Legal prism — 2026-08-18

Correction. The article describes criminal liability under Article 127 of the Criminal Code incompletely. The review provided states that Article 127 provides for five alternative penalties: community service, a fine, restriction of liberty, arrest, or imprisonment for up to two years. It would therefore be more accurate to write that intentional desecration of the state flag may also be punishable by community service. The article also refers to Article 519 of the Code of Administrative Offences, but the evidence provided contains only Article 518, concerning arbitrary exercise of rights. Accordingly, the administrative fines of EUR 10 to EUR 60 cannot be verified in this assessment against the text of the provision provided.

Under Article 519(1) of the Code of Administrative Offences, liability is differentiated according to the status of the subject:

The next point to monitor is the forthcoming decision on the draft amendment to Article 519 of the Code of Administrative Offences; the sources provided do not indicate a timeframe for its adoption.

Core issue

The Klaipėda theatre case would primarily entail a risk of administrative liability for the responsible head of the institution or another responsible person. The decisive issue is not reverential rhetoric, but whether the procedure for displaying the flag was breached and whether the breach is attributable to a specific responsible subject. The precise legal question is whether the factual situation falls within Article 519(1) or 519(2) of the Code of Administrative Offences of the Republic of Lithuania. The general basis for liability arises from Article 9 of the Law on the State Flag and Other Flags of the Republic of Lithuania, which refers violations to liability in accordance with the procedure established by law. If desecration of the flag were established, Article 9(2) of the Law on the State Flag and Other Flags provides for a separate route to punishment.

Legal assessment

Under Article 4(1) of the Code of Administrative Offences, liability applies for an administrative offence committed within the territory of the Lithuanian state. A possible violation observed in Klaipėda falls within this territorial rule of application. Under Article 4(3) of the Code of Administrative Offences, the place of commission may be the place where the person was required and able to act. This is important for the institution, because the assessment concerns not only the physical condition of the flag, but also the responsible person’s ability to supervise it.

• heads of legal persons or other responsible persons, except for state and municipal institutions and bodies, are subject to a warning or a fine of EUR 10 to EUR 12;
• owners of residential buildings or persons responsible for organising their operation are subject to a warning or a fine of EUR 10 to EUR 12;
• heads or responsible persons of state and municipal institutions and bodies are subject to a fine of EUR 10 to EUR 16.

A repeated violation under Article 519(2) of the Code of Administrative Offences results in a stricter sanction. For responsible subjects of legal persons and residential buildings, the fine is EUR 12 to EUR 16, while for state and municipal institutions it is EUR 16 to EUR 30. Accordingly, under the cited provisions, the position of the head of a public institution or municipal institution is stricter than that of the head of a private legal person. This means that a purely political proposal to increase fines does not alter liability unless the applicable provision of the Code is amended. The sources provided contain no case law, and therefore the assessment cannot be based on a specific case. A criminal-law assessment, based on the sources provided, is limited to the reference in Article 9(2) of the Law on the State Flag and Other Flags to punishment in accordance with the procedure established by law.

Consequences

In practical terms, this matter may proceed in two administrative directions. First, if a breach of the procedure for displaying the flag is established, Article 519 of the Code of Administrative Offences applies and a warning or fine is imposed. Second, if the violation is repeated, the sanction increases under Article 519(2) of the Code of Administrative Offences. For the market and the public sector, this is practically important because liability is personalised: the abstract institution itself is not punished; rather, the head or responsible person is. For residents, it is important that the owner of a residential building or the person organising its operation is also a direct addressee of Article 519 of the Code of Administrative Offences. The tightening currently being considered in the Seimas would be significant only if it amended the sanction provision currently in force.

Article 145(2) of the Code of Civil Procedure limits the scope of the measures: their total amount must not be substantially greater than the amount of the claim.

Under Article 146(1) of the Code of Civil Procedure, if security is not provided within the prescribed time limit, the measures are lifted within three working days.

Core issue

Until the civil cases are resolved by final and binding judgments, payment of the EUR 1.3 million guarantees remains suspended. The Vilnius Regional Court prohibited VAATC from calling on the guarantees and prohibited the Lithuanian branch of BTA Baltic Insurance Company from paying them out. The legal issue is whether, in order to secure enforcement of a future judgment, it was necessary temporarily to prohibit actions relating to payment under the guarantees. This issue is assessed under Articles 144, 145(1)(6), 145(1)(7), 145(1)(13), 145(2), 146 and 147 of the Code of Civil Procedure.

Legal assessment

Article 144 of the Code of Civil Procedure permits interim protective measures to be applied at any stage of civil proceedings. The measures could already have been applied once Energesman’s claims concerning termination of the contracts had been accepted. In this situation, the closest category of measures is a prohibition on taking certain actions and a prohibition on other persons performing obligations. This corresponds to Article 145(1)(6) and (7) of the Code of Civil Procedure.

