall be determined by the law of the Republic of Lithuania.

Article 1.22. Law applicable to representatives of foreign legal persons or any other organizations and to their civil liability

1. If the business of a legal person or any other organization founded under foreign law is conducted in the Republic of Lithuania, the civil liability of the persons acting on behalf and in the interests of those legal persons or any other organizations shall be governed by the law of the Republic of Lithuania.

2. A legal person or any other organization may not claim for annulment or invalidity of a transaction formed by its body or any other representatives in excess of their competence (powers) if the law of the state where the domicile or the head office of the other party to the transaction is located does not provide for any restrictions on their representative powers, unless the other party knew or, taking into account its position and the relationship with the other party, should have known of such restrictions.

Article 1.23. Law applicable to the state and state institutions as well as to local governments and local government institutions as subjects to civil legal relationships

Civil capacity of the state and state institutions as well as those of local governments and local government institutions shall be governed by the law of the state concerned.

Section four

Law applicable to family legal relationships

Article 1.24. Law applicable to a promise to marriage

1. A promise to marry and its legal effects shall be governed by the law of the state of domicile of the parties to the promise.

2. Where the parties to the promise of marriage are domiciled in different states, the promise of marriage and its legal effects shall be governed by the law of the place where the promise was made, or by the law of the state of domicile of one of the parties, or by the law of the state of citizenship of one of the parties, whichever law is most closely related with the dispute.

Article 1.25. Law applicable to the conditions to contract marriage

1. Matrimonial capacity and other conditions to contract marriage shall be governed by the law of the Republic of Lithuania.

2. Civil Registration Bureaus of the Republic of Lithuania shall have jurisdiction to perform the registration of marriage if either of the persons intending to marry is domiciled in the Republic of Lithuania or is a Lithuanian citizen at the time of solemnization of the marriage.

3. Matrimonial capacity and other conditions to contract marriage in respect of foreign citizens and stateless persons without Lithuanian domicile may be determined by the law of the state of domicile of both persons intending to marry if such marriage is recognized in the state of domicile of either of them.

4. A marriage validly performed abroad shall be recognized in the Republic of Lithuania, except in cases when both spouses domiciled in the Republic of Lithuania performed the marriage abroad with the purpose of evading grounds for nullity of their marriage under Lithuanian law.

Article 1.26. Law applicable to the procedure of contracting marriage

The procedure of contracting marriage shall be determined in accordance with the law of the state where the marriage is solemnized. Marriage shall also be recognized valid if the procedure of its contracting is in compliance with the requirements of the law of the state of domicile of either of the spouses or the law of the state of citizenship of either of them at the moment of solemnization of the marriage.

Article 1.27. Law applicable to personal relations between spouses

1. Personal relations between spouses shall be governed by the law of the state of their domicile.

2. Personal relations between the spouses domiciled in different states shall be governed by the law of the state of their last common domicile. Where the spouses have never had a common domicile, the law applicable to their personal relations shall be the law of the state to which the personal relations between the spouses are the most closely related. Where it is not possible to determine to the law of which state the personal relations between the spouses are the most closely related, the law of the state where the marriage was solemnized shall apply.

Article 1.28. Law applicable to matrimonial property relations between spouses

1. The matrimonial property legal regime shall be governed by the law of the state of domicile of the spouses. Where the spouses are domiciled in different states, the law of their common state of citizenship shall apply. Where the spouses have never had a common domicile and are citizens of different states, the law of the state where the marriage was solemnized shall apply.

2. The law applicable to contractual legal regime of matrimonial property shall be determined by the law of the state chosen by the spouses upon agreement. In this event, the spouses may choose the law of the state in which they are both domiciled or will be domiciled in future, or the law of the state in which the marriage was solemnized, or the law of the state a citizen of which is one of the spouses. The agreement of the spouses upon the applicable law shall be valid if it is in compliance with the requirements of the law of the chosen state or the law of the state in which the agreement is made.

3. The applicable law chosen upon agreement of the spouses may be invoked against third persons only if they knew or should have known of that fact, i.e. if the third party knew or should have known the chosen law that governed the matrimonial property regime when the legal relationship commenced.

4. The applicable law chosen upon agreement of the spouses may be used in resolving a dispute related to real rights in immovable property only in the event if the requirements of public registration of this property and of the real rights therein, as determined by the law of the state where the property is located, were complied with.

5. Any agreed change of matrimonial property legal regime shall be governed by the law of the state of domicile of the spouses at the time of the change. If the spouses were domiciled in different states at the time of change of the matrimonial property legal regime, the applicable law shall be the law of their last common domicile, or failing that, the law governing matrimonial property relationships between the spouses.

Article 1.29. Law applicable to separation and dissolution of marriage

1. Separation and dissolution of marriage shall be governed by the law of the spouses’ state of domicile.

2. If the spouses do not have their common domicile, the law of the state of their last common domicile shall apply, or failing that, the law of the state where the case is tried.

3. If the law of the state of common citizenship of the spouses does not permit dissolution of marriage or imposes special conditions for dissolution, the dissolution of marriage may be performed in accordance with the law of the Republic of Lithuania if one of the spouses is also a Lithuanian citizen or is domiciled in the Republic of Lithuania.

Article 1.30. Jurisdiction in the cases of annulment, dissolution of marriage and separation

The courts of the Republic of Lithuania shall have jurisdiction over actions of annulment, dissolution of marriage or separation in the cases provided for by the Code of Civil Procedure of the Republic of Lithuania.

Article 1.31. Law applicable to the ascertainment of the origin of a child (legitimation)

1. The origin of a child (ascertainment or contest of paternity or maternity) shall be established either in accordance with the law of the state the citizenship of which the child acquired at his birth, or with the law of the state which is recognized as the domicile of the child at the time of his birth, or with the law of the state in which one of the child’s parents is domiciled, or with the law of the state the citizen of which one of the parents was at the time of the child’s birth, whichever is more beneficial to the child.

2. The consequences of legitimation shall be governed by the law of the state of domicile of the child.

3. If a child or one of his parents is domiciled in the Republic of Lithuania, the questions of legitimation shall be decided by the courts or other state institutions of the Republic of Lithuania.

4. The parents’ (the father’s or the mother’s) legal active capacity in acknowledging paternity (maternity) shall be governed by the law of the state of his or her domicile at the time of the acknowledgement. The form of the acknowledgement of paternity (maternity) shall be governed by the law of the state in which it is made or by the law of the state of the child’s domicile.

5. The provisions of this Article shall also apply to the legitimation of a child born out of wedlock.

Article 1.32. Law applicable to relations between the parents and the child

1. Personal and property relationships between the parents and the child shall be governed by the law of the state of the child’s domicile.

2. If neither parent is domiciled in the state of the child’s domicile, while the child and the parents are citizens of the same state, the law of the state of their common citizenship shall apply.

Article 1.33. Law applicable to adoption relationship

1. Relationships of adoption shall be governed by the law of the state of the child’s domicile.

2. Where it becomes evident that the adoption performed according to the law of the state of the child’s (the adoptee’s) domicile will not be recognized in the state of domicile or citizenship of the adoptive parents (adoptive parent), the adoption may be performed pursuant to the law of the state of domicile or citizenship of the adopter (the adopters) if this will not prejudice the best interests of the child. If the recognition of adoption remains uncertain, the adoption shall not be allowed.

3. Relations between the adopted person (the adoptee) on the one side, and the adopting persons (the adopters) and the relatives of the latter on the other side shall be governed by the law of the state of the adopters’ (the adopter’s) domicile.

4. Cases related with adoption shall belong to the jurisdiction of the courts of the Republic of Lithuania if the child (the adoptee) or the adopting persons (adopting person) are domiciled in the Republic of Lithuania.

Article 1.34. Law applicable to protective measures in relation to minors, their guardianship and curatorship

Law applicable to protection of minors, their guardianship and curatorship shall be determined pursuant to the Hague Convention of 5 October 1961 concerning the Powers of Authorities and the Law Applicable in Respect of the Protection of Minors.

Article 1.35. Law applicable to guardianship and curatorship of family members who have reached majority

1. Guardianship and curatorship of family members who have reached majority shall be governed by the law of the state of such incapable persons’ domicile.

2. Cases related with guardianship or curatorship of persons who have reached majority shall belong to the jurisdiction of the courts of the Republic of Lithuania if the incapable person’s domicile or his property is located in the Republic of Lithuania.

Article 1.36. Law applicable to maintenance obligations (alimony relationships) within the family

Maintenance obligations (alimony) within the family shall be governed by the Hague Convention of 2 October 1973 on the Law Applicable to Maintenance Obligations.

SECTION five

Law applicable to contractual obligations

Article 1.37. Law applicable to contractual obligations

1 Contractual obligations shall be governed by the law agreed by the parties. Such agreement of the parties may be expressed in the form of separate terms of the concluded contract or it may be determined in accordance with the factual circumstances of the case. The law of the state designated by the agreement of the contracting parties may be applied to the whole contract or only to a part or parts thereof.

2. The initially chosen law applicable to contractual obligations may be changed by the agreement of the parties at any time. A change of law shall be retroactive to the time the contract was concluded though such change may not adversely effect the rights of third persons and shall not prejudice the formal validity of the contract.

3. The choice of the law applicable to a contract as made by the agreement of the parties may not be the grounds for refusing to apply the mandatory legal norms of the Republic of Lithuania or those of any other state that cannot be changed or declined by the agreement of the parties.

4. If no law applicable to a contractual obligation is designated by the agreement of the contracting parties, the law of the state with which the contractual obligation is most closely connected shall apply. The contractual obligation shall be presumed to be the most closely connected with the state in the territory of which:

1) the party bound to perform the obligation most characteristic to the contract is domiciled or has its central administration. If the obligation is most closely connected with the law of the state where the business of the party to the obligation is located, the law of that state shall apply;

2) immovable property is located, if the subject matter of the contract is the right in the immovable property or the right to its use;

3) was the place of the principal business of a carrier at the time when the contract for carriage was made, if the state of the principal business of the carrier is also the same state where the cargo was loaded, or the head office of the sender is located, or the place the cargo was dispatched from.

5. Paragraph 4 of this Article shall not apply where it is impossible to determine the place of performance of the obligation most characteristic to the contract and the presumptions established in this paragraph may not be relied upon as it is evident from the circumstances of the case that the contract is most closely connected with another state.

6. A contract of insurance shall be governed by the law of the state where the domicile or the place of business of the insurer is located; a contract of insurance in respect to an immovable thing shall be governed by the law of the state in the territory of which the thing is located.

7. An arbitration agreement shall be governed by the law applicable to the principal contract, and in the case of invalidity of the principal contract, by the law of the place where the arbitration agreement was concluded, where it is impossible to identify the place of conclusion, the law of the state in which arbitration is situated shall apply.

8. Contracts concluded in a stock exchange or auction shall be governed by the law of the state in which the stock exchange or auction is located.

Article 1.38. Law applicable to the form of transaction

1. The form of transaction shall be governed by the provisions established in paragraph 1 of Article 1.37 of this Code.

2. If no applicable law is designated by the agreement of the parties, the form of transaction shall be governed by the laws of the place where the parties entered into that transaction. A contract made by the parties residing in different states shall also be considered valid if its form corresponds to the legal requirements in respect of the form of the relevant transaction established in the national law of at least one of those states.

3. The form of transactions regarding an immovable thing or the rights therein shall be governed by the law of the state in which the immovable thing is located.

4. The form of consumer contracts concluded in cases provided for in paragraph 1 of Article 1.39 of this Code shall be governed by the law of the place of the consumer’s domicile.

Article 1.39. Particularities of application of foreign law to consumer contracts

1. A consumer contract for the purposes of this Article as well as other Articles of this Code shall be a contract on the acquisition of goods or services concluded between a natural person (consumer) and a person who sells such goods or services (supplier) for the purposes not related with the consumer’s commercial or professional activities, i.e. for the satisfaction of the consumer’s personal, family or household needs.

2. The right of the contracting parties established in paragraph 1 of Article 1.37 of this Code to make a choice of the law applicable to a contractual obligation shall not result in depriving or restricting the consumer of the right to protect his interests by the remedies determined by the provisions of the law of the state of his domicile if:

1) the formation of the contract in the state of his domicile was preceded by a special offer or by advertising in that country;

2) the consumer was induced by the other contracting party to travel to a foreign state for the purpose of forming the contract;

3) the order was received by the other party or his agent from the consumer in the state of the latter’s domicile.

3. If the parties to a consumer contract have not made a choice of the applicable law, the law of the state in which the consumer is domiciled shall apply.

4. The provisions of this Article shall not apply to contracts for carriage, contracts for the supply of services where the services are to be supplied to the consumer exclusively in a country other than the Republic of Lithuania.

Article 1.40. Laws applicable to the form, time-limit of validity and content of a power of attorney

The form of a power of attorney shall be governed by the law of the state in the territory of which it is issued. The time-limit of validity of a power of attorney, where it is not indicated in the document itself, the powers (rights and obligations) of the agent, the bilateral liability of the principal and the agent, and their liability in respect of third persons shall be governed by the law of the state in which the agent acts.

Article 1.41. Law applicable to gift

1. Gifts shall be governed by the law of the state of the donor’s domicile or his business activities with the exception of contracts upon gifting of an immovable thing, as such contracts shall be governed by the law of the state where that immovable thing is located.

2. A gift cannot be declared invalid as to its form if the form corresponds to the requirements of the law of the state in which the act of gift was performed, or of the law of the state of the donor’s domicile or his place of business activities.

Article 1.42 Law applicable to the assignment of a claim and the assumption of debt

1. Relations connected with the assignability of a claim and the assumption of a debt shall be governed by the law chosen by the parties upon agreement.

2. The choice of law made by the parties in the assignment of a claim may not be applied against the debtor without his consent to the application of the chosen law.

3. In the event of the parties not having made a choice of the applicable law, relations connected with the assignability of a claim and the assumption of a debt shall be regulated by the law governing the principal obligation, the claim arising from which (the debt) is to be assigned (assumed).

4. The form of the assignment of a claim or the assumption of a debt shall be governed by the law applicable to the contract of assignment or assumption.

SECTION six

Law applicable to DELICTUAL obligations

Article 1.43. Law applicable to delictual obligations

1. Rights and obligations of the parties resulting from tort shall be governed, at the choice of the aggrieved party, either by the law of the state where the tortious act was committed or any other tortious circumstances occurred, or by the law of the state in which the damage occurred.

2. Where it is impossible to determine the place where the act was committed or other circumstances occurred, or the state in which the damage appeared, the law of the state most closely connected with the case upon reparation for damage shall apply.

3. After the incurrence of damage, the parties may agree that the law applicable to the reparation for damage shall be the law of the state where the case concerned is being heard.

4. If both parties are domiciled in the same state, the law of that state shall be applicable to the reparation for damage.

5. An obligation to make reparation for damage caused by defective products shall be governed by the law of the state where the damage was incurred if the aggrieved person is domiciled in the same state, or it is the place of business of the person liable for the damage, or the products of inferior quality were acquired there by the aggrieved person. If the state of domicile of the aggrieved person coincides with the state of the place of business of the person liable for the damage caused, or with the state in which the defective product was acquired, the law of the state of the aggrieved person’s domicile shall apply. Where it is impossible to determine the applicable law in accordance with the criteria indicated in this paragraph, the law of the state where the business of the person liable for the damage is located shall apply, except in cases when the claim of the plaintiff is based on the law of the state in which the damage was made.

6. Terms of civil liability, its extent, the person liable and the terms of release from civil liability shall be governed by the law applicable to the obligations resulting from the delictual obligations.

Article 1.44. Law applicable to claims resulting from a traffic accident

Claims resulting from a traffic accident shall be governed by the Hague Convention of 4 May 1971 on the Law Applicable to Traffic Accidents.

Article 1.45. Law applicable to claims resulting from infringement of personal non-property rights

1. Claims for reparation of damage resulting from infringement of personal non-property rights committed by the mass media shall be governed, depending on the choice of the aggrieved person, by the law of the state where the aggrieved person is domiciled, or has his place of business, or where the infringement occurred, or by the law of the state where the person who caused the damage is domiciled or has his place of business.

2. Response to the media (denial) shall be governed by the law of the state in which the publication appeared, or the radio or television program was broadcast.

Article 1.46. Law applicable to claims for reparation of damage resulting from an act of unfair competition

Claims for reparation of damage resulting from an act of unfair competition shall be governed by the law of the state in whose market the negative effects of unfair competition occurred. If the act of unfair competition has affected exclusively the interests of an individual person, the applicable law shall be that of the state where the place of business of the aggrieved person is located.

Article 1.47. Plurality of debtors

If damage is caused by several persons, the applicable law shall be determined for each of them in accordance with the provisions of Article 1.43 of this Code.

SECTION seven

Law applicable to real rights

Article 1.48. Law applicable to ownership legal relations

1. The ownership right and other real rights in an immovable and movable thing shall be governed by the law of the state where the thing was situated at the moment of change of its legal status. Acknowledgement of a thing to be movable or immovable shall be governed by the law of the state in which the relevant thing is located.

2. Official registration of the ownership right and other real rights shall be governed by the law of the state where the thing is located at the time of its registration.

3. The ownership right and other real rights in a thing in transit (cargo) shall be governed by the law of the state of destination of this thing.

4. The ownership right to an immovable thing resulting from acquisitive prescription shall be governed by the law of the state where the thing is located.

Article 1.49. The right of the parties to choose the law applicable to a movable thing

1. The parties may choose upon their agreement the law of the state of dispatch or the state of destination of the thing, or the law regulating the underlying legal transaction as the law applicable to the arisal and termination of the rights to the movable property.

2. The choice of the applicable law may not affect the rights of third persons.

Article 1.50. Law applicable to encumbrance of the right in a movable thing

1.Where a movable thing over which encumbrance of right was validly established abroad is imported into the Republic of Lithuania, that encumbrance shall be acknowledged to be likewise valid in the Republic of Lithuania.

2. Retention of title over a movable thing validly established abroad shall remain valid after that thing has been transported into the Republic of Lithuania, though such retention may not affect the rights of third persons in good faith.

3. Retention of title over a movable thing in transit shall be governed by the law of the state of its place of destination.

Article 1.51. Law applicable to pledge

1. The pledge of rights, securities and claims shall be governed by the law chosen by the parties, though the choice of law may not affect the rights of third persons.

2. In the absence of the parties’ choice of law, the pledge of claims and securities shall be governed by the law of the state where the place of domicile or business of the secured creditor is located; the pledge of other rights shall be governed by the law applicable to such rights.

SECTION eight

Law applicable to intellectual property rights

Article 1.52. Law applicable to contracts related to intellectual property rights

1. In the absence of the parties’ choice of applicable law (Article 1.37 of this Code), contracts related to intellectual property rights shall be governed by the law of the state where the party transferring the intellectual property rights or granting the use thereof has his domicile or the place of business.

2. Contracts between an employer and an employee regarding the rights to intellectual property created by the employee in the course of his employment shall be governed by the law applicable to employment contracts.

Article 1.53. Intellectual property rights and the law applicable to their protection

1. Intellectual property rights and their protection shall be governed by the law of the state where the protection of the intellectual property rights is sought.

2. In the event of infringement of intellectual property rights, the parties may agree after the occurrence of the damage that the applicable law shall be the law of the state where the court hearing the case concerned is located.

SECTION nine

Law applicable to other obligations

Article 1.54. Law applicable to obligations arising from the reception of a thing not due, or unjust enrichment

1. Claims resulting from an obligation performed without any legal grounds for such performance shall be governed by the law of the state pursuant to the laws of which the legal sources for the obligation are determinable.

2. Claims related with unjust enrichment resulting from unlawful actions shall be governed by the law of the state where such unlawful actions were performed.

3. Where reception of a thing not due or unjust enrichment occurs from the existing legal relationship between the parties, the law determining that legal relationship shall apply.

Article 1.55. Law applicable to unilateral transactions

Unilateral transactions shall be governed by the law of the state where they were formed.

Article 1.56. Law applicable to securities

1. Cheques and bills of exchange shall be governed by the provisions set forth in the Geneva Convention of March 19, 1931 on Conflicts of Law in Matters of Bank Cheques and the Geneva Convention of June 7, 1930 on Conflicts of Law in Matters Involving Bills of Exchange and Promissory Notes.

2. Other securities shall be governed by the law of the state where they are issued (drawn).

Article 1.57. Law applicable to the currency in which payments are to be made

1. Currency in which payments are to be made shall be determined by the law of the state where the payment must be made, unless the parties have chosen upon their agreement the currency in which the payments are to be made.

2. In all other cases, currency shall be regulated by the law of the state which issued the currency.

Article 1.58. Law applicable to obligations deriving from other grounds

Obligations deriving from management of affairs of another, likewise obligations deriving from other grounds not specified in this Chapter shall be governed by the law of the state where the grounds for the obligation occurred.

Article 1.59. Law applicable to prescription

Prescription shall be governed by the law applicable in determining the rights and obligations of the participants in the relevant civil legal relationship.

SECTION TEN

LAW APPLICABLE TO LEGAL RELATIONS OF SUCCESSION

Article 1.60. Capacity to make a will

The capacity of making, amending or revoking a will shall be governed by the law of the state of the testator’s domicile. Where a person has no domicile or it is impossible to be determined, the capacity of such person to make a will shall be governed by the law of the state were the will is made.

Article 1.61. Form of a will

1. The form of a will, its amendment or revocation shall be governed by the law of the state where these acts are performed.

2. A will as well as its amendment or revocation shall also be valid in regard of the form if the form of the indicated acts is in compliance with the requirements of the law of the state of the testator’s domicile, or those of the laws of the state whose citizen the testator was at the time when the relevant acts were performed, or the law of the state of the testator’s residence at the time when those acts were performed or at the time of his death. A will in respect of an immovable thing, as well as any amendment or revocation thereof shall be valid if the form of the acts concerned is in compliance with the requirements of the law of the state where the immovable thing is located.

Article 1.62. Law applicable to other legal relations of succession

1. Other legal relationships of succession, with the exception of those related with inheritance of immovable things, shall be governed by the law of the state of domicile of the testator at the time of his death. Relations of succession in respect of an immovable thing shall be governed by the law of the state where the immovable thing is located.

2. Where succession opens by the death of a citizen of the Republic of Lithuania, irrespective of the law applicable, his heirs residing in the Republic of Lithuania and in possession of the right to the mandatory share of succession shall inherit this part in accordance with the law of the Republic of Lithuania, except the immovable things.

3. Where in accordance with the law applicable to relations of succession a property cannot devolve to a foreign state, and where no other heir thereto is known and the property is located in Lithuania, that property shall be devolved to the ownership of the Republic of Lithuania.

PART II

TRANSACTIONS

CHAPTER III

CONCEPT AND FORM OF TRANSACTIONS

Article 1.63. Concept and types of transactions

1. Transactions are the actions of persons intended to create, modify or extinguish civil rights and duties.

2. Transactions may be unilateral, bilateral or multilateral.

3. A transaction shall be considered to be unilateral where the expression of the will of one party is a necessary and sufficient condition for its formation.

4. A unilateral transaction shall impose obligations exclusively on the person who forms it. Obligations on any other persons shall be imposed by a unilateral transaction only in the cases established by laws or by an agreement between the persons concerned.

5. Legal norms which regulate obligations and contracts shall apply to unilateral transactions to the extent that this does not prejudice laws and the essence of the unilateral transaction.

6. A transaction shall be considered to be bilateral where the concerted will of two parties is a necessary condition for its formation.

7. A transaction shall be considered to be multilateral where the concerted will of three or more parties is a necessary condition for its formation.

Article 1.64. Form of the expression of will

1. The free will of a person who enters into a transaction may be expressed verbally, in writing, by action or in any other manner of expressing will.

2. The will of a person may be implied subject to the special circumstances under which the transaction is formed.

3. Silence may be deemed to be an expression of will exclusively in the cases established by laws or agreed upon by the parties to the transaction.

Article 1.65. Expression of will by means of public notice

1. In the cases established by laws or a contract, a person – the declarant – may express his will by means of a public notice (public authorization, public annulment of authorization, etc.) in accordance with the procedure established by this Article.

2. A public notice shall be published in a newspaper that is issued in the last known place of residence or business either of the other party to the transaction or that of the declarant of will (if such a newspaper exists), also in one of the national newspapers of the Republic of Lithuania, while in the cases provided for in the contract – in the website specified by the contract. The court may, if necessary, establish any other procedure for the expression of a person’s will by means of public notice.

3. A declaration of will by public notice shall be presumed to have become known to the other party upon the lapse of 14 days counting from the date of the last public declaration. However, this presumption shall not apply if the person who declared his will by public notice failed to perform every possible action available to him for the ascertainment of the place of residence or business of the other party to the transaction.

4. A public declaration of will shall be published at the expense of the declarant of the will.

Article 1.66. Conditional transaction

1. A transaction may render the appearance, modification or extinguishment of rights and duties dependent upon the fulfillment or non-fulfillment of certain conditions.

2. A transaction shall be deemed to be concluded with a suspensive condition if the arising of rights and duties therefrom is conditioned by the parties upon an uncertain event.

3. A transaction shall be deemed to be concluded with a resolutory condition if the extinguishment of rights and duties arising therefrom is conditioned by the parties upon an uncertain event.

4. A transaction shall be null and void if the arising, modification or extinguishment of rights and duties is conditioned by the parties upon the fulfillment of an unlawful condition or a condition incompatible with the public order or good morals, or upon the performance of unlawful actions.

Article 1.67. Consequences of an unfair hindering or assistance in the appearance of a condition

1. Where the appearance of a condition is unfairly hindered by a party to whom the condition is disadvantageous, this condition shall be considered as having existed.

2. Where the appearance of a condition is unfairly facilitated by a party to whom the condition is advantageous, this condition shall be considered as not having existed.

Article 1.68. Other consequences of a conditional transaction

1. If a condition had already been fulfilled at the time when the transaction was formed, such transaction shall be unconditional in the case of a suspensive condition, and null and void in the case of a resolutory condition.

2. If non-fulfillment of the conditions was already certain at the time when the transaction was formed, such transaction shall be unconditional in the case of a suspensive condition, and null and void in the case of a resolutory condition.

3. A transaction subject to a suspensive condition which is impossible objectively shall be null and void; a transaction subject to a resolutory condition which is objectively impossible shall be unconditional.

4. A transaction subject to a suspensive condition shall be null and void if the condition is dependent solely upon the will of the debtor.

Article 1.69. Place of transaction forming

1. A unilateral transaction shall be deemed to have been formed in the place where the will of a party to the transaction is expressed (the place where an authorization is given or a will (a testament) is made, etc.)

2. A bilateral or multilateral transaction shall be deemed to have been formed in the place of residence or business of the offeror, unless laws or agreement of the parties provide for otherwise.

3. Where the receipt of the notice of acceptance by the offeror is not a necessary condition for the formation of a transaction, such transaction shall be deemed to have been formed in the place of residence or business of the acceptor, or the place in which the factual actions of the acceptor were performed.

Article 1.70. Procedure of forming transactions

1. Natural persons may form transactions themselves or through their agents. It shall not be allowed to enter into transaction through an agent if, dependent on the nature of the transaction, it may be formed only by the natural person himself; the same stands for any other transactions determined by laws.

2. Transactions on behalf of legal persons shall be formed by the bodies or agents indicated in their incorporation documents.

Article 1.71. Form of transactions

1. Transactions shall be made in writing (in the ordinary or notarial form) or their formation may be implied from the actions.

2. A transaction, in respect of which there is no specific form established by laws, shall be deemed to have been formed if the person demonstrates by his behaviour the will to form a transaction (a contract formed by actions).

Article 1.72. Verbal form of transactions

1. Where the written form is not required by laws or by an agreement of the parties as a necessary condition for the forming of a transaction, the transaction may be formed verbally.

2. Transactions resulting from the performance of a written contract may be formed verbally if this does not contradict laws or the contract.

Article 1.73. Written form of transactions

1.The following shall be made in the ordinary written form:

1. transactions made by natural persons in the event where at the moment of their formation the value of the property upon which the transaction is made exceeds five thousand Litas, except such transactions which are performed at the time of their formation;

2. transactions on the foundation of legal persons;

3. contracts of purchase and sale of goods by instalments;

4. insurance contracts;

5. arbitration agreements;

6. contracts of lease of a movable thing for a term of over one year;

7. preliminary contracts;

8. contracts of life annuity (contracts of rent);

9. compromise agreements;

10. other transactions whose mandatory ordinary written form is provided for by this Code or other laws.

2. Written transactions shall be made either by drawing up one document signed by all the parties or by the parties exchanging separate documents. Documents signed by the parties and transmitted by means of telegraph, facsimile communication or over any other means of communication terminal equipment shall be conferred the same power as having been made in the written form, providing the protection of the text is guaranteed and the signature can be identified.

3. The parties may agree to adopt additional requirements for the written form of the transaction (signatures of certain persons, affixation of a stamp on the document, assignment of a special form for the document, etc.) and establish the legal effects for non-compliance with such requirements. In the event of the parties failing to comply with the established requirements, the transaction shall not be considered formed, unless the parties agree otherwise.

Article 1.74. Notarised transactions

1.The following transactions shall be drawn up in the notarial form:

1) transactions on the transfer of the real rights in an immovable thing and transactions on the encumbrance of the real rights and of the immovable thing;

2) contracts of marriage (pre-nuptial and post-nuptial);

3) other transactions which are to be notarised in accordance with the mandatory provisions of this Code.

Article 1.75. Legal registration of transactions

1. The law may establish mandatory legal registration of certain transactions. A transaction shall produce its effects between the parties even if it is not registered in the mandatory order. In such instances, the rights and duties of the parties produce their effects between them not from the moment of registration of the transaction but from the moment established by the law or agreement of the parties, except in cases where it is expressly determined by this Code that the rights and duties of the parties shall arise only from the moment of registration of the transaction concerned.

2. The parties to an unregistered transaction may not invoke the fact of transaction against third persons and argue their rights against third persons by relying on other means of proof.

3. If the same real rights or the same thing is acquired by several acquirers but only one of them registers that transaction, it shall be considered that the acquirer who has registered the transaction is vested with that thing or with the real rights in that thing. If none of the acquirers registers the transaction, it shall be considered that the acquirer who is the first to form that transaction is vested with the rights indicated above.

4. If several persons register their property rights or real rights in the same thing, the person who is the first to register that transaction shall be vested with these rights.

5. Damage caused to persons by unlawful acts of the officials of state institutions or other organisations effectuating mandatory legal registration of transactions shall be compensated by the state.

Article 1.76. Signing of transactions formed in writing

1. Transactions drawn up in writing must be signed by the contracting parties. Where a natural person, due to physical defect, illness or any other reason, cannot sign it himself, he may authorize another person to sign on his behalf. The signature of the latter must be witnessed by a notary; or the head or a deputy head of the enterprise, institution or organisation where the person concerned is employed or studies; or by the head physician or a deputy head physician of the in-patient medical institution where the person concerned undergoes treatment; or by the commander of the military unit or a deputy commander thereof if the transaction is made by a soldier; or by the master of a ship during the period of a long voyage; in addition, the reason for which the person entering into the transaction is unable to sign it himself must be indicated.

2. Where the transaction is made by employing telecommunication terminal equipment, in all cases there must be sufficient data for the ascertainment of the parties to the transaction. In the event of absence of such data, the parties, if a dispute arises, may not rely upon witnesses to prove the fact of transaction forming.

Article 1.77. Formation of transactions in the form other than established by the law

1. Transactions which are permitted by laws to be formed verbally, may also be made in the written or notarial form.

2. Transactions, the ordinary written form for which is mandatory, may also be formed in the notarial form.

Chapter IV

Voidability of transactions

Article 1.78. Null and voidable transactions

1. If the nature of nullity is clearly indicated in the law, a transaction shall be presumed to be null, irrespective of the fact of existence of a court judgement upon its nullity. The parties may not ratify a transaction which is null and void.

2. Any transaction for the declaration of voidability of which a court judgement is necessary, shall be a voidable one.

3. A transaction may be deemed to be null and void only on the grounds established by laws.

4. An action for the voidability of a voidable transaction may be invoked only by the persons indicated in the laws.

5. A claim to apply the legal effects arising from a transaction that is null and void may be invoked by any interested person. Legal effects of a null and void transaction, also the fact of its nullity shall be stated by the court ex officio (on its own motion).

Article 1.79. Ratification of a voidable transaction

1. A party possessing the right to invoke voidability of a transaction may ratify it within the time-limit established by the other party or the laws. After ratifying the transaction, the party forfeits his right to claim for voidability of that transaction.

2. It shall be presumed that a transaction is ratified by the party if, after it became possible to be ratified or disputed by that party, any of the following events have taken place:

1) the transaction has been performed partly or in whole;

2) a demand has been made against the other party for the performance of the transaction;

3) a security for the performance of the obligation subject to ratification has been granted to the other party;

4) the rights acquired according to that transaction have been transferred to another person partly or in whole.

Article 1.80. Nullity of a transaction that does not correspond to the requirements of mandatory statutory provisions

1. Any transaction that fails to meet the requirements of mandatory statutory provisions shall be null and void.

2. When a transaction is null and void, each party shall be bound to restore to the other party everything he has received according to that transaction (restitution), and where it is impossible to restore in kind the received, the parties are bound to compensate the received to each other in money, unless the laws provide for other consequences of voidness of the transaction.

3. The rules of restitution are established by Book Six of this Code.

4. The property – object of the transaction that is annulled – may not be claimed from the third person in good faith, except in cases provided for in paragraphs 1, 2 and 3 of Article 4.96 of this Code.

Article 1.81. Nullity of a transaction contradicting public order and good morals

1. A transaction that is contrary to public order or norms of good morals shall be null and void.

2. If a transaction is annulled on the grounds established in paragraph 1 of this Article, the rules provided for in paragraph 2 of Article 1.80 of this Code shall not apply if both parties knew or should have known the transaction to be contrary to public order or good morals.

3. Unilateral or bilateral restitution may take place where its application is not contrary to the mandatory statutory provisions or good morals, i.e. where the purpose of the transaction contradicting public order or norms of good morals was not achieved, and the provisions of public law do not establish any property sanctions in regard to the parties to such transaction.

Article 1.82.Voidability of a transaction contradicting the legal passive capacity of a legal person by whom the transaction was formed

1.Transactions made by the governing bodies of a private legal person in breach of the competence conferred on them by their incorporation documents or contradicting the goals of that legal person may be declared void only in the cases where it is proved that the other party acted in bad faith, i.e. he knew or should have known that the transaction was contrary to the goals of the legal person concerned. In such cases, the fact of announcement of the incorporation documents of the legal person concerned shall not be a sufficient proof of the other party’s bad faith, therefore the legal person shall be bound to prove that the other party deliberately acted in bad faith (Article 2.74 and Articles from 2.83 to 2.85 of this Code).

2. Transactions formed by public legal persons that are contrary to the goals of their activities may be declared void.

3. An action for the declaration of voidness on the grounds established by this Article may be brought by the legal person, the founder (founders) or a participant (participants) thereof. The laws may also specify other persons entitled to bring such an action, or special requirements which have to be met by the persons bringing such an action (e.g., holding of a certain number of shares (deciding votes))

4. Transactions indicated above shall be governed by the rules prescribed in paragraph 2 of Article 1.80 of this Code.

Article 1.83. Legal effects of a transaction formed on behalf of a legal person that is not registered within the procedure established by laws or has no licence to be engaged in the activities that are prohibited without a licence

1. Where a transaction is made on behalf of a legal person that is not registered within the procedure established by laws, the natural person by whom such a transaction is made acquires the rights and assumes the duties arising from that transaction, providing there are no other grounds for declaring such transaction void.

2. Where transactions are made on behalf of a legal person prior to its registration, the persons by whom these transactions are made shall be solidary liable, unless the legal person, after it is registered, assumes the obligations resulting from those transactions (Article 2.61 of this Code).

Article 1.84. Voidability of a transaction formed by a natural incapable person

1. A transaction shall be voidable if formed by a minor under fourteen years of age, except in cases where the minor, within the limits imposed by his age and in accordance with this Code and other laws of the Republic of Lithuania, may enter into transactions alone to satisfy his ordinary and usual needs.

