Lithuania

Legal and regulatory shifts in one country are no longer isolated events, they increasingly influence approaches and expectations in neighbouring markets. Baltic law firm COBALT has published its annual Baltic Disputes Market Overview 2025, offering a regional snapshot of the key litigation and regulatory developments shaping Estonia, Latvia and Lithuania. Disputes Shaped by Compliance and Decision-Making Quality A clear theme runs through this year’s overview: courts and authorities are placing greater emphasis on well-substantiated reasoning and procedural quality. Documentation, consistency in internal processes and robust evidentiary standards have become central across multiple areas of law. In employment disputes, expectations around workplace conduct are tightening, and new considerations, including so-called “soft values”, are increasingly reflected in cases. Termination-related disputes remain common, with courts highlighting the importance of proper documentation and consistent workplace practices. In construction disputes, parties continue to rely on negotiated and court-mediated settlements to avoid lengthy litigation. Across the Baltics, disputes centre on two main areas: large-scale infrastructure and residential real estate projects. Major infrastructure developments, particularly Rail Baltica, remain a key source of litigation. Delays, cost overruns and challenges to building permits have brought contract performance and risk allocation into sharp focus, especially between the state, project companies and contractors. Digital and intellectual property matters also remain in focus. In Estonia, data protection enforcement intensified, including the imposition of a record fine and a rise in breach notifications. Several high-profile incidents have demonstrated how quickly inadequate safeguards can escalate into violations, investigations and costly disputes. Regulatory enforcement expands across key sectors Competition law saw notable shifts across the Baltics in 2025. In Estonia, the ECN+ Directive strengthened the Competition Authority’s powers, likely leading to more investigations and higher fines. The new rules have already sparked debate and may result in further disputes. In Latvia, the Supreme Court issued landmark rulings, tightening standards for private damages claims and prohibiting the use of covert criminal surveillance data in competition cases. In Lithuania, courts focused more on fundamental legal questions, including referring a key case to the EU Court of Justice, while also applying stricter scrutiny to certain decisions of the competition authority. White-collar crime saw notable developments across the Baltics in 2025. In Estonia, a new Prosecutor General prioritised efficiency, while debate continued over enforcement focus, particularly in cases involving public officials. Companies are encouraged to conduct internal investigations when facing economic crime allegations. In Latvia, sanctions and tax-related cases remained central. Legislative amendments strengthened penalties for serious sanctions breaches, and the Constitutional Court reinforced fair trial standards in confiscation cases. In Lithuania, liability for certain abuse-of-office offences was eased, while courts continued to impose prison sentences for bribery and addressed high-profile public order cases. Insolvency, corporate and tax disputes reflect structural shifts Insolvency trends eased across the Baltics in 2025. Estonia saw a slight drop in bankruptcies and fewer reorganisation cases, although new restructurings have so far been successful. Latvia also recorded fewer insolvency proceedings, while courts approved more restructuring plans than in the previous year. In Lithuania, bankruptcies declined, but restructuring cases increased sharply, largely due to the AUGA Group case. Corporate disputes remained largely stable across the Baltics in 2025. In Estonia, attention focused on board member liability and shareholder disputes, mainly concerning profit distribution and meeting decisions. In Latvia, dispute patterns remained similar, with the Supreme Court clarifying the effect of interim measures in