LITHUANIA Law and Practice Contributed by: Gintautas Šulija and Eduard Plešak, Šulija & Partners
3.2.7 Formalities/Mandatory Terms to Create and Perfect Security Assignments Any assignment amending the terms of a mortgage agreement shall be subject to notarial certification. Failure to comply with notarial form renders the agree - ment null and void. 3.2.8 Domestic Law Security Instruments Any mortgage over the aircraft must be governed by local laws and subject to a notarial certification. Notary fees should generally not exceed EUR500. Additional costs related to the translation into Lithuanian of cor - porate documents of parties to a mortgage agreement should be expected. 3.2.9 Domestic Registration of Security Assignments Governed by Foreign Laws English or New York law-governed security assign - ments are not locally registered. 3.2.10 Transfer of Security Interests Over Aircraft/ Engines Any mortgage or amendment of such mortgage over the aircraft must be governed by local laws and sub - ject to a notarial certification. 3.2.11 Effect of Changes in the Identity of Secured Parties See 3.2.10 Transfer of Security Interests Over Air- craft/Engines . 3.2.12 “Parallel Debt” Structures Parallel debt structures are customarily contractually agreed. However, the authors are not aware of any case law related to their practical enforcement. 3.2.13 Effect of Security Assignments on Residence of Secured Parties A secured party under a security assignment will not be deemed to be resident, domiciled, or carrying on business in Lithuania. 3.2.14 Perfection of Domestic Law Mortgages Any mortgage over the aircraft must be governed by local laws and subject to a notarial certification. It is advisable for the mortgaging of an aircraft engine to also be notarised.
3.2.15 Differences Between Security Over Aircraft and Spare Engines Mortgage over an aircraft that is an immovable prop - erty in Lithuania must be certified by a public notary. 3.2.16 Form and Perfection of Security Over Bank Accounts It is advisable for security over a fund held in a bank account to be certified by a public notary. 3.3 Liens 3.3.1 Third-Party Liens As mentioned in 2.4.5 Attachment by Creditors , the Law on Aviation 2000 provides that an aircraft can be prohibited from leaving a Lithuanian airport if, among other things, airport charges or air navigation fees are not discharged in respect of that aircraft or if it fails to comply with safety requirements. The Civil Code 2001 also prescribes that the lawful possessor of an object belonging to another person, who has the right of claim against the owner of the object, may detain such object until the claim is sat - isfied. This right is often exercised by maintenance, repair and overhaul entities (MROs) in the event that the repair costs are not covered. 3.3.2 Timeframe to Discharge a Lien or Mortgage Provided that all necessary documents are collected, it takes approximately between one and five business days to clear a local law mortgage. 3.3.3 Register of Mortgages and Charges Mortgages over aircraft are recorded in the Register of Contracts and Restrictions of Rights and such data is available to the civil aviation authority. 3.3.4 Statutory Rights of Detention or Non- Consensual Preferential Liens As noted in 3.3.1 Third-Party Liens , a repair organisa - tion or any other lawful possessor of an aircraft may exercise the right of detention over a particular aircraft. 3.3.5 Verification of an Aircraft’s Freedom From Encumbrances An application can be submitted to the local aviation authority. Also, the searches in the Register of Con -
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