2. A transaction is likewise voidable if it is made by a natural person who within the procedure established by laws is recognised as legally incapable by reason of mental disease or imbecility.

3. In the cases established in paragraphs 1 and 2 of this Article, besides the consequences provided for in paragraph 2 of Article 1.80 of this Code, the legally capable party shall be obliged to compensate the expenses suffered by the other party, also any damage to the latter’s property or loss thereof if the capable party knew or should have known about the incapacity of that other party.

4. The voidness of such transaction may be invoked by statutory representatives of the incapable person, also a public prosecutor. A transaction, if it is beneficial to the incapable person, may be ratified by the statutory representative of the latter in accordance with the procedure established by laws.

Article 1.85. Voidability of a transaction made by a natural person who overindulges in strong drinks or narcotic substances

1. A transaction upon the transfer of property or a real right that is formed by a natural person whose legal active capacity is limited by reason of overindulgence in strong drinks or narcotic substances and without the consent of a curator, except small transactions to meet his ordinary and usual needs, can be declared voidable within the judicial procedure on the action of the curator or a prosecutor.

2. If a transaction indicated in the preceding paragraph of this Article is declared voidable, the provisions of paragraph 3 of Article 1.84 of this Code shall apply.

3. After a transaction has been formed, a curator may ratify the transaction formed by the protected person alone during the period of his limited capacity for which he required to be represented if such transaction is beneficial to the person with limited capacity.

Article 1.86. Nullity of a fictitious transaction

1. A transaction made for the sake of appearance without intention to create legal effects shall not produce its effects between the parties and shall be null and void.

2. The provisions established in paragraph 2 of Article 1.80 of this Code shall apply to the transactions specified above.

Article 1.87. Nullity of a simulated transaction

1. If a transaction is formed to cover up another transaction, i.e. if the parties’ intent to make a transaction is different from the simulated transaction, the rules applicable to the intended transaction shall apply.

2. If the rights or lawful interests of third persons are violated by a simulated transaction, the third persons in defence of their rights shall be able to plead simulation against the parties of the simulated transaction.

3. A simulated transaction cannot be used as a defence by the contracting parties against third persons who in good faith have acquired rights from the simulated transaction.

Article 1.88. Declaring voidable a transaction made by a minor from fourteen to eighteen years of age

1. A transaction made by a minor from fourteen to eighteen years of age, where the law does not allow him to act without the consent of his parents or curators, may be declared void within the judicial procedure on the action of such minor’s parents or curators, with the exception of transactions into which the minor may, within the limits imposed by his age, enter alone in accordance with this Code and other laws of the Republic of Lithuania.

2. If a transaction specified in paragraph 1 of this Article is declared void, the rules prescribed in paragraph 3 of Article 1.84 of this Code shall apply.

3. Statutory representatives of a minor can ratify a voidable transaction made without a proper consent, by giving their consent after the transaction has been formed, if such transaction is beneficial to the minor concerned.

Article 1.89. Declaring voidable a transaction formed by a natural person who was unable to understand the meaning of his own actions

1. A transaction formed by a capable natural person may be annulled within the judicial procedure on the action of the natural person concerned if, by reason of his state at the moment of the transaction forming, he was unable to comprehend the meaning of his acts or to control them.

2. Where the transaction specified in paragraph 1 of this Article is declared void, besides the consequences established in paragraph 2 of Article 1.80 of this Code, the following additional consequences arise: the other party shall be bound to compensate to the party who at the moment of the transaction forming was unable to comprehend his own actions or to control them the expenses suffered, also any damage to his property or loss thereof, if this another party was aware or should have been aware of the state of the first contracting party.

Article 1.90. Declaring voidable a transaction formed under the influence of a mistake

1. A transaction resulting from the consent given by an essential mistake may be declared void within the judicial procedure on the person’s whose consent is vitiated action for its voidness.

2. A mistake is an erroneous assumption of the essential facts of the transaction that existed at the moment of the transaction forming.

3. In the event of annulment of a transaction formed under the influence of an essential mistake, the provisions established in paragraph 2 of Article 1.80 of this Code shall apply. The party upon whose action the transaction is declared void may, in addition to the annulment, also claim from the other party compensation for the expenses incurred or the damage to his property or loss thereof if this party proves that the mistake was caused by the fault of the other party. Where it is not proved, the party on whose action the transaction is declared void shall be bound to compensate to the other party the expenses incurred as well as the damage to his property or loss thereof.

4. A mistake is essential where the error relates to the nature, object or any other essential conditions of the contract itself, or the civil legal status of the other contracting party or any other circumstances, and where a person of normal diligence and attentiveness would not have made the transaction in a similar situation or would have made it on essentially different terms if he had known the real state of events. A mistake is likewise essential if both contracting parties are mistaken, or an error of one party induced the other party to err without the former’s intention to deceive, or if one party was aware or should have been aware of the mistake committed by the other party and the requirement addressed to the mistaken party to perform the transaction would contradict to the principles of good faith, justice and reasonableness.

5. A mistake may not be considered essential if caused by gross negligence of the mistaken party, or induced by circumstances the risk of which was taken by the party upon himself or if, taking into account the concrete circumstances, the risk of mistake falls on that party in particular.

6. A mistake resulting from the expression or transmission of a party’s will shall be deemed to be a mistake committed by that party himself.

7. The mistaken party cannot claim for the annulment of a contract where his rights and interests may be adequately protected by invoking other remedies.

Article 1.91. Voidability of a transaction made by a party whose consent was obtained by fraud, extorted by duress, economic pressure or induced by real threatening, likewise of a transaction made by the malicious agreement of a agent of one party with the other party, or a transaction entered into because of abusive circumstances

1. A transaction may be declared voidable by a court on the action of the aggrieved party if it was entered into due to fraud, duress, economic pressure or real threatening, or if it was formed by a malicious agreement of the agent of one party with the other party, likewise if, by entering into the transaction by reason of abusive circumstances, one party assumes obligations under unfair conditions.

2. Where the voidability of a transaction is based on any of the grounds specified in paragraph 1 of this Article, the other party shall be bound to restore to the aggrieved party everything he has received according to that transaction, and where it is impossible to restore (in kind), it must be compensated in money. In addition, the guilty party shall be bound to compensate to the aggrieved person all the expenses incurred.

3. Where a transaction is declared voidable by reason of fraud, violence, economic pressure, real threatening or malicious agreement made between the agent of one party and the other party, the aggrieved party may, in addition to remedies provided for in the preceding paragraph of this Article, claim non-pecuniary damage caused by the actions indicated.

4. For the purposes of this Article, the notion “real threatening” means unjustifiable or unlawful actions of the other party or a third person directed towards the person, property or reputation of the other contracting party, or that of his parents, children, spouse, grandparents, grandchildren or any other close relatives; the threatening actions must be of such nature as to impress a reasonable person and to cause him fear that the person, property or reputation of the persons concerned may be exposed to damage and there is no other reasonable alternative except to enter into the transaction. Threatening shall also be deemed to be real where one party or a third person threatens to enforce measures of economic pressure against the other contracting party that is economically weaker or is in essence economically dependent in order to compel him to form a transaction under exceptionally economically disadvantageous conditions. In determining the occurrence of real threatening, the court shall take into account the age, economic and financial position, and the gender of the party towards whom the threat was directed, the nature of the threat, and any other conditions significant for the case.

5. In addition to the forms specified in the preceding paragraph of this Article, fraud may result from the silence of a party, i.e. from concealment of such circumstances being aware of which the other contracting party would not have formed the transaction and which, within the principles of reasonableness, justice and good faith, had to be disclosed to the other party; fraud may also result from active actions by which it is desired to mislead the other contracting party concerning the effect of the transaction, essential terms thereof, civil legal capacity of the person who enters into the transaction, and any other essential circumstances.

6. If a third person, but not the other party to the transaction is guilty of fraud, duress or threatening, the transaction shall be declared voidable only in the cases where that other party was aware or should have been aware of those facts.

7. The fact of declaring voidable a transaction formed under the influence of fraud may not be invoked against third persons in good faith, except in cases established by this Code.

Article 1.92. Voidability of a transaction formed by an agent outside the authority conferred on him

A transaction made by a agent outside the limitations of the authority conferred on him by laws or a contract, may be declared voidable upon the action of the principal, unless such transaction is ratified by the principal (Article 2.133 of this Code).

Article 1.93. Voidability of a transaction resulting from the lack of requisites of its form established by laws

1. A transaction not made in the form required by laws for this particular case shall be void only in the case when such consequence is expressly indicated in the laws.

2. Where any dispute arises upon the fact of forming or performance of a transaction which fails to meet the necessary requirements for its ordinary written form, the parties lose the right to use testimony of witnesses as evidence to prove the facts indicated above; in the cases expressly prescribed by the law, non-observance of the ordinary written form obligatory to a concrete kind of transactions shall cause the nullity of such transaction.

3. Non-observance of the notarial form required by the law as a necessary condition of a transaction shall result in the nullity of the transaction in any case.

4. Where one party in the whole or partly performs his obligations arising from a transaction that must be notarized while the other party avoids the notarization thereof, the court may, on the action of the party who has performed his obligations, declare such transaction valid. In such event, a subsequent notarization of the transaction is not required.

5. Where nullity of a transaction results from the lack of necessary requisites of its form as established by laws, the consequences provided for in paragraph 2 of Article 1.80 of this Code shall arise.

6. The provisions established in paragraph 2 of this Article may not be applied by a court if they contradict the principles of good faith, justice and reasonableness, in particular where:

1) there exists other written evidence, even though indirect, that proves the forming of the transaction;

2) written evidence to prove the fact of transaction forming has been lost not through the fault of the party;

3) taking into consideration the circumstances in which the transaction was formed, it was objectively impossible to form that transaction in writing;

4) taking into consideration the interrelations between the parties, the nature of the transaction, and other circumstances of importance to the proceedings, prohibition to invoke testimonies of witnesses would contradict to the principles of good faith, justice and reasonableness.

Article 1.94. Legal effects of non-observance of the requirement to perform legal registration of a transaction

Non-observance of the requirement established by laws to perform legal registration of a transaction shall not result in nullity of the unregistered transaction, except in the cases prescribed by this Code.

Article 1.95. Time from which the effect of annulment arises

1. A transaction which has been annulled shall be deemed to be null and void ab initio (from the moment of its forming).

2. Where from the content of a transaction follows that it is impossible to declare such transaction void ab initio, it may be declared void only for the future, i.e. from the time when the judgement acquires the authority of the final judgement (res judicata).

Article 1.96. Consequences of partial nullity of a transaction

Partial nullity of a transaction shall not import the nullity of the entire transaction where it can be supposed that the contracting parties would have entered into that transaction even without the part affected by nullity having been included.

Part III

OBJECTS OF CIVIL RIGHTS

Chapter V

CONCEPT and kinds of objects of civil rights

Article 1.97. Kinds of objects of civil rights

1. Objects of civil rights shall be things, money and securities, other property and property rights, results of intellectual activities, information, actions and results thereof, as well as any other material and non-material values.

2. Things and property the turnover of which is restricted may be considered to be objects of civil rights only in the cases established by laws. Things which are withdrawn from civil use or the turnover of which is restricted must be imperatively indicated in the laws. Otherwise, the civil turnover of things or property shall not be considered restricted.

Article 1.98. Things as object of civil rights

1. Things as object of civil rights shall be divided into movables and immovables.

2. Land and other things which are connected with land and which cannot be moved from one place to another without change of their purpose and essential reduction of their value are immovables (buildings, equipment, perennial plants and other things which, according to their purpose and nature, are deemed to be immovable).

3. Ships and aircraft, the mandatory legal registration for which is established by laws, are also considered to be immovables. Any other property may also be attributed to immovables by the laws.

4. Things which can be moved from one place to another without a change of their purpose and considerable reduction of their value are considered to be movables, unless otherwise provided for by laws.

Article 1.99. Kinds of things as objects of civil rights

1. Things as objects of civil rights shall be divided into things determined by their individual features and things determined by their specific properties.

2. Things also are divided into divisible and undivisible, consumptable and unconsumptable, principals and accessories.

Article 1.100. Money

1. Money, as an object of civil rights, shall be bank-notes issued by the Bank of the Republic of Lithuania, coins and means in accounts, also bank-notes issued by other foreign states, Treasury notes, as well as coins and means in accounts, serving as lawful means of settlement.

Article 1.101. Securities

1. A security, as an object of civil rights, is a document certifying the obligation of its issuer to the holder of this document. A security can confirm the right of the person in possession of the document (holder) to receive from the issuer interest, dividends, part of an enterprise upon its liquidation, or the funds lent to the issuer (shares, bonds, etc.); the right or duty to acquire or alienate for payment or gratuitously other securities (the right to sign, future transactions, options, convertible bonds, etc.); the right to some income or payment duty subsequent to a change of prices on the security market (index, etc.). A security is also a document by which a direct order is issued to a bank to pay a certain sum of money (cheques) or which certifies a duty to pay a certain sum of money to the person whose name is indicated in the document (bill of exchange); or which proves the right of ownership to merchandise (mercantile securities): likewise a document which certifies the right or duty to acquire or alienate mercantile securities (derivative mercantile securities). Uncertified securities are issued in the cases established by laws and indicated (consolidated) in a special security register.

2. The laws may also provide for other types of securities. For the purposes of protecting the rights of investors, as well as for supervising and regulating the capital market, the laws may provide for a different definition of securities (investment) to be employed in the laws which regulate these relationships. Unless provided for otherwise, the provisions of this Code and the definition of securities shall apply to investment (investment securities) if the documents certifying the investment possess the features specified in paragraphs 1 and 3 of this Article.

3. The right certified by a security may be alienated to another person only in that event if the security itself is alienated, unless otherwise provided for by the laws. Securities may be alienated in accordance with the laws, the ordinary practice or by custom freely and unrestrictedly. Securities shall be alienated by transfer, though it ought to be certified by means of making an inscription of transfer of the security – an endorsement.

4. Securities may be underlying or derivative. Underlying securities confirm their holders’ rights and duties specified in paragraph 1 of this Article, with the exception of the right or duty to acquire or alienate for payment or gratuitously other securities, as well as the right to receive certain income or an duty to pay a certain sum of money subsequent to a change of prices on the security market. The securities which certify these exclusive rights or duties are called derivative securities.

5. Securities are divided into registered, bearer or order securities. They also divided into monetary, investment and mercantile securities.

6. A monetary security grants the right to receive a certain sum of money indicated therein (cheque, bill of exchange, bond).

7. An investment security concedes the right to participate in the management of the enterprise, certifies possession of the enterprise capital and entitles to receive a part of its profits (shares and certificates of shares, etc.), except in cases provided for by laws.

8. A mercantile security grants the right of ownership of merchandise, also the right to receive merchandise (bill of lading, way-bill, etc.).

9. Securities must contain the requisites provided for by laws. The absence of obligatory requisites of a security shall render it null, except in cases established by laws.

10. Upon the issue of uncertified securities, where the laws do not provide for otherwise, it shall be presumed pursuant to this Code that the holder of the securities has entrusted the accountant with their keep upon the contract of deposit. The rights, obligations and liability of the keeper shall be determined in accordance with the provisions of Book Six of this Code applicable to the contract of deposit. Where accountancy is managed by several persons on different levels, it shall be presumed that the person who handles the accounts of the security owner has transferred the keep of the securities concerned to another person under the contract of deposit. Such securities shall be alienated by the relevant entries in the security register.

Article 1.102. A share

1. A share is a security certifying the right of its holder (shareholder) to participate in the management of a stock company and, where the laws do not provide for otherwise, to receive a part of the stock company profits in the form of dividend and a part of the remaining property of the stock company in case of its liquidation, as well as certifying other rights established by laws.

2. Shares may be of the following classes: registered or bearer, ordinary or preference, certificates or uncertificated.

Article 1.103. A bond

A bond is a security certifying its holder’s right to receive from the person who issues the bond the nominal value of the bond, annual interest or any other equivalent, or other property rights within the time-limits prescribed in it.

Article 1.104. A cheque

A cheque, as a security, is an unconditional order drawn up in a certain manner that is addressed by the drawer to a bank to pay a certain sum in money to the holder of the cheque.

Article 1.105. A bill of exchange

1. A bill of exchange, as a security, is an unconditional order in writing addressed by one drawer to another by which the first person pledges himself or entrusts another person to pay directly or indirectly a certain sum of money to the person whose name is indorsed therein.

2. A bill of exchange may be of two forms: an order bill (draft bill) or a single bill (sole bill).

3. By using an order bill (draft bill) its drawer entrusts another person to pay to the person whose name is indorsed in the bill the sum indicated therein.

4. By using a single bill (sole bill) its drawer pledges himself to pay the sum indicated therein.

Article 1.106. A bill of lading

1. A bill of lading, as a security, is a document certifying the fact of conclusion of a contract and its holder’s right to receive from the carrier the goods specified therein (cargo) and the right to dispose of the goods (cargo) received.

2. A bill of lading may be bearer, order or straight. If a bill of lading is drawn up in several copies, after the shipment is delivered under any of the copies of the bill of lading presented first, the other copies thereof shall lose their legal power.

Article 1.107. A bank certificate

1. A bank certificate is a written bank document containing a statement on the monetary contribution and granting the depositor the right to receive that contribution and interests subject to the time-limits stated therein.

2. A bank certificate may be inscribed, transferable or non-transferable.

Article 1.108. A state debt obligation

1. A state debt obligation is a security payable to the bearer which certifies that its holder has lent a certain sum in money to the state and grants its holder the right to receive the sum indicated therein and interests established thereby during the period of the possession of this security.

Article 1.109. A plot of land and other resources

A land plot indicated in kind and registered within the procedure established by laws, also the indicated areas of the entrails of the earth, as well as waters, forests, objects of flora and fauna may be objects of civil rights.

Article 1.110. Enterprises and other property complexes

1. An enterprise, as a complex of assets, property and non-property rights belonging to the person who is engaged in business (seeking profit), as well as debts and other duties thereof, may be the object of civil rights. An enterprise is considered to be an immovable thing.

2. A property complex, as the object of civil rights, is the totality of things joined by a common economic purpose.

Article 1.111. Results of intellectual activities

Works of science, literature and art, invention patents, industrial samples and other results of intellectual activities expressed in any objective form (manuscripts, technical drawings, models, etc.) shall be deemed to be objects of civil rights. Invention patents and other results of intellectual activity shall become objects of civil rights from the moment of their recognition as such made within the procedure established by laws.

Article 1.112. Property rights

1. Real rights, rights arising from obligations, also rights arising from the results of intellectual activities shall be objects of civil rights.

2. Property rights may be transferred and inherited.

Article 1.113. Actions and their results

Various actions and their results (transportation of goods, repairing of things, services, etc.) shall be objects of civil rights.

Article 1.114. Personal non-property rights and values

1. Personal non-property rights and values, i.e. name, life, health, inviolability of body, honour, dignity, the private life of an individual, the author’s name, professional reputation, business name, trade marks of goods (services) and other values with which the arising of certain legal effects is linked by the laws shall be objects protected by the Civil law.

2. Personal non-property rights may be transferred or inherited only in the cases established by laws or where this does not contradict the nature of these values and principles of good morals or is not restricted by laws.

Article 1.115. Personal non-property rights

1. Objects protected by the Civil law are personal non-property rights, i.e. the rights that have no economic content and are inseparably related with their holder.

2. Personal non-property rights may be related with property rights, or they may not be related with the aforesaid rights.

Article 1.116. Commercial (industrial) and professional secret

1. Information shall be considered to be a commercial (industrial) secret if a real or potential commercial value thereof manifests itself in what is not known to third persons and cannot be freely accessible because of the reasonable efforts of the owner of such information, or of any other person entrusted with that information by the owner, to preserve its confidentiality. The information that cannot be considered commercial (industrial) secret shall be determined by laws.

2. Forms of protecting the information containing a commercial (industrial) secret are established by this Code.

3. Persons who unlawfully acquire information considered to be a commercial (industrial) secret shall be bound to compensate for the damages caused. Workers who in breach of the labour contract disclose a commercial (industrial) secret, as well as a party of any other contract who in breach of that contract discloses a commercial secret shall also be bound to compensate damages resulting from the disclosure of the commercial (industrial) secret. In this event, the damages suffered by the holder of the secret include the investment expenses incurred for its creation, development and use, as well as the incomes of which he (the holder) has been deprived. Incomes received from unlawful use of a commercial (industrial) secret shall be considered unjust enrichment.

4. A person who discloses a commercial (industrial) secret may be released from liability if he proves that the disclosure of that secret is justified by the interests of public safety.

5. Information shall be considered to be a professional secret if, according to the laws or upon an agreement, it must be safeguarded by persons of certain professions (advocators, doctors, auditors, etc.). This information is received by the indicated persons in performance of their duties provided for by laws or contracts. The cases when the information received in exercise of professional rights and in performance of professional duties shall not be considered professional secret are established by laws. Damage resulting from unlawful disclosure of a professional secret shall be compensated upon general grounds established by this Code.

Part IV

TIME-LIMITS

Chapter VI

General provisions

Article 1.117. Definition of a time-limit

1. A time-limit is a period of time determined by laws or a transaction or established by a judicial authority and fixed by a calendar date or by the termination of a period expressed in years, months, weeks, days or hours.

2. A time-limit may also be defined by indicating an event that must inevitably occur.

3. Time-limits may be restoratory, acquisitionary or resolutory.

4. A restoratory time-limit is a period which may be restored by the court after its expiration, providing it was exceeded due to substantial reasons.

5. An acquisitionary time-limit is a period after the expiration of which a certain civil right or duty is acquired.

6. A resolutory time-limit is a period after the expiration of which a certain civil right or duty expires. The resolutory time-limits may not be restored by a court or arbitration.

Article 1.118. Commencement of a time-limit

1. The moment from which a time-limit begins shall be 0 hours 00 minutes of the next day that follows the calendar date or the event by which its beginning is defined, unless law provide for otherwise.

2. A fixed time-limit that is expressed in hours shall begin from the moment defined by laws or one or both parties.

Article 1.119. Expiration of a time-limit expressed in years and months

1. A time-limit expressed in years shall expire at midnight on the corresponding day and month of the last year of the time-limit indicated as the dies ad quem (the day on which the time-limit expires).

2. A time-limit expressed in months shall expire at midnight on the corresponding day of the last month of the time-limit indicated as the dies ad quem.

3. In the event where in the time-limit expressed in years or months there is no corresponding day in the last month, the day of maturity shall be the last day of the relevant month.

Article 1.120. Expiration of a time-limit expressed in weeks

A time-limit expressed in weeks shall expire at midnight on the corresponding day of the week indicated as the dies ad quem.

Article 1.121. Inclusion of official holidays and weekends

1. Official holidays and weekends shall be included when calculating a time limit.

2. In the event where the day on which a time-limit expires is a day of an official holiday or a weekend, the time-limit shall be extended to include the first working day thereafter.

Article 1.122. Performance of actions on the dies ad quem

1. An action for the performance of which a time-limit is fixed shall have to be performed before midnight of the dies ad quem. Where an act has to be performed in an institution, it must be performed before the end of the normal office or business hours of that organisation on the dies ad quem.

2. Any applications and information in writing delivered to the post office or telegraph, or transmitted by other means of communication before midnight of the dies ad quem shall be considered to have been performed on time.

Article 1.123. Legal significance of a time-limit

1. If arising of a duty is made dependent upon the expiration of a certain time-limit, the performance of the duty may not be demanded before the expiry of that time-limit.

2. If certain legal effects of a transaction are made dependent upon the maturity of a time-limit, a transaction or obligation shall terminate with the expiry of the time-limit.

3. It shall be presumed that a time-limit takes effect in favour of a debtor except in the cases where:

1) the debtor is put on bankruptcy proceedings;

2) the debtor destroys the security provided for the performance of an obligation;

3) the debtor fails to provide a security of performance of an obligation he was bound to provide.

Chapter VII

Prescription

Article 1.124. Concept of prescription

Prescription is a time period established by laws during which a person can defend his violated right by bringing an action.

Article 1.125. Time limits of prescription

1. General prescription comprises a period of ten years.

2. In respect of concrete kinds of claims, abridged prescription shall be established by this Code and other laws of the Republic of Lithuania.

3. Abridged one-month prescription shall apply to claims arising from the results of tender.

4. Abridged three-month prescription shall apply in respect of claims for declaring voidable the decisions of the bodies of a legal person.

5. Abridged six-month prescription shall apply in respect of:

1) claims arising from the exaction of penalties;

2) claims arising from shortage in the goods sold.

6. Abridged six-month prescription shall apply with respect to claims arising from the relationships between communication enterprises and their clients regarding dispatches sent within the territory of Lithuania, or abridged one-month prescription when the dispatches were sent abroad.

7. Abridged one-year prescription shall be applied with respect to claims arising from the legal relationships of insurance.

8. Abridged three-year prescription shall be applied with respect to claims for the compensation of damage, including claims for the compensation of damage caused by defective production.

9. Abridged five-year prescription shall be applied with respect to claims for the recovery of interest and any other periodical payments.

10. Claims arising from defects of the work performed shall be prescribed in the abridged prescription established in Book Six of this Code.

11. Claims, arising from contracts for transportation of goods, passengers or baggage shall be prescribed in the abridged prescription established by the codes (laws) regulating separate types of transport.

12. Any agreement of the parties with an intention to modify legal regulation of prescription, i.e. to modify the time-limit and the calculation thereof, shall be prohibited.

Article 1.126. Application of prescription

1. A claim to protect a violated right shall be accepted by the court irrespective of the expiry of prescription.

2. The expiration of prescription shall be effected by the court exclusively if invoked by a party to the dispute.

3. Prescription may not be renounced in advance.

Article 1.127. Commencement of prescription

1. Prescription shall start its run from the day on which the right to bring an action may be enforced. The right to bring an action arises from the day on which a person becomes aware or should have become aware of the violation of his right. Exceptions to this rule shall be established by this Code and other laws of the Republic of Lithuania.

2. Where there is a time-limit established for the performance of an obligation, prescription of a claim arising from such obligation shall start its run upon the expiry of the time-limit allotted for the performance of that obligation.

3. Where a time-limit for the performance of an obligation is not established, prescription shall run from the moment when a claim to perform the obligation is brought.

4. Prescription of claims arising from regressive obligation shall start its run from the moment when the principal obligation is performed.

5. In the event of a continuous infringement, i.e. it happens every day (a person fails to perform the actions he is bound to perform, or performs the actions he has no right to perform, or does not discontinue another violation), prescription for actions brought upon activity or inactivity that occurred on a concrete day shall start its run from that every day.

Article 1.128. Prescription of claims arising from an obligation upon subrogation

Substitution of persons in an obligation shall not affect the course of prescription – the time-limit and the procedure of its calculation, unless laws provide for otherwise.

Article 1.129. Suspension of prescription

1. Prescription shall be suspended if:

1) an extraordinary event that cannot be prevented in certain circumstances (force majeure) hinders to bring an action;

2) the Government of the Republic of Lithuania establishes a postponement of the performance of obligations (moratorium);

3) the plaintiff or defendant serves in a unit of the armed forces of the Republic of Lithuania where martial law is imposed;

4) no guardian or curator is appointed to a legally incapable person or to a person whose legal active capacity is limited;

5) the parties to an obligation are spouses;

6) the parties to an obligation are a guardian and the person under guardianship, or a curator and the person under curatorship;

7) the parties to an obligation are parents and their minor children;

8) the effect of the law or any other legal act regulating relationships of the dispute is suspended;

2. The run of prescription shall be suspended only in the event when the circumstances indicated in paragraph 1 of this Article occured or continued to exist during the last six months of the prescription; where the time-limit of the prescription does not exceed six months, the run of the prescription shall be suspended if the circumstances indicated in paragraph 1 of this Article occured or continued to exist during the whole period of the time-limit of the prescription.

3. Suspended prescription resumes its run from the day when the circumstance which conditioned such suspension ceases to exist. In that event, the remaining part of the time-limit shall be prolonged by six months; if the time-limit of prescription is shorter than six months, it shall be prolonged by the whole duration of the time-limit.

Article 1.130. Interruption of prescription

1. Prescription shall be interrupted by bringing an action within the procedure established by laws.

2. Prescription shall also be interrupted by actions of a debtor by which the debtor acknowledges his obligation to the creditor.

3. An interrupted time-limit of prescription shall be resumed from the moment when the cause of such interruption ceases to exist. An interruption of prescription resulting from bringing an action shall be resumed from the time when the judgement thereon acquires the authority of the final judgement (res judicata), provided that an identical claim can be forwarded from the disputed legal relationship. The period that expired before the interruption shall not be included into the new time-limit of prescription.

4. No interruption in the time-limit of prescription shall occur where the suit is discontinued by the court due to the fault of the plaintiff. Refusal to accept the complaint or its withdrawal by the plaintiff shall likewise have no effect of interrupting prescription.

5. If an action brought in criminal proceedings is discontinued, prescription commenced before this action was brought shall continue its run from the day when the verdict by which the action was discontinued becomes finally binding.

Article 1.131. Legal effects of the expiration of a time-limit of prescription

1. The expiration of a time-limit of prescription prior to the date of bringing an action shall serve as valid grounds for dismissal of the claim.

2. If the court acknowledges the time-limit of prescription as expired due to important reasons, the violated right must be protected and the expired time-limit restored.

3. Questions of the ownership of property, for revindication of which prescription has expired, shall be regulated by the provisions of Book Four of this Code.

Article 1.132. Suspension, interruption and restoration of abridged prescription

The provisions regulating suspension, interruption and restoration of prescription (Articles 1.129 to 1.131 of this Code) shall likewise be applied in respect of abridged prescription except in cases where laws provide for otherwise.

Article 1.133. Consequences arising when a debtor performs an obligation after the expiration of a time-limit of prescription

Where a debtor performs his obligation after the expiration of the time-limit of prescription, he shall have not right to claim restitution even if at the time of the performance of his obligation he did not know that the time-limit of prescription had expired.

Article 1.134. Claims not subject to prescription

1. The following claims shall not be prescribed:

1) claims arising from the violation of personal non-property rights, except in cases established by laws;

2) claims of depositors for repayment of their accounts deposited in a bank or any other credit institution;

3) claims for compensation for material and non-material damage incurred because of the crimes specified in paragraph 8 of Article 95 of the Criminal Code;

4) other claims in cases established by other laws.

Article 1.135. Application of prescription with respect to accessory claims

Expiration of prescription with respect to the principal claim shall have the same effect likewise on the accessory claims (penalty, pledge, suretyship, etc.), even though the prescription of the latter may not have expired.

PART V

Exercise and protection of civil rights

CHAPTER VIII

PRINCIPLES OF EXERCISE OF CIVIL RIGHTS AND THE WAYS OF THEIR PROTECTION

Article 1.136. Grounds for the arisal of civil rights and duties

1. Civil rights and duties shall arise on the grounds established by this Code and other laws, also from actions performed by natural persons and organizations which, though not determined by laws, create civil rights and duties within the general principles and the meaning of the civil laws.

2. Pursuant to paragraph 1 of this Article, civil rights and duties shall arise:

1) from contracts and other transactions provided for by this Code and other laws, likewise from such transactions which might not be stipulated by the laws but not at variance with these laws;

2) from court judgements;

3) from administrative acts that cause civil legal effects;

4) as a result of creating intellectual property;

5) on the grounds damage, as well as on the grounds of the reception of property not due or of unjust enrichment;

6) on the grounds of events or actions (active or passive) to which the arising of civil legal effects is linked by laws.

Article 1.137. Enjoyment and exercise of civil rights and performance of civil duties

1. Persons shall freely enjoy their civil rights at their own discretion, including the right to protection.

2. Persons, while exercising their rights and performing their duties, must obey laws, respect rules of public welfare and principles of good morals, good faith, reasonableness and justice.

3. A person shall be forbidden to abuse his own right, i.e. there being no legal ground, no civil rights may be exercised in a manner or by means intended to violate other persons’ rights and interests protected by laws; or to restrict other persons in their rights and interests protected by laws; or with the intent of doing damage to other persons; or where this would be contrary to the purpose of the subjective right. Abuse of a right that causes injury to other persons shall be the grounds for the implementation of civil liability. A court may refuse to protect the subjective right of which the person abuses.

4. The exercise of civil rights may not be used in bad faith and with the intent of unlawfully limiting competition or in abuse of the dominating position in the market.

5. Civil rights shall be protected by the laws, except in cases when the exercise of these rights is inconsistent with their purpose, public order, good usages (bonus mores) or the principles of public morals.

6. A renouncement of exercise of a subjective civil right shall not abolish the civil subjective right, except in cases established by laws.

Article 1.138. Protection of civil rights

1. Civil rights shall be protected by the court acting within its competence and according to the procedure established by laws. The ways of protecting civil rights are the following:

1) acknowledgement of rights;

2) restoration of the situation that existed before the right was violated;

3) prevention of unlawful actions or prohibition to perform actions that pose reasonable threat of the occurrence of damage (preventive action);

4) ad judgement to perform an obligation in kind;

5) interruption or modification of a legal relationship;

6) recovery of pecuniary or non-pecuniary damage from the person who infringes the law and, in cases established by the law or contract, recovery of a penalty (fine, interest);

7) declaration as voidable of unlawful acts of the state or those of the institutions of local governments or the officials thereof in the cases established in paragraph 4 Article 1.3 of this Code;

8) other ways provided by laws.

Article 1.139. Self-defense

1. Self-defense may be exercised for the purposes of protecting one’s civil rights only in the events established by this Code.

2. Methods and means of self-defense must correspond to the nature of the unlawful act and cannot exceed the limits of self-defense that exist in every concrete event.

3. In exercising self-defense, the rights and freedoms of individuals must be respected, as well as the requirements of laws must be observed.

BOOK TWO

PERSONS

PART I

NATURAL PERSONS

CHAPTER I

PASSIVE AND ACTIVE CIVIL CAPACITY OF NATURAL PERSONS

SECTION ONE

PASSIVE CAPACITY

Article 2.1. The concept of passive civil capacity of natural persons

Every natural person shall have the full enjoyment of civil rights (passive civil capacity)

Article 2.2. Beginning and end of passive civil capacity of natural persons

1. Passive civil capacity of a natural person shall begin at the moment of his birth and end at the moment of his death.

2. The beginning of rights prescribed by law to a conceived but yet unborn baby shall depend on the act of its birth.

3. In the event of the impossibility to establish whether a baby was born alive or dead it shall be presumed that it was born alive.

4. Where certain ensuing legal consequences depend on the fact which of natural persons died at an earlier date and where it is impossible to establish the moment of the act of death of them each, it shall be presumed that the said natural persons died at the same time.

Article 2.3. Acts of birth and death of natural persons

1. The first independent breath shall be considered to be the act of birth of a natural person.

2. Full and irreversible stoppage of blood circulation or stoppage of all brain functions shall be considered to be the act of death of a natural person.

3. Criteria for stating the acts of birth or death shall be prescribed by law.

Article 2.4 Content of the passive civil capacity of natural persons

1. According to law, natural persons shall be entitled to property as the object of private ownership and shall enjoy the right to engage in commercial activities, establish enterprises or other legal entities, inherit property and bequeath it, choose a sphere of activities and residence, to have invention or industrial sample rights as well as other property and individual non-property rights, which are protected by the civil law.

2. Natural persons who, in accordance with the procedure established by the law, are engaged in commercial activities shall be deemed to be entrepreneurs.

3. Every person engaged in business or practising of his profession shall have to administer his property and everything related to his undertaking or practising of his profession as well as to safeguard documents and other information about his property, undertaking or practising of his profession in the manner, which would enable every person, having a legal interest, at any time, to receive comprehensive information about the property rights and obligations of the person in question.

SECTION TWO

ACTIVE CAPACITY

Article 2.5. Active civil capacity of natural persons

1. On attaining full age, i.e. when a natural person is eighteen years of age, he, by his acts, shall have full exercise of all his civil rights and shall assume civil obligations.

2. Where the law provides for the possibility of a natural person to enter into marriage before he is eighteen, the person, who has not yet come of the given age, shall acquire full active civil capacity at the moment of entering into marriage. If at a later date this marriage is dissolved or nullity of marriage is declared for reasons not related to the age of the parties to marriage a minor shall not loose his full active civil capacity.