shareholder cases. In Lithuania, shareholder and management disputes continued to dominate, while upcoming legal amendments may influence future conflicts. Public procurement volumes declined across the Baltics in 2025. Estonia and Latvia saw lower overall contract values, while Lithuania recorded a drop in both value and number of procedures. At the same time, green and quality-based procurement increased, particularly in Estonia and Lithuania. Disputes remain active, and legislative reforms are underway in Estonia and Latvia. Tax disputes in 2025 focused on enforcement and evidentiary standards across the Baltics. In Estonia, courts addressed board members’ tax liability and clarified the burden of proof in tax assessments. Latvia saw fewer audits but maintained a continued focus on VAT and compliance issues, alongside constitutional challenges to new tax rules. In Lithuania, courts dealt with VAT, corporate tax and exemptions, emphasising strict compliance while applying proportionality in penalties. The overview draws on COBALT’s experience, as well as publicly available information and noteworthy disputes handled by other law firms, with the aim of offering a grounded snapshot of where the disputes landscape is heading. We hope this report serves as a useful resource for businesses, legal practitioners and policymakers navigating disputes in the Baltic region. The full Baltic Disputes Market Overview 2025 can be found here: https://www.cobalt.legal/wp-content/uploads/2026/02/Baltic-Disputes-Market-Overview-5.pdf Article by:  Managing Partners Jaanus Mody, Lauris Liepa and Partner Professor Dr Rimantas Simaitis  

As of 2 January, sustainability and tax expert Ronaldas Kubilius has joined Ellex Valiunas team in Lithuania. Together with Gintaras Balčius, the new partner will lead the Tax Practice Group and will also head the Sustainability Practice. “We are strengthening our Tax Practice Group – at the end of last year, tax law expert Alina Gaudutytė joined the team, and as of this year we are welcoming a new partner who will also be responsible for the development of sustainability services. Ronaldas brings an exceptional combination of competencies – he has deep expertise in both tax matters and sustainability requirements. Both areas are particularly relevant for businesses today, as the regulatory environment and sustainability reporting standards are changing rapidly,” says Rolandas Valiūnas, Managing Partner of Ellex in Lithuania. Ronaldas Kubilius is the 26th partner at the Ellex Lithuanian Office. The new partner holds degrees in law and economics and gained his professional experience while working at one of the Big Four audit and consulting firms, PricewaterhouseCoopers. “Throughout my career, I have advised 8 out of the 10 largest Lithuanian corporate groups, as well as hundreds of other Lithuanian and international clients. Working with leading businesses, major projects and top professionals is both a great responsibility and a pleasure for me. I am delighted to have received an invitation to join the best law firm in the Baltic States. I believe that the diverse experience and expertise of myself and the Ellex team will enable us to provide clients with the highest-quality advice, offer comprehensive one-stop support, and contribute to the growth of sustainable business and the Lithuanian economy as a whole,” says the new Ellex partner, R. Kubilius. In the field of Lithuanian and international taxation, Ronaldas has accumulated more than 17 years of experience advising business groups and owners on group reorganisations, investment structuring, mergers and acquisitions (M&A), assessment of tax incentives and risks, and representing clients in disputes with tax authorities. In the area of sustainability, Ronaldas has assisted companies in preparing and verifying sustainability reports and strategies, assessing impacts, risks and opportunities, advising on taxonomy and greenhouse gas (GHG) calculations, and contributing to the development of sustainability assurance practices. His experience also includes ESG data collection, board-level training, and other services focused on sustainable business development.

