LITHUANIA Law and Practice Contributed by: Gintautas Šulija and Eduard Plešak, Šulija & Partners
2. Aircraft and Engine Leasing 2.1 Overview 2.1.1 Non-Permissible Leases
short-form sale and purchase agreement governed by the laws of Lithuania is often concluded for aircraft re-registration purposes. However, the parties also enter into a parallel English or New York law sale and purchase agreement, which is further accompanied by a customary English law or New York law bill of sale. 1.2.3 Enforceability Against Domestic Parties A bill of sale evidencing the transfer of title to an air - craft may be required by the Lithuanian civil aviation authority during the registration of an ownership inter - est. The aviation authority needs to either take sight of the original documents or have a copy of the bill of sale notarised and apostilled. As a matter of practice, documents in English are accepted without requiring translation. If the aircraft has already been registered during the transfer of title, a notarised sale and purchase agree - ment or a similar document must also be submitted to the aviation authority (see 1.2.2 Sales Governed by English or New York Law ). 1.2.4 Registration, Filing and/or Consent From Government Entities A bill of sale does not need to be filed to any gov - ernment entity in Lithuania and is not subject to any consent from the government entity, except that the civil aviation authority may request the bill of sale (and its translation into Lithuanian) to be filed if the owner wishes to register the aircraft in Lithuania. The bill of sale is required so that the aviation authority can verify the title of the aircraft before registering it. If requested, the aviation authority produces a copy for its own registration purposes, and the original docu - ment filed by the applicant is returned. 1.2.5 Taxes/Duties Payable Upon Execution of a Bill of Sale No taxes or duties are payable in Lithuania for execut - ing and/or delivering a bill of sale or consummating the sale of the ownership interest in an entity that owns an aircraft or engine. If a bill of sale is submitted for aircraft registration pur - poses, standard aircraft registration fees apply.
There are no non-permissible types of operating, wet or finance leases in Lithuania. Lithuanian law estab - lishes the principle of freedom of contract, allowing parties to conclude any types of agreements. However, this matter may arise on a case-by-case basis when certain contract clauses come into ques - tion (eg, hell or high water clauses and excessive fines). The authors consider, however, that courts are more likely to take a non-interventionist approach and would endeavour to uphold the clauses agreed upon by the parties. 2.1.2 Application of Foreign Laws There are no restrictions in Lithuania on choosing a foreign law as the governing law for any lease agree - ment. 2.1.3 Restrictions Concerning Payments in US Dollars There are no restrictions in Lithuania relating to pay - ment of rent under the lease in US dollars or any other foreign currency. However, payments for wet lease contracts are normally agreed upon in euros. 2.1.4 Exchange Controls There are no exchange control laws in Lithuania. 2.1.5 Taxes/Duties Payable for Physical Execution of a Lease No taxes or duties are due for executing a lease in Lithuania or as a consequence of an original or copy of a lease being brought into Lithuania either physi - cally or electronically. 2.1.6 Licensing/Qualification of Lessors There are no requirements for the lessor to be licensed or otherwise qualified in Lithuania to enter into any lease arrangements with a domestic lessee.
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