Article 2.6. Prohibition to impose restrictions on the passive or active civil capacity of Natural Persons on the Grounds which are not Prescribed by Law.

1. Restrictions on the passive or active civil capacity may not be imposed on anyone in any other manner except by express provision of law.

2. Transactions, acts of public or municipality institutions or officials, which impose restrictions on the passive or active civil capacity, are deemed to be null and void except in cases where the said transactions and acts are prescribed by law.

Article 2.7. Active civil capacity of minors under fourteen years of age

1. Contracts on behalf and in the name of minor’s under fourteen years of age name shall be concluded by their parents or guardians.

2. Upon entering into contracts and enforcing them parents and guardians shall have to act exceptionally in the interest of minors. Rights and obligations of parents and guardians in administering the property of minors are laid down in the provisions of Book three of the given Code.

3. Minors under fourteen years of age shall enjoy the right to enter alone into contracts to meet their ordinary and usual needs, conclude contracts aiming at gratuitous personal gain, as well as conclude contracts related to the use of their own earnings or money provided by their legal representatives or other persons if the said contracts fail to have a prescribed notarial or any other specific form.

4. Liability of legal representatives for contractual obligations of minors, who are under fourteen years of age, shall be prescribed by law if they fail to prove that they are not at fault for the breach of the said obligations.

5. Where a contract concluded by a minor under fourteen years of age is not recognised to be null and void and where the said person becomes legally capable, the other party to the contract may apply in writing to the party to the contract, who has become legally capable, and request the approval of the contract within the time limits, which may not be shorter than one month, determined in the application. Where the person fails to notify about his refusal to approve the contract within the proposed time limits, he shall be deemed to have approved the contract.

Article 2.8. Active civil capacity of minors over fourteen and under eighteen years of age

1. Minors over fourteen and under eighteen years of age shall enter into contracts with the consent of parents or guardians. The form of consent shall have to correspond to the form of the contract concluded. Contracts concluded without the consent of legal representatives shall be deemed valid if the consent of the legal representative is given after the contract has been concluded.

2. Minors over fourteen but under eighteen years of age, apart from the rights laid down in paragraph 3 of Article 2.7, shall have the right to dispose of their income and property acquired for that income, implement copyright to their works, inventions, industrial design as well as the right to enter into contracts alone to meet their ordinary and usual needs.

3. Where there are sufficient grounds, the court may be called upon to rule on an application filed by child care institutions or other interested persons to impose restrictions on or divest minors, who are over fourteen but under eighteen years of age, of the right to dispose independently of their income and property.

4. The right of minors over fourteen but under eighteen years of age to make deposits in credit institutions and dispose of them shall be prescribed by law.

5. Minors over fourteen but under eighteen years of age shall alone be liable for their contractual obligations.

Article 2.9. Emancipation of minors

1. Where a minor is sixteen years of age the court may emancipate him after he or his guardian , parents, institutions of guardianship or he himself has filed a declaration to that effect with the court if there are sufficient grounds to believe that he may exercise all civil rights and discharge his obligations alone. In all cases a minor has to give his consent to be emancipated.

2. The court may annul minor’s emancipation on the request of parents or child care institutions in the event that exercising his rights and discharging his obligations a minor causes damage to his own or other persons’ rights or lawful interests.

SECTION THREE

DECLARATION OF INCAPACITY OR LIMITATION OF CAPACITY OF A NATURAL PERSON

Article 2.10. Declaration of incapacity of a natural person

1. Natural person who as a result of mental illness or imbecility is not able to understand the meaning of his actions or control them may be declared incapable. The incapable person shall be placed under guardianship.

2. Contracts on behalf and in the name of the person, who was declared incapable, shall be concluded by his guardian. Rights and obligations of a guardian are laid down in the provisions of Book Three of the given Code.

3. Where a person who was declared incapable gets over his illness or the state of his health improves considerably the court shall recognise his capacity. After the court judgement becomes res judicta, guardianship to the said person shall be revoked.

4. The spouse of the person, parents, adult children, care institution or a public prosecutor shall have the right to request the declaration of person’s incapacity by filing a declaration to the given effect. They shall also have the right to apply to the court requesting the declaration of person’s capacity.

Article 2.11. Limitation of active civil capacity of natural persons

1. Where natural persons abuse alcoholic beverages, drugs, narcotic or toxic substances the court may impose restrictions on their civil capacity. After person’s capacity has been imposed limitations , he shall be placed under guardianship. Rights and obligations of a guardian are laid down in the provisions of Book three of the given Code.

2. Upon imposition of a limitation on a person’s capacity he may enter into contracts related to the disposition of his property, receive his salary, pension or any other income and dispose of it only with the consent of his guardian , with the exception of contracts, which he concludes to meet his ordinary and usual needs. Person whose capacity has been imposed limitations may not without the consent of his guardian curator:

1) borrow and lend money, when the sum exceeds two average monthly wages (without deductions);

2) extend a guarantee or offer a surety to other person;

3) conclude contracts of alienation or encumbrance of rights to his property ;

4) conclude an arbitration agreement;

5) file a statement of claim related to that part of his active civil capacity where his active capacity is limited;

6) come into inheritance or disclaim an inheritance;

7) conclude a contract for the construction of a construction works (apartment) or major repairs;

8) conclude a contract of tenancy or a loan-for-use contract;

3. The court may request the consent of the guardian curator to conclude other contracts, which are not laid down in paragraph 2 of the given Article.

4. Where the reasons for which person’s capacity was imposed limitations are no more valid the court shall lift the limitations on person’s capacity. After the court judgement has come into force, guardianship to a person under which he has been placed shall be annulled.

5. A person of full age who has limited capacity shall be alone liable for his contractual and non-contractual obligations.

6. A request to impose limitations on person’s civil capacity may be filed by the spouse of the said person, his parents, adult children, institution of guardianship or the public prosecutor. The person whose capacity was imposed limitations shall also have the right to apply to the court requesting to lift the limitations on his capacity.

7. Provisions of the articles of Part VII of Book Three of the given Code are applied mutatis mutandis to relations, arising in the exercise and protection of the property and non-property rights of an incapable natural person or a natural person of limited capacity.

Article 2.111. The Register of Legally Incapacitated Persons and Persons of Limited Capacity

1. The Register of Legally Incapacitated Persons and Persons of Limited Capacity shall record persons who are declared in accordance with the procedure laid down by the court to be legally incapacitated or whose civil capacity is limited, minors from 14 years of age to 18 years of age in the cases provided for in paragraph 3 of Article 2.8 of this Code, guardians and curators of such persons; the data of the court decisions, adopted in respect of them, concerning the establishment and revocation of legal capacity or limitation of legal capacity. The Register of Legally Incapacitated Persons and Persons of Limited Capacity shall be a non-public state register.

2. The leading Register management body shall be the Ministry of Justice of the Republic of Lithuania, the Register management body shall be the Central Mortgage Office. The data of the Register of Legally Incapacitated Persons and Persons of Limited Capacity shall be managed in accordance with the procedure laid down by the regulations of the Register of Legally Incapacitated Persons and Persons of Limited Capacity.

3. The data of the Register of Legally Incapacitated Persons and Persons of Limited Capacity shall be provided in accordance with the procedure laid down by the regulations of the Register of Legally Incapacitated Persons and Persons of Limited Capacity to the data recipients who have the statutory right to receive such data for the direct performance of their functions.

SECTION FOUR

DOMICILE AND RESIDENCE OF A NATURAL PERSON

Article 2.12. Domicile of a Natural Person

Being an expression of person’s relationship with the state or part of its territory, domicile of a natural person shall be that state or its part, in which he permanently or ordinarily resides, regarding that state or its part to be the seat of his personal, social and economic interests.

1. A natural person is deemed to be domiciled in the Republic of Lithuania when of his own will he establishes and maintains the only or principal residence with the intention to make it a seat of his personal, social and economic interests. This intention, inter alia, may manifest itself by person’s actual presence on the territory of the Republic of Lithuania as well as the establishment of personal or business relations between him and the persons of the Republic of Lithuania or by some other criteria.

2. A natural person may have only one domicile. A person called to a temporary or revocable public office shall retain his domicile.

3. Domicile of a natural person shall be deemed unchanged until he changes it to another domicile.

4. Domicile of a married person shall not depend on the domicile of his spouse, although the domicile of one of the spouses is the fact, which has to be taken into consideration in establishing the domicile of the other spouse.

Article 2.13. Domicile of Legally Incapable Natural Persons

1. Domicile of legally incapable natural person shall be deemed to be the domicile of his guardian if the guardian and his ward reside in the same state.

2. Where a legally incapable person resides in a different from his guardian state and the said state is the seat of personal, social and economic interests of the legally incapable person he shall be deemed to be domiciled in that state.

Article 2.14. Domicile of Juvenile Natural Persons

1.Domicile of minor natural persons shall be deemed to be the domicile of their parents or guardians (foster parents).

2.Where parents of a minor natural person fail to have a common domicile, the domicile of a minor shall be deemed to be the domicile of one of his parents with whom the minor resides most of the time, unless the court has established the domicile of a minor with one of his parents.

Article 2.15. Right of the Parties to the Contract to Choose Domicile

The parties to a contract shall enjoy the right to choose, in writing, domicile with the view to the performance of the contract and the exercise of the rights arising from the said contract.

Article 2.16. Place of Residence of a Natural Person

1.The residence of a person shall be the place where he ordinarily resides.

2.Where a person has more than one residence, the seat of his principal establishment (where the person has property or a major part of property, where he has his job or where he lives the longest) shall be deemed to be his principal residence. In such case person’s principal residence shall be taken into consideration in establishing his domicile.

3.A person, whose domicile cannot be determined with certainty in accordance with the criteria laid down in Article 2.12 of the given Code, shall be deemed to be domiciled at the place of his residence. This rule shall, too, be applied to refugees from the state, which was their domicile unless they were domiciled in the Republic of Lithuania in accordance with the provisions of Article 2.12 of the given Code.

Article 2.17. Criteria for the Establishment of Residence

1. Length and continuity of actual residence at the place, data on person’s residence in public registers as well as his own public statements about his residence shall be taken into account in determining residence of a natural person.

2. A person whose residence is unknown or cannot be determined with certainty shall be deemed to live at the place of his last known residence.

3. A natural person must notify, in writing, the other party to the contract as well as his creditors or debtors about the change of residence. Where a person fails to perform this obligation the other party to the contract and creditors shall have the right to send notifications and perform other acts at the place of his last known residence.

SECTION FIVE

ACTS OF CIVIL STATUS

Article 2.18. State Registration of Acts of Civil Status

The state conducts mandatory registration of the following acts of civil status:

1) birth of a person;

2) death of a person;

3) entering into marriage;

4) dissolution of marriage

5) adoption;

6) recognition and establishment of parenthood;

7) change of the first name and surname;

8) change of designation of sex of a person;

9) partnership.

Article 2.19. The Order of Registration of Acts of Civil Status

1. Acts of civil status, except partnership, shall be registered in the registry offices by making respective entries into the register of civil status and issuing to the person the certificate of a respective entry of the act.

2. The procedure of registration of acts of civil status, alterations of the acts of civil status, rectification and reconstitution of acts is established in Book Three of the given Code.

PART TWO

ENJOYMENT AND EXERCISE OF SPECIFIC CIVIL RIGHTS OF NATURAL PERSONS

Article 2.20. Right to a Name

1. Every natural person shall enjoy the right to a name. Right to a name includes a right to a surname, name (names) and pseudonym. It shall be prohibited to gain rights and assume obligations under the cover of other person’s name.

2. A natural person shall have the right to use his full or abbreviated name (names) and request other persons not to use and not to act in his name without his authorisation.

3. The basis and the procedure for the change of name and surname shall be provided by law.

4. Having changed his surname or name a natural person must inform his debtors and creditors thereof. Where the person fails to perform this obligation he shall run the risk of negative consequences ensuing after his failure to notify about the change of his name or surname.

Article 2.21. Protection of the Right to a Name

1. A natural person whose right to a name has been infringed as a result of other person’s unlawful acts in his name or some other mode of unlawful appropriation of his name or he is prevented from using it, shall have the right to apply to court and request to oblige the guilty person to discontinue the said acts and redress the property and non-pecuniary damage incurred on him by such unlawful acts.

2. After the death of a natural person such claim may be presented by his spouse, parents or children.

Article 2.22. Right to an Image

1. Photograph (or its part) or some other image of a natural person may be reproduced, sold, demonstrated, published and the person may be photographed only with his consent. Such consent after natural person’s death may be given by his spouse, parents or children.

2. Where such acts are related to person’s public activities, his official post, request of law enforcement agencies or where a person is photographed in public places, consent of a person shall not be required. Person’s photograph (or its part) produced under the said circumstances, however, may not be demonstrated, reproduced or sold if those acts were to abase person’s honour, dignity or damage his professional reputation.

3. Natural person whose right to image has been infringed enjoys the right to request the court to oblige the discontinuance of the said acts and redressing of the property and non-pecuniary damage. After person’s death, such claim may be presented by his spouse, children and parents.

Article 2.23. Right to Privacy and Secrecy

1. Privacy of natural person shall be inviolable. Information on person’s private life may be made public only with his consent. After person’s death the said consent may be given by person’s spouse, children and parents.

2. Unlawful invasion of person’s dwelling or other private premises as well as fenced private territory, keeping his private life under observation, unlawful search of the person or his property, intentional interception of person’s telephone, post or other private communications as well as violation of the confidentiality of his personal notes and information, publication of the data on the state of his health in violation of the procedure prescribed by laws and other unlawful acts shall be deemed to violate person’s private life.

3. Establishment of a file on another person’s private life in violation of law shall be prohibited. A person may not be denied access to the information contained in the file except as otherwise provided by the law. Dissemination of the collected information on the person’s private life shall be prohibited unless, taking into consideration person’s official post and his status in the society, dissemination of the said information is in line with the lawful and well-grounded public interest to be aware of the said information.

4. Public announcement of facts of private life, however truthful they may be, as well as making private correspondence public in violation of the procedure prescribed in paragraphs 1 and 3 of the given Article as well as invasion of person’s dwelling without his consent except as otherwise provided by the law, keeping his private life under observation or gathering of information about him in violation of law as well as other unlawful acts, infringing the right to privacy shall form the basis for bringing an action for repairing the property and non-pecuniary damage incurred by the said acts.

5. Where the said acts are committed on the basis of reasoned judgement of the court, restrictions imposed on the publication and collecting of information about the person which are laid down in the provisions of paragraphs 1 and 3 of the given Article shall not be applied.

Article 2.24. Protection of Honour and Dignity

1. A person shall have the right to demand refutation in judicial proceedings of the publicised data, which abase his honour and dignity and which are erroneous as well as redress of the property and non-pecuniary damage incurred by the public announcement of the said data. After person’s death this right shall pass on to his spouse, parents and children if the public announcement of erroneous data about the deceased person abases their honour and dignity as well. The data, which was made public, shall be presumed to be erroneous as long as the person who publicised them proves the opposite.

2. Where erroneous data were publicised by a mass medium (press, television, radio etc.) the person about whom the data was publicised shall have the right to file a refutation and demand the given mass medium to publish the said refutation free of charge or make it public in some other way. The mass medium shall have to publish the refutation or make it public in some other way in the course of two weeks from its receipt. Mass medium shall have the right to refuse to publish the refutation or make it public only in such cases where the content of the refutation contradicts good morals.

3. The request to redress the property or non-property non-pecuniary damage shall be investigated by the court irrespective of the fact whether the person who has disseminated such data refuted them or not.

4. Where a mass medium refuses to publish the refutation or make it public in some other way or fails to do it in the term provided in paragraph 2 of the given Article, the person gains the right to apply to court in accordance with the procedure established in paragraph 1 of the given Article. The court shall establish the procedure and the term for the refutation of the data, which were erroneous or abased other person’s reputation.

5. The mass medium, which publicised erroneous data abasing person’s reputation shall have to redress property and non-pecuniary damage incurred on the person only in those cases, when it knew or had to know that the data were erroneous as well as in those cases when the data were made public by its employees or the data was made public anonymously and the mass medium refuses to name the person who supplied the said data.

6. The person who made a public announcement of erroneous data shall be exempted from civil liability in cases when the publicised data is related to a public person and his state or public activities and the person who made them public proves that his actions were in good faith and meant to introduce the person and his activities to the public.

7. Where the court judgement, which obliges the refutation of erroneous data abasing person’s honour and dignity, is not executed , the court may issue an order to recover a fine from the defendant for each day of default. The amount of the fine shall be established by the court. It shall be recovered for the benefit of the defendant irrespective of the redress for the inflicted damage.

8. Provisions of the given article shall, too, be applied to protect the tarnished professional reputation of a legal person.

9. Provisions of the given article shall not be applied to those participants of judicial proceedings who are not held responsible for the speeches delivered at court hearings or data made public in judicial documents.

Article 2.25. Right to the Inviolability and Integrity of the Person

1. A natural person shall be inviolable. No natural person may be made to undergo scientific or medical test or examination against his will and without his free consent (in cases of person’s incapability – without consent of his legal representative). Such consent shall be given in writing.

2. Intervention into a human body, removal of parts of his body or organs shall be possible only with his consent. Consent to a surgical operation shall be given in writing. Where a person is incapable his guardian shall give his consent, in the event of castration, sterilisation, abortion, operation, removal of organs of an incapable person, however, authorisation of the court shall be necessary. Such consent shall not be necessary in emergency cases when person’s life is endangered and has to be saved while the person himself is unable to express his will.

3. A natural person may determine, in writing, the nature of his funeral and the disposal of his body after his death.

4. The procedure for the donation and transplantation of human tissues and organs is established in a separate law.

5. Human body, its parts or organs and tissues may not become subjects of commercial contracts. Such contracts shall be deemed null and void.

6. The person whose right to the inviolability of and integrity of his person has been infringed shall enjoy the right to request the guilty persons to redress property and non-pecuniary damage incurred on him.

Article 2.26. Prohibition to Restrict the Freedom of a Natural Person

1. Freedom of a natural person shall be inviolable. A capable person may be placed under any supervision or imposed any restrictions only after his consent has been given as well as in other cases prescribed by law.

2. Where a person’s life is endangered or he has to be hospitalised to protect the public interests person’s consent to the medical care shall not be required.

3. Psychiatric examination of a person may be conducted only with his consent or after the authorisation of the court has been granted. Consent to conduct psychiatric examination of an incapable person may be given by his guardian or by the court. Where a person’s life is seriously endangered urgent psychiatric care may be taken without person’s consent.

4. A person may be confined in a psychiatric institution only with his consent and after the authorisation of the court has been granted. Where a person is seriously ill with a mental disease and where there is a real danger that his actions may cause considerable damage to his or other people’s health or life and property, the person may be hospitalised in a compulsory manner for the period not exceeding two days. Compulsory hospitalisation may be extended only after the authorisation of the court in accordance with the procedure prescribed by law has been granted. Where a person is incapable, his guardian may give his consent to the said person’s compulsory hospitalisation for the period not exceeding two days. Compulsory hospitalisation of an incapable person may be extended only after the authorisation of the court following the procedure prescribed by law has been granted.

5. Persons who unlawfully imposed restrictions on the freedom of a natural person shall have to redress property and non-pecuniary damage incurred on the said person.

Article 2.27. Right to the Change of the Designation of Sex

1. An unmarried natural person of full age enjoys the right to the change of designation of sex in cases when it is feasible from the medical point of view. The application to the given effect shall have to be made in writing.

2. The conditions and the procedure for the change of designation of sex shall be prescribed by law.

CHAPTER THREE

RECOGNITION OF PERSON’S ABSENCE OR DECLARATORY JUDGEMENT OF DEATH

Article 2.28 Recognition of person’s absence

1. Where for the period of one year in person’s domicile there is no information about his whereabouts the court may recognise the person to be an absentee.

2. Where there is no possibility to establish the day when the last data about an absentee have been received, the first of January of the following year shall be deemed to be the beginning of person’s absence.

Article 2.29. Protection of the Property of an Absentee

1. After application of the interested persons or the public prosecutor has been filed, the court shall appoint a temporary administrator of absentee’s property. Absentee’s spouse, close relatives or person’s who are motivated to preserve his property may be appointed temporary administrators. The temporary administrator must take the inventory of the property and take measures to safeguard it. The court shall establish the amount of remuneration for the administrator’s services with the exception of cases where the temporary administrator is person’s spouse or a close relative. They shall fulfil the said functions free of charge.

2. Temporary administrator shall administer the property, shall maintain the persons whom the absentee is obliged to maintain and shall pay the absentee’s debts. Temporary administrator shall have to obtain the authorisation of the court to dispose of the property, mortgage it or restrict the right to property in some other manner.

3. Where the absentee’s property is an enterprise the court shall appoint its administrator. The administrator shall act in his owner’s name.

4. Where the court gives a judgement that the person is recognised an absentee, a permanent administrator to his property shall be appointed by the court judgement.

5. A person may be appointed an administrator to the property only with his consent.

Article 2.30. Revocation of the Judgement to Recognise the Person an Absentee

1. In the event that an absentee returns or his whereabouts become known the court shall revoke its judgement to recognise the person an absentee and the administration to his property.

2. Revenues received by the administrator from the property of the absentee shall be recovered by the owner of the property who has returned and who has to reimburse the property administrator for all expenses related to the administration thereof.

Article 2.31. Declaratory Judgement of Death

1. In the event that no information on person’s whereabouts is obtained in his domicile for a period of three years and where he disappeared under such circumstances, which posed a mortal threat or give the grounds to suspect that he was killed in an accident, and no information about the person has been obtained for a period of six months, a declaratory judgement of natural person’s death may be pronounced. The beginning of the said term is established in accordance with the rules laid down in paragraph 2 of Article 2.28 of the given Code.

2. A soldier or other person who disappeared as a result of military actions may in judicial proceedings be declared dead but not earlier than two years as of the day of the end of military actions.

3. A declaratory judgement of death may be pronounced for a person irrespective of the fact whether he was or was not recognised an absentee.

4. The date of death for a person for whom a declaratory judgement of death was pronounced shall be deemed the day when the court judgement becomes res judicata . Where a declaratory judgement of death is pronounced for a person who disappeared under such circumstances, which posed mortal threat or give grounds to suspect that he was killed in an accident the court may consider the alleged day of the accident to be the date of his death.

5. Specific location pointed out in the court judgement shall be considered to be the location of such person’s death. Where it is impossible to establish a specific location of person’s death the last known location of his whereabouts is deemed to be the location of his death.

6. From the point of view of person’s civil rights and obligations, pronouncement of a declaratory judgement of his death shall equal the act of person’s death.

Article 2.32. Consequences of the Return of a Person who was Declared Dead

1. Where a person who was declared dead returns or his whereabouts become known the court revokes its judgement to declare the person dead.

2. The person who has returned shall not have the right to request the recovery of his property, which has been inherited after a declaratory judgement of death was pronounced. However, in cases where a person was absent for serious reasons he shall enjoy the right, irrespective of the time of his return, to request the recovery of his property which is in possession of his heirs.

3. A person who has returned shall also enjoy the right to request either the recovery of his property, which was gratuitously received by the third persons, or its value. He shall have, however, to compensate the person, who, in good faith, was in possession of his property, for all losses related to the recovery of the said property or its value.

PART II

LEGAL PERSONS

CHAPTER IV

GENERAL PROVISIONS

Article 2.33. Concept of a Legal Person

1. A legal person shall be an enterprise or an organisation which has its business name, which may in its name gain and enjoy rights and assume obligations as well as act as a defendant and as a plaintiff in courts.

2. Provisions of the PART II of the given book shall be applied to individual juridical forms of legal persons except as otherwise provided by the provisions of the given Code.

3. Incorporation, management, reorganization, restructuring, and liquidation of legal persons specified in the Law on Enterprises and Facilities of Strategic Importance to National Security and Other Enterprises Important to Ensuring National Security shall be regulated by this Code to the extent the Law on Enterprises and Facilities of Strategic Importance to National Security and Other Enterprises Important to Ensuring National Security does not provide otherwise.

Article 2.34. Public and Private Persons

1. Legal persons shall be divided into public and private persons.

2. Public legal persons shall be legal persons established by the state or municipalities, their institutions or other non-profit-seeking persons whose goal is to meet public interests (state and municipality enterprises, state or municipality institutions, public institutions, religious communities, etc.).

3. Private legal persons shall be legal persons, which aim at meeting private interests.

4. Chapter VII of the given book shall be applied to the public legal persons in a subsidiary manner.

5. Chapter IX of the given book shall not be applied to the public legal persons.

Article 2.35. State and Municipalities

1. The state and municipalities shall be legal persons.

2. State and municipality institutions the existence whereof is prescribed by the Constitution of the Republic of Lithuania shall be legal persons in the cases prescribed by law.

3. With the exception of Articles 2.36, 2.74, 2.76, 2.80, 2.84, 2.85 Provisions of the Part II of the given book shall not be applied to the state and municipalities.

4. State and municipality institutions specified in paragraph 2 of the given Article shall file with the register of legal persons documents and data, laid down in Articles 2.46 and 2.66 of the given Code.

Article 2.36. Participation of the State and Municipalities in Civil Relations.

1. State, municipalities and their institutions shall be subjects of civil relations subject to the same grounds as other participants thereof.

2. The state and municipalities shall gain civil rights, assume civil duties and implement them through respective public and municipality administration institutions.

Article 2.37. Religious Communities and Associations

1. Traditional religious communities and associations shall be legal persons. Other religious communities and associations gain the rights of a legal person in accordance with the procedure established in Chapter V of the given book as well as in other laws.

2. Structural units of religious communities and associations, which pursuant to the regulations of communities and associations, statutes or other norms fulfil the requirements provided in Article 2.33 of the given Code, shall be legal persons. These structural units shall file documents, testifying to their compliance with the requirements specified in the given paragraph, with the register of legal persons.

3. Religious communities and associations and their structural units, which enjoy the rights of a legal person, shall act pursuant to their regulations, statutes and other norms inasmuch as they do not infringe the laws, and only Chapters IV and VI , Articles 2.84, 2.85 shall be applied to the said legal persons as well as Chapter V but only inasmuch as it fails to contradict the provisions of paragraph I of the given Article.

Article 2.38. Trade Unions

1. Where the requirements of paragraph 2 of the given Article are fulfilled trade unions shall be considered to be legal persons.

2. A trade union shall be formed when it has no less than 20 founders or when the founders would account for no less than one tenth of all employees in an enterprise, an institution or an organisation (while one tenth of all employees would account for no less than three employees) and if the general meeting of the trade union approves its statute and elects its managing bodies.

3. Citizens of the Republic of Lithuania or natural persons domiciled in the Republic of Lithuania who are not younger than fourteen years of age and are employed on the basis of labour contracts or some other basis may be founders of a trade union.

4. Provisions of Chapter V of the given book shall be applied to trade unions inasmuch as they fail to contradict the provisions of paragraph 1 of the given Article. Trade unions shall file documents testifying to their compliance with the requirements laid down in paragraph 2 of the given Article with the register of legal persons.

Article 2.39. Business Name of a Legal Person

1. A legal person shall possess its business name enabling to distinguish it from other legal persons.

2. Business name of a legal person shall be its property, which, however, may not be sold or conveyed in any other manner to become the property of the other person separately from the legal person.

3. Business name of a legal person may not contradict the public order or good morals or mislead the society as to its incorporator, co-owner, registered office, purpose of activities, juridical form, identity of the legal person or similarity to business names of other legal persons, business names of foreign enterprises, institutions and organisations, as well as trademarks and service marks which are familiar to the Lithuanian society. Business name of a legal person may not mislead by its identity or similarity to the recognised well-known trademarks and service marks which were submitted for registration, and were registered prior to the said legal person.

4. Where provisions of paragraph 3 of Article 2.46 of the given Code must be applied, business name of a legal person shall not be registered separately and shall be protected as of the day on which an application for the registration of a legal person is filed with the register of legal persons or a legal act has been adopted.

5. Regulations of the register of legal persons may establish additional requirements for the business name of legal persons.

Article 2.40. Composition of the Business Name of Legal Person

1. Business name of a legal person is composed of words or word-combinations used in their figurative or direct meaning.

2. Business name of a legal person shall be composed by taking into consideration the norms of standard Lithuanian and shall not be composed of a generic word (or words) denoting directly the sort of objects or services of activity or a single toponym or of some other word which fails to possess a distinctive feature.

3. Business name of a legal person may be composed only of letters, which may not be understood as words and numerals or their combinations only in cases when such business name is customary in the society. Where the consent has been given, business name of a legal person which is related to a foreign legal person or other organisation may be composed in such manner which would make the said name identical or similar to the business name of a foreign legal person or other organisation.

Article 2.41. Business Name of a Legal Person which is in the Process of Incorporation

1. Incorporators of a legal person may apply to the register of natural persons and request to make a temporary entry of the business name of a legal person, which is in the process of incorporation, in the register of legal persons.

2. Business name of a legal person, which is in the process of incorporation, shall be subject to the same rules as the business name of a legal person with the exception of paragraph 4 of Article 2.39 and Article 2.42 of the given Code.

3. Entry of a business name of a legal person, which is in the process of incorporation shall be made in the register of legal persons for the period of six months and upon its expiry shall be deleted without prior notification thereof to the founders of the legal person.

Article 2.42. Right to the Business Name of a Legal Person

1. It shall be prohibited to gain rights and assume obligations by using other legal person’s business name as a cover or to use other legal person’s business name without the latter’s consent.

2. Where legal person’s right to a business name has been infringed by other person’s unlawful use of the said person’s business name or where the other person has or uses a business name, which fails to meet the requirements laid down in Article 2.39 of the given Code, the legal person shall have the right to apply to the court and request the court to oblige the legal person to discontinue the said unlawful acts or alter the business name and to redress the property and non-pecuniary damage incurred by the said acts, while in the event that provisions of paragraph 1 of the given Article have been infringed – to request the person to return everything he has acquired by using other person’s name as a cover or using the said name without the latter’s consent.

Article 2.43. Alteration of the Business Name of a Legal Person

1. Prior to the alteration of the business name a legal person shall have, one time, to make a public announcement thereof or notify, in writing, all creditors of the legal person.

2. Where a legal person fails to discharge its obligation stipulated in paragraph 1 of the given Article he shall have to suffer the ensuing negative consequences related to its failure to notify about the alteration of its business name.

3. The business name of a legal person shall be altered alongside with the alteration of incorporation documents, which are filed with the Register of legal persons only after the requirements of paragraph 1 of the given Article have been fulfilled.

4. A legal person shall have the right to apply to the Register of legal persons and request to make a temporary entry in the Register of legal persons of the planned new business name. In such cases the provisions of Article 2.41 of the given Code shall be applied mutatis mutandis

Article 2.44. Information Supplied in the Documents of a Legal Person

1. Documents of a legal person used in his business relations with other subjects (business letters, invoices, trade documents etc.) shall have to supply the following information:

1) business name of a legal person;

2) juridical form of a legal person;

3) head office of a legal person;

4) code of a legal person;

5) Register which stores and safeguards the data on the given legal person.

2. Where a legal person has declared bankruptcy or is liquidated the information thereof must be indicated in the documents specified in paragraph 1 of the given Article.

3. Where a legal person has to pay value-added tax, the payer’s code shall have to be indicated in the documents specified in paragraph 1 of the given Article.

4. Where the assets of a legal person are mentioned in the documents specified in paragraph 1 of the given Article, authorised capital and the amount of paid-in authorised capital shall have to be indicated as well.

Article 2.45. Member of the Legal Person

1. A member of a legal person (shareholder, member, part-owner etc.) shall be the person, which enjoys the right of ownership to the property of a legal person, or the person, who, irrespective of his failure to maintain the right of ownership to the property of a legal person, acquires the obligatory rights and duties related to the legal person.

Article 2.46. Documents of Incorporation of a Legal Person

1. Legal persons shall act in accordance with the documents of their incorporation: articles of incorporation, incorporation contract or in cases provided by law – general regulations. According to the provisions of the given Code articles of incorporation shall have equal status with the regulations, statutes and other incorporation documents of legal persons.

2. Provisions of incorporation documents shall be valid inasmuch as they do not contravene the mandatory provisions of laws.

3. Public legal persons may act in accordance with the law or, where the law provides for it, in accordance with the legal act on the incorporation of a public legal person adopted by the state or municipalities if the said act does not provide for the obligation of a public legal person to act in accordance with the statutes approved by the state or municipality institutions.

4. Where incorporation documents of a legal person are not filed with the Register of legal persons within six months after they have been drafted and where other laws fail to provide for a different time limit, they shall be deemed void.

5. Identity of signatures of natural persons who have signed the incorporation documents of a legal person shall have to be approved by a notary with the exception of derogations provided by the law.

Article 2.47. Articles of Incorporation of a Legal Person

1. Articles of incorporation and in the event that a legal person fails to have articles of incorporation – incorporation contract or general regulations, where a legal person acts in accordance with the general regulations, or a legal act, where a legal person acts in accordance with the legal act, shall have to supply the following information:

1) business name of a legal person;

2) juridical form of a legal person;

3) repealed;

4) goals of activities of a legal person;

5) competence of the general meeting of members of a legal person and the procedure for its convening;

6) bodies of a legal person and the procedure for their formation and dissolution or, where the bodies are not formed and the legal person exercises its rights through a member of a legal person – member of a legal person;

7) the procedure for the alteration of the incorporation documents of a legal person;

8) where the term of activities of a legal person is restricted, the term of its activities;

9) other provisions laid down in the laws, the incorporator or a member of a legal person.

2. Goals of the activities of public legal persons shall have to be defined in a clear and comprehensive manner including the field and form thereof.

3. It shall not be necessary to indicate the procedure for convening a general meeting of the members of a legal person and the competence of a general meeting, the procedure for setting up and dissolving other bodies of a legal person and their competence, the procedure for making changes in the documents of incorporation, if such procedure is identical to the procedure provided for by the law and where the given fact is indicated in the articles of incorporation.

Article 2.48. Property of legal persons

1. Property of legal persons shall be administered, used and disposed of on the basis of the ownership right or the right of trust.

2. Property, which is administered, used and disposed of on the basis of the right of trust shall be owned by the incorporator of a legal person or its member on the basis of the ownership right.

Article 2.49. Registered Office of a Legal Person

1. Registered office of a legal person shall be the seat of its principal managing body. Registered office of a legal person shall be defined by indicating the address of the premises in which the head office is located.

2. Where the registered office of a legal person indicated in the register of legal persons or the contract and the seat of its principal managing body fail to coincide, the third parties shall enjoy the right to consider the seat of its principal managing body to be the registered office of a legal person.

3. All correspondence with a legal person shall be deemed appropriate where the address of the registered office is used as well as where due regard of paragraph 2 of the given article is taken except as otherwise provided by a legal person.

4. A decision regarding the registered office of a legal person shall be taken by incorporators. A decision to change the registered office a legal person shall be taken in accordance with the procedure laid down by the incorporation documents of a legal person, unless laws regulating activities of individual legal persons provide otherwise.

Article 2.50. Contractual Liability of Legal Persons

1. A legal person shall be liable for his obligations by his property, which it owns on the basis of the ownership right or right of trust

2. A legal person shall not be liable for the obligations of its member and the latter shall not be liable for the obligations of the legal person with the exception of cases provided by the law and incorporation documents of a legal person.

3. Where a legal person fails to perform his obligations due to acts in bad faith of a member of the legal person, the member of a legal person shall, in a subsidiary manner, be liable for the obligations of a legal person by his property.

4. Legal persons shall be divided into persons of limited and unlimited civil liability. Where the property of a legal person of unlimited civil liability is not sufficient to discharge its obligations, a member of a legal person shall be liable for the said obligations. Personal (individual) enterprise and commercial partnership shall be legal persons of unlimited civil liability.

Article 2.51. Term of the Activities of a Legal Person

1. A legal person may be incorporated for a fixed or open-ended term. Date as well as presence or absence of certain conditions may be considered to be the term.

2. Where documents of incorporation of a legal person fail to indicate that the legal person has been incorporated for a fixed period of time such legal person shall be considered incorporated for an open-ended term.