Market participants in Lithuania’s aviation sector are currently subject to an excessive legal requirement – the transfer of ownership of an aircraft must be executed in notarised form. AVERUS law firm calls on the relevant institutions to review this outdated practice, which imposes unjustified administrative and financial burdens on the aviation industry. "Aircraft should not automatically be equated with immovable property. The fact that they are high-value assets should not, in itself, dictate the form of the transfer transaction. This requirement is not applied, for instance, to ships – why, then, is a stricter regime applied to aircraft?" notes Laura Čereškaitė-Kinčiuvienė, Managing Partner at AVERUS and Head of the Aviation Practice. She highlights that Lithuania's requirement to notarise aircraft ownership transfer transactions is quite unique, as most other jurisdictions do not impose such a condition. "In commercial and business aviation, most civil aircraft transactions have a cross-border element. The notarisation requirement leads to unnecessarily high costs and time delays for the parties involved, undermining the competitiveness of our jurisdiction. It also creates an unjustified discrepancy between the treatment of aircraft and ships – the latter can now be transferred under a simple written form, since recent legislative changes reclassified ships as movable property,” said the aviation law expert. Notary fees for a single aircraft transfer transaction may reach EUR 5,000, given that commercial and business aviation aircraft typically exceed EUR 1 million in value. Recent Legal Changes Exempt Ships from Notarisation Under the current Civil Code provisions, aircraft and ships are classified as immovable property, requiring notarised transfer agreements. However, despite this formal equivalence, recent legislative changes have established a different practice for ships. Amendments to the Law on Merchant Shipping adopted in 2023 reclassified maritime vessels (excluding the LNG storage vessel Independence) as movable property. As a result, notarisation is no longer required for the transfer of registered maritime vessels in Lithuania. Similar Reforms Needed for Aircraft According to legal experts, the excessive notarisation requirement for aircraft transactions could be eliminated either by changing current administrative practice or by amending the Aviation Law to explicitly state that aircraft are not to be considered immovable property. "The Transport Competence Agency should no longer require notarised transfer documents for aircraft registered in Lithuania. Alternatively, the Aviation Law should be amended to specify that civil aircraft are not considered immovable property, unless otherwise provided by law. This would bring clarity and regulatory parity between aircraft and maritime vessels," adds Laura Čereškaitė-Kinčiuvienė. AVERUS invites relevant institutions and the legal community to engage in a dialogue on the need to modernise the regulatory framework and strengthen Lithuania’s position as a competitive jurisdiction for aviation. About AVERUS AVERUS is a business law firm with offices in Vilnius and Klaipėda. Since 2014, the international legal directory Legal 500 has recognised AVERUS as one of the leading law firms in Lithuania in aviation, shipping and transport, and dispute resolution. Daugiau informacijos Laura Čereškaitė-Kinčiuvienė Vadovaujančioji AVERUS partnerė, advokatė Mob.: +370 684 06452 El. paštas: [email protected]

The Swedish Bergs Timber AB has decided to sell its sawmill business in Latvia, SIA Vika Wood, one of the largest and most efficient sawmills in the Baltic region. On 20 December 2024, Bergs Timber AB concluded an agreement with Nextwood One GmbH, a company of the Austrian HS Timber group, regarding the sale of 100% of shares in the Latvian wood processing company SIA Vika Wood. The transaction is subject to clearance by the Competition Council. The parties plan to close the transaction in the first quarter of 2025. TGS Baltic provided full transactional support concerning Latvian law and Latvian jurisdiction, including assistance with drafting, negotiating and signing the share purchase agreement. Bergs Timber was assisted in this project by the TGS Baltic team: partner Andra Rubene and senior associates Anna Vaivade, Dita Buša, and Alīna Lepere. Bergs Timber Bergs Timber — an international wood products group — consists of independent subsidiaries that develop, produce, and market processed wood for various applications. The sale of the raw material provider SIA Vika Wood will allow Bergs Timber to focus on its current strategy: the production and sale of customer-oriented processed wood products. Vika Wood SIA Vika Wood is a leading manufacturer of high-quality coniferous-sawn timber in the Baltics. Its sawn timber production capacity reaches 300,000m³ per year. The company processes logs from sustainably managed local forests. Its products are exported to more than 30 countries worldwide. The sawmill also plays a crucial role in the regional value chain, supplying byproducts to the pellet producers and pulp industry. For more information, please visit: https://www.bergstimber.com/en/press/press?news_id=82940b4e-0a42-45b3-868b-dcb3b93d9880 https://hs.at/en/newsroom/news/detail/hs-timber-group-acquires-vika-wood-sia-from-bergs-timber-ab.html TGS Baltic is a top-tier full-service business law firm in Latvia, Estonia, and Lithuania, employing more than 170 lawyers across the Baltics http://tgsbaltic.com/