• VAATC’s obligation under the rulings is not to demand payment of the EUR 1.3 million guarantees.
• The insurer’s obligation is not to transfer the guarantee funds while the court-imposed prohibition remains in force.
• Energesman’s right at this stage is to seek to ensure that the subject matter of the dispute is not altered before a decision on the contracts is made.

Article 145(1)(13) of the Code of Civil Procedure also allows other measures where, without them, enforcement of the judgment would become more difficult. The court could assess whether payment under the guarantees would complicate possible enforcement of a judgment requiring performance of the contracts in kind. Here, the suspended amount is approximately EUR 1.3 million, while the report states that Energesman’s preliminary losses amount to approximately EUR 20 million. The Review of General Issues Concerning the Application of Interim Protective Measures of the Supreme Court of Lithuania of 15 December 2010 entails two points. First, interim protective measures are intended to secure enforcement of a future judgment, not to determine the merits of the dispute. Second, they have neither prejudicial nor res judicata effect and therefore do not confirm the position of either VAATC or Energesman. Article 146(1) of the Code of Civil Procedure allows VAATC to request security for compensation of potential losses caused by the measures. If the court were to order such security, it could also be provided in the form of a bank guarantee. If the claim were dismissed by a final and binding judgment, Article 146(2) of the Code of Civil Procedure would allow the defendant to claim compensation for losses.

Consequences

The immediate practical consequence is a freezing of the financial position: EUR 1.3 million remains with the insurer. This is relevant to VAATC’s cash flow, the insurer’s payment obligation, and Energesman’s litigation strategy concerning specific performance of the contracts. The suspension of the guarantees does not in itself mean that termination of the contracts was unlawful. Nor does it mean that the EUR 20 million in losses referred to by Energesman are already recoverable.

• If Energesman’s claims are upheld, the purpose of the prohibitions will be linked to enforcement of the future judgment.
• If the claims are dismissed, VAATC will be able to raise the issue of losses caused by the interim measures under Article 146(2) of the Code of Civil Procedure.
• If the circumstances change, the measures may be lifted under the rule stated in the Supreme Court of Lithuania’s Review of 15 December 2010.

It is now necessary to await final and binding judgments in the two civil cases concerning termination of the operation and modernisation contracts.

Under Article 2504(1) of the Criminal Code, the sanction is three to ten years.

Article 67(3) of the Criminal Code permits such measures to be imposed on a natural person together with a sentence.

Core issue

The decisive dispute will not be the form of cryptocurrency, but whether it is proven that support was provided with knowledge of, or for the purpose of, supporting terrorist activity. The case states that M. A. Nurkulovas, while holding a residence permit in Lithuania, transferred support in cryptocurrency to the “Al Qassem Brigades” at least twice. The precise legal question is whether such transfers constitute the provision of “funds or other assets” or “other material support” under Article 2504(1) of the Criminal Code. This provision covers direct and indirect financing where a person knows or intends that the support be used to support terrorist activity.

Legal assessment

On the facts presented, the prosecution will rely on three core elements:

• the provision of material support or assets;
• a link to a terrorist group whose purpose is to commit terrorist offences;
• the accused’s knowledge or intention that the support would assist terrorist activity. Article 2504(1) of the Criminal Code does not require the accused personally to prepare or commit a terrorist offence. It is sufficient to prove an act of financing or support and the requisite mental element regarding the purpose of the support. Accordingly, communication with representatives of the organisation, if confirmed in the case, may be relevant to establishing knowledge or intention. Other terrorism provisions define the boundaries but do not alter the principal qualification. Article 2502 of the Criminal Code applies to recruitment, Article 2503 to threats, Article 2505 to preparation or training, and Article 2506 to travel for terrorist purposes. The information presented primarily concerns financing and support, so the central provision remains Article 2504 of the Criminal Code. Article 50(1) of the Criminal Code provides that fixed-term imprisonment is imposed in the cases provided for in the Special Part. From the list provided, the most practically significant measure may be Article 67(2)(7) of the Criminal Code concerning confiscation of property, if confiscable property is identified in the case.

Consequences

The possible outcomes of the case are as follows:

• acquittal, if the elements of Article 2504(1) of the Criminal Code are not proven;
• conviction and a sentence of three to ten years’ imprisonment;
• criminal-law measures imposed together with the sentence under Article 67 of the Criminal Code, including confiscation of property;
• the issue of release from criminal liability under Article 391 of the Criminal Code, if the apparent conditions of that provision are met. Article 391(1) of the Criminal Code would permit release from liability only for a person who confessed and actively assisted in uncovering acts committed by members of a terrorist group. Article 391(2) of the Criminal Code does not apply this ground to an organiser or leader, or to a person who participated in intentional killing.