Article 2.52. Financial Year of a Legal Person

1. Financial year of a legal person shall be the calendar year.

2. Any other period of twelve months may be considered to be the financial year of a legal person.

3. Where the financial year is changed, the end of the financial year shall be considered to be the end of the new financial year if the period from the beginning of the financial year to the end of the new financial year is not longer than eighteen months. Where such period is longer than eighteen months, transitional financial year shall be set and its beginning shall be the end of the previous financial year whereas the end of it – the beginning of the new financial year.

4. Upon the incorporation of a legal person, the first financial year of a legal person shall be the period from the day of its incorporation to the end of the financial year. With the expiry of the term of a legal person the period from the beginning of the financial year to the day of the expiry of the term of a natural person shall be considered to be the last financial year.

5. Financial year of a legal person may not be altered more frequently than one time in five years. Where a legal person changes its financial year for a financial year coinciding with the calendar year, the given provision shall not be applied.

Article 2.53. Branch Office of a Legal Person

1. Branch office of a legal person shall be its structural unit, which has its registered office and performs all or part of legal person’s the functions.

2. Branch office of a legal person shall not be a legal person. The legal person shall be liable for the obligations of the branch office and the branch office shall be liable for the obligations of the legal person.

Article 2.54. Regulations of the Branch Office of a Legal Person

1. Branch office of a legal person shall act in accordance with the regulations approved by a legal person. They must contain the following information:

1) business name of the branch office;

2) repealed

3) goals of activities of the branch office;

4) managing body of the branch office and its competence;

5) term of the activities of the branch office (where it is fixed

6) other provisions established by the law or a legal person.

2. Regulations of the branch office of a legal person shall also provide information specified in subparagraphs 1, 2, 4 and 5 of paragraph 1 of Article 2.44 of the given Code on the founder of the branch office and on the managing body of a legal person, which enjoys the right to form or dissolve managing bodies of the branch office and make decisions on the legal status of the branch office.

Article 2.55. Regulation of Branch Offices

1. Provisions of PART II of the given book shall be applied to the branch offices and their activities inasmuch as they do not contradict the essence of a branch office and by taking due regard of peculiar provisions laid down in the given Article.

2. Documents of the branch office listed in Article 2.44 of the given Code shall also contain analogous information about the legal person, with the exception of information specified in paragraph 3 of Article 2.44 of the given Code in cases, where a foreign legal person or other organisation is the founder of the branch office.

3. Upon the registration of a branch office a foreign legal person or other organisation must to notify the Register of legal persons about the alterations in the legal person’s documents and data which were filed with the Register, and the legal status of a legal person or other organisation, must present a set of annual financial statements of a legal person, other organisation or branch office, if a set of annual financial statements of a foreign legal person or other organisation is compiled in accordance with the requirements other than those applied in the European Union, and financial reporting is mandatory under laws of the Republic of Lithuania which are applied to a foreign legal person or other organisation.

Article 2.56. Representative Office of a Legal Person

1. Representative office of a legal person shall be a unit of a legal person, which shall have its registered office enjoy the right to perform all operations specified in paragraph 2 of the given Article.

2. Representative office of a legal person shall have the right to represent the interests of a legal person and safeguard them, to enter into contracts as well as perform other operations in legal person’s name, to conduct import and export operations exclusively between foreign legal persons and other organisations, which have established the branch office or related enterprises, institutions or organisations and the branch office.

3. Representative office of a legal person shall not be a legal person.

Article 2.57. Regulations of a Representative Office of a Legal Person

1.Representative office of a legal person shall act pursuant to the regulations approved by a legal person which have to indicate:

1) business name of a representative office;

2) registered office of a representative office;

3) goals of activities of a representative office;

4) managing body of a representative office and its competence;

5) period of activities of a representative office where it is limited;

6) other provisions established by the law or a legal person.

2.Regulations of the representative office of a legal person shall also include information specified in Article 2.24 of the given Code about its founder and about the managing body which has the right to form and dissolve managing bodies and make decisions on the legal status of a representative office.

Article 2.58. Regulation of the Representative Office of a Legal Person

1. Provisions of Part II of the given book shall be applied to representative offices inasmuch as they do not contradict the essence of a representative office and by taking due regard of peculiar provisions laid down in the given Article.

2. Documents of a representative office listed in Article 2.44 of the given Code must also contain similar information about a legal person, with the exception of information specified in paragraph 3 of Article 2.44 of the given Code in cases, where the founder of a representative office is a foreign legal person or other organisation.

3. Upon registration of a representative office a foreign legal person or other organisation must notify the Register of legal persons about the alterations of legal person’s documents and data filed with the Register as well as about the legal status of a legal person.

CHAPTER V

INCORPORATION OF A LEGAL PERSON

Article 2.59. Procedure for the Incorporation of a Legal Person

Legal persons shall be incorporated pursuant to the procedure established by the law and the given Code.

Article 2.60. Incorporators of a Legal Person

1. Incorporator of a legal person shall be a person who has concluded a contract for the incorporation of a legal person. Upon passing a respective law or, where it is provided for by the law, other legal act, the state, or, where it is provided by the law, a municipality, public or local self-government institutions upon passing a respective legal act, which forms the basis for the incorporation of a public legal person, shall, too, be considered the incorporators of a legal person.

2. Natural and legal persons may be incorporators of a legal person.

3. The law may provide for cases, where for the purpose of protection of public order or where retaliatory action is taken, a foreign legal person, other organisation or a foreigner may not be an incorporator or a member of legal persons.

Article 2.61. Contracts Concluded Prior to the Incorporation of a Legal Person

1. A special managing body of a legal person or some other body defined in the incorporation document shall have the right to approve contracts, which in a legal person’s name were concluded by other persons prior to the incorporation of a legal person. When such contract is concluded it should be indicated that it is concluded in a legal person’s name and in its interests. Where such reference fails to be included the person who has concluded the contract and the legal person, whose managing body or some other body defined in the incorporation document approved the contract concluded in its interest, shall have solidarity obligation to discharge their contractual obligations.

2. Where such contract fails to be approved by the body of the legal person which was incorporated at a later date all obligations arising from the contract shall have to be discharged by the person who has concluded the said contract. Where such contract has been entered into by some persons and where a legal persons fails to approve it all persons shall have the solidarity obligation to discharge obligations arising from the said contract.

Article 2.62. Register of Legal Persons

1. Legal person shall have to be registered with the Register of legal persons.

2. Register of legal persons shall file legal persons and store data thereof. Register of legal persons shall be the principal register of the state.

3. Register of legal persons must be supplied with all data prescribed by the law on legal persons themselves and their activities (principle of disclosure).

4. A head institution for the administration of the Register of legal persons and an institution for the administration of the Register (registrar of the Register) shall be defined by the law .

Article 2.63. Moment of Incorporation of a Legal Person

1. A legal person shall be deemed incorporated as of the moment of its registration with the Register of legal persons.

2. In cases prescribed by the law or laws, other legal act which formed the basis for the incorporation of public legal person may establish that a legal person is deemed incorporated after the act forming the basis for the incorporation has entered into force. In such cases the said legal act must contain the data laid down in Article 2.66 of the given Code and the said legal act has to be published and produced to the Register of legal persons.

Article 2.64. Registration of Legal Persons

1. A legal person shall be registered with the Register of legal persons after documents listed in paragraph 2 of the given Article have been produced except as otherwise provided by other laws in relation to cases established by the provisions of the given Code.

2. The following documents shall have to be produced to the Register of legal persons for the registration of a legal person:

1) application of the established form for the registration of a legal person;

2) incorporation documents of a legal person;

3) licence, where issuance of a licence prior to the incorporation of a legal person is provided for by the law;

4) documents verifying the authenticity of documents which are produced to the Register and the compliance of incorporation documents with the provisions of laws as well as documents verifying the fact that a legal person may be registered because contractual obligations assumed in the incorporation contract have been fulfilled and the circumstances prescribed by the law and incorporation documents have emerged;

5) repealed

6) other documents prescribed by the law.

3. A legal person must be registered within 3 working days from the day on which all documents listed in Paragraph 2 of the given Article are produced and a registration fee is paid.

4. Regulations of the Register of legal persons shall establish the procedure for the registration of legal persons.

5. A fee shall be paid for registration of legal persons, their representative offices and branch offices, registration of alterations of their data, information and incorporation documents. A rate of the fee shall be fixed by the Government.

6. A legal person may be removed from the Register only on the expiry of the term of a legal person.

Article 2.65. Code of a Legal Person

Upon registration of a legal person, the registrar of the Register shall give a legal person a code of a legal person and shall issue an extract from the Register of legal persons.

Article 2.66. Data of the Register of Legal Persons

1. Register of legal persons shall have to include:

1) business name of a legal person;

2) juridical form of a legal person;

3) code of a legal person;

4) registered office of a legal person;

5) bodies of a legal person;

6) members of managing bodies of a legal person (name, surname, personal code, place of residence);

7) members of managing bodies of a legal person and members of a legal person having the right to conclude contracts in the legal person’s name, limits of authority;

8) branch offices and representative offices of a legal person (names, codes, registered offices, members of managing bodies of branch offices and representative offices);

9) restrictions on the activities of a legal person;

10) legal status of a legal person;

11) expiry of the term of a legal person;

12) dates of alterations in the data filed with the register and dates of the alteration of documents;

13) a financial year of a legal person;

14) other data prescribed by the law.

2. Where legal persons the members whereof are liable for contractual obligations of a legal person are registered, additional information on a member, a natural person, of a legal person shall be furnished: name, surname, personal code, residence or business name of a legal person, juridical form, code and registered office.

3. Where the data, listed in paragraphs 1 and 2 of the given Article has been altered and where incorporation documents or other data listed in paragraphs 1 and 2 of the given Article has been altered, a legal person must file an application of the established form requesting the registration of the alterations with the Register of legal persons within thirty days as of the day the alterations have been made. Documents listed in point 4 paragraph 2 of Article 2.64 of the given Code and full text of the altered document, where the document has been altered, must be produced together with the application requesting the registration of the alterations.

4. A set of annual financial statements (a set of consolidated financial statements) and an annual report (a consolidated annual report) of an enterprise shall be produced to the Register of legal persons every year within thirty days from the day of their approval, except as otherwise provided for by the law.

5. Alterations in the data listed in points 5-7 and 11 of paragraph 1 of the given Article as well as alterations of documents shall enter into force only upon their registration with the Register of legal persons with the exception of derogations provided by the law.

Article 2.67. Persons Responsible for the Production of Documents of a Legal Person and the Data of the Register to the Registrar of the Register

1. Managing body of a legal person shall be responsible for the timely production of documents of a natural person, data and other requested information to the Register of legal persons except as otherwise provided by the law or incorporation documents.

Article 2.68. Refusal to Register

1. The registrar may refuse to register a legal person or the alterations in the data and documents of a legal person only in cases where:

1) the application to register a legal person (alterations of data and documents to be registered with the register, removal of data) fails to conform to the established form or not all documents specified in Articles 2.63 and 2.64 are produced;

2) the term specified in paragraph 4 of Article 2.46 of the given Code has expired;

3) data and documents produced to the Register are not in conformity with one another, are vague or misleading;

4) form or content of the documents fail to conform to the requirements provided for by law.

2. Where obstacles for the registration of the produced documents and data arise, the registrar shall set a time limit for the elimination of defects. Where the defects are not eliminated within the established time limit and corrected documents are not produced to the registrar, the registrar makes a motivated decision to refuse the registration of a legal person (alterations in data or documents).

3. Decision to refuse registration of a legal person (data to be registered in the register or alterations in documents) shall be appealed to the court in accordance with the procedure established by the law.

Article 2.69. Rectification of the Register of Legal Persons

1. Errors in the Register of legal persons shall be rectified on the application of a legal person or a person whose data has been inserted in the Register or on the initiative of the registrar.

2. Upon the detection of an error in the Register, the registrar shall have, without delay, to notify, in writing, a legal person. Where a legal person fails to raise objections within the time limit set by the registrar for the rectification of the error, the registrar shall rectify the data in the register.

3. In the event that a legal person, the data whereof has been registered with the Register, requests the rectification of an error in the Register, the registrar shall have to rectify the data in the Register within three business days as of the day, on which the application and the documents verifying the facts have been received.

4. The registrar shall have to notify, where applicable, the persons who were given erroneous data about the rectification of the mistake in the Register.

Article 2.70. Liquidation of a Legal Person on the Initiative of the Registrar of Legal Persons.

1. Where a legal person registered with the Register fails to renew its data in the Register of legal persons within five years and where there are grounds to presume that the said legal person has stopped its activities or where an enterprise failed to produce documents of financial accountability, which were specified in paragraph 4 of Article 2.66 of the given Code for a period exceeding twenty four months and failed to inform the administrator of the Register of legal persons about the reasons thereof or where management bodies failed to make decisions due to the lack of quorum after the resignation of the members of managing bodies of a legal person and the situation persists for more than six months or where members of managing bodies of a legal person may not be contacted at the registered office of a legal person or locations, the addresses of which have been produced to the Register of legal persons, the registrar of the Register shall have the right to initiate liquidation of a legal person.

2. The registrar of legal persons shall send a notification about the pending liquidation of the legal person to the registered office of a legal person or to the addresses of the members of managing bodies of a legal person which were produced to the register of legal persons as well as make the public announcement of the said notification in the source provided for in the regulations of the register of legal persons.

3. Where within three months following the public announcement of the pending liquidation of a legal person the registrar of legal person fails to receive objections to the pending liquidation of a legal person he applies to the court requesting to put the legal person into liquidation.

4. Requests of the registrar of the Register regarding liquidation of a legal person shall be considered in accordance with the procedure laid down in Chapter XXXIX of the Code of Civil Procedure.

Article 2.71. Publication of the Register of Legal Persons

1. Data of the Register of legal persons, documents stored in the register as well as any information supplied to the Register shall be made public.

2. A separate file shall be made up for each legal person. Documents, their copies produced to the Register, data and other information related to the given legal person shall be stored and safeguarded in the said file.

3. When the Register produces in a written form extracts of the data and information stored in the Register, a mark “attested extract” must be applied, and when it produces copies of the documents – a mark “attested copy” must be applied, except in cases where an applicant does not request the said mark. When the Register produces in an electronic form extracts of the data and information stored in the Register and copies of the documents a mark “attested extract” (“attested copy”) shall not be applied, except in cases where an applicant requests the said mark. When the registrar of the Register of Legal Persons produces extracts of the data and information, copies of the documents stored in the Register, the said extracts and copies shall have prima facie authority.

4. Every person shall have the right to receive, free of charge, oral information on the legal status of a legal person and restrictions imposed of his activities in accordance with the procedure established by the Register of legal persons.

Article 2.72. Procedure and Mode of Publication of the Data of the Register of Legal Persons

1. The registrar shall have to make a public announcement of the registration of a legal person, alteration of the data stored in the Register in accordance with the procedure established by the provisions of the Register of legal persons and in the source designated by the said provisions.

2. Copies of the data and documents stored in the Register of legal persons shall be issued pursuant to the procedure established by the regulations of the Register of legal persons.

3. Every person shall enjoy the right to be issued copies of any data, documents and information stored in the Register after a fee not exceeding the costs of the said work has been paid.

4. Data of the Register of legal person shall be issued free of charge:

1) to natural persons whose data are inserted in the Register – the Register stores the data about the said persons;

2) to law enforcement institutions, courts and tax administration institutions – inasmuch as they need such data for discharging their direct functions;

3) to other State registers and information systems – under data provision contracts.

5. a fee for the issuance of copies of the data and documents of legal persons shall not exceed the costs of the administration of the Register.

Article 2.73. Liability for Unlawful Refusal to Register a Legal Person and for Errors in the Register of Legal Persons

1. Where a legal person and the data produced to the Register or documents to be registered with the Register, are unlawfully refused registration a legal person shall have the right to seek a legal redress for the damage inflicted on him by the said actions.

2. Damage incurred by the actions specified in paragraph 1 of the given Article on a legal person as well as damage incurred on other persons in the administration of the Register of legal persons shall be redressed by the State. The said damage is recovered in judicial proceedings. Institution authorised by the State shall represent the State in civil cases for the award of damage.

CHAPTER VI

LEGAL CAPACITY OF LEGAL PERSONS

Article 2.74. Legal Capacity of Legal Persons

1. Private legal persons may be in possession of or achieve any civil rights and assume duties except those, which may emerge only when such characteristics of a natural person as gender, age and consanguinity are in place.

2. Public legal persons shall have a special legal capacity, i. e they may be in possession of or achieve only such civil rights and assume such duties, which are not at variance with their incorporation documents or goals of activities.

3. Provisions of paragraph 3 of Article 2.4 of the given Code shall be applied to legal persons mutatis mutandis.

Article 2.75. Restrictions on the Legal Capacity of Legal Persons

1. Legal Capacity of legal persons may not be imposed limitations in any other manner except as by express provision and procedure of law.

2. Legal Capacity of an individual legal person may be imposed limitations only by the court judgement.

Article 2.76. Prohibition of Discrimination

1. It shall be prohibited to establish in legal acts, for discrimination purposes, different rights, obligations or privileges for separate legal persons.

Article 2.77. Licensing of the Activities of Legal Persons

1. In cases provided by law legal persons may be engaged in a certain type of activities only after a licence has been granted in accordance with the procedure established by the law.

2. A legal person must be in possession of all licences (permits) which are defined in the law as a necessary prerequisite for its activities.

Article 2.78. Licensing Requirements

1. The Government approves licensing requirements for every licenced sphere of activities provided by law except as otherwise provided by other laws.

2. Licensing requirements shall indicate the following:

1) licenced activities;

2) licensing institution and its authority;

3) documents for the issuance of a licence;

4) procedure and term for the investigation of documents;

5) types of licences, conditions of their issuance, re-issuance of a licence;

6) forms of licences;

7) procedure for the registration of issued licences;

8) cases of refusal to issue a licence;

9) conditions of licenced activities;

10) procedure for the supervision of the observance of the conditions of a licence;

11) procedure and cases for the revocation and withdrawal of a licence.

3. Regulations of licensing may provide for other requirements and a different procedure.

Article 2.79. Issuance of a Licence

1. Where the requirements specified in the regulations of licensing are fulfilled an open-ended licence shall be issued.

2. Except as otherwise provided by law, licence for the engagement in a certain activity or a written motivated refusal to issue a licence shall be submitted to an applicant within thirty days as of the day on which the documents for the issuance of a licence were produced.

3. Refusal to issue a licence may not be based on the inexpediency of activities and has to be motivated.

4. Information on the issuance of a licence, its revocation and withdrawal shall be stored in the register of legal persons. The licensing authority must notify the register of legal persons about the issuance, revocation and withdrawal of licences in accordance with the procedure established by the regulations of the register of legal persons.

5. Upon the issuance of a licence a legal person must supply information specified in the licensing requirements and related to the licenced activities or conditions predetermining the issuance thereof and allow the institution for the supervision of licenced activities to verify it.

6. A state fee for the issuance of a licence shall not exceed the costs of the issuance of a licence and supervision thereof.

Article 2.80. Prohibition to Use Administrative Methods

1. Public or municipality institutions shall be prohibited, in cases not prescribed by law, to use methods of administrative regulation of the activities of legal persons.

2. Where, in accordance with the procedure prescribed by law, an emergency or martial law is declared or a certain territory is declared the region of disaster, legal persons must carry out the instructions of the Government or local self-government institution.

CHAPTER VII

BODIES OF A LEGAL PERSON

Article 2.81. Bodies of a Legal Person

1. Legal persons achieve civil rights, assume civil duties and implement them through their bodies which are formed and act in accordance with laws and documents of incorporation of legal persons

2. In cases prescribed by laws and incorporation documents legal persons may achieve civil rights and assume duties through their members.

3. Members of legal persons enjoy the right to institute an action at law requesting to prohibit the managing bodies of a legal person to enter into contracts which contravene the goals of the activities of a legal person or overstep the authority of a managing body of a legal person.

4. Only natural persons may be members of managing bodies of a legal person whereas both natural and legal persons may be members of other bodies.

Article 2.82. Authority and Functions of the Bodies of Legal Persons

1. Authority and functions of the natural persons’ bodies shall be established by the law and incorporation documents of a legal person, which regulate legal persons of a respective juridical form.

2. Where incorporation documents and laws regulating the activities of a legal person fail to provide a different structure of managing bodies, each legal person must have a single-person or a collegial managing body and the general meeting of members. Laws regulating individual juridical forms of legal persons may establish that an managing body and the general meeting of members may be considered to be the same body of a legal person.

3. A managing body shall be responsible for convocation of the general meeting of members of a legal person, notification of the members of a legal person about the essential events which are important for activities of a legal person, organisation of legal person’s activities, accounting of the members of a legal person and actions specified in paragraph 3 of Article 2.4 of the given Code, except as otherwise provided in laws regulating activities of individual legal persons.

4. Decisions of the bodies of a legal person may, in judicial proceedings, be declared void where they contravene the imperative provisions of the law, incorporation documents of a legal person or principles of reasonableness and good faith. Where the decision infringes their rights or interests, action can be taken by the creditors of a legal person, a respective managing body of a legal person, member of a legal person or other persons prescribed by the law. Three-month limitation of actions period shall be set for the said actions. It shall be counted as of the day on which the defendant found out or had to find out about the contested decision where the given Code and other laws fail to set another term of limitation of actions or a different procedure for the challenging of the decision.

Article 2.83. Contracts Concluded in Overstepping the Authority of Managing Bodies of a Private Legal Person

1. Contracts concluded by the managing bodies of a private legal person in overstepping their authority shall impose obligations on a legal person except in cases where it is proved that concluding the contract the third person was aware or due to certain circumstances may not have failed to be aware of the fact that the contract has been entered into by a managing body of a legal person who was not authorised to conclude it.

2. Paragraph 1 of the given Article shall not be applied where quantitative representation has been established, i.e. only some members of a managing body together or a member of a managing body and a representative together are authorised to act in the name of a legal person. Quantitative representation shall have to be provided in the incorporation documents of a legal person, specified in the register of legal persons and publicised in accordance with the procedure established by the regulations of the register of legal persons.

3. Where a legal person fails to satisfy fully the claim of a third person, the person who has concluded the contract under circumstances laid down in paragraph 1 of the given Article shall take on subsidiary liability.

Article 2.84. Contracts Concluded in Overstepping the Authority of Managing Bodies of a Public Legal Person

1. Contracts concluded by administrative bodies of a public legal person in overstepping their authority shall not impose obligations on a legal person.

2. Where, at a later date, the person approves the contract, the contract shall become valid as of the day of its conclusion.

3. A person who, under the circumstances laid down in paragraph 1 of the given Article, has concluded a contract, which is not approved by a legal person, must redress the damage incurred on the third person, if he fails to prove that concluding the contract the third person was aware or due to certain circumstances may not have failed to be aware of the fact that the contract has been concluded in overstepping the authority of the managing body of a legal person.

Article 2.85. Public Announcement of the Authority

Publication and indication in the Register of legal persons of the authority of managing bodies of legal persons which was stipulated in incorporation documents shall not affect the application of the provisions of Articles 2.83 and 2.84.

Article 2.86. Equality of Members of Legal Person’s Managing Bodies

Members of legal person’s managing body shall enjoy equal rights and obligations with the exception of the case specified in paragraph 2 of Article 2.93 of the given Code.

Article 2.87. Duties of Members of Legal Person’s Managing Bodies

1. Member of a legal person’s body shall have to act in good faith and reasonable manner in respect of the legal person and members of other legal person’s bodies.

2. Member of a managing body of a legal person shall have to be loyal to the legal person and maintain confidentiality.

3. Member of legal person’s managing body shall have to avoid a situation where his personal interests are contrary or may be contrary to the interests of a legal person.

4. Member of a managing body of a legal person may not confuse the property of a legal person with his own property and, without consent of members of a legal person, use the property or the information, which he obtains in the capacity of a member of legal person’s body, for his personal gain or third person’s gain.

5. A member of a managing body of a legal person must notify other members of the managing body of a legal person about the circumstances laid down in paragraph 3 of the given Article and define their nature and, where applicable, their value. Such information shall have to be supplied in writing or included into the minutes of the meeting of legal person’s bodies.

6. A member of a managing body of a legal person may enter into a contract with a legal person being in the capacity of a member of the said person’s body. He shall have, without delay, to notify other bodies of a legal person about the said contract in accordance with the procedure established in paragraph 5 of the given Article or members of a legal person where incorporation documents of a legal person fail to provide explicitly for a different procedure of notification.

7. A member of a managing body of a legal person who fails to perform or performs improperly his duties specified in the given Article or incorporation documents must redress all damage incurred on a legal person except as otherwise provided by law, incorporation documents, or an agreement.

Article 2.88. Agreements on the Voting of the Members of a Legal Person

1. Members of a legal person may conclude an agreement on general voting at the meeting of the members of a legal person. Agreements on voting are null and void where an obligation is assumed:

1) to vote according to instructions received from the managing bodies of a legal person;

2) to vote for all proposals made by the managing bodies of a legal person;

3) to vote according to instructions or abstain from voting for certain remuneration.

2. An agreement on voting may establish that parties to the said agreement may grant an authorisation to a third person to vote at the general meetings of the members of a legal person in the name of the parties to the agreement on voting, and such authorisation may be revoked only in cases provided for in the said agreement.

3. Upon the issuance of the authorisation in accordance with the provisions of paragraph 2 of the given Article, the parties to the agreement are deprived of the right to vote or to grant authorisation to other persons to vote at the meetings of members of legal person for issues specified in the authorisation.

4. Where provisions of an agreement on voting have been infringed by one party to the agreement the court is authorised to oblige re-counting of the results of voting at the meeting of members of a legal person in accordance with the agreement on voting and reverse the decision taken at the meeting of members of a legal person in cases where voting in violation of the agreement was decisive in arriving or not arriving at a certain decision.

Article 2.89. Transfer of a Voting Right

1. A member of a legal person may transfer his right to vote at the general meeting of members of a legal person to other persons and establish the procedure and modes of exercising the voting right.

2. An agreement on the transfer of the voting right enters into force as of disclosure to a legal person of the data on the number of transferred votes, time limit of transfer, grounds for the entitlement to the voting right, member of a legal person who transfers the right and the person who achieves the right (inasmuch as is provided in incorporation documents of a legal person, laws or the established practice of a legal person).

3. A legal person must notify the member of a legal person who transfers his voting right and the person who achieves it as well as, at the nearest meeting of members of a legal person, announce that he has received documents and information specified in paragraph 2 of the given Article. Obligations of a legal person related to the convening of the general meeting of members of a legal person are fulfilled in respect of the person who has achieved a voting right.

4. Term for an agreement on the transfer of a voting right may not exceed a period of ten years.

5. Other non-property rights enjoyed by a member of a legal person may, too, be transferred by an agreement on the transfer of voting rights.

Article 2.90. Minutes

1. Meetings of a legal person’s collegiate body shall keep the minutes.

2. The minutes shall include the time and place of a meeting, number of participants, the fact of having a quorum, results of voting, and decisions. The minutes shall have to be annexed by the list of participants and information on the convening of the meeting. On the request of participants of the meeting information specified by them shall have to be included into the minutes. All alterations and supplements shall have to be deliberated.

3. Minutes shall have to be stored no less than ten years and on the request of each participant or other member of a managing body who participated or was entitled to participate in the meeting a copy of the minutes shall have to be issued. A legal person shall have the right to demand from a member of a legal persona a fee, not exceeding the costs of its issuance, for the copy of minutes.

4. Where a decision is signed by all members of a managing body of a legal person or where only one person constitutes a body of an legal person and in this case a decision made by that member of a legal person equals a decision made by a managing body of a legal person, minutes shall not be taken.

5. Laws may provide for different or supplementary requirements for minutes compared to those, which are laid down in paragraph 2 of the given Article.

Article 2.91. Keeping and Signing of Minutes

1. Minutes shall be taken by a secretary of a meeting, a chairman of a meeting, where a secretary is not elected, or by a chairman of a collegiate managing body of a legal person where a chairman and secretary of a meeting are not elected.

2. Minutes are signed by the person who has taken it and by the chairman of a meeting and in cases where he is not elected – chairman of a collegiate managing body of a legal person.

3. Minutes shall be taken and signed within a time limit established in incorporation documents or laws and in all cases, however, must not exceed thirty days as of the day on which a meeting was convened.

Article 2.92. Remarks on the Minutes

1. Participants of a meeting shall enjoy the right to make remarks on the minutes within three days as of the moment they have read them but neither the period of three days nor the maximum time limit for taking minutes established in incorporation documents may be exceeded.

2. Remarks on the minutes shall be attached to the minutes together with the information whether persons who signed the minutes agree or disagree with them.

3. Failure to make remarks shall not preclude the right to contest decisions of the managing body of a legal person.

Article 2.93. Voting

1. Resolutions of collegiate bodies of a legal person shall be adopted by voting.

2. Equality of votes shall mean that the same number of votes “for” and the same number of votes “against” have been received. In cases of equality of votes, vote of the chairman of a collegiate body shall be decisive. Where the chairman of a collegiate body has not been designated or fails to participate in the resolution adopting process, the resolution, in the case of equality of votes, shall be deemed not adopted.

3. Where members of a collegiate body fail to raise objections voting could be done, in writing, in the form of an interview.

4. In urgent cases the court may designate members of a body of a legal person.

5. Member of a body of a legal person may vote himself or may authorise other persons to vote for him as his proxy except as otherwise provided in incorporation documents of a legal person.

6. Decision of a chairman of the sitting (meeting) of a legal person’s collegiate body on the results of voting shall be decisive except in the cases where the voting is held in writing or a commission for counting of votes is established. In such cases the decision of the commission shall be final. Where upon the announcement of the results of voting by the chairman of the sitting or the commission for counting of votes, doubts are expressed on the lawfulness of voting, repeated voting, upon the request by the majority of members of a collegiate body, must be done.

7. Laws and incorporation documents of a legal person may provide for a different procedure of voting.

8. Provisions of the given Article shall not be applied to the general meeting of shareholders.

Article 2.94. Verification of a Decision

Where, for purposes of validity of a resolution, approval of the body of other legal person may be requested, the said approval may be effected at a later date within a reasonable period of time.

CHAPTER VIII

TERMINATION AND RESTRUCTURING OF LEGAL PERSONS

Article 2.95. Termination of Legal Persons

1. Legal persons shall be terminated by way of liquidation or reorganisation.

2. Reorganisation shall be termination of a legal person without the liquidation procedure.

3. A legal person shall be terminated as of the day of its removal from the Register of legal persons.

Article 2.96. Reorganisation of Legal Persons

1. Resolution to reorganise a legal person shall be passed by members of a legal person or the court in cases provided by law.

2. Resolution to reorganise, by way of merger, a legal person, which is joined by other legal person, may, too, be passed by the managing body of a legal person where the given circumstances emerge.

1) Public announcement about the terms of reorganisation of legal persons laid down in paragraph 2 of Article 2.99 of the given Code shall be made no later than thirty days prior to the general meeting of members of a legal person, which is going to be merged.

2) Every member of a legal person shall have the right to acquaint himself with the documents specified in paragraph 4 of the given Article.

3) One or some members of a legal person with no less than 1/20 of votes at the general meeting of members of a legal person shall enjoy the right to request the convening of the general meeting of legal person’s members on the reorganisation, by way of merger, of a legal person.

3. Resolution to reorganise a legal person shall be passed by the qualified majority vote. It shall be set in the incorporation documents and may be no less than 2/3 of the votes given by the persons present at the general meeting. Subject to paragraph 1 of Article 2.101 of the given Code, resolution to reorganise a legal person may be passed only upon the expiry of a thirty days period following the public announcement that terms for the reorganisation have been set. Terms of reorganisation shall have to be approved by a resolution to reorganise a legal person and documents of incorporation shall have to be altered or new documents shall have to be drawn up.

4. Members of a legal person shall have the right to acquaint themselves with the terms of reorganisation, incorporation documents of legal persons who will continue the activities after the reorganisation or documents of newly incorporated legal persons or with their projects and reports drawn up by all managing bodies of legal persons participating in the reorganisation, assessments of experts as well as financial statement for the last three financial years. Where terms of the reorganisation were set six months following the end of the financial year of at least one legal person participating in the reorganisation, interim financial statement has to be issued in accordance with the same rules applied to the earlier financial statement and has to be presented to the members of a legal person. It shall be issued no earlier than three months prior to the setting of terms for the reorganisation. All members of a legal person shall have the right to receive copies of the said documents.

5. Managing bodies of legal persons shall have to notify members of legal persons about all essential changes after terms of reorganisation have been set and prior to taking decision on the reorganisation and attach this written notification to documents specified in paragraph 4 of the given Article as well as inform, orally, about essential changes in the general meeting of members of legal persons.

Article 2.97. Modes of Reorganisation of Legal Persons

1. Legal persons may be reorganised by way of merger and division.

2. Joining and consolidation shall be the possible modes of merger of a legal person.

3. Joining shall be merger of one or more legal persons to the other legal person, which become successors to all rights and obligations of the reorganised legal person.

4. Consolidation is a merger of two or more legal persons into a new legal person, which becomes a successor to all rights and obligations of reorganised legal persons.

5. Possible modes of splitting up of legal persons shall be division and parcelling out.

6. Parcelling out shall be parcelling out of legal person’s rights and obligations to other functioning legal persons.

7. Division shall be incorporation of two or more legal persons on the basis of the legal person under reorganisation, which become successors to certain parts of legal person’s rights and obligations.

8. Where the resolution to liquidate a legal person was not passed by the general meeting of the members of a legal person or where at least one member of a legal person became a successor to a part of property of a legal person under liquidation it shall be prohibited to reorganise such legal person under liquidation.

9. Specific character of reorganisation of individual legal persons may be prescribed by the laws, which regulate individual legal forms of legal persons.

Article 2.98. Reorganisation of Legal Persons of Different Legal Forms

1. Only legal persons of the same legal form may participate in the reorganisation procedures with the exception of derogations provided by laws regulating individual legal forms of legal persons.

2. Upon termination of a reorganised legal person whose members are liable for obligations of a legal person, members of the terminated and reorganised legal person shall, irrespective of the terms of reorganisation, accept subsidiary liability for the obligations of the dissolved legal person, which emerge prior to the legal person’s, who will continue activities of the dissolved legal person, becoming a successor to the rights and obligations of the terminated legal person. Where a member of a legal person fails to become a member of a legal person who, upon reorganisation, will continue the activities of the dissolved legal person throughout the reorganisation procedure as well as later, he shall not be exempted from the liability specified in the given paragraph.

Article 2.99. Terms of Reorganisation and Report on the Reorganisation

1. Managing bodies of legal persons participating in the reorganisation shall have to prepare the terms of reorganisation which have to indicate:

1) information, specified in Article 2.44. of the given Code, on all legal persons participating in the reorganisation;

2) mode of reorganisation, terminated legal persons and legal persons continuing the activities after reorganisation;

3) procedure for becoming a member of a legal person who continues activities after reorganisation, terms and time limit as well as payments to the members of a legal person;

4) moment from which a legal person continuing the activities becomes a successor to rights and obligations of a terminated legal person;

5) ancillary rights conferred to managing and other bodies of a legal person, employees of administration or experts specified in Article 2.100 if the given Code.

2. Public announcement of the terms of reorganisation shall be made subject to the provisions of paragraph 1 of Article 2.101 of the given Code and filed with the Register of legal persons no later than on the first day of publication by applying the provisions of paragraph 3 of Article 2.66 of the given Code mutatis mutandis.

3. Managing bodies of each legal person participating in the reorganisation shall have to draw up written reports, which have to indicate the goals of reorganisation, explain the terms of reorganisation, continuity of legal person’s activities, time limit for reorganisation and economic grounds.

4. Paragraph 3 of the given Article shall be applied only in those cases where a joint-stock company, participating in the reorganisation, or other persons whose members have no less than 1/20 of all votes request it.

Article 2.100. Assessment of the Terms of Reorganisation

1. Terms of the reorganisation of legal persons shall be assessed by independent experts who have the necessary qualifications, provided that this is set out in laws regulating activities of individual legal persons.

2. Independent experts shall be designated by each legal person participating in the reorganisation. Where there is a wish to designate a single expert for all legal persons under reorganisation such designation must be approved by the registrar of legal persons

Article 2.101. Protection of the Rights of Creditors of the Legal Persons under Reorganisation

1. Public announcement of the terms of reorganisation shall be made three times with at least three-month intervals between the announcements or public announcement shall be made once and all creditors of a legal person shall be given a written notice thereof. The notice shall indicate data specified in points 1, 2 and 4 of paragraph 1 of Article 2.99 of the given Code as well as information where and when documents listed in paragraph 4 of Article 2.96 are available.

2. A creditor of a legal person under reorganisation shall enjoy the right to request termination of the contract or performance of obligations before the expiry of the time limit as well as redress of damages, where this has been provided in the contract, and where there are grounds to presume that the performance of obligations may become more difficult due to reorganisation and where, on creditor’s request, a legal person failed to extend an additional guarantee for the performance of obligations.

3. Creditors of the person under reorganisation shall have the right to acquaint themselves with the documents specified in paragraph 4 of Article 2.96 of the given Code and receive their copies.

Article 2.102. Invalidity of Reorganisation

1. Only the court may declare reorganisation invalid and only in cases where the following circumstances emerge:

1) no public announcement of the respective documents of the reorganisation procedure has been made or they were not filed with the Register of legal persons;

2) resolutions on the reorganisation passed by the body of members of a legal person or other managing body are declared invalid;

3) not all requirements for reorganisation established by the imperative provisions of law have been fulfilled.

2. Where the period following the termination of a legal person to its applying to the court exceeds six months reorganisation may not be declared invalid.

3. Where applicable, the court must grant a reasonable time limit to correct mistakes which gave grounds for declaring reorganisation invalid.

4. Judgement of the court to declare reorganisation of a legal person invalid shall not invalidate the activities of a legal person after reorganisation or of a newly incorporated legal person prior to the alteration of respective data in the Register of legal persons. All legal persons who participated in the reorganisation shall accept solidary liability for obligations arising from such contracts of legal persons.

Article 2.103. Simplified Reorganisation of Legal Persons

Where a legal person under reorganisation is joined to a legal person which is the only member of the legal person under reorganisation or where public legal persons participate in the reorganisation, paragraph 3 of Article 2.99 and Article 2.100 of the given Code shall not be applied.

Article 2.104. Restructuring of Legal Persons

1. Restructuring shall be an alteration of the juridical form of a legal person whereby a legal person of a new juridical form becomes the successor to all rights and liabilities duties of the restructured legal person.

2. Where a legal person, members of which are liable for obligations of a legal person, is restructured, members of a restructured legal person, irrespective of a new legal form of a legal person, shall accept subsidiary liability, for three years, for the obligations of the restructured legal person which emerge prior to the registration of a legal person of a new legal form with the Register of legal persons. Where a member of a restructured legal person fails to become a member of a legal person of as new juridical legal form he will not be exempted liability specified in the given paragraph either during restructuring or later.

3. Public legal person, except public and municipality enterprises, may not be restructured into a private legal person.

4. Restructuring of legal persons shall be applied, mutatis mutandis, provisions of paragraph 2 of Article 2.101, Article 2.102, paragraph 1 of Article 2.107 and paragraphs 1 and 2 of Article 2.112.

5. Laws regulating individual legal forms of legal persons may establish a specific mode for the restructuring of legal persons.

Article 2.105. Mandatory Restructuring of Legal Persons

1. Laws may provide for circumstances under which a legal person must alter its legal form.

2. Where within the time limit established by the law, which may not be shorter than nine months, members of a legal person fail to pass a resolution on the alteration of legal person’s legal form, it shall be considered that the legal form of a legal person has been altered and the legal person acts according to the documents of incorporation inasmuch as they do not infringe laws regulating activities of legal persons having the legal form into which the said legal person had to be altered.

3. Where a legal person passes a resolution to liquidate a legal person within the time limit for the restructuring established by the law, paragraph 2 of the given Article shall not be applied.

Article 2.106. Grounds for Liquidation of a Legal Person

Grounds for the liquidation of a legal person may only be the following:

1) resolution of members of a legal person to terminate the activities of a legal person has been passed;

2) the court or the creditor’s meeting has passed a decision to liquidate a bankrupt legal person;

3) the court has passed a judgement to liquidate a legal person subject to the provisions of Article 2.131 of the given Code;

4) the court has passed a ruling to liquidate a legal person in cases prescribed by Article 2.70 of the given Code;

5) the term of the legal person has expired;

6) the number of members of a legal person has decreased more than the permitted the minimum prescribed by law where member of a legal person fails to pass a decision within six months following the decrease, to reorganise or restructure a legal person;

7) incorporation of a legal person has been declared invalid subject to the provisions of Article 2.114 of the given Code.

Article 2.107. Resolution of Members of a Legal Person on Liquidation

1) Resolution to liquidate a legal person shall be passed by a qualified majority vote of members of a legal person. It shall be established in incorporation documents of a legal person and it may not be lower than 2/3 of all votes of the participants of the general meeting.

2) Resolution to liquidate a legal person may not be reversed where at least one member of a legal person received part of the property of a legal person under liquidation.

Article 2.108. Appointment of a Liquidator

1) After the resolution to liquidate a legal person has been passed, members of legal persons, general meeting of creditors, registrar of legal persons or the court must appoint a liquidator.

2) Incorporation documents of a legal person or laws may provide for different rules for the appointment of a liquidator or establish a concrete liquidator. These rules shall not be binding on the court, general meeting of creditors or the registrar of legal persons.

3) A liquidator shall be a person having the necessary qualifications. Some liquidators may be appointed. Where some liquidators are appointed liquidation commission shall be formed and one of the liquidators shall be appointed a chairman of the liquidation commission.

4) Where the grounds for liquidation are points 5 and 6 of Article 2.106 of the given Code and where a member of a legal person fails to appoint a liquidator, managing bodies of a legal person or members of a legal person with no less than 1/20 of all votes and registrar of legal persons shall have to apply to court requesting the appointment of a liquidator.

5) Where the grounds for liquidation are points 3 or 7 of Article 2.106 of the given Code, institution authorised by the Government shall discharge the duties of a liquidator before a liquidator has been appointed by a member of a legal person.. This institution, on the approval of the court, shall have the right to assign other person to discharge the duties of a liquidator.

Article 2.109. Revocation of a Liquidator of a Legal Person

1) Liquidator of a legal person may be revoked by a simple majority of vote of legal person’s members present at the meeting.

2) Members of a legal person with no less than 1/10 of all votes, a creditor with no less than fifty thousand Litas right of requisition or no less than 1/5 of the legal person’s employees shall have the right to apply to court to change the liquidator where he fails to act in a proper manner, is dishonest in effecting settlements with creditors and members of a legal person, is dishonest in discharging other duties or infringes the rights of legal person’s members, creditors or legal person’s employees.

Article 2.110. Authority of a Liquidator

1) Managing bodies of a legal person shall be divested of their authority and the authority of legal person’s members shall be delegated to a liquidator as of the day of his appointment while in cases specified in paragraph 5 of Article 2.108 of the given Code – as of the moment when the resolution on the liquidation of a legal person enters into force.

2) A liquidator shall enjoy the rights of a legal person’s managing body and provisions of Chapter VII of the given book shall be applied to him mutatis mutandis.

Article 2.111. Contracts of a Legal Person in Liquidation

Legal person in liquidation may conclude only such contracts, which are related to the termination of legal person’s activities as well as those contracts, which are provided for in the liquidation resolution.

Article 2.112. Notification about Liquidation

1) The person, which passed a resolution to liquidate a legal person in accordance with the procedure established in the incorporation documents of legal persons, shall make a public announcement thereof three times with at least 3-month interval between the announcements or make a public announcement once and shall give all creditors written notices thereof. The notices shall include all data listed in paragraph 1 of Article 2.44 of the given Code.

2) Register of legal persons shall, too, be notified about the liquidation no later than on the first day of the public announcement thereof in accordance with the procedure established in paragraph 3 of Article 2.66 of the given Code.

3) A different procedure for the notification about the liquidation may be established by the given Code or other laws of the Republic of Lithuania.

Article 2.113. Sequence of and Procedure for the Satisfaction of Claims of a Legal Person’s Creditors

1. In the event of legal person’s liquidation the following sequence of and procedure for the satisfaction of creditors’ claims shall be established:

1) priority in satisfying creditors’ claims shall be given to claims secured by the mortgage of property of a legal person in liquidation – from the value of the mortgaged property;

2) first in sequence for the satisfaction of claims shall be employees’ claims connected with labour relations; claims of compensation for maiming or other physical injuries, occupational disease or deprivation of life resulting from an accident in the place of work as well as claims of natural persons to settle accounts for agricultural produce supplied for processing.

3) second in sequence for the satisfaction of claims shall be the claims related to taxes and other payments to the budget as well as compulsory state social insurance and health insurance contributions and foreign loans granted the State guarantee;

4) third in sequence for the satisfaction of claims shall be all other claims of creditors.

2. The claims of creditors of each successive sequence shall be fulfilled upon fully satisfying the claims of creditors of the preceding sequence. If assets are insufficient to fulfil all the claims of one sequence in full, said claims shall be satisfied in proportion to the amount of claims due to each creditor.

Article 2.114. Unlawful Incorporation of a Legal Person

1. Unlawful incorporation of a legal person may be recognised only by the court and only in cases where:

1) all incorporators were incapable or the provision establishing the minimum number of incorporators has been violated;

2) documents of incorporation prescribed by law have not been drawn up or mandatory provisions of the regulations for the incorporation of a legal person have been violated;

3) true goals of legal person’s incorporation were unlawful or contradict public order;

4) minimum authorised capital has not been formed in accordance with the procedure established by law and within the established time limit;

5) incorporation documents of a legal person fail to indicate its business name, goals, amounts of authorised capital and personal contributions of the members of a legal person where such requirements are laid down in the mandatory provisions of the laws regulating individual juridical forms of legal persons.

2. Where the court passes a judgement that the incorporation of a legal person was unlawful the said legal person must be liquidated in accordance with the procedure established by law.

3. Where applicable, the court must grant a reasonable period of time to correct mistakes due to which the incorporation of a legal person was recognised to be unlawful.

4. Passing a judgement that a legal person has been incorporated unlawfully the court shall have to take into consideration the interests of employees and members of a legal person who participated in the incorporation of a legal person.

5. The claim for the recognition of unlawful incorporation of a legal person may be filed by a member or managing bodies of a legal person as well as by a public prosecutor to protect public interests.

CHAPTER IX

FORCED SALE OF SHARES (INTEREST, CONTRIBUTIONS)

Article 2.115. Content of Forced Sale of Shares (Interest, Contributions)

1. Members of a legal person listed in Article 2.116 of the given Code shall have the right to file an application to the court with the request that shares (interest, contributions) of a legal person which are in possession of a legal person’s member whose actions contradict the goals of legal person’s activities and where there are no grounds to expect any changes in the said actions, be sold to the applying member of a legal person.

2. The claim for the forced sale of shares (interest, contributions) shall be filed with the district court according to the location of the registered office of a legal person. The court must inform the legal person, whose shares (interest, contributions) have to be sold in the forced manner, about the claim and the decisions.

3. Participation of a lawyer in the process of litigation of the parties to the given cases shall be compulsory.

4. Member of a legal person who has filed a claim for forced sale must apply to other members of a legal person to become co-claimants.

Article 2.116. Persons Entitled to File an Application for Forced Sale of Shares (Interest, Contributions).

1. The following members of a private legal person shall have the right to file an application for forced sale of shares (interest, contributions):

1) one or some shareholders of a private company whose face value of shares accounts for no less than 1/3 of the authorised capital;

2) one or some members of a partnership whose interest accounts for no less than 1/3 of all interest of jointly owned assets;

3) one or some members of an agricultural partnership or co-operative society whose contribution accounts for no less than 1/3 of all contributions.

2. A member of a legal person shall have no right to file an application for the forced sale of shares (interest, contributions) under the circumstances laid down in Article 2.115 if incorporation documents of a legal person or contracts concluded by its members provide for different rules of forced sale of shares (interest, contributions) and the said rules may be applied.

3. Member of a legal person shall have no right to file an application for forced sale of shares (interest, contributions) if he is controlled by a legal person the shares whereof (interest, contributions) have to be sold in a forced manner.

4. Member of a legal person shall have no right to file an application for forced sale of shares (interest, contributions) if he himself is the legal person the shares whereof (interest, contributions) have to be sold in a forced manner

Article 2.117. Restrictions on the Transfer of Title to Shares (Interest, Contributions)

1. A defendant shall have no right, without claimant’s consent, to sell or otherwise transfer the title to shares (interest, contributions), to mortgage them or otherwise encumber the rights to them as well as transfer or otherwise encumber the rights granted by the shares (interest, contributions) as of the day on which the court judgement becomes res judicata, except as otherwise decided by the court. The court shall enjoy the right to authorise the acts specified in the given paragraph if a defendant fails to give his consent thereof.

2. A defendant shall have no right to sell, except according to the provisions of the given section, or otherwise transfer the title to shares (interest, contributions), to mortgage them or otherwise encumber the rights to them, as well as transfer or otherwise encumber the rights granted by the shares (interest, contributions) as of the day on which the court judgement becomes res judicata, except as otherwise decided by the court.

3. The court may, upon plaintiff’s request, prohibit a defendant to exercise his right to vote without the consent of the court or a plaintiff.

4. Prohibitions established in paragraphs 1 and 3 of the given Article shall be valid irrespective of the appeal against the court judgement.

Article 2.118. Appointment of Experts

1. Upon satisfaction of a claim the court shall have to appoint experts to set the price of shares (interest, contributions).

2. Experts shall start their activities only after the court judgement becomes res judicata . Experts shall have to present a written report on the price of shares (interest, contributions) to the court and the parties to the case.

3. Articles 2.127 – 2.130 of the given Code shall be applied mutatis mutandis.

Article 2.119. Setting of a Price

1. After the experts’ report on the price of shares (interest, contributions) has been submitted, the court shall have to pass a judgement on the setting of a price and establish the person who will have to reimburse experts’ work and other expenses borne. The court may decide that a legal person shall have to reimburse the given expenses.

2. A separate appeal against the court judgement whereby a price is set may be lodged.

Article 2.120. Procedure for Forced Sale

1. After the court judgement on setting a price has become res judicata the defendant shall have, in two weeks time, to transfer title to his shares (interest, contributions) to the plaintiff and the plaintiff shall have the right to accept the shares (interest, contributions) and pay the established price. The price shall have to be paid upon the transfer of title to the shares to the plaintiff. Transfer shall take place in the registered office of a legal person whose shares (interest, contributions) are sold or in some other place agreed upon by the plaintiff and the defendant.

2. Where a defendant fails to discharge his duty to transfer the title to his shares (interest, contributions), a legal person shall have to transfer the title to the shares (interest, contributions) in the defendant’s name and issue documents confirming the owner’s rights to the shares (interest, contributions) sold in the forced manner and declare respective defendant’s documents invalid as well as make a public announcement thereof in the source prescribed by the legal acts. Upon the receipt of documents confirming the title to the shares (interest, contributions), the plaintiff shall pay the price into the deposit account of a notary, bank or other credit institution.

3. In the event that there are some plaintiffs, shares (interest, contributions) sold in forced manner shall be allotted as proportionally as possible to the legal person’s shares (interest, contributions) held by the plaintiffs.

Article 2.121. The Procedure for Forced Selling of Shares in the Presence of a Prior Right

1. Where other members or persons of a legal person have a prior right to acquire the shares (interest, contributions) sold in forced manner, a legal person, upon the receipt of a res judicata court order on the setting of a price, must make a proposal to the said persons to purchase shares (interest, contributions) for the price fixed by the court. After the court judgement on the forced sale of shares (interest, contributions) has become res judicata , the defendant shall have to notify a legal person about the persons who enjoy the prior right to acquire shares (interest, contributions) sold in forced manner in accordance with the contracts concluded by the plaintiff.

2. Upon the receipt of legal person’s proposal to exercise the prior right, the persons shall have, within thirty days, in writing, to accept or reject the proposal. Where a person fails to reply to the said proposal, the proposal shall be deemed unaccepted.

3. Upon the expiry of a thirty-day time limit, a legal person shall have to notify the plaintiff and the defendant of how many shares (interest, contributions) have been accepted. Upon the receipt of the said notification, the defendant shall have to transfer title to the shares to persons specified in the notification and the remainder of them, in accordance with the provisions of Article 2.120 of the given Code, to the plaintiff. Shareholders who purchase shares (interest, contributions) shall have to make payments for them in accordance with the provisions of Article 2.120 of the given Code. Where the persons enjoying the prior right fail to make timely payments for shares (interest, contributions), shares (interest, contributions) shall be transferred to the plaintiff.

Article 2.122. Transfer of the Right to Vote

1. Persons listed in Article 2.116 of the given Code shall enjoy the right to apply to the court with a request to reinstate the owner of shares (interest, contributions) in his right to vote in cases where the right to vote has been assigned to other person whose actions contradict the goals of a legal person and there no grounds to expect positive changes in the future.

2. The owner of shares (interest, contributions) shall be granted the right to vote as of the day on which the court judgement has become res judicata.

3. In this case paragraphs 2 and 3 of Article 2.115, Article 2.116, paragraph 3 of Article 2.117 of the given Code shall be applied mutatis mutandis.

Article 2.123. Forced Sale of Shares (Interest, Contributions) Due to the Failure to xercise the Rights Properly

1. Where members of a legal person listed in Article 2.116 fail to exercise their rights of members of a legal person properly due to the actions of the other member of a legal person and where there no grounds to expect any positive changes in the future, the said members may file an action to the court requesting the member of a legal person, whose actions obstruct proper exercise of their rights, to purchase their shares (interest, contributions). In this case paragraphs 2 and 3 of Article 2.115 and Articles 2.116 – 2.121 of the given Code shall be applied mutatis mutandis.

2. Member of a legal person who is requested to purchase plaintiff’s shares (interest, contributions) must apply to other members of a legal person with the proposal to become co-defendants.

CHAPTER X

INVESTIGATION OF LEGAL PERSON’S ACTIVITIES

Article 2.124. Content of the Investigation of Legal Person’s Activities

Persons listed in Article 2.125 of the given Code shall enjoy the right to request the court to appoint experts who have to investigate whether a legal person or legal person’s managing bodies or their members acted in a proper way, and in the event that improper actions are established to apply measures specified in Article 2.131 of the given Code.

Article 2.125. Persons Enjoying the Right to Apply for Investigation of the Activities

1. The following persons shall enjoy the right to apply for investigation of the activities:

1) one or some shareholders who hold or manage shares the par value of which accounts for no less than 1/10 of the authorised capital;

2) one or some members of an economic partnership whose interest accounts for no less than 1/10 of all interest;

3) one or some members of a farming partnership or a co-operative society (co-operative) whose contributions account for no less than 1/10 of all contributions;

4) members of a legal person who have no less than 1/5 of all votes, with the exception of legal persons’ members listed in Articles 2.35 and 2.37 and in points 1,2 and 3 of the given paragraph, who have no less than 1/5 of all votes;

5) persons as well as members of a legal person who, according to incorporation documents or contracts concluded with legal persons, have been granted said right.

2. The public prosecutor shall also have the right to apply for the investigation of legal person’s activities in an attempt to safeguard public interests including the cases where the activities of a legal person, its managing bodies or its members are at variance with the public interests.

Article 2.126. Filing of an Application

1. An application for the investigation of activities shall be filed with the district court according to the location of the legal person’s registered office.

2. An application may be filed only after a plaintiff has applied to a legal person (legal person’s managing body or its member) with the request to terminate inappropriate activities and has granted a reasonable time limit to adjust the situation. A request, which either fails to specify inappropriate activities or bad faith in discharging the duties or give reasons why the activities are considered to be inappropriate, shall not be deemed to be an application.

3. Participation of a lawyer shall be obligatory in drawing up an application for the investigation of activities. Where a public prosecutor, acting in the public interest, files an application, provisions of the given paragraph shall not be applied.

4. Upon the receipt of an application and listening to the reasoning of the parties the court shall pass a judgement on the investigation of legal person’s activities if there are grounds to presume the feasibility of circumstances specified in Article 2. 124, paragraphs 2 and 3 of Article 2.125, or shall reject the application.

Article 2.127. Appointment of Experts

1. The court may appoint as experts any independent persons, who have the necessary qualifications to investigate legal person’s activities and make a report, in writing, on inappropriate activities, as well as draw up guidelines for the application of measures specified in Article 2.131 of the given Code.

2. Prior to the appointment of experts the court must make a proposal to the parties to reach a consensus on the appointment of specific experts. Where a consensus has been reached, the court shall appoint jointly chosen experts if they meet the requirements set in paragraph 1 of the given Article. Where a consensus on the appointment of experts has not been reached, the court shall appoint experts, at its discretion, from the list, compiled by the parties, of proposed experts. Each party must compile a list of no less than ten experts and shall enjoy the right to delete, for any reasons, five experts from the list of the other party, as well as to give an opinion on the remaining five experts regarding their compliance with the requirements set in paragraph 1 of the given Article.

3. The number of experts shall be established by the court with due regard to the scope of investigation of legal person’s activities.

Article 2.128. Rights of Experts

1. Experts shall have the right to examine legal person’s documents and interrogate members of a legal person, members and employees of managing bodies as well as persons who were legal person’s members, members of managing bodies or employees in the period under investigation.

2. On experts’ instruction a legal person shall have to grant a possibility to examine legal person’s property. The judge may, without prior notification to the parties, pass a judgement, which shall grant the right to the experts to take the actions laid down in paragraph 1 of the given Article with respect to other legal persons as well as receive documents and information from respective public institutions.

3. Where experts are prevented from exercise of their rights the court may give instructions to the police to facilitate the experts’ activities.

Article 2.129. Payment for Experts’ Work

1. The experts, who were appointed by the court, must notify the court about the terms as well as the amount of payment for their services and reimbursement of expenses incurred on them. In the event that the court approves the terms as well as the amount of payment and reimbursement of expenses incurred, it shall fix the sum, which may not be less than seventy per cent of the amount indicated by the experts, without prior notification to the parties. The plaintiff must pay the said sum into the separate account of the court.

2. Where the plaintiff fails to pay the sum indicated by the court into the separate account of the court, the court shall not proceed with the application. In such cases other parties to the case shall have the right to the reimbursement of court expenses incurred on them.

3. In the event that the court fails to approve the terms of payment and reimbursement of expenses proposed by experts it shall appoint new experts after listening to the opinions of the parties.

Article 2.130. Experts’ Reports and Dissemination of Guidelines

1. Upon the receipt of experts’ report and guidelines the court must notify the parties and their representatives thereof and send the copies of experts’ report and guidelines to each party and their representatives as well as convene a court sitting to discuss the said report and the guidelines.

2. Experts’ report and the guidelines must be sent to respective public institutions, which exercise the supervision, prescribed by the law, of legal person’s activities.

3. Persons, who were not specified in the given Article, may examine the experts’ report and guidelines only after permission of the court has been granted.

Article 2.131. Measures Applied by the Court

1. In the event that the experts’ report points out that legal person’s (legal person’s managing bodies or their members) activities are inappropriate and the court approves the said conclusion, the court may, upon receipt of opinions of the parties and public institutions mentioned in Article 2.130 of the given Code, apply one of the following measures:

1) revoke the decisions taken by the legal person’s managing bodies;

2) suspend temporarily the powers of the members of legal person’s managing bodies or exclude a person from legal person’s managing body;

3) appoint provisional members of legal person’s managing bodies;

4) authorise non-implementation of certain provisions of incorporation documents;

5) to oblige making of amendments to certain provisions of incorporation documents;

6) to transfer the legal person’s right to vote to other person;

7) to oblige a legal person to take or not to take certain actions;

8) to liquidate a legal person and appoint a liquidator.

2. Upon the appointment of a member of managing body the court may fix his salary.

3. A decision to liquidate a legal person may not be taken where such decision would contravene the interests of other legal person’s members or employees or public interest. A decision to revoke decisions of legal person’s managing bodies may not be taken where the period of limitation of actions prescribed by the given Code or other laws has expired.

4. The court shall have to notify, without delay, the Register of legal persons about the judgement and its becoming res judicata.

PART III

AGENCY

CHAPTER XI

GENERAL PROVISIONS

Article 2.132. Conclusion of Contracts by Agents

1. Persons shall enjoy the right to conclude contracts through agents with the exception of those contracts which, due to their character, may be concluded only personally as well as other contracts prescribed by the law.

2. Agency shall be possible on the basis of contract, law statute, court judgement or an administrative act.

3. Legally capable natural persons as well as legal persons shall act as agents.

4. Persons who act in their own name although in the interest of other person shall not be deemed to be agents (sales intermediaries, etc.).

Article 2.133. Legal Effects of a Contract Concluded by an Agent

1. the event that a contract was concluded without due authorisation, a person who has concluded the contract shall be liable for his contractual obligations to the other party to the contract, except in cases, where the said party to the contract was aware or had to be aware of the fact that the latter was not entitled to conclude the contract.

2. A contract concluded by one person (agent) in other person’s (principal’s) name by disclosing thereby the fact of agency and without exceeding the rights conferred, shall assign, alter and destruct directly the civil rights and obligations of a principal.

3. Rights of an agent may also arise from the circumstances under which an agent acts (salesperson in retail trade, cashier, etc.). In the event that behaviour of a person gives reasonable grounds for the third persons to think that he has appointed the other person to be his agent , contracts concluded by the said person in principal’s name shall be binding for the principal.

4. In the event that concluding a contract an agent fails to inform that he acts in principal’s name and in his interests, the principal shall acquire the rights and assume the duties arising from the contract only where the other party to the contract was in a position to understand from the circumstances of conclusion thereof that the said contract was concluded with an agent, or where the identity of the person with whom the contract was concluded was of no importance to the said party.

5. Where the validity of a contract concluded by an agent is questioned due to a mistake, deceit, duress or threat, the existence or non-existence of the said circumstances shall be established with due regard to agent’s will.

6. Where a contract has been concluded as per principal’s instructions the principal may not question its validity by stating that concluding the contract the agent ignored certain circumstances if the principal was aware of the said circumstances or ignored them due to his carelessness.

7. Where a contract has been concluded by a person, who has not been authorised to do so, the principal must bear the consequences thereof only when the principal approves the said contract. The other party to the contract may, in this case, request to approve or not to approve the contract within its established time limit, which may not be shorter than fourteen days. Where no reply has been received within the established time limit the contract shall be deemed not approved. The approval of a contract shall have a retroactive effect, i.e. it shall be deemed valid as of the day of its conclusion.

8. The other party to the contract, which concluded a contract with a person, who was not authorised to do so, may terminate the contract prior to the approval of the contract by the principal, except in cases, where at the moment of its conclusion the said party was aware or had to be aware of the fact that it has concluded a contract with a person who has not been granted the requisite authority.

9. In Where an agent acted in excess of his powers but in the manner which gave to a third person serious grounds to think that he was concluding a contract with a duly authorised agent, the contract shall be obligatory to the principal, except in cases where the other party to the contract was aware or had to be aware that an agent was exceeding his powers.

Article 2.134. Restriction Imposed on Agent’s Rights to Conclude a Contract

1. An agent may not conclude contracts in principal’s name either with himself or with a person, whom he represents at the given time, as well as his spouse, parents, children or other close relatives. Such contracts, upon principal’s request, may be deemed null and void.

2. Restrictions laid down in paragraph 1 of the given Article shall not be imposed in the cases where other laws provide otherwise and where an agent acts as a statutory agent .

3. An agent may not conclude a contract which a principal himself is not authorised to conclude.

Article 2.135. Conflict of Interests

1. Where, in violation of the rights conferred, an agent enters into a contract, which contravenes the interests of a principal, such contract, upon principal’s request, may be deemed void in the cases where a third person was aware or had to be aware of the conflict of interests.

2. A person may not act as an agent of both parties to the contract. This provision, however, shall not be applied in the cases where contractual obligations are performed as well as in the cases where both parties to the contract express their will explicitly that the agent has to act in the interests of both parties.

Article 2.136. Legal Effects of a Contract Concluded in Other Person’s Name Without Express Authorisation or in Excess of Authority

1. A contract, which was concluded by a person in other person’s name without express authorisation or in excess of his authority, shall impose, alter and revoke obligations and rights of a principal only in the cases where, at a later date, the principal approves all the contract or that part of it, which is in excess of his authority (paragraph 6 of Article 2.133 of the given Code).

2. Principal’s approval of a contract at a later date shall make the contract valid as of the date of its conclusion.

3. Upon conclusion of a contract, which is not approved by the principal , under circumstances laid down in paragraph 1 of the given Article, an agent shall have to redress the damage incurred on a third person in the cases where the said third person was not aware and was under no obligation to be aware of the said circumstances.

Article 2.137. Power of Attorney

1. Power of attorney shall be a written document granted by a person (principal) to other person (authorised agent) to represent a principal in establishing and maintaining relations with the third persons.

2. An authorised agent whose rights in the power of attorney are not clearly defined shall enjoy the right to perform only those actions, which are necessary for the protection of principal’s property and property interests as well as supervision of principal’s property.

Article 2.138. Verification of the Power of Attorney by a Notary

1. The following powers of attorney must be verified by a notary:

1) power of attorney to conclude contracts whereby a notarial form is obligatory;

2) power of attorney to perform, in natural person’s name, the actions related to legal persons, with the exception of the cases where the authorisation of a different form is permitted;

3) power of attorney to administer, use or dispose of his immovable property granted by a natural person.

2. Powers of attorney verified by a notary shall be equalled to:

1) powers of attorney of servicemen verified by the commanders (heads)of military units, formations, military institutions and military schools;

2) powers of attorney of people in imprisonment institutions verified by the heads of imprisonment institutions;

3) powers of attorney of long voyage seamen on the ships, navigating under the colours of Lithuania, verified by the captains of the said ships.

Article 2.1381. Register of Powers of Attorney Verified by a Notary

1. Powers of attorney verified by a notary and powers of attorney equalled to those equalled by a notary, as specified in paragraph 2 of Article 2.138 of this Code must be entered in a public Register of Powers of Attorney Verified by a Notary. Data for the Register of Powers of Attorney Verified by a Notary shall be submitted by notaries who have verified the powers of attorney, consular officers of the Republic of Lithuania and the persons referred to in paragraph 2 of Article 2.138 of this Code.

2. When recording powers of attorney verified by a notary as well as powers of attorney equalled to those verified by a notary, as specified in paragraph 2 of Article 2.138 of this Code, the Register of Powers of Attorney Verified by a Notary shall be supplied with the data about a person who has granted power of attorney, an agent, a person who has verified power of attorney, the dates of verification and expiry of the term of power of attorney, the content of power of attorney as well as other data specified by the regulations of the Register of Powers of Attorney Verified by a Notary.

3 The leading Register management body shall be the Ministry of Justice of the Republic of Lithuania; the Register management body shall be the Central Mortgage Office.

4. The data of the Register of Powers of Attorney Verified by a Notary shall be managed in accordance with the procedure laid down by the regulations of the Register of Powers of Attorney Verified by a Notary.

Article 2.139. Simplified Verification of Power of Attorney

Power of Attorney, which is granted by a natural person to receive mail (specifically – posted money and parcels) as well as to receive salaries and other payments related to labour relations, pensions, benefits, stipends, may be verified by an organisation in which the natural person works or studies, chairman of a partnership of multi-storey dwelling houses in which the natural person resides, warden of the ward in the territory assigned to which the natural person resides, or a captain of a long voyage sea-fearing ship.

Article 2.140. Power of Attorney Granted by a Legal Person

1) Power of attorney granted by a legal person shall be signed and, in the event that the legal person must have a stamp, be stamped by the head thereof.

2) Additional requirements for a power of attorney granted by a legal person may be prescribed by the law.

3) Provisions of Articles 2.176-2.185 of the given Code shall be applied to the power of attorney granted by profit-seeking (commercial) legal persons.

Article 2.141. Rights and Obligations of a Legal Person Vested with the Power of Attorney

A legal person may be vested with the power of attorney to conclude only such contracts the right of conclusion whereof has been provided in his incorporation documents.

Article 2.142. Term of the Power of Attorney

1) The term of the power of attorney may be fixed or open-ended. Where the term of the power of attorney fails to be indicated, the power of attorney shall be valid for one year as of the day on which it was granted..

2) The power of attorney, verified by a notary, to perform certain actions abroad, which fails to specify its term, shall be valid until the person who granted the power of attorney revokes it.

3) Power of attorney, which fails to indicate the date when it was granted, shall be deemed invalid.

Article 2.143. The Right to Request Power of Attorney and its Copy

1) The third person who concludes a contract with a principal shall have the right to request an agent to produce his power of attorney and its copy.

Article 2.144. Obligation to Return the Power of Attorney

Upon the expiry of the term of the power of attorney or revocation thereof prior to the expiry of the term, an agent shall have to return the power of attorney to a principal or successors to his rights.

Article 2.145. Re-authorisation

1. An authorised agent shall have to perform the acts, which he has been authorised to perform. He may re-authorise the other person to perform the said acts only in the cases where such right has been conferred upon him by the authority he was vested with or where under certain circumstances he is forced to do so to protect the principal’s interests. A re-authorised person shall enjoy the same rights and assume the same obligations as an agent in respect of a principal and the third persons.

2. The form of power of attorney, which is given by re-authorisation shall have to conform to the form of the power of attorney, which has been granted.

3. The term of power of attorney granted by re-authorisation may not exceed the term of power of attorney, which formed the basis for granting it.

4. A person, who delegates his authority to the other person, shall have to notify a principal thereof and supply the necessary data about the person who was delegated the authority. Where the authorised agent fails to discharge the given obligation he shall be liable for the actions of the person, to whom he delegated his authority, as for his own actions. Where an authorised agent has been appointed as per principal’s instructions, an agent shall not be liable for the authorised agent’s actions, except in the cases where the agent was aware of the fact that the person who was appointed as authorised agent was dishonest and unreliable but failed to notify the principal thereof.

Article 2.146. The Right to Revoke Power of Attorney and Re-authorisation and the Right to Waive Them

1. A principle shall enjoy the right to divest, at any time, of the power of attorney whereas an authorised agent – to waive it. Both a principal and an authorised agent may, at any time, revoke re-authorisation. The person who has been vested with the power of attorney by way of re-authorisation may, in his turn, waive it.

2. Laws or an agreement of the parties may provide for the cases whereby an irrevocable power of attorney may be granted.

Article 2.147. Expiry of the Power of Attorney

1. Power of attorney expires:

1) upon the expiry of the term of power of attorney;

2) upon the divestment of power of attorney by a principal;

3) upon the waiver of power of attorney by an authorised agent;

4) upon termination of a legal person, which was vested with power of attorney

5) upon termination of a legal person which was vested with power of attorney or where the said person was instituted a bankruptcy;

6) upon the death, recognition of legal incapacity, partial capacity or absence of a natural person who vested with power of attorney;

7) upon the death, recognition of legal incapacity, partial capacity or absence of a natural person who was vested with the power of attorney.

2. The data about the expiry of the term of power of attorney must be submitted to the body managing the Register of Powers of Attorney Verified by a Notary.

3. Upon the expiry of power of attorney, power of re-authorisation, too, shall be terminated.

4. Expiry of representation may not be used against third persons acting in good faith, except in cases where the said persons were aware or had to be aware of the expiry of representation but were not aware of it due to their negligence.

Article 2.148. Obligation of an Authorised Agent to Notify About the Expiry of the Power of Attorney

1. A principle shall have to notify an authorised agent and the third persons known to the principle and for the establishment and maintenance of relations with whom the power of attorney has been granted, about the divestment of power of attorney, laid down in point 2 of paragraph 1 of Article 2.147. Where the power of attorney expires on the basis of provisions laid down in points 4 and 6 of paragraph 1 of Article 2.147 of the given Code, successors to the rights of the authorised agent shall have the same obligations.

2. Rights and obligations of an authorised agent and successors to his rights, arising as a result of the authorised agent’s actions prior to the date on which the said agent learned or had to learn about the expiry of the power of attorney, shall be valid for the third persons. In the event that the third person was aware or had to be aware of the expiry of the power of attorney, the given provision shall not be applied.

3. Upon the expiry of the power of attorney an authorised person and successors to his rights shall have to return the power of attorney to the principal or successors to his rights.

Article 2.149. Subsidiary Application of Provisions Regulating Agency

Provisions, which regulate agency, shall, too, be applied in the cases where a person whose business was managed by the other person without due authority approves the actions of the said person at a later date.

Article 2.150. Obligation of an Agent to Report

An Agent must present a report to a principal about his activities and give an account of everything he received in his mission to the principal.

Article 2.151. Obligation of a Principal to Refund the Expenses and Offer Remuneration

1. A principal shall have to refund all agent’s expenses related to his mission except as otherwise provided by the law or the contract.

2. A principal shall have to offer remuneration to the agent with the exception of the cases where the law or the contract provide for a free of charge representation.

CHAPTER XII

COMMERCIAL AGENCY

SECTION ONE

COMMERCIAL AGENT

Article 2.152. Concept of a Commercial Agent

1. A commercial agent shall be an independent person whose basic business activity is to continually act for payment as intermediary for a principal in conclusion of contracts or conclusion of contracts in the principal’s name and at the principal’s expense. Bodies of a legal person and persons possessing the rights and duties of a body of the legal person, as well as partners acting in compliance with the contract on joint activities (partnership) shall not be regarded as commercial agents.

2. A principal and an agent may, in a mutual contract, establish such competition restricting conditions, which are not prohibited by the provisions of the law on competition.

3. The contract may provide for an exemption, which grants a commercial agent an exclusive right to conclude contracts in principal’s name on a certain territory or with a certain group of consumers where such exemption fails to violate the provisions of paragraph 2 of the given Article.

Article 2.153. Prerequisites for the Activities of a Commercial Agent

Prior to commencing his activities a commercial agent shall have to insure his civil liability against possible damage which, as a result of his activities, may be incurred on the principal or the third persons.

Article 2.154. Establishment of Commercial Agent’s Rights and Obligations

1. Commercial agent’s rights and obligations may be established in writing or orally.

2. Upon a commercial agent’s or a principal’s request their contract must be concluded in writing. Waiver of the right to conclude the contract in writing shall be null and void.

3. Only upon conclusion of a contract in writing shall the following conditions be valid and shall establish:

1) restrictions on the civil liability of an agent or a principal or a complete exemption from civil liability ;

2) prohibition of competition after the contract has been terminated;

3) conditions for the termination of a contract;

4) exclusive rights of a commercial agent;

5) ratio of the commercial agent’s right to remuneration to the performance of a contract.

Article 2.155. Term of Validity of a Contract

1. A contract between a commercial agent and a principal may be for a fixed period or for an indefinite period.

2. Where a contract has been concluded for a fixed period and where upon the expiry of the given period the parties continue to exercise their rights and discharge their duties, the contract shall be considered renewed for an indefinite period on the same conditions.

Article 2.156. Obligations of a Commercial Agent

A commercial agent must:

1) carry out in good faith and carefully comply with all principal’s reasonable instructions, be loyal to the principal and act exclusively in the principal’s interest;

2) notify the principal, on a regular basis, about contracts, which are being or have been concluded, as well as supply other important information related to his own and principal’s business;

3) keep principal’s commercial secrets during the term of validity of a contract and upon its expiry;

4) where such condition has been set in the contract, avoid competition with the principal;

5) compensate the losses damages incurred on the principal ;

6) upon the expiry of a contract, return to the principal all documents, property and other things which were handed over by the principal.

Article 2.157. Obligations of a Principal

A principal must:

1) supply the commercial agent with requisite documents and information (price lists, samples of commodities, advertising materials, standard conditions of contracts, etc.);

2) notify the commercial agent , without delay, about his consent or refusal to enter into a specific contract or enforce perform it, as well as about alterations of or supplements to the conditions of the contract;

3) notify, without delay, the commercial agent about the approval or a refusal to approve a contract, which the commercial agent concluded without due authority;

4) pay a salary as provided in the contract;

5) supply the commercial agent with information requested for the performance of the agency contract and especially notify about the existence of a lesser number of trade contracts than the commercial agent might expect.

Article 2.158. Remuneration to a Commercial Agent

1. A principal shall remunerate a commercial agent for every successfully concluded contract as provided in the agency contract. The commercial agent shall also have the right to remuneration in the case where the contract has been concluded by the principal himself but owing to the activities of the commercial agent and even in the event that the contract has been concluded after the expiry of agency relations.

2. A contract may provide that commercial agent’s remuneration shall depend on how successfully the principal’s instructions have been carried out or that the commercial agent is offered remuneration only in the cases where the third person has performed the contract. A commercial agent shall also be offered remuneration for the sums of money recovered for the principal from the third persons.

3. Where a commercial agent gives a guarantee to a principal that the other party to the contract will perform the contract in the proper way, the commercial agent shall be entitled to an additional remuneration (del credere). Agreement of the parties to preclude the given right shall be null and void. The right to additional remuneration (del credere) shall be achieved upon successful performance of a contract.

4. In the event that remuneration for a commercial agent fails to be set in the contract, he shall be offered the remuneration, which is paid to the commercial agents, employed in the sphere of the said commercial agent’s activities, and for the goods, which are provided in the agency contract, whereas in the absence of such practice the commercial agent shall be entitled to a reasonable remuneration set by taking into consideration all peculiarities of the contract.

Article 2.159. Setting of the Amount of Commercial Agent’s Remuneration

1. The amount of commercial agent’s remuneration set in the agency contract shall be presented in the form of a specific sum of money or the ratio of the contract value to the recovered sum.

2. All expenses borne by a commercial agent shall be refunded if the other party to the contract failed to reimburse them (transportation of goods, storage, protection, packaging expenses, customs duties paid, as well as other dues and fees) and they shall not be included into the expenses of commercial agent’s independent activities.

3. Where the salary of a commercial agent is presented in a concrete sum the Article 2.160 is applied inasmuch as it fails to contradict the essence of the agreement on the commercial agent’s salary expressed in concrete terms.

Article 2.160. The Procedure for the Remuneration to a Commercial Agent

1. A commercial agent acquires the right to remuneration as of the moment of the conclusion of a contract on condition that the principal has performed a contract or had to perform a contract according to an agreement reached with the third party , or the third party performed a contract, and in all cases, however, the latest date is when the third party has performed its part of the contract or could have done it if the principal had performed his part of the contract

2. Where a contract provides that remuneration for a commercial agent is paid only after a third person has performed a contract, a commercial agent shall be entitled to advance payment An advance payment may not be less than forty per cent of the salary and has to be paid no later than on the last day of the next month following the month on which a contract has been concluded, except as otherwise provided in the contract

3. Where it becomes evident that the third person will fail to perform a contract a commercial agent shall be denied the right to request remuneration. In the event that the money has already been paid or an advance payment has been made, a principal shall have the right to recover the money from the commercial agent. The given provision shall not be applied in the cases where the principal is at fault for the failure to enforce the contract.

4. A principal shall have to remunerate a commercial agent on a monthly basis and no later than on the last day of the month following the accounting period. The parties may, in a written contract, extend the term of payment but no longer than for three months from the last day of the accounting period.

5. Every month, and upon reaching a written agreement at least every three months, a principal shall have to submit to a commercial agent documents of accounting, the data of which shall allow to calculate and offer remuneration, as well as to inform about all circumstances against which payments to the commercial agent are stopped or cut.

6. In the event of disputes related to remuneration a commercial agent shall enjoy the right to request an audit to establish the exact amounts of remuneration and payments. Waiver of the right to audit shall not be valid. Where a principal refuses to carry out an audit or in the event of disagreement about the auditor the commercial agent shall have the right to file a request with the court for the mandatory appointment of an auditor.

7. Three-year period of limitation shall be applied to requests to recover a commercial agent’s remuneration.

8. Where a commercial agent has been granted an exclusive right to conclude contracts on a certain territory or with certain consumers, a commercial agent shall be entitled to payment by commission, which shall be calculated by taking into account the contracts concluded within the period of validity of the agency contract with the persons from the said territory or the said consumers.

9. A commercial agent shall, too, be entitled to payment by commission in the cases where the order of the third party has reached the principal prior to the expiry of the agency contract or within a reasonable period of time after the expiry of the agency contract and the contract is related to the agency contract.

10. Where a commercial agent is paid by commission after the expiry of the contract, the new agent shall not be entitled to payment by commission except in the cases where division of payment by commission under certain circumstances may be considered to be fair.

Article 2. 161. The right to Retention

1. A dealer commercial agent shall have the right to retain principal’s things , which are in his possession and the documents confirming the rights to them until the principal offers remuneration to the commercial agent .

2. Waiver of the right to retention shall be null and void..

Article 2.162. Rights of a Commercial Agent

1. A commercial agent shall enjoy the right to perform any requested actions to carry out principal’s instruction properly in the principal’s name without special authority . A commercial agent shall have the right to alter provisions of contracts and accept the performance of the contract only in the cases where the given right has been provided separately in the agency contract or a separate power of attorney.

2. Even though a commercial agent fails to be vested with authority to enter into contracts he shall be vested with authority to receive claims related to the quantity and the quality of goods as well as other claims related to the enforcement performance of a contract, and exercise, in the principal’s name, the latter’s right to secure the proof.

Article 2.163. Liability for Obligations Arising Under Contracts Concluded by a Commercial Agent

1. Where a commercial agent, in the principal’s name, concludes a contract without authority to do so and where the other party was not aware and was not able to be aware thereof, it shall be recognised that the principal has approved the contract in the case, where he, upon notification about the said contract by the commercial agent or the third person, failed to inform, without delay, the third person of his disapproval thereof.

2. Provision of paragraph 1 of the given Article shall also be applied in the cases where a commercial agent acted outside his authority.

Article 2.164. Prohibition of Competition

1. A commercial agent and a principal may provide in the contract that upon expiry of the contract the commercial agent shall not compete with the principal for no more than two years. The given provision may be agreed upon in writing.

2. Restriction of competition may be related only to a certain territory or certain kinds of goods and services or a group of customers and a territory, which were entrusted to the commercial agent.

3. A principal shall enjoy the right to waive, in writing, in a unilateral manner, the prohibition of competition until the end of a contract.

4. Where a contract provides for the prohibition of competition a commercial agent shall enjoy the right to compensation for all the period of the prohibition thereof. The amount of compensation shall be fixed by the agreement of both parties. The amount of compensation may be expressed by the sum of annual payment to the commercial agent.

5. Where the contract has been terminated through the commercial agent’s fault, the commercial agent shall be divested of the right to compensation provided in paragraph 4 of the given Article.

6. A principal shall be divested of the right to refer to the provision of the contract on the prohibition of competition where:

1) a principal terminates the contract without commercial agent’s consent violating thereby the term of prior notification about the termination of a contract and fails to notify, without delay, the commercial agent about the important reasons for the termination thereof.

2) A commercial agent terminates the contract for important reasons for which the principal is held liable and notifies the principal, without delay, thereof.

3) Contract of a commercial agent and a principal has been terminated by a court judgement for reasons for which the principal is held liable;

7. The court shall have authority, upon commercial agent’s request, to declare full or partial invalidity of the provision on the prohibition of competition where, taking into consideration the commercial agent’s lawful interests, the said provision causes him serious damage.

8. Agreements, which contravene the provisions of the given Article and aggravate the situation of the commercial agent, shall be null and void.

Article 2.165. Termination of a Contract Concluded for an Indefinite Period

1. An agency contract for indefinite period may be terminated on each party’s initiative subject to the condition that the other party has been notified about the termination thereof within the following term:

1) a month before – where the contract was valid for one year;

2) two months before – where the contract was valid for no more than two years;

3) three months before – where the contract was valid for no more than three years;

4) four months before – where the contract was valid for more than three years.

2. The parties may not establish a shorter term of notification by an agreement but may establish a longer term of notification but in all cases the same term of notification shall be established for both parties.

3. The party, which has terminated a contract without the other party’s consent and has violated the term of prior notification, must compensate the other party for the losses incurred by its actions, except in the cases, where the contract has been terminated for compelling reasons, which have to be notified, without delay, to the other party.

4. Except as otherwise agreed upon by the parties, the last day of notification and the day of the termination of a contract shall have to coincide with the end of the calendar month.

5. Where the term of an agency contract has expired and the fixed period contract became a contract for an indefinite period, the term of notification laid down in paragraph 1 of the given Article, which includes the time limit of validity of a fixed period contract, shall be applied to its termination.

Article 2.166. Termination of a Contract for a Fixed Period

1. Each party shall have the right to terminate a fixed period contract before the expiry of its term where there are compelling reasons to do so. Waiver of the given right shall be null and void.

2. Where the contract is terminated for reasons, for which the other party is liable, the latter shall have to compensate for the losses damages inflicted by the termination of the contract.

Article 2.167. Right to Compensation and Damages

1. When a contract between a commercial agent and a principal expires, the commercial agent shall be entitled to compensation under paragraph 2 of this Article, if the parties to the contract have not agreed upon that after the expiration of the contract the commercial agent shall be entitled to damages under paragraph 6 of this Article. Waiver of the right to compensation or damages shall be null and void.

2. A commercial agent shall be entitled to compensation where:

1) upon the termination of the contract the principal has considerable profit from the business relations with clients who were found by the commercial agent or with who, because of the commercial agent, the amount of principal’s business has increased significantly;

2) taking into consideration all circumstances, payment of the compensation would be in line with the principle of justice.

3. Maximum amount for compensation shall be the average annual payment to the commercial agent calculated for all the term of contract validity where the contract was valid for no more than five years. Where the contract was valid more than five years, the average annual payment of the last five years shall be calculated. Payment of compensation shall not abolish the right of the commercial agent to make a claim for damages due for the breach of the contract.

4. A commercial agent shall be divested of the right to compensation when during the period of one year after the expiration of the contract he fails to inform the principal about his intention to make use of such right.

5. A commercial agent shall not be entitled to compensation where:

1) the contract has been terminated on the commercial agent’s initiative, except in the cases where the commercial agent terminates the contract due to the unlawful actions of the principal or due to his illness, age or disability which prevent him from discharging his obligations properly;

2) the contract has been terminated on the principal’s initiative where the commercial agent was at fault;

3) the commercial agent, with principal’s consent, transfers his rights and obligations stipulated in the agency contract to another person.

6. A commercial agent shall have the right to damages due for the termination of the contract with the principal, especially if he fails to receive a commission he is entitled to after a successful performance of an agency contract and the principal profits substantially from the commercial agent’s activities, and (or) where he fails to reimburse the expenses the commercial agent had to bear in the execution of the principal’s instructions. In the event of damages being awarded, paragraphs 4 and 5 of this Article shall apply.

Article 2.168. Exemptions

1. The laws may provide for exemptions to the provisions of the given Section where they are deemed necessary due to the specific character of commercial agent’s activities in the different fields of business.

SECTION TWO

PECULIARITIES OF COMMERCIAL AGENCY IN CONCLUSION AND PERFORMANCE OF INTERNATIONAL CONTRACTS OF PURCHASE AND SALE OF GOODS

Article 2.169. The Field of Application

1. Provisions of the given Section shall be applied only in the cases where the following requirements are fulfilled:

1) an international contract of purchase and sale of goods has been concluded and is performed;

2) a principal and the third person reside in different states.

2. Provisions of the given Section shall be applied only to the relations between a principal and a commercial agent, on the one hand, and the third person, on the other.

3. Provisions of the given Section shall not be applied:

1) to shares or other securities traded in the stock exchange;

2) to commodities sold by auction;

3) to the activities of statutory representatives as well as activities of representatives appointed by the decision of the court or an administrative institution.

4. Where a legal person’s managing bodies or employees act without overstepping the authority prescribed by law or legal person’s incorporation documents they, in the given Section, shall not be deemed to be agents.

Article 2.170. Rights and Obligations of an Agent

1. Rights and obligations of an agent may be express or implied in specific circumstances.

2. An agent shall be vested with authority to perform any acts, which under specific circumstances are necessary to carry out principal’s instruction properly.

3. Rights and obligations of an agent may be presented in any form and any mode of proof may be used to prove their content.

Article 2.171. Validity of Contracts Concluded by an Agent

1. Where an agent acts in principal’s name and in his interests without overstepping his authority and where the third person was aware or had to be aware that he was concluding the contract with an agent, the principal shall achieve the rights and assume obligations arising under the contract.

2. Rights and obligations arising under a contract concluded by the agent shall be imposed on a agent and not a principal where:

1) the third person failed to know and was not obliged to know that the contract was concluded with an agent (undisclosed agency );

2) specific circumstances (e.g. provision of the contract) confirm that the agent, not the principal, intended to achieve rights and assume obligations arising under the contract.

3. Where an agent fails to discharge his obligations to the principal, the principal, notwithstanding the circumstances laid down in paragraph 2 of the given Article, may exercise the rights, achieved by the agent, and related to the third person, by taking into consideration the right of the third person to use protective measures against the agent. Where the agent fails to discharge his obligations to the third person, the said person shall be vested with authority to exercise his rights, achieved against the agent, and related to the principal, by taking into account the right of the agent to use protective measures against the third person as well as the principal’s right to use protective measures against the agent.

4. Rights provided in paragraph 3 of the given Article may be exercised if the principal, the agent and the third person have been respectively notified thereof. Upon the receipt of the said notification, the third person or the principal may not waive the obligations linking them with the agent.

5. Where an agent fails to discharge his obligations to the third person through a principal’s fault, the agent must reveal principal’s name to the third person.

6. Where the third person fails to discharge his obligations to the agent, the agent must reveal the third person’s name to the principal.

7. A principal may not exercise the rights achieved by the agent and related to the third person, where the third person proves, that he would not have concluded the contract if he had known who the principal was.

Article 2.172. Conclusion and Enforcement of a Contract Without Due Authority or Outside One’s Authority

1. Where a person acts without due authority or outside his authority his actions shall have no legal consequences for the principal. In such cases rights and obligations of the said person and the third person shall be achieved.

2. Provisions of paragraph 1 of the given Article shall not be applied in cases where principal’s behaviour gave reasonable grounds for the third person to think that the agent had due authority and has not exceeded his powers.

Article 2.173. Approval of Agent’s Actions

1. A principal shall have the right to approve the actions taken by the person who was not authorised to do so or was outside his authority. Approval may be done in different ways. Besides, approval may be implied in principal’s behaviour. Approval enters into force as of the moment of its receipt by the third person. Approval, which entered into force, shall be irrevocable.

2. Where at the moment of entering into the contract the third person is unaware and is not able to know that the agent is not vested with authority or acts outside it, the third person shall not be liable to the principal if prior to the approval of his actions he notifies the principal, that the contract is not binding on him even after it has been approved.

3. Where on entering into a contract the third person knew or had to know that the agent was not vested with authority or acts outside it the third person may not terminate the contract prior to the approval of agent’s actions or thereafter.

4. The third person shall in all cases enjoy the right to waive only a partial approval of the agent’s actions.

5. Where a person performs certain actions in the future legal person’s interests prior to the incorporation of a legal person, such actions may be approved only in the cases prescribed by the law.

Article 2.174. Legal Consequences of a Failure to Approve Agent’s Actions

1. Where a person acts without due authority or outside his authority and where the principal refuses to approve his actions, the person must compensate to the third person those losses which would enable the third person to be in the situation in which he might have been if the agent had possessed the requested authority or acted without overstepping his authority.

2. A person shall not be liable to the third person where the third person knew or had to know, that the person was not vested with authority or acted outside it.

Article 2.175. Termination of Agent’s Authority

1. Authority of an agent shall be terminated:

1) upon the agreement between a principal and an agent ;

2) upon conclusion of the contract or performance of some other action for which the authority was granted;

3) where a principal divests the agent of the authority he was granted;

4) where an agent waives the rights he was granted;

5) in other cases provided for by the given Code.

2. Termination of agent’s authority shall not exercise influence on the authority of the third person except in the cases where the third person knew or had to know about the termination of agent’s authority or the circumstances, which formed the basis for the termination thereof.

3. Notwithstanding the termination of agent’s authority, an agent shall enjoy the right to perform, in principal’s or his successors’ interests, certain actions which are necessary to avoid damage, which may be incurred on his or his successors’ interests.

SECTION THREE

PROCURACY

Article 2.176. Concept of Procuracy

1. Procuracy shall be a power of attorney, which a legal person (entrepreneur) grants to his employee or other person to perform, in principal’s name and in his interests, all legal acts related to legal person’s (entrepreneur’s) undertaking.

2. Besides, procuracy shall grant the right to perform, in principal’s name and in his interests, legal acts in the court or other non-judicial institutions.

3. A person who is issued a procuracy shall be a procurator.

Article 2.177. Issuance of a Procuracy

1. Procuracy shall be issued by a respective managing body of a legal person or the owner of a legal person or his authorised person in accordance with the procedure established in incorporation documents.

2. Procuracy may be issued to some persons (joint procuracy). In such case all procurators shall have to act together.

Article 2.178. Form of a Procuracy

1. Procuracy shall be issued in writing and signed by a person vested with authority to issue a procuracy.

2. Procuracy shall be registered in accordance with the procedure prescribed by the law.

Article 2.179. Rights of a Procurator

1. A procurator shall not have the right to perform and he may not be authorised to perform the following acts:

1) to transfer an immovable object thing of the principal (enterprise) or encumber the rights to it;

2) to sign the balance sheet and tax return of the principal;

3) to institute bankruptcy proceedings of the principal;

4) to issue a procuracy;

5) to accept interest holders into an enterprise;

2. A procurator shall not have the right to delegate his authority to the other person.

Article 2.180. Restrictions on a Procuracy

1. Procuracy may be restricted. Procuracy may be restricted to a branch office of a legal person, respective spheres and types of legal person’s activities, certain circumstances, time or territory.

2. Restrictions on procuracy specified in paragraph 1 of this Article shall have no effect on the third persons.

Article 2.181. Entering Into Force of a Procuracy

1. A procuracy establishing the relations between a principal and a procurator shall enter into force as of the moment of its issuance.

2. A procuracy, which is establishing relations between a procurator and the third persons shall enter into force as of the moment of its registration in accordance with the procedure prescribed by the law.

Article 2.182. Signature of a Procurator

Signing documents in a principal’s name a procurator shall have to indicate that he acts as a procurator, i.e. to include the word “procurator” or its abbreviation “pp”.

Article 2.183. Procurator’s Liability

A procurator shall be liable to a principal and the third persons in the same manner as a commercial agent.

Article 2.184. Termination of Procuracy

1. Procuracy shall be terminated when:

1) a principal revokes it;

2) a procurator waives it;

3) a principal has been instituted bankruptcy proceedings;

4) a legal person which issued the procuracy is liquidated or reorganised;

5) a procurator is dead.

2. Procuracy shall be terminated as of the date of a respective entry in a respective register with the exception of the cases laid down in points 4 and 5 of paragraph 1 of the given Article.

Article 2.185. Acts Performed Without Procuracy

1. A principal may instruct his employees to perform acts, which in a certain field of undertaking are usual and commonplace, without issuance of the procuracy. In such cases provisions of the given Code regulating a procuracy shall be applied by analogy.

2. It is presumed that employees working in a shop or a warehouse shall have the right to sell, deliver or receive goods as well as receive claims concerning the quantity and quality of goods.

3. On signing documents in the principal’s name employees specified in the given Article shall have to indicate their capacity, name, family name and authority.

BOOK THREE

FAMILY LAW

PART I

GENERAL PROVISIONS

CHAPTER I

FAMILY LAWS

Article 3.1. Relationships governed by Book Three of the Civil Code of the Republic of Lithuania

1. The provisions of Book Three of the Civil Code of the Republic of Lithuania define the general principles of the legal regulation of family relations and govern the grounds and procedures of entering into marriage, validity and dissolution of marriage, property and non-property personal rights of spouses, filiation, mutual rights and responsibilities between children, parents as well as other family members, the basic provisions on adoption, guardianship, curatorship and on the procedures of registering Acts of Civil Status.

2. The provisions of the other Books of the Civil Code, as well as the provisions of other civil laws, shall apply to family relationships to the extent that they are not regulated by the provisions of this Book.

Article 3.2. Sources of family law

1. Family relations shall be governed by the Constitution, the Civil Code and other laws of the Republic of Lithuania as well as by the international treaties of the Republic of Lithuania.

2. The Government and other public authorities of the Republic of Lithuania may adopt regulations on family law matters only in the cases and to the extent provided for in this Code and other legislation.

3. Customs shall apply to family relations only in cases provided for by legislation. In case there is a contradiction between the law and the custom, the law shall prevail.

Article 3.3. Principles of the legal regulation of family relationships

1. In the Republic of Lithuania the legal regulation of family relationships shall be based on the principles of monogamy, voluntary marriage, equality of spouses, priority of protecting and safeguarding the rights and interests of children, up-bringing of children in the family, comprehensive protection of motherhood and other principles of the legal regulation of civil relationships.

2. Family laws and their application must ensure the strengthening of the family and its significance in the society, the mutual responsibility of family members for the preservation of the family and the education of the children, the possibility for each member of the family to exercise his or her rights in an appropriate manner and to protect the children of minor age from the undue influence of the other members of the family or other persons or any other such factor.

Article 3.4. Analogy of statute or law

1. Where family relationships are not governed by this or the other Books of the Civil Code, they shall be governed by the provisions of other civil laws applicable to similar legal relations. The application by analogy of special legal norms stipulating derogation from the general provisions shall be prohibited.

2. Where it is not possible to apply statute by analogy and also where the resolution of the matter is left to judicial discretion, the rights and duties of the subjects of family relations shall be determined on the basis of justice, good faith, reasonableness and other general legal principles.

3. Where there are no mandatory rules, also in cases provided for in this Code and other laws, the subjects of family relations may determine their rights and duties by mutual agreement in accordance with the principles enshrined in paragraph 2 and Article 3.3 hereof.

Article 3.5. Implementation and protection of family rights

1. Persons are free to implement and exercise their family rights at their own discretion including the right to the protection of family rights. A waiver from a family right or its implementation shall not abolish the right except in cases provided for by law.

2. In exercising their family rights and performing their duties, persons must comply with the laws, respect the rules of their community life as well as the principles of good morality and act in good faith.

3. It is prohibited to abuse family rights, i. e. it is prohibited to exercise them in such a way and by such means as would violate or restrict other persons’ rights or interests protected by law, or would inflict harm on other persons. If a person abuses a family right, the court may refuse to protect it.

4. Family rights shall be protected by courts, institutions of guardianship and curatorship, governmental or non-governmental organisations in the ways provided for herein. Courts and other institutions shall seek that the parties to a dispute resolve their dispute peacefully by mutual agreement, and shall help the parties in every possible way to reach such an agreement.

Article 3.6. Limitation period for action

1. Claims arising from legal family relations shall be subject to statutory limitations except for the exemptions provided for in this Book hereof.

2. The procedures for the calculation, suspension, termination or restoration of limitation periods shall be stipulated in the rules of Book One hereof unless this Book provides for different rules.

PART II

MARRIAGE

CHAPTER II

CREATION OF MARRIAGE

SECTION ONE

AGREEMENT TO MARRY AND ITS LEGAL CONSEQUENCES

Article 3.7. Concept of marriage

1. Marriage is a voluntary agreement between a man and a woman to create legal family relations executed in the procedure provided for by law.

2. A man and a woman who have registered their marriage in the procedure provided for in law shall be deemed to be spouses.

Article 3.8. Agreement to marry (engagement)

1. Agreement to marry is not binding and may not be enforced by force although it may give rise to legal consequences described in Articles 3.9 to 3.11 hereof.

2. An agreement to marry may be expressed orally or in writing.

3. An application to register a marriage submitted to the Register Office in the prescribed format shall be deemed to be a public agreement to marry.

Article 3.9. Return of gifts

1. If the engagement is terminated, both parties to the public agreement to marry shall have a right to demand that the other party return everything he or she has received from the other party as a gift in consideration of the intended marriage except where the value of the gift is under one thousand Litas or where the party who had received a gift died before the registration of the marriage and the marriage has not been contracted due to the death of one of the parties.

2. Requests for the return of gifts shall be governed by the rules of Book Six hereof regulating relations pertaining to unjust enrichment or acquisition of assets not due.

3. An action for the return of a gift may be brought within a year of the date of the refusal to marry.

Article 3.10. Compensation of damages

1. The party to the agreement to marry that has refused to contract the marriage without a reasonable cause must compensate the damages incurred by the other party due to the refusal to marry.

2. The damages include the actual expenses of the party in preparation to marry and the actual expenses made in performing the obligations related to the intended marriage.

3. Where a party refuses to marry for a weighty reason that has emerged through the fault of the other party, the party at fault shall pay damages under paragraphs and 2 hereof.

4. The time limit to present claims for damages shall be one year after the date of the refusal to marry.

Article 3.11. Compensation for non-pecuniary damage

1. Where the parties had made a public agreement to marry, the party entitled to damages under Article 3.10 hereof, may also claim compensation for non-pecuniary damage.

2. An action for compensation of non-pecuniary damage may be brought within a year of the date of the refusal to marry.

SECTION TWO

CONDITIONS FOR CONTRACTING A MARRIAGE

Article 3.12. Prohibiting marriage of persons of the same gender

Marriage may be contracted only with a person of the opposite gender.

Article 3.13. Voluntary nature of marriage

1. Marriage shall be contracted by a man and a woman of their own free will.

2. Any threat, coercion, deceit or any other lack of free will shall provide the grounds on which the marriage declared null and void.

Article 3.14. Legal age of consent to marriage

1. Marriage may be contracted by persons who by or on the date of contracting a marriage have attained the age of 18.

2. At the request of a person who intends to marry before the age of 18, the court may, in a summary procedure, reduce for him or her the legal age of consent to marriage, but by no more than two years.

3. In the case of a pregnancy, the court may allow the person to marry before the age of 16.

4. While deciding on the reduction of a person’s legal age of consent to marriage, the court must hear the opinion of the minor person’s parents or guardians or curators and take into account his or her mental or psychological condition, financial situation and other important reasons why the person’s legal age of consent to marriage should be reduced. Pregnancy shall provide an important ground for the reduction of the person’s legal age of consent to marriage.

5. In the process of deciding on the reduction of the legal age of consent to marriage, the state institution for the protection of the child’s rights must present its opinion on the advisability of the reduction of the person’s legal age of consent to marriage and whether such a reduction is in the true interests of the person concerned.

Article 3.15. Active capacity

1. A person who has been declared by a res judicata court judgement) to be legally incapacitated may not contract a marriage.

2. If there is knowledge of a case pending before a court for the declaration of one of the parties to an intended marriage to be legally incapacitated, the registration of the marriage must be postponed until the judgement of the court becomes res judicata.

Article 3.16. Prohibition to violate the principle of monogamy

A married person who has not terminated his or her marital bond in accordance with the procedures laid down by the law may not enter into a second marriage.

Article 3.17. Prohibition to contract marriage between close relatives

Marriage between parents and children, adopters and adoptees grandparents and grandchildren, real or foster-brothers and real or foster-sisters, cousins, uncles and nieces, aunts and nephews shall be prohibited.

SECTION THREE

FORMATION OF MARRIAGE

Article 3.18. Application to register a marriage

Persons intending to marry must file an application to register the marriage in the procedure specified in Article 3.299 hereof.

Article 3.19. Making public the application to register a marriage

The fact of the submission of the application to register a marriage shall be made public in the procedure specified in Article 3.302 hereof.

Article 3.20. Confirmation of the compliance with the requirements for the formation of a marriage

1. While filing an application to register a marriage, the intended spouses must confirm in writing that they have met all the requirements laid down for the formation of marriage in Articles 3.12 to 3.17 hereof.

2. Before registering a marriage, the officials of the Register Office must check if all the requirements laid down in Articles 3.12 to 3.17 for the formation of marriage have been complied with.

Article 3.21. Premarital medical examination

1. At the time of filing an application to register a marriage, the officials of the Register Office shall suggest to the intended spouses that they undergo a premarital medical examination and prior to the date of the registration of their marriage submit a doctor’s certificate drawn up in the form specified by the institution authorised by the Government.

2. Failure to submit a doctor’s certificate shall not be an impediment for the registration of the marriage.

3. Failure of one of the parties to an intended marriage to inform the other party that he or she is suffering from a venereal disease or AIDS shall provide a cause for rendering the marriage null and void.

Article 3.22. Declaration on impediments to marriage

1. Any interested person shall have a right to make a written declaration to the Register Office that has made the application to register a marriage public to the effect that, subject to this Book, there are impediments to the marriage.

2. Having received a declaration on impediments to a marriage, the official of the Register Office shall postpone the registration of the marriage and request that the declarant submit written evidence of the facts alleged in the declaration within three days. If the declarant fails to submit such evidence within three days, the marriage shall be registered in accordance with the general procedures.

3. If the written evidence on the existing impediment to a marriage is presented, the official of the Register Office shall suspend the registration of the marriage and, in the event of a dispute, advise the intended spouses on their right to apply for the court to refute the declaration. In such a case the marriage shall be registered only after the intended spouses submit to the Register Office the res judicata court judgement on the refutation of the declaration on the impediments to the marriage as ill-founded.

4. Where the court decides to refute the declaration on the impediments to the marriage as unfounded, after the formation of the marriage the intended spouses shall have a right, within a year of the day on which the court’s judgement became res judicata, to claim damages from the person who submitted the declaration on impediments to the marriage, except in cases where the declaration was presented by the parents of one of the spouses or a public prosecutor.

Article 3.23. Proof of marriage

1. The Register Office that has registered a marriage shall issue a Certificate of Marriage.

2. The proof of marriage shall be the record of the marriage and the Certificate of Marriage issued on the basis of the record.

Article 3.24. Formation of religious marriages in the procedure established by the Church (confessions)

1. A religious marriage is formed in accordance with the procedures established by the internal law (canons) of the respective religion.

2. The formation of a marriage in accordance with the procedures established by the Church (confessions) shall entail the same legal consequences as those entailed by the formation of a marriage in the Register Office provided that:

1) the conditions laid down in Articles 3.12 to 3.17 hereof have been satisfied;

2) the marriage has been formed according to the procedures established by the canons of a religious organisation registered in and recognised by the Republic of Lithuania;

3) the formation of a marriage in the procedure established by the Church (confessions) has been recorded at the Register Office in the procedure provided for herein.

Article 3.25. Official records of marriages formed in the procedure established by the Church (confessions)

Marriages formed according to the procedure established by the Church (confessions) shall be entered in the official records in accordance with Article 3.304 hereof.

SECTION FOUR

LEGAL EFFECTS OF MARRIAGE

Article 3.26. Equality of spouses

1. Having contracted a marriage, the spouses acquire the rights and duties defined in this Book.

2. Spouses shall have equal rights and equal civil liability in respect of each other and their children in matters related to the formation, duration and termination of their marriage.

3. Spouses may not waive, by mutual agreement, their rights or extinguish their duties that arise from a marriage.

Article 3.27. The duty of spouses to support each other

1. Spouses must be loyal to and respect each other; they must support each other morally and financially and contribute toward the common needs of the family or the needs of the other spouse in proportion to their respective capabilities.

2. Where due to objective reasons one of the spouses is unable to make a sufficient contribution toward the common needs of the family, the other spouse must do that in accordance with his or her abilities.

Article 3.28. Creation of family relations

By contracting a marriage the spouses create family relations as a basis for their life together.

Article 3.29. Passive and active capacity of spouses

Marriage shall not restrict the passive and active capacity of spouses, nevertheless the possibility of the spouses to exercise certain rights may be restricted by the contract of marriage or the mandatory rules hereof.

Article 3.30. Duties of the spouses in respect to their children

Spouses must maintain and bring up their children of minor age, care for their education and health, ensure the child’s right to personal life, inviolability of his or her personality and freedom, the child’s property, social and other rights laid down in the domestic and international law.

Article 3.31. The surnames of the spouses

Both spouses shall have the right to retain their respective surnames or to choose the surname of the other spouse as their common surname or to have a double surname by adjoining the surname of the other spouse to one’s own surname.

Article 3.32. Representation

1. Any of the spouses may authorise the other to represent him and act on his behalf.

2. Where certain acts require the consent of the other spouse, but for any objective reason the other spouse is unable to give such a consent, the court may, upon the interested spouse’s request, give the interested spouse permission to perform the act. Before giving the permission, the court must satisfy itself that the consent of the other spouse is really unobtainable, while the permission will serve the interests of the family. The court’s permission is valid only for the act specified in the court’s order to be performed in the specified period of time. If the court finds that the spouse’s actions are contrary to the interests of the family or of the children of minor age, it may amend or revoke its permission on the request of the state institution for the protection of the child’s rights or the public prosecutor. The amendments or revocation of the permission shall be effective only from the date of the court’s order to that effect. On the day of its adoption, such an order of the court must be sent to the Chamber of Notaries Public or, if the permission is related to the disposition of immovable property, to the public register.

3. If a spouse has acted on behalf of the other spouse without his or her permission or the permission of the court, such acts and their consequences shall be subject to the rules of Book Six regulating the management of the other spouse’s affairs.

Article 3.33. Disputes of spouses relating to the performance of their duties or exercise of their rights

1. Where the spouses are unable to agree as to the performance of their duties or the exercise of their rights, either of them shall have a right to apply to the court for the resolution of their dispute.

2. In its efforts to resolve the dispute the court shall take measures for the reconciliation of the spouses.

3. The court must decide on the dispute of the spouses by taking account of the interests of their children of minor age and the interests of the family as a whole.

Article 3.34. Temporary Restriction of the property rights of a spouse

1. Where one of the spouses is in serious breach of his or her marital duties provided for in this Book hereof and poses a threat to the property interests of the family by his or her acts, the other spouse shall have a right to apply to the court for an order prohibiting the other spouse from disposing of their community property without the consent of the other spouse. The prohibition may not be valid for more than two years.

2. Transactions entered into by a spouse without the consent of the other spouse, which should have been obtained, may be annulled under an action brought by the other spouse provided the third party involved in the transaction was in bad faith. An action may be brought within a year of the date on which the spouse acquired or should have acquired knowledge of the transaction.

Article 3.35. Rights and duties of the spouses in the household

1. Neither spouse may, without the consent of the other spouse, alienate, pledge or lease movable property used in the household or encumber the right to it in any other way.

2. The movable property serving for the use of the household shall include household utensils, furniture, except for works of art, collections or home libraries.

3. A spouse having neither consented to nor ratified such a transaction may apply to have it annulled except in cases where the transaction was by onerous title and the third party was in good faith.

Article 3.36. The rights and duties of spouses in respect of the dwelling considered to be Family Property

1. Where the spouses live in a rented dwelling under a lease agreement, the spouse in whose name the dwelling is rented may not, without a written consent of the other spouse, terminate the lease agreement before its term, sublease it or transfer the rights under the lease agreement. The spouse having neither consented nor ratified such an act may apply to have it annulled.

2. A spouse who is the sole owner of the family dwelling may not, without a written consent of the other spouse, alienate, pledge or lease this dwelling. The spouse having neither consented to nor ratified such an act may apply to have it annulled provided that the disputed premises have registered in the public register as a family asset.

3. The rules of paragraph 1 and 2 shall be applied also in cases of usufruct (i. e. the right of using and receiving the profits, products or fruits of property that belongs to another) and contract of use.

CHAPTER III

NULLITY OF MARRIAGE

Article 3.37. The grounds and procedures for declaring marriage null and void

1. A marriage may be declared null and void if the conditions for the formation of a valid marriage set out in Articles 3.12 to 3.17 hereof have been violated as well as on the grounds provided for in paragraph 3 Article 3.21, Articles 3.39 and 3.40 hereof.

2. A marriage may be annulled only by the court.

3. A marriage that the court declares to be null and void shall be void ab initio.

4. Having pronounced a marriage null and void, the court must send a copy of its judgement to the Register Office where the marriage was registered within three business days of its effective date.

Article 3.38. Persons entitled to petition for a decree of nullity on the grounds of violation of the requirements for the formation of marriage.

1. A marriage formed in violation of the conditions set for the formation of marriage in Articles 3.16 and 3.17 hereof may be declared null and void on the petition of spouse who was ignorant of the impediments to the marriage, a public prosecutor or any other person whose rights and lawful interests were violated by the marriage.

2. A marriage formed in violation of the requirement set in Article 3.14 hereof may be declared null and void on the petition of a minor spouse, his or her parents, guardians or curators, public institutions for the protection of the child’s rights or a public prosecutor. After the minor spouse attains the age of 18, he or she shall be the only person who may petition for a decree of nullity.

3. A marriage formed in violation of the requirement set in Article 3.15 hereof may be declared null and void on the petition of the guardian of the spouse lacking capacity to marry, a public prosecutor or any other person whose rights and lawful interests have been violated by the marriage.

4. A marriage formed in violation of the requirement set in Article 3.13 hereof may be declared null and void on the petition of the spouse who had failed to express his or her free will at the time of the marriage or a public prosecutor. Where the who failed to express his free will is a minor, the nullity of the marriage may be sought by his or her parents, guardians, curators or a State institution for the protection of the child’s rights.

5. A judgement for the nullity of marriage on the grounds referred to in paragraph 3 Article 3.21 hereof may be sought by the party to the marriage who by the time of marriage had not been informed of the other party’s illness.

Article 3.39. Nullity of a fictitious (‘sham’) marriage

A marriage formed fictitiously without the true intention of creating a legal family relationship may be declared null and void on the petition of either spouse or a public prosecutor.

Article 3.40. Declaring a marriage null and void due to the lack of free will

1. A marriage may be declared null and void if a spouse can prove that at the time of marriage he or she was incapable of understanding the true meaning of his or her actions or of being in charge of them of being in charge of them.

2. Nullity of marriage may be sought by a spouse if he or she entered into the marriage under threat, duress or fraud.

3. A spouse who gave consent to the marriage in consequence of an essential mistake may seek the nullity of the marriage. The mistake is presumed to be essential if it is a mistake about the circumstances related to the other party the knowledge of which would have been a sufficient reason for the party not to enter into the marriage. The mistake is presumed to be essential if it is about:

1) the health condition or the sexual abnormality of a party which makes the usual family life impossible;

2) the grave crime committed by the other party.

Article 3.41. Bars to the nullity of marriage

1. The court may refuse to declare a marriage null and void if the circumstances which had constituted an impediment to the marriage hereunder disappeared during the proceedings of the case.

2. The court may refuse to declare a marriage contracted by a minor person null and void if the nullity of the marriage were contrary to the interests of the minor children of the minor spouse or spouses.

3. A marriage may not be pronounced to be a fictitious marriage if prior to the petition for nullity the spouses had created family relations or had cohabited for over a year from the date of marriage or had given birth to or were expecting their own child.

4. A marriage may not be declared null and void after divorce, except where the marriage had been contracted in violation of the monogamy principle or within the prohibited degrees of relationship (Articles 3.16 and 3.13).

5. A marriage which was contracted without one of the spouses expressing his free will may not be pronounced null and void if, after the formation of the marriage or after the knowledge of the circumstances giving a sufficient ground for pronouncing it null and void, the spouses lived together for over a year or they have given birth to or are expecting their own baby.

Article 3.42. Statutes of limitation

1. A spouse who entered into a marriage under the age of 18 may petition for the nullity of the marriage within a year of the date of his or her attaining full age.

2. Petition for the nullity of a marriage contracted without a free and voluntary consent may be presented within a year of the date on which the circumstances constituting the grounds for pronouncing the marriage null and void disappeared or became known.

3. Petition for the nullity of a fictitious marriage may be presented within a year of the date on which the marriage was contracted. A public prosecutor may petition for the nullity of a marriage under Article 3.39 hereof within five years of the date on which the marriage was contracted.

4. Petition for the nullity of a marriage on other grounds shall be subject to no limitations.

Article 3.43. Separation of spouses and maintenance order

1. In an effort to protect the interests of one of the spouses, the court may, circumstances permitting, order the spouses to separate pending the proceedings on the nullity of their marriage.

2. In pronouncing a marriage null and void, the court must decide as to the maintenance of the children and the spouse in good faith as well as to make a residence order in respect of the children.

Article 3.44. Extinguishment of the right to petition

1. The right to petition for the nullity of a marriage may not be devolved by succession or any other way.

2. After the death of one of the parties to a marriage, a public prosecutor may no longer initiate proceedings for the nullity of the marriage.

Article 3.45. Legal effects of marriage declared null and void

1. Any children born of a marriage subsequently decreed void by the court shall be treated as born within marriage.

2. Where both the spouses were in good faith, i. e. did not and could not know about the impediments to their marriage, the legal consequences of their marriage, although it has been declared null and void, shall be the same as those of a valid marriage except for the right of succession. Evidence of the good faith of the spouses must be indicated in the judgement of the court.

Article 3.46. Legal consequences of nullity where one or both spouses were in bad faith

1. With a null and void marriage where only one of the parties was in good faith, the party in good faith shall be entitled to all the rights a spouse is entitled to by virtue of a valid marriage.

2. With a null and void marriage where both the parties were in bad faith, they lose all the rights and duties spouses have by virtue of a valid marriage. Each of them shall have a right to recover their own property including the gifts to the other party.

Article 3.47. Rights of the spouse in good faith

1. If in need of maintenance, the spouse in good faith shall have a right to petition for maintenance from the spouse in bad faith for a period not exceeding three years.

2. The amount of the maintenance shall be at the discretion of the court having regard to the financial position of both the parties. The court may make an order for periodical monthly payments or one payment of a lump sum. If the financial position of one of the parties changes, the interested party may start apply for the increase, decrease or termination of maintenance.

3. An order for maintenance to the spouse in good faith terminates on the remarriage of the payee or at the end of the three-year period during which maintenance was paid.

Article 3.48. Mandatory participation of guardianship and care institutions

Where one or both spouses are of minor age or have been declared by the court lacking legal capacity, guardianship and care institutions or the public institution for the protection of the child’s rights must attend the proceedings for the nullity of the marriage of such persons and give their opinion on whether the nullity of the marriage may prejudice the rights and interests of such persons or their children.

CHAPTER IV

DISSOLUTION OF MARRIAGE

SECTION ONE

FUNDAMENTALS OF DISSOLUTION OF MARRIAGE

Article 3.49. Cases of dissolution of marriage

1. A marriage is dissolved by the death of one of the spouses or by termination by the operation of law.

2. A marriage may be dissolved by the mutual consent of the spouses, on the application of one of the spouses or through the fault of a spouse (spouses).

Article 3.50. Dissolution of marriage by the death of one of the spouses

1. A marriage is dissolved by the death or a court judgement of presumption of death of one of the spouses.

2. Where one of the spouses is presumed dead, the marriage shall be considered dissolved from the date on which the court judgement becomes res judicata or from date specified therein.

3. If the spouse who has been presumed to be dead by a court judgement turns up, the marriage may be renewed by the mutual application of the spouses to be presented, after the annulment of the court judgement of presumption of death, to the Register Office that registered the dissolution of marriage.

4. A marriage may not be renewed if the other spouse had remarried or there are impediments under Articles 3.12 to 3.17 hereof.

SECTION TWO

DIVORCE BY THE MUTUAL CONSENT OF THE SPOUSES

Article 3.51. Conditions for divorce

1. A marriage may be dissolved by the mutual consent of the spouses provided all the following conditions have been satisfied:

1) over a year has elapsed from the commencement of the marriage;

2) the spouses have made a contract in respect of the consequences of their divorce (property adjustment, maintenance payments for the children, etc.);

3) both the spouses have full active legal capacity.

2. In cases provided for in this Article divorce shall be obtained under simplified procedures.

Article 3.52. Application for divorce

1. A mutual application of the spouses for divorce shall be presented to the court of the district where one of the spouses resides.

2. The application must be accompanied by the contract as to the consequences of the divorce.

3. The application must contain reasons why, in the opinion of the spouses, their marriage has broken down.

Article 3.53. Divorce proceedings

1. The court grants a judgement of divorce if it is satisfied that the marriage has broken down irretrievably. A marriage shall be considered to have broken down irretrievably if the spouses no longer live together and it is not likely they will live together again.

2. An irretrievable breakdown of a marriage is presumed if the spouses have been separated form board and bed for over a year.

3. While granting a divorce decree, the court shall approve the contract of the spouses as to the consequences of divorce providing for the maintenance payments for the children of minor age and each other, the residence of their minor children, their participation in the education of their children and their other property rights and duties. The content of the contract shall be incorporated in the judgement of divorce. In case there is an essential change in the circumstances (illness of one of the former spouses, incapacity for work, etc.), the former spouses or one of them may petition the court to reconsider the terms and conditions of their contract as to the consequences of divorce.

4. Where the contract as to the consequences of divorce is not consistent with the public order or is an essential violation of the rights and lawful interests of the minor children of the spouses or of one of the spouses, the court shall not approve the contract and shall suspend the divorce proceedings until the spouses have made a new contract. If the spouses fail to comply with the directions of the court within six months of the suspension of the proceedings, the court shall not resume the consideration of the application for divorce.

Article 3.54. Reconciliation of spouses

1. The court must take measures to encourage the reconciliation of the spouses.

2. At the request of one of the spouses or on its own initiative the court may provide for an up to a six-month-long reconciliation period. At the end of the reconciliation period the divorce proceedings shall be resumed at the request of one of the parties.

3. If neither of the spouses petitions for divorce within a year of the beginning of the reconciliation period, the court does not resume the divorce proceedings.

4. Where the spouses have lived apart for over a year or the reconciliation period is essentially contrary to the interests of one of the spouses or those of their children, or where both the spouses require a substantive consideration of their case, the court shall not set any reconciliation period.

SECTION THREE

DIVORCE ON THE APPLICATION OF ONE OF THE SPOUSES

Article 3.55. Conditions for obtaining divorce

1. A marriage may be dissolved on the application of one of the spouses filed with the court of the district where the applicant resides, if at least one of the following conditions are satisfied:

1) the spouses have been separated for over a year;

2) after the formation of the marriage one of the spouses has been declared legally incapacitated by the court;

3) one of the spouses has been declared missing by the court;

4) one of the spouses has been serving a term of imprisonment for over a year for the commission of a non-premeditated crime.

2. On behalf of the spouse lacking legal capacity the application for divorce may be filed by his or her guardian, a public prosecutor or a guardianship and care institution.

Article 3.56. The content of the application

1. The application must contain the indication of one of the grounds for divorce under paragraph 1 Article 3.55 hereof.

2. The application must also indicate how the applicant is going to perform his or her obligations toward the other spouse and their minor children.

3. The application must also contain the data provided for in the Code of Civil Procedure.

Article 3.57. Examination of the application

1. A spouse’s application for divorce shall be examined in a simplified procedure.

2. Where divorce proceedings are commenced on the application of one of the spouses, the reconciliation measures referred to in Article 3.54 shall not be applied.

3. The court having regard to the age of one of the spouses, the duration of marriage, the interests of the minor children of the family may refuse to grant a divorce decree if the divorce may cause significant harm to the property and non-property interests of one of the spouses or their children.

4. The other spouse or his or her guardian shall have a right to declare that the marriage has broken down through the applicant’s fault and demand that the court grant divorce on the basis of the applicant’s fault. If the court considers the declaration to be well grounded, divorce shall be granted on the basis of the fault of the spouse who initiated the divorce proceedings (Article 3.60 hereof).

Article 3.58. Mandatory participation of guardianship and care institutions

Where one of the spouses lacks legal capacity, a guardianship and care institution must present its opinion to the court concerning the guarantees of the interests of the spouse lacking legal capacity on divorce.

Article 3.59. Matters to be resolved by the court in granting divorce

In granting a divorce the court must resolve matters relating to the residence and maintenance of the minor children, the maintenance of one of the spouses, adjustment of the community property of the spouses, except in cases where the property has been adjusted by the mutual agreement of the spouses certified in the notarial procedure.

SECTION FOUR

DIVORCE ON THE BASIS OF THE FAULT OF ONE OR BOTH OF THE SPOUSES

Article 3.60. Conditions for obtaining divorce

1. A spouse may apply for divorce on the grounds provided for in this Section where the marriage has broken down through the fault of the other spouse.

2. The fault of a spouse for the breakdown of the marriage shall be established if he or she has seriously breached the duties under this Book hereof, which is the reason why their matrimonial life has become impossible.

3. A marriage shall be presumed to have broken down through the fault of the other spouse where he or she has been convicted of a pre-meditated crime or has committed adultery or is violent toward the other spouse or the other members of the family or has deserted the family and has not been caring for it for over a year.

Article 3.61. Both spouses at fault

1. The respondent in a divorce suit may argue against his or her fault and adduce facts to prove that the other spouse is at fault for the breakdown of the marriage.

2. The court having regard to the circumstances of the case may declare that both parties are at fault for the breakdown of the marriage.

3. A divorce based on the fault of both spouses shall have the same consequences as the dissolution of marriage by the mutual consent of the spouses (Articles 3.51 to 3.54).

Article 3.62. Divorce procedure

1. A divorce on the basis of the fault of one of the spouses shall be granted by the court under contentious procedure.

2. At the request of one of the spouses divorce proceedings shall be held in a closed hearing.

3. Divorce proceedings shall be subject, mutatis mutandis, to Article 3.59 hereof.

Article 3.63. Omission of the specific causes of a divorce from the court judgement

At the request of both spouses the court, in granting a divorce, shall omit the specific facts evidencing the fault of one or both the spouses for the dissolution of the marriage from the judgement and merely indicate that the marriage has broken down through the fault of one or both the spouses.

Article 3.64. Conciliation of spouses

1. The court must take measures to achieve a reconciliation of the spouses.

2. The court must suggest that the spouses reach an amicable settlement of their respective property interests, the maintenance and education of their children as well as other consequences of their divorce. If the spouses reach an agreement, paragraphs 3 and 4 of Article 3.53 hereof shall be applied.

3. The court shall apply measures provided for in paragraph 2 and 3 of Article 3.54 hereof, except in cases where the application of those provisions may be detrimental to the interests of the applicant or the minor children of the spouses.

Article 3.65. Provisional protection measures

1. The court having regard to the interests of the children of the spouses as well as the interests of one of the spouses may make orders for provisional protection measures pending the outcome of the divorce suit.

2. The court may make the following orders for provisional protection measures:

1) to order one of the spouses to live separately;

2) to determine the residence of the minor children with one of the parents;

3) to demand for one of the spouses not to interfere with the use of certain property by the other spouse;

4) to issue a maintenance order in favour of the minor children or the other spouse;

5) seize property until its ownership by one of the spouses is determined or in order to enforce maintenance payments;

6) seize the property of one of the spouses the value of which could be used to compensate for the litigation costs to the other spouse;

7) prohibit one of the spouses from having contact with his or her minor children or appearing in certain places.

SECTION FIVE

LEGAL EFFECTS OF DIVORCE

Article 3.66. The moment of the dissolution of marriage

1. A marriage shall be considered to be dissolved on the date when the divorce judgement becomes res judicata.

2. The court must send a copy of the divorce judgement to the local Register Office for the registration of the divorce within three business days of the date of res judicta of the judgement.

Article 3.67. Consequences of divorce to the property interests of the spouses

1. Legal consequences of divorce to the property interests of the spouses shall be produced from the moment of the commencement of divorce proceedings.

2. A spouse other than the one determined to be at fault for the breakdown of the marriage may ask the court to rule that the legal consequences of divorce to the interests of the spouses shall be produced from the day of their actual separation.

Article 3.68. Invalidation of transactions made after the commencement of the divorce proceedings

Transactions related to the joint property of the spouses made by one of the spouses after the commencement of the divorce proceedings may be invalidated by the court in an action brought by the other spouse provided the other spouse can prove that the transaction was made with the aim of prejudicing his or her interests while the third party was in bad faith.

Article 3.69. Surnames of the former spouses

1. On divorce, a spouse may retain his or her married surname or the surname he or she had before the marriage.

2. Where a marriage is dissolved on the basis of the fault of one of the spouses, the court may, at the request of the other spouse, prohibit the spouse at fault from retaining his or her married surname, except in cases where the spouses have children.

Article 3.70. Legal consequences of a divorce on the basis of the fault of one of the spouses

1. Where a divorce is granted on the basis of the fault of one of the spouses, the spouse at fault shall lose the rights of a divorcee under the law or under the marriage contract including the right to maintenance.

2. The other spouse may demand from the spouse responsible for the breakdown of the marriage damages related to the divorce as well as compensation for non-pecuniary damage done by the divorce. This provision shall not be applied where both spouses are responsible for the breakdown of the marriage.

3. At the request of the other spouse the spouse at fault for the breakdown of the marriage shall return the gifts received from him or her except for the wedding ring unless the marriage contract provides otherwise.

4. Where both spouses are responsible for the breakdown of the marriage, both of them shall have a right to demand the return of the immovable gifts given to each other unless more than ten years have elapsed from the gift contract and the immovable property has been transferred to third parties.

Article 3.71. Retention of the right to use the matrimonial dwelling

1. Where the matrimonial dwelling is owned by one of the spouses, the court may make a usufruct order and allow the other spouse to remain in the matrimonial dwelling if their minor children live with him or her.

2. The usufruct order shall be valid until the child (children) attain majority.

3. Where the matrimonial dwelling is rented, the court may award the rights of the lessee to the spouse that remains to live with their minor children or that lacks capacity for work and may evict the other spouse if he or she has been ordered to live separately.

Article 3.72. Mutual maintenance of the former spouses

1. The court when making a divorce judgement shall also make a maintenance order in favour of the spouse in need of maintenance unless the matters of maintenance are settled in the agreement of the spouses concerning the consequences of divorce. A spouse shall have no right to maintenance if his or her assets or income are sufficient to fully support him or her.

2. Maintenance shall be presumed to be necessary if he or she is bringing up a minor child of the marriage or is incapacitated for employment because of his or her age or state of health.

3. A spouse that was not able to obtain any qualifications for work (complete his or her studies) because of the marriage, common interests of the family or the need to care for the children, shall have a right to demand from the former spouse to cover the costs related to the completion of his or her studies or retraining.

4. The spouse responsible for the breakdown of the marriage shall have no right to maintenance.

5. While making a maintenance order and deciding on its amount, the court shall take into account the duration of the marriage, the need for maintenance, the assets owned by the former spouses, their state of health, age, capacity for employment, the possibility of the unemployed spouse of finding employment and other important circumstances.

6. The amount of maintenance shall be reduced, made temporary or refused if one of the following circumstances exist:

1) the marriage lasted for a period not exceeding a year;

2) the spouse entitled to maintenance has committed a crime against the other spouse or his or her next of kin;

3) the spouse entitled to maintenance has created his or her difficult financial situation through his or her own irresponsible acts;

4) the spouse requesting maintenance did not contribute to the growth of their community assets or wilfully prejudiced the interests of the other spouse or the family during the marriage.

7. The court may demand from the spouse obliged to provide maintenance to the other spouse to produce an adequate guarantee of fulfilment of this obligation.

8. The court may make maintenance orders for a lump sum or periodical (monthly) payments or property adjustment.

9. Where divorce is based on the application of one of the spouses because of the legal incompetence of the other spouse, the applicant spouse must cover the treatment and care expenses of the former incompetent spouse unless the expenses are covered from state social security funds.

10. The maintenance order shall be the basis for the forced pledge of the respondent’s assets. If the former spouse defaults on his or her obligation to pay maintenance, his or her assets may be used to make payments in the procedure laid down by the law.

11. Where the maintenance order is for periodical payments, a significant change in the circumstances referred to in paragraph 5 of this Article may warrant the application of either of the former spouses for an increase, reduction or termination of maintenance payments. Periodical payments shall be for the life of the creditor and shall be inflation-indexed annually in the procedure laid down by the Government.

12. After the death of the spouse obliged to pay maintenance, the obligation to pay maintenance is devolved on his or her successors to the extent of his or her estate irrespective of the way the estate is accepted.

13. Where the payee dies or remarries, the maintenance payment shall be terminated. On the payee’s death, the right to demand arrears of the maintenance payments shall pass to the payee’s successors. The dissolution of the new marriage shall create a right to apply for the renewal of maintenance payments provided the payee is bringing up a child by his or her former spouse or is caring for a disabled child by his or her former spouse. In all other cases the duty of the subsequent spouse to maintain the payee shall take precedence over that of the first former spouse.

CHAPTER V

SEPARATION

Article 3.73. Application for separation

1. One of the spouses may apply to the court for the approval of the separation if due to certain circumstances, which may not depend on the other spouse, their life together has become intolerable (impossible) or can seriously prejudice the interests of their minor children or the spouses are no longer interested in living together.

2. Both spouses may jointly apply to the court for the approval of their separation if they have made a contract concerning the consequences of their separation providing for the residence, maintenance and education of their minor children as well as for the adjustment of their property and mutual maintenance.

Article 3.74. Counter-applications

1. The defendant in a separation case shall have a right to lodge a counter-claim for divorce.

2. The defendant in a divorce case shall have a right to lodge a counter-claim for separation.

3. Where one of the spouses seeks a divorce while the other spouse applies for separation, the court may make a divorce order on the basis of the fault of one or both of the spouses or it may make a separation order.

Article 3.75. Separation procedure

1. The court shall examine applications for separation in the contentious procedure.

2. Having regard to the interests of the minor children of the spouses as well as to the interests of one of the spouses the court shall take measures to foster a reconciliation of the spouses (Article 3.54 hereof).

3. The court may order provisional protection measures referred to in Article 3.65 hereof.

Article 3.76. Matters to be resolved in making a separation judgement

1. When making a separation judgement, the court must designate the spouse with whom the children are to live, the maintenance of the children and the involvement of the separated father (mother) in the education of their children.

2. Having regard to important circumstances, the court may make an order for the residence of the children with other persons or in a guardianship or care institution.

3. In deciding which of the spouses should have a right to stay in their matrimonial dwelling, first consideration must be given to the spouse with whom the minor children are to live or to the spouse lacking capacity for work.

4. Where the spouses have made a contract as to the consequences of separation (paragraph 2 Article 3.73), the court shall approve the contract provided that it is consistent with public order, the rights and lawful interests of their minor children or one of the spouses. Having approved the contract, the court shall incorporate its content in the separation judgement.

5. If there is a serious change in the circumstances significant for the matters related to the separation of the spouses, either spouse may seek the reconsideration of the former judgement and a different resolution of matters referred to in paragraph 1 of this Article based on the change in the circumstances.

Article 3.77. Legal consequences of separation

1. When the court makes a separation judgement, it releases the spouses form the obligation to live together, but the other rights and duties of the spouses shall not be extinguished except in cases provided for herein.

2. Separation shall not produce any effects on the rights and duties of he spouses in respect of their minor children except in cases provided for herein.

3. When making a separation judgement, the court must always make a property adjustment order unless those matters are settled in the marriage contract of the spouses.

4. The legal consequences of separation for the property interests of the spouses shall be produced from the initiation of the separation suit. However, the spouse other than the one responsible, in the opinion of the court, for the separation may ask the court to make the legal consequences of separation retroactive to the date on which the spouses ceased to live together.

5. If one of the separated spouses dies, the survivor shall retain all the rights of a surviving spouse under the law, except where the surviving spouse has been declared by the court to be at fault for the separation. The same rule shall apply where the court makes a separation order on the basis of the joint application of the spouses unless the marriage contract of the spouses stipulates otherwise. The surviving spouse, however, shall lose the right of succession to the estate of the deceased spouse.

Article 3.78. Mutual maintenance of the spouses

1. When issuing a separation order, the court may order the spouse at fault for the separation to pay maintenance to the other spouse in need of it unless the maintenance matters are settled in the agreement of the spouses.

2. When making a maintenance order and determining the amount, the court must take into consideration the duration of the marriage, the need for maintenance, the financial position of both spouses, their state of health, age as well as their earning capacity, the unemployed spouse’s chances of finding employment and other important circumstances.

3. The court may rule that the spouse under the obligation to pay maintenance to other spouse must provide a security that the obligation will be fulfilled.

4. Maintenance may be ordered as a lump sum of a certain amount or periodical monthly payments or property transfer.

5. The maintenance order shall be the basis for the statutory pledge of the respondent’s assets. If a spouse defaults on his or her obligation to provide maintenance, his or her assets may be used to make payments in the procedure laid down by the law.

6. Where maintenance has been ordered in the form of periodical payments, a fundamental change in the circumstances referred to in paragraph 2 of this Article, either spouse may claim an increase, reduction or termination of the payments. Periodical payments shall be indexed annually in the procedure laid down by the Government.

Article 3.79. End of a separation

1. A separation shall end when the spouses start living together again and their life together proves their intention to live together permanently. A separation shall end when, on the joint application of the spouses, the court makes a judgement to end the separation, which revokes its former separation order.

2. On the resumption of their life together, the spouses shall remain separate as to property until they make a new marriage contract and set a new matrimonial regime.

3. The end of separation shall produce effects for third parties only if the spouses make a new marriage contract and register it in the procedure provided for in Article 3.103 hereof.

4. Where the spouses are separated for more than a year after the date when the court judgement became res judicata, either spouse may seek divorce on the basis provided for in point 1 paragraph 1 Article 3.55 hereof.

Article 3.80. Mandatory participation of the state institution for the protection of the child’s rights

Where the spouses have children of minor age, the state institution for the protection of the child’s rights must participate in the proceedings and present its conclusion on the possible violation of the children’s rights in taking decisions on separation matters.

PART III

RIGHTS AND DUTIES OF THE SPOUSES IN PROPERTY

CHAPTER VI

LEGAL REGIME OF PROPERTY OF SPOUSES

SECTION ONE

GENERAL PROVISIONS

Article 3.81. Kinds of legal regime of property of spouses

1. There shall be statutory and contractual legal regime of the property of spouses.

2. The statutory legal regime of the property of spouses shall be governed by Articles 3.87 to 3.100 hereof.

3. The contractual regime of the property of spouses shall be governed by Articles 3.101 to 3.108 hereof.

Article 3.82. Application of Statutory Legal Regime of Property

Where the spouses have not made a marriage contract, their property shall be subject to the statutory regime.

Article 3.83. The right of the spouses to fix their matrimonial regime in their marriage contract

1. When making a marriage contract, the spouses shall have a right to determine their matrimonial regime as they think fit.

2. Provisions of a marriage contract inconsistent with good morality or public order shall be null and void.

Article 3.84. Family assets

1. Any assets referred to in paragraph 2 of this Article owned by either spouse before or during the marriage shall be considered to be family assets. Family assets may be used only to meet the needs of the family.

2. The following assets owned by one or both spouses shall be family assets:

1) the family dwelling;

2) movables intended for the use in the household including furniture.

3. Family assets shall include the right to use the family dwelling.

4. Assets referred to in paragraphs 2 and 3 of this Article shall acquire the legal status of family assets on the date of the registration of marriage, but the spouses may use this fact in respect of third parties in good faith only if an immovable is registered in the public register as a family asset.

Article 3.85. Legal regime of family assets

1. Assets referred to in paragraph 2 Article 3.84 hereof, which are the personal property of one of the spouses, may be used, managed or disposed of only in accordance with this Article.

2. The spouse who is the owner of an immovable considered to be a family asset, may transfer ownership rights to it, charge it or encumber the rights to it in any other way only with the written consent of the other spouse. Where the spouses have children of minor age, transactions in respect of an immovable considered to be a family asset require a judicial authorisation.

3. Family assets may not be used against a creditor if the creditor knew or should have known that the transaction is not related to meeting the needs of the family and is contrary to the interests of the family.

4. The legal regime of family assets or the composition of the family assets may not be changed by an agreement of the spouses.

Article 3.86. End of the legal regime of family assets

1. The legal regime of family assets shall end on divorce, declaration of the nullity of marriage or separation of the spouses.

2. The court may award the right to use family assets or a certain part of them (usufruct) to the spouse with whom the minor children of the marriage will live. The usufruct shall be valid until the children attain majority.

3. Where the spouses rent a family dwelling, the court may transfer the lessee rights to the spouse with whom the children will live or the spouse who lacks earning capacity.

4. The court may award the chattels intended for the use in the household to the spouse who stays in the family dwelling together with the minor children.

SECTION TWO

STATUTORY LEGAL REGIME OF PROPERTY OF SPOUSES

Article 3.87. Definition of the fundamentals of the legal regime of property

1. Under the legal regime the property acquired by the spouses after the commencement of their marriage shall be their joint community property.

2. The property of spouses constitutes their joint community property until their separation as to property or until the extinguishment of the joint community property rights in some other way.

Article 3.88. Joint community property

1. Joint community property shall be:

1) property acquired after the formation of marriage in the name of one or both of the spouses;

2) the income and fruits collected from the individual property of a spouse;

3) income derived from the joint activities of the spouses, and income derived from the activities of one of the spouses except for the funds required for that spouse’s occupation;

4) an enterprise and the income derived from the operations of the enterprise or any other business provided that the spouses took up such business activities after the commencement of the marriage. Where the enterprise was owned by one of the spouses before the marriage, the joint community property shall include the income derived from the operations of the enterprise or any other business and the increase of the enterprise (business) after the formation of the marriage;

5) income from the work or intellectual activities, dividends, pensions, benefits or other payments collected by both spouses or one of them after the commencement of the marriage except for payments received for specific purposes (such as damages for moral or corporal injury, support, allowance or other benefits paid specifically to only one of the spouses, etc.).

2. All property shall be presumed to be joint community property unless it is established that it is the individual property of one of them.

3. Both spouses must be registered as the owners of the joint community property in the public register. Where the property is registered in the name of one of the spouses, it shall be considered to be joint community property provided it is registered as joint community property.

4. On divorce, a spouse shall have the right to claim one half of the funds accumulated in a private pension fund from the joint financial sources of the spouses.

Article 3.89. Individual property of the spouses

1. The individual property of each spouse shall consist of:

1) property acquired separately by each spouse before the commencement of the marriage;

2) property devolved to a spouse by succession or gift during the marriage unless the will or donation agreement indicates that the property is devolved as joint community property;

3) a spouse’s personas effects (footwear, clothing, instruments required for the spouse’s occupation);

4) the rights to intellectual or industrial property except for the income derived from those rights;

5) funds and chattels required for the personal business of one of the spouses other than the funds and chattels used in the business conducted jointly by both spouses;

6) damages and compensation payments received by one of the spouses for non-pecuniary damage or personal injury, payments as financial aid for specific purposes and other benefits related specifically to only one of the spouses, rights that may not be transferred;

7) property acquired with the separate funds or proceeds from the sale of a separate property with the express intention of the spouse at the time of the acquisition to acquire it as a separate property.

2. The fact of property being a separate individual property of one of the spouses may be proved only by written documents (evidence) except in cases where the law allows to accept the testimony of witnesses or the nature of the property is sufficient proof of it being a separate property of one of the spouses.

3. Individual property that one of the spouses transfers to the temporary possession of the other spouse to meet the latter’s personal needs shall remain a separate property of the transferor.

Article 3.90. Declaration of individual property to be joint community property

1. The court may declare an individual property of one of the spouses to be joint community property if it is established that during the marriage the property was fundamentally improved with the joint funds of the spouses or with the funds of or due to the work of the other spouse (capital investments, reconstruction, etc.).

2. Where a spouse used both his or her separate funds and the funds owned jointly with the other spouse to acquire a property for his or her own personal needs, the court may declare the property so acquired to be joint community property provided the value of the joint community funds used to acquire such property exceeded the value of the separate funds of the spouse so expended.

Article 3.91. Enterprise (farm, business)

Property required for the operation of an enterprise (farm, business) established by one of the spouses after the formation of the marriage as well as the income of the enterprise (farm, business) established by one of the spouses before the formation of the marriage other than the funds required for the operation of the spouse’s personal enterprise (farm, business) shall be joint community property provided that property exists at the moment of divorce.

Article 3.92. Management, use and disposal of joint community property

1. Joint community property shall be used, managed and disposed of by the mutual agreement of the spouses.

2. The consent of the other spouse shall not be required for:

1) the acceptance or rejection of succession to estate;

2) the refusal to enter a contract;

3) urgent measures to protect the community property;

4) bringing an action to protect the joint community property;

5) bringing an action to protect one’s rights related to community property or one’s personal rights unrelated to the interests of the family.

3. When making transactions a spouse shall be presumed to have the consent of the other spouse except in cases where entering into a transaction requires the written consent of the other spouse. In exceptional cases where delay would cause serious damage to the interests of the family while the other spouse is unable to express his or her will because of illness or some other objective reasons, a spouse may enter into a transaction without the consent of the other spouse in accordance with the procedure laid down in Paragraph 2 Article 3.32 hereof.

4. Transactions related to the disposal or encumbrance of a jointly co-owned immovable or the rights to it, also transactions on the alienation of a jointly co-owned enterprise or securities or the encumbrance of the rights to them may be made only by both spouses except where one of the spouses has been given the power of attorney by the other spouse to enter into such a transaction.

5. Each spouse shall have a right to open a bank account in his or her name without the consent of the other spouse and to dispose freely of the funds on the account unless those funds have been made joint community property.

6. Where a transaction has been made without the consent of the other spouse, that other spouse may ratify the transaction within a month of the date when he or she learnt about the transaction. Before its ratification the other party may withdraw from the transaction. If the other spouse does not ratify the transaction within a month, the transaction shall be declared as having been made without the consent of the other spouse. If the other party to the transaction knew that the person with whom it was entering into the transaction was married, it can withdraw from the transaction only if the spouse misrepresented the existence of the other spouse’s consent.

Article 3.93. Consent to enter into a transaction

1. Where a spouse does not give the other spouse consent required to enter into a transaction, the interested spouse may seek leave to enter into the transaction in court.

2. The court shall award leave to enter into a transaction only if the interested spouse can prove that the transaction is necessary to meet the needs of the family or the needs of their jointly co-owned business.

Article 3.94. Power of attorney to manage property

1. A spouse may give a power of attorney to the other spouse to manage, use and dispose of their joint community property.

2. Where one of the spouses is away or cannot participate in the management of the community property for important reasons, the other spouse may apply to the court to be authorised to manage such property alone.

3. If the spouse is negligent or unreasonable in managing joint community property alone, he or she shall be liable for the losses sustained through his or her fault and shall compensate for them against his or her separate property.

4. Management of property shall be governed mutatis mutandis by the rules of Book Four hereof regulating the management of property owned by another person.

Article 3.95. Challenging the competence of managing joint community property

1. Where a spouse is unable to manage community property or does that in a way that incurs losses, the other spouse may apply to have the court remove the spouse from managing the property. The court shall grant the requested removal if the applicant can prove that it is necessary to ensure the needs of the family or those of their joint business.

2. Once the grounds for removal disappear, the removed spouse may request the court to allow him or her to manage the community property again.

Article 3.96. Avoidance of transactions

1. Transactions made without the consent of the other spouse and not ratified by him or her later, may be avoided in an action brought by that spouse within a year of the date when he or she learnt about the transaction provided it is proved that the other party to the transaction was in bad faith.

2. Transactions that should have been made with a written consent of the other spouse or could only have been made jointly by both the spouses (Paragraph 4 Article 3.92 hereof) may be declared void irrespective of the other party to the transaction being in good or bad faith except in cases where one or both of the spouses used fraud in making the transaction or made misrepresentations to institutions in charge of public registers or to any other institutions or officials. In such cases the transaction may be declared void only if the other party to the transaction was in bad faith.

Article 3.97. Management of the individual property of a spouse

1. A spouse shall use, manage or dispose of his or her individual property at his or her own discretion. Management, use or disposal of property defined herein as family assets shall be subject to the restrictions laid down in this Book.

2. Where a spouse manages his or her individual property in such a negligent or unreasonable way that it endangers the interests of the family because the property may be lost or substantially reduced, the other spouse shall have a right to seek in court the appointment of an administrator for the management of such property. The court may appoint the applicant to be the administrator.

3. After the circumstances which caused the appointment of an administrator disappear, either spouse may apply to the court to have the appointment of an administrator revoked.

4. A spouse may grant a power of attorney to the other spouse to manage his or her individual property. In such a case the mutual relations of the spouses in property shall be governed by the rules of Book Two hereof on the regulation of legal agency relations.

5. Where a spouse cannot manage alone his or her individual property and contribute to the needs of the household due an illness or any other objective reason, the other spouse shall have a right to use the individual funds and assets of the spouse incapable of managing alone his or her property for the needs of the household. The rule shall not be applied in cases where the spouses are separated or an administrator has been appointed for the individual property of the spouse unable to manage it alone and make a contribution towards meeting the needs of the household.

Article 3.98. Right to compensation

1. Where the value of the joint community property is increased by adding the individual property of one of the spouses, the spouse the addition of whose property has increased the value of the joint community property shall be entitled to compensation against the community property.

2. A spouse shall be entitled to compensation also in cases when his or her individual funds have been used for the acquisition of joint community property.

3. Each of the spouses must compensate for the reduction of the joint community property if he or she has used it for purposes unrelated to the duties referred to in Article 3.109 hereof, except in cases where he or she can prove that the property has been used to satisfy the needs of the family.

4. The compensations referred to in this Article shall be paid when the spouse’s joint co-ownership ends.

Article 3.99. Gifts of the spouses

1. Spouses shall have a right to make gifts of assets to each other in accordance with the rules of Book Six hereof, regulating gift agreements.

2. An agreement on a gift of an immovable shall give rise to legal consequences for the creditors of the donor only if the agreement has been recorded in a public register.

3. The beneficiary spouse shall be liable to the creditors of the donor for the obligations of the donor that existed at the time the gift agreement was made to the extent of the value of the gift. Where the gift is lost through no fault of the beneficiary, his or her liability for the obligations of the donor shall be extinguished.

Article 3.100. Grounds for termination of joint co-ownership of the spouses

Joint co-ownership rights of the spouses shall end on:

1) the death of one of the spouses;

2) presumption of the death of one of the spouses or the judicial declaration of one of the spouses as missing;

3) the declaration of the nullity of the marriage;

4) divorce;

5) separation;

6) the judicial partitioning of the community property;

7) the change of the legal regime of property in accordance with the mutual agreement of the spouses;

8) in other cases laid down by the law.

SECTION THREE

CONTRACTUAL LEGAL REGIME OF PROPERTY OF SPOUSES

Article 3.101. Marriage contract

A marriage contract shall mean an agreement of the spouses defining their property rights and duties during the marriage as well as on divorce or separation.

Article 3.102. Making a marriage contract

1. A marriage contract may be made before the registration of the marriage (pre-nuptial contract) or at any time after the registration of the marriage (post-nuptial contract).

2. A marriage contract made before the registration of the marriage shall come into effect on the day of the registration of the marriage. A post-nuptial contract shall come into force on the date on which it is made unless the agreement stipulates otherwise.

3. A minor may enter into a marriage settlement only after the registration of the marriage.

4. A spouse declared by the court as having limited active capacity may enter into a marriage contract only with a written consent of his or her custodian. If the custodian refuses to give consent, the spouse may apply to the court for leave to enter into a marriage contract.

Article 3.103. The form of a marriage contract

1. A marriage contract must be entered into before the notary public. .

2. A marriage contract as well as its subsequent amendments must be registered in the register of marriage contracts maintained by mortgage institutions in the procedure laid down by the rules of the register. A marriage contract may be amendment only with leave of the court. In no case may the amendments of a marriage contract be retroactive.

3. A marriage contract and its amendments may be used against third parties provided the settlement and its amendments have been registered in the register of marriage contracts. This rule shall not apply if at the time of the transaction the third parties knew of the marriage contract and its amendments.

Article 3.104. Content of a marriage contract

1. Spouses shall have a right to stipulate in the marriage contract that:

1) property acquired both before and during the marriage shall be the individual property of each spouse;

2) individual property acquired by a spouse before the marriage shall become joint community property after the registration of the marriage;

3) property acquired during the marriage shall be partial community property.

2. In their marriage contract the spouses may stipulate that one of the matrimonial legal regimes referred to in Paragraph 1 of his Article shall be applied to their entire property or only to its certain part or to specified chattels.

3. In their marriage contract the spouses may define a matrimonial legal regime both in respect of their existing and future property.

4. A marriage contract may contain the stipulation of rights and duties related to the management of property, mutual maintenance, participation in the provision for family needs and expenses as well as the procedure for partitioning property on divorce and other matters related to the spouse’s mutual relations in property.

5. The rights and duties of the spouses provided for in their marriage contract may be limited in time, or the emergence or termination of rights and duties may be related to the fulfilment or omission of a certain condition stipulated in the marriage contract.

Article 3.105. Nullity of conditions in a marriage contract

Conditions stipulated in a marriage contract shall be null and void if they:

1) contradict the mandatory legislative rules, good morality and public order;

2) change the legal regime in respect of the individual property of one of the spouses or in respect of their joint community property (Articles 3.88 and 3.89) where the matrimonial legal regime the spouses have chosen provides for joint community property;

3) prejudice the principle of equal parts in joint community property enshrined in Article 3.117 hereof;

4) restrict the passive or active legal capacity of the spouses;

5) regulate the personal relations of the spouses unrelated to property;

6) establish or change the personal rights and duties of the spouses towards their children;

7) limit or annul the right of one (or both) of the spouses to maintenance;

8) limit or annul the right of one (or both) of the spouses to bring legal proceedings in court;

9) change the procedure and conditions of succession in property.

Article 3.106. Amendments and termination of a marriage contract

1. A marriage contract may be amended or terminated by the mutual agreement of the spouses at any time in the same form as that laid down for its formation.

2. An amendment to a marriage contract or its termination may be used against third parties provided the amendment or termination of the marriage contract has been registered in the register of marriage contracts settlements. This rule shall not be applied if at the time of the transaction the third parties knew of the amendment or termination of the marriage contract.

3. At the request of one of the spouses a marriage contract may be amended or terminated by the judgement of the court on the grounds provided for in Book Six hereof for the amendment or termination of a marriage contract.

4. The creditors of one or both of the spouses whose rights have been prejudiced by the amendment or termination of the marriage contract may, within a year of becoming aware of the amendment or termination, challenge in court such an amendment or termination and require the restoration of their rights.

Article 3.107. Termination of a marriage contract

A marriage contract shall terminate on divorce or on separation except in respect of the duties which under the agreement remain in force on divorce or separation. The termination of a marriage contract shall be registered in the register of marriage contracts.

Article 3.108. Nullity of a marriage contract

1. In addition to the grounds provided for in Article 3.105 hereof, a marriage contract may be declared null and void, wholly or in part, on the grounds for the nullity of transactions provided for in Book One hereof.

2. The court may declare a marriage contract null and void at the request of one of the spouses if the agreement is in serious breach of the principle of equality or is especially unfavourable for one of the spouses.

3. The creditors of one or both of the spouses shall have a right to demand that the agreement be declared null and void because it is fictitious.

CHAPTER VII

CIVIL LIABILITY OF SPOUSES FOR OBLIGATIONS IN PROPERTY

Article 3.109. Obligations discharged from community property

1. The following obligations shall be discharged from the community property of spouses:

1) obligations related to the encumbrances of property acquired in co-ownership that existed at the time of acquisition or were created later;

2) obligations related to the costs of managing community property;

3) obligations related to the maintenance of the household;

4) obligations related to legal expenses where the action is related to community property or the interests of the family;

5) obligations arising from transactions made by one of the spouses with the consent of the other spouse or ratified by the latter subsequently as well as obligations arising from transactions for which no consent of the other spouse was required provided that the transactions were made in the interests of the family;

6) joint and several obligations of the spouses.

2. Either spouse shall have a right to enter into transactions necessary to maintain the family and to secure the upbringing and education of the children. Both spouses shall be jointly and severally liable for the obligations arising from such transactions whatever their matrimonial regime may be except in cases where the price of the transactions is clearly too high and unreasonable.

3. Joint and several liability of the spouses shall not be created where one of the spouses takes a loan or acquires goods under credit purchase, which is not necessary for the needs of the family, without the consent of the other spouse.

4. In creating and discharging obligations related to the needs of the family the spouses shall be as prudent and careful as in creating and discharging their own personal obligations.

Article 3.110. Liability of spouses for obligations created before the registration of marriage

1. Community property may not be used to discharge the obligations of spouses created before the registration of marriage except those charged against the relevant spouse’s share in community property.

2. The claims of the spouses’ common creditors to be discharged from community property shall take precedence over the claims of the separate creditors of each spouse. This rule shall not apply to mortgage creditors.

Article 3.111. Obligations arising from gift agreements or succession

Where one of the spouses receives a gift or comes into inheritance, the obligations arising therefrom may not be paid from community property unless the gift or the inheritance has been received as community property.

Article 3.112. Liability for the obligations of one of the spouses

1. Claims arising from the transactions made after the registration of marriage by one of the spouses without the consent of the other spouse may be discharged from community property if the individual property of the spouse is not sufficient to meet the claims of the creditors.

2. Legal expenses shall be discharged from the individual property of a spouse if the lawsuit is not related to community property or the interests of the family.

Article 3.113. Enforcement against the individual property of spouses

Where the community property is not sufficient to meet the joint and several claims of creditors, the claims shall be discharged met from the individual property of the spouses.

Article 3.114. Separation of the liability of spouses

1. If the marriage contract stipulates that property acquired both before and during marriage is to be treated as the individual property of one and the other spouse, the spouses shall be liable for their obligations only by their individual properties. In such cases the spouses shall be jointly and severally liable for their joint obligations and the obligations in the interests of the family.

2. Spouses shall not be held to be each other’s guarantors or surety in obligations arising in the management or disposal of property that is an individual property of one and the other spouse.

Article 3.115. Entitlement to compensation

1. The spouse whose fines for breaches of law or damages incurred through his or her actions have been paid from the joint community property shall be obliged to compensate for the reduction of the joint community property.

2. If a transaction was made to meet the personal needs of only one of the spouses by using joint community property, that spouse shall be obliged to compensate for the reduction of the joint community property.

CHAPTER VIII

DIVISION OF JOINT COMMUNITY PROPERTY

Article 3.116. Ways of division

1. On the application of one of the spouses or their creditors, joint community property may be divided by the mutual agreement of the spouses or by a court judgement during marriage and on divorce or separation.

2. The rules of this Chapter shall be applicable where the spouses have not made a marriage contract.

Article 3.117. Shares of the spouses in joint community property

1. The shares of the spouses in joint community property shall be presumed to be equal.

2. Departure from the principle of the equality of the shares of the spouses in joint community property shall be permitted only in cases provided for herein.

3. Where the value of the property awarded by the court to one of the spouses is greater than his or her share in the joint community property, that spouse shall be obliged to pay a compensation to the other spouse. Upon the presentation of an adequate security for this liability, the court may defer the payment of the compensation for no longer than two years.

4. On the death of one of the spouses, his or her share in the joint community property shall be inherited according to the rules of Book Five hereof.

Article 3.118. Balance of property

1. Before partitioning the joint community property of the spouses, first the community property and the respective individual property of the spouses shall be established.

2. The community property shall first be used to pay (award) the debts that have fallen due and are payable from this property. Where the time limit for meeting the liabilities from the community property has not expired or the liabilities are disputed, the value of the community property to be partitioned shall be reduced by the amount of these liabilities (debts).

3. After establishing the individual property of the spouses and deducing their personal debts from it, a balance sheet of compensations shall be drawn up indicating the amounts one or the other spouse must pay by way of compensating for the community property or receive from the community property.

4. Where the balance of community property is positive it is divided equally between the spouses, except in cases provided for herein.

Article 3.119. Assessment of the value of property

The value of the community property to be partitioned shall be established at its market value on the date of the termination of the joint community property of the spouses.

Article 3.120. Property not to be partitioned

1. Property to be partitioned shall not include chattels intended for the needs of the minor children of the marriage or the spouses’ clothing, personal effects, personal property interests and non-property rights related only to that particular spouse.

2. Property intended to meet the needs of the minor children referred to in Paragraph 1 shall go, without deducing any compensations, to the spouse with whom the minor children are to live, while the remaining part of the property of personal nature goes to one and the other spouse.

Article 3.121. Attribution of individual property to joint community property

1. By the mutual consent of the spouses, property defined as the individual property of the spouses in the marriage contract may be attributed to the joint community property subject to partitioning.

2. Arrangements referred to in Paragraph 1 shall be prohibited if they can cause damage to the creditors of the spouse. Where due to such arrangements the claims of the creditor cannot be fully covered from the individual property of a spouse, the debt shall be charged against the spouse’s share in the community property.

Article 3.122. Security for the claims to a share in the community property

At the request of one of the spouses or a spouse’s creditors, the court may seize the joint community property of the spouses or to appoint an administrator for the property if that is necessary to protect the interests of the spouses in the community property or the rights of their creditors. These measures shall not be applicable where the other spouse submits an adequate security for the claims of the spouse requesting the seizure of the property or the appointment of an administrator or for the claims of the creditors.

Article 3.123. Departure from the principle of the equality of the shares of the spouses in the community property

1. Having regard to the interests of the minor children, the health state or the financial position of one of the spouses or other important circumstances, the court may depart from the principle of the equality of the spouse’s shares in the community property and award one of the spouses a greater portion of the property. These criteria must also be taken into consideration by the court in deciding on the way of partitioning community property.

2. The share of the spouse obliged to make maintenance payments to the other spouse may be reduced by the amount of the maintenance if it is to be paid by a lump sum or certain property given in payment.

3. Where, less than a year before the institution of the action for the partitioning of the property, one of the spouses reduced the value of the community property without the consent of the other spouse by donating some of it or by using it to increase his or her own individual property, the portion of this spouse in the community property may be reduced while establishing the respective portions of the spouses in the community property by the value of the lost community property.

4. The share of one of the spouses in the community property may also be reduced by the amount of income unrealised due to the spouse’s negligence or because he or she concealed the income from the family and used it for his or her personal needs. The period for which such unrealised income is calculated should not exceed five years before the institution of the lawsuit for the division of property.

Article 3.124. Division of property by the court judgement without divorce

Where one of the spouses has been declared incapable or of limited active capacity or where one of the spouses manages community property in a loss-making way or by his or her actions jeopardises the joint community property of the spouses or the interests of the family or without any justified reason fails to contribute to the needs of the family, the other spouse shall have a right to bring an action seeking a division of the property.

Article 3.125. Registration of division of property

The agreement of the parties or the judgement of the court under which the joint community property of the spouses is divided must be registered with the mortgage office that has registered the marriage contract or the division of property by making a relevant entry in the register of marriage contracts.

Article 3.126. Guarantees of the rights of the creditors

1. The creditors of one or both of the spouses shall have a right to participate as third parties in the lawsuit for the division of joint community property and present their own individual claims.

2. In his or her application the spouse who institutes proceedings for the division of property must indicate the creditors of one or both of the spouses he or she is aware of and notify the creditors of the institution of proceedings by sending them a copy of the application.

Article 3.127. Property to be divided

1. The court shall divide the property the spouses acquired as joint community property before the institution of the proceedings or before the day the court hands down its judgement.

2. On the application of one of the spouses the court may decide to divide only the property acquired before the separation of the spouses.

3. If possible, the property is divided in kind having regard to its value and the share of each spouse in the community property. If the property cannot be divided in kind, it is awarded in kind to one of the spouses, who is ordered to compensate for the other spouse’s share in money. The decision on the way the property is to be divided and the actual division of property in kind is taken having regard to the interests of the minor children, the state of health and the financial situation of one of the spouses as well as to other important circumstances.

Article 3.128. Mutual obligations of spouses after the division of property without divorce

1. The spouse on whose application the property has been divided must, to the extent of his or her possibilities, contribute to the maintenance of the household and the upbringing and education of the children.

2. Where for objective reasons the other spouse cannot contribute to the maintenance of the household or the upbringing and education of the children, all such expenses must be covered by the spouse on whose application the property has been divided.

3. When dividing the property, the court may award an amount of money from one spouse to the other to be used for the repayment of the outstanding debts of the marriage to the third parties.

Article 3.129. Limitations

Claims for the division of joint community property, except for immovables, may be made within five years of the date of the separation of the spouses.

PART IV

MUTUAL RIGHTS AND DUTIES OF CHILDREN AND PARENTS

CHAPTER IX

CONSANGUINITY AND AFFINITY

Article 3.130. Concept of consanguinity

1. Consanguinity is relationship by blood of persons descended from the same stock or common ancestor.

2. Consanguinity shall give rise to legal consequences only in cases provided for by the law.

3. Relationship between adopted children (and their descendants) and their adoptive parents (and their kindred) shall be treated as consanguinity.

Article 3.131. Lines of consanguinity

Two lines of consanguinity – direct and collateral consanguinity – shall be distinguished.

Article 3.132. Direct consanguinity

1. Direct consanguinity is that which subsists between the ancestor and the descendants in the direct line from one of the other (great-grandparents, grandparents, parents, children, grandchildren, great-grandchildren, etc.)

2. Consanguinity upward from the descendant to the ancestor is the direct ascending line (grandchildren, children, parents, grandparents, etc.)

3. Consanguinity downward from the ancestor to the descendant is the direct descending line (grandparents, parents, children, grandchildren, etc.)

Article 3.133. Collateral consanguinity

Collateral consanguinity is that which subsists between persons who have the same ancestors, but who do not descend one from the other (siblings, cousins, uncles or aunts, nephews and nieces, etc.)

Article 3.134. Degree of consanguinity

1. A degree of relationship is measured by the number of related births other than the birth of the ancestor (ancestors).

2. Only the degrees of relationship laid down by the law shall give rise to legal consequences.

Article 3.135. Close relatives

Close relatives shall embrace persons related by direct consanguinity up to the second degree of consanguinity inclusively (parents and children, grandparents and grandchildren) and persons related in the second degree of kinship by collateral consanguinity (siblings).

Article 3.136. Affinity

1. Affinity is the connection, in consequence of a marriage, between one of the spouses and the kindred of the other spouse (stepson, stepdaughter, stepfather, stepmother, father-in-law, mother-in-law, daughter-in-law, etc.) as well as between the kindred of both spouses (the husband’s brother or sister and the wife’s brother or sister, the husband’s father and mother and the wife’s father or mother, etc.)

2. Affinity shall give rise to legal consequences only in cases provided for by the law.

CHAPTER X

FILIATION

SECTION ONE

GENERAL BASIS FOR FILIATION

Article 3.137. Legitimate filiation of a Child

1. Legitimate filiation of a child shall be confirmed in the procedure laid down in Articles 3.138 to 3.140 hereof.

2. The mutual rights and duties of the child and his or her parents shall be based on the legitimate filiation of the child.

3. A child’s legitimate filiation from the parents shall be confirmed from the date of birth and shall create the respective rights and duties laid down by the law from that date.

Article 3.138. Proof of legitimate filiation

The parents of a child shall be proved by the record of birth in the Registrar’s Office and by the certificate of birth issued on the basis thereof.

Article 3.139. Maternal affiliation

1. A woman shall be entered as a child’s mother in the records of a Registrar’s Office on the basis of the certificate of the child’s birth issued by a hospital.

2. Where the child is born not in a hospital, the certificate of the child’s birth shall be issued by a medical centre that makes a postnatal examination of the mother’s and the baby’s health.

3. If the child is born not in a hospital and no postnatal examination of the mother’s and the baby’s health is made, the certificate of the child’s birth shall be issued by a consulting commission of doctors in the procedure laid down by the Government. According to such a certificate the mother of the baby is the woman in respect of whom the consulting commission of doctors have no doubt that it was she who gave birth to the baby.

4. If the record of the child’s birth contains no data on the child’s mother or if the maternity of the child has been successfully contested, the child’s mother may be established by the court in an action filed by the woman who considers herself to be the child’s mother, by the adult child, by the child’s father or guardian (curator) or by the state institution for the protection of the child’s rights.

Article 3.140. Paternal affiliation

1. Where a married woman gives birth to a baby, although the baby may have been conceived before the marriage, the man identified as the spouse of the baby’s mother in the marriage record or the marriage certificate issued on the basis thereof shall be identified as the baby’s father in the record of the baby’s birth.

2. Where a child is born within three hundred days of the date of separation or the annulment of the marriage or divorce or the death of the husband, the ex-spouse of the mother shall be recognised as the child’s father.

3. Where a mother who contracted a new marriage within less than three hundred days of the dissolution of her previous marriage gives birth to a baby, the new spouse of the mother shall be considered to be the baby’s father.

4. Where an unmarried woman gives birth to a baby after more than three hundred days have elapsed from the dissolution of her previous marriage, the man who has acknowledged his paternity in the procedure established in this Book or whose paternity has been established by a judicial judgement may be identified as the baby’s father in the record of the baby’s birth.

5. Where a divorced mother gives birth to a baby within less than three hundred days of the divorce, the baby’s mother, her ex-husband and the man who acknowledges his paternity of the child shall have a right to file a joint application seeking that the man who acknowledges his paternity of the child be identified as the baby’s father. After the court approves such a joint application, the man who acknowledges his paternity of the child rather than the ex-husband of the baby’s mother shall be entered in the record as the baby’s father.

SECTION TWO

ACKNOWLEDGEMENT OF PATERNITY

Article 3.141. Conditions for the acknowledgement of paternity

1. Where the record of the baby’s birth contains no data on the baby’s father, the paternity of the baby may be determined on the basis of the application of the man who considers himself father of the baby.

2. Where a baby is born to a married mother or the baby is born within less than three hundred days of the dissolution of the marriage, the paternity of the baby may be determined on the basis of an application provided the paternity of the present or former spouse of the mother has been successfully contested.

3. If the adjudication of paternity on the basis of an application acknowledging paternity has been contested, determination of paternity on another application acknowledging paternity is inadmissible.

4. There shall be no period of limitation applicable to acknowledgement of paternity.

Article 3.142. Procedure for acknowledging paternity

1. The man considering himself the father of a child shall have a right to file an application of a standard form certified by a notary public with the Registrar’s Office seeking to be recognised as the father of the child.

2. Where the child has attained the age of 10, the Registrar’s Office may accept an application for the recognition of the child’s paternity only with a written consent of the child.

3. Where the man acknowledging his paternity of a child is a minor, the filing of an application for the recognition of paternity with the Registrar’s Office requires the written consent of the minor’s parents, guardians or curators or care institutions. If the parents, guardians or curators or care institutions refuse to give their consent, such a leave may be handed down by the court at the minor’s request.

Article 3.143. Acknowledging paternity before the child’s birth

1. If there are circumstances that will bar the filing of an application acknowledging the paternity of a child after the birth of the baby, the man considering himself the father of the child conceived but not yet born may file a joint application with the child’s mother for the recognition of his paternity for the period of pregnancy with the Registrar’s Office of the district where the child’s mother resides.

2. The application acknowledging the paternity of a child before the child’s birth shall be accompanied with the certificate of pregnancy issued by a medical centre.

3. Where before the child’s birth the child’s mother marries the man who has filed an application acknowledging his paternity of the child, or another man, the paternity of the child may not be confirmed after the birth of the child on the basis of that application.

4. Where the child’s mother or the man who has filed an application acknowledging the paternity of the child before the birth of the child withdraws the application before the birth of the child has been recorded with the Registrar’s Office, the child’s paternity on the basis of that application shall not be registered.

Article 3.144. Acknowledging paternity without the consent of the child’s mother

1. Where the child’s mother is dead, incompetent or cannot, for other reasons, file a joint application with the child’s father for the recognition of his paternity, or the parents or guardian (curator) of the man who considers himself the father of the child, but who is a minor or of limited legal competence, refuse to recognise his paternity or the child of 10 or over does not give his or her written consent, the application acknowledging paternity may be considered a valid basis for the registration of paternity if the court approves the application.

2. In examining an application acknowledging paternity where the child’s mother is dead, incompetent or cannot, for other reasons, file a joint application with the man acknowledging to be the child’s father, the court must require that the child’s father adduce evidence corroborating his paternity of the child.

3. The application acknowledging the paternity of a child may not be registered without the consent of the child who is of full age.

Article 3.145. Examination of the application for the approval of the acknowledgement of paternity

1. The court shall examine applications for the approval of the acknowledgement of paternity in a simplified procedure.

2. The res judicata judgement on the approval of the application acknowledging a child’s paternity shall be sent to the Registrar’s Office that has registered the birth of the child within three business days.

3. Where the application for the approval of the acknowledgement of a child’s paternity is contested by the parents or guardians (curators) of the minor or the person of limited legal capacity who considers himself the father of the child, the application shall be submitted to the court to be examined by contentious proceedings

SECTION THREE

PATERNITY AFFILIATION

Article 3.146. Conditions for paternity affiliation

1. Where the child is born out of wedlock, and in the absence of paternal acknowledgement, paternity affiliation may be determined by the court.

2. Where a child is born to a married woman or the child’s paternity has been ascertained on the basis of an application acknowledging the child’s paternity, paternity affiliation is possible only after a successful contesting of the data concerning the child’s father contained in the record of the child’s birth.

3. The paternity of a dead person may be ascertained only if the person had offspring.

Article 3.147. Persons entitled to petition for Paternity Affiliation

1. Where a child is born out of wedlock or the data on the father contained in the record of the child’s birth have been successfully contested, an action for the paternity affiliation may be filed by the man considering himself the father of the child. The child and the child’s mother shall act as defendants in such an action.

2. If a child’s father refuses to acknowledge his paternity by an application for the approval of his acknowledgement of the child’s paternity or if a child’s father is dead, the action for paternity affiliation may be filed by the child’s mother or the child after having attained full active capacity or the child’s guardian or curator or the state institution for the protection of the child’s rights or the descendants of a child who is dead.

3. Having determined a child’s paternity, the court shall send its res judicata judgement to the Registrar’s Office that has registered the child’s birth within three business days.

Article 3.148. Grounds for paternity affiliation

1. Grounds for paternity affiliation shall be scientific evidence (conclusions of expert examinations on consanguinity determination) and other means of proof provided for in the Code of Civil Procedure. If the parties refuse to undergo expert examination, the child’s paternity may be adjudicated on the basis of facts that have a sufficient evidential value, such as the child’s mother’s and the putative father’s life together, their joint participation in the upbringing and maintenance of the child and other evidence.

2. If the defendant refuses expert examination, the court having regard to the circumstances of the case may treat such a refusal as proof of the defendant’s paternity of the child.

SECTION FOUR

CONTESTING PATERNITY (MATERNITY)

Article 3.149. Conditions for contesting paternity (maternity)

1. Data on the mother or father of a child contained in the record of the child’s birth may be contested only in court.

2. Data on the mother or father of a child entered in the record of the child’s birth on the basis of a res judicata judicial decision may not be contested.

Article 3.150. Grounds for contesting paternity (maternity)

1. The paternity of a child born to a married couple or within three hundred days of the dissolution of marriage may be contested only by proving that the person cannot be the father of the child.

2. The maternity or paternity of a child adjudicated on the basis of an application acknowledging parentage may be contested by proving that the child’s mother or father not the biological parent of the child.

Article 3.151. Persons entitled to file an action for contesting paternity (maternity)

1. Actions for contesting paternity or maternity may be filed by the person entered in the record of the child’s birth as the child’s mother or father, or the person who, although not recorded as the child’s mother or father in the record of the child’s birth, considers himself the mother or the father of the child, or the parents or guardians (curators) of the minor entered in the record of the child’s birth as the child’s father, or the child on attaining majority, or a minor on attaining full active capacity.

2. Where the child’s mother or father is legally incapable or of limited active capacity, an action for contesting maternity or paternity may be filed by his or her guardians or curators.

3. An action for contesting the paternity of a man who is dead may be filed by his descendants if the person recorded as the child’s father died within the limitation period provided for in Article 3.152 hereof.

Article 3.152. Limitation period for proceedings

1. The limitation period for filing a suit for contesting paternity (maternity) shall be one year as from the day when the plaintiff became aware of the disputed data in the record of the child’s birth or of certain circumstances giving reason to believe that the data are not truthful.

2. Where the persons recorded in the record of the child’s birth as a child’s mother or father became aware of such a record at the time when they were minors or legally incapable, the one-year limit shall be calculated from the day they attained majority or full active capacity..

3. The res judicata court judgement on the annulment of paternity (maternity) shall be sent to the Registrar’s Office that registered the child’s birth within three business days of its effective date.

Article 3.153. Mandatory participation of the agency for the protection of the child’s rights

In adjudicating paternity or disputes over paternity the participation of the agency for the protection of the child’s rights shall be mandatory.

SECTION FIVE

ARTIFICIAL INSEMINATION

Article 3.154. Legal regulation of artificial insemination

The conditions, mode, procedures of artificial insemination as well as matters related to the paternity (maternity) of a child born from artificial insemination shall be regulated by other laws.

CHAPTER XI

PARENTAL RIGHTS AND DUTIES IN RESPECT OF THEIR CHILDREN

SECTION ONE

PARENTAL AUTHORITY

Article 3.155. Substance of paternal authority

1. Until they attain majority or emancipation, children shall be cared for by their parents.

2. Parents shall have a right and a duty to properly educate and bring up their children, care for their health and, having regard to their physical and mental state, to create favourable conditions for their full and harmonious development so that the child should be ready for an independent life in society.

Article 3.156. Equality of paternal authority

1. The father and the mother shall have equal rights and duties in respect of their children.

2. Parents shall have equal rights and duties by their children irrespective of whether the child was born to a married or unmarried couple, after divorce or judicial nullity of the marriage or separation.

Article 3.157. Representation of children

1. Legally incapable children shall be represented by their parents under the law, except where the parents have been declared legally incapable by a court judgement.

2. Parents shall represent their children on the presentation of the child’s birth certificate.

Article 3.158. Authority of minor-aged parents

1. Minor parents with full active capacity shall have all personal rights and duties in respect of their children.

2. Minor parents who are legally incapable or of limited active capacity shall have a right to live to together with their child and participate in the child’s education. In such cases a guardian (curator) shall be appointed to the child in the procedure provided for in this Book hereof.

3. On attaining majority or full active capacity, the parents shall acquire all the rights and duties in respect of their children.

Article 3.159. Mandatory exercise of parental authority

1. A father’s or mother’s surrender of the rights and duties by his or her underage children shall be null and void.

2. Parents shall be jointly and severally responsible for the care and education of their children.

3. Parental authority may not be used contrary to the interests of the child.

4. Failure to exercise parental authority shall be subject to legal responsibility under the law.

Article 3.160. End of parental authority

1. Parental rights and duties shall end when the child attains majority or full active capacity.

2. In certain cases considered in the light of the child’s interests, parental authority may be limited on a temporary or permanent basis or the child may be separated from the parents in the procedure laid down in this Book hereof.

SECTION TWO

CHILDREN’S RIGHTS AND DUTIES

Article 3.161. Children’s rights

1. Every child shall have an inalienable right to life, healthy development and a name and surname from birth.

2. A child shall have a right to know his or her parents unless that prejudices his or her interests or the law provides for otherwise.

3. A child shall have a right to live with his or her parents, be brought up and cared for in his or her parents’ family, have contact with his or her parents no matter whether the parents live together or separately, have contact with his or her relatives, unless that is prejudicial to the child’s interests.

4. Children shall have no ownership rights to the property of their parents and the parents shall have no ownership rights to the property of their children. Children’s property rights are defined in this and the other Books hereof.

5. Children born within or outside marriage shall have equal rights.

6. Children’s rights shall not be affected by their parents’ divorce, separation or nullity of marriage.

Article 3.162. Children’s duties

Children shall owe respect to their parents and perform their duties by their parents diligently.

Article 3.163. Assurance of children’s rights

1. The rights of minor-aged children shall be assured by the parents.

2. The rights of children deprived of parental care shall be assured by the guardian (curator) according to the rules laid down in this Book.

3. After a minor attains full active capacity, the protection of his or her rights shall be his or her own responsibility.

4. If the parents or guardians (curators) abuse their children’s rights, measures to defend the children’s rights may be taken by the state institution for the protection of the child’s rights or a prosecutor.

Article 3.164. Involvement of a minor in the assurance of his or her rights

1. In considering any question related to a child, the child, if capable of formulating his or her views, must be heard directly or, where that is impossible, through a representative. Any decisions on such a question must be taken with regard to the child’s wishes unless they are contrary to the child’s interests. In making a decision on the appointment of a child’s guardian (curator) or on a child’s adoption, the child’s wishes shall be given paramount consideration.

2. If a child considers that his or her parents abuse his or her rights, the child shall have a right to apply to a state institution for the protection of the child’s rights or, on attaining the age of 14, to bring the matter before the court.

SECTION THREE

PERSONAL PARENTAL RIGHTS AND DUTIES

Article 3.165. Substance of personal parental rights and duties

1. Parents shall have a right and duty to bring up their children; they shall be responsible for their children’s education and development, their health and spiritual and moral guidance. In performing these duties, parents shall have a priority right over the rights of other persons.

2. Parents must create conditions for the