LITHUANIA Law and Practice Contributed by: Kęstutis Švirinas, Ieva Rimavičienė, Domantė Lunytė and Luka Tamulionytė, Sorainen
Sorainen 44A Gedimino Ave, LT-01110 Vilnius Lithuania Tel: +370 52 685 040 Email: lithuania@sorainen.com Web: www.sorainen.com
1. Overview 1.1 National Position
tion of its BITs with the Russian Federation and the Republic of Belarus, citing incompatibility of treaty obligations with Lithuania’s legal and political stance following Russia’s aggression against Ukraine. These BITs will cease to be in force as of 15 October 2025. Despite formal termination, the survival clause con- tained in both treaties ensures that their substantive protections remain effective for a period of ten years following termination, in respect of investments made prior to the termination date. Accordingly, qualifying investments made before 15 October 2025 will con- tinue to benefit from treaty protections until 15 Octo- ber 2035, and disputes arising from such investments may still be resolved under the terms of the respective BITs. Furthermore, Lithuania signed the Energy Charter Treaty (ECT) in April 1995, and the Seimas (Lithuanian parliament) ratified it in June 1998. In line with the position adopted by several other Member States, Lithuania has decided to withdraw from the ECT, with the withdrawal scheduled to take effect on 8 August 2026. Under the ECT’s sunset clause, the treaty’s substan- tive protections will continue to apply to investments made prior to the effective date of withdrawal for a period of 20 years. Thus, investments made before 8 August 2026 will remain protected under the ECT until 8 August 2046. Despite these developments, Lithuania remains com- mitted to safeguarding investor rights and ensuring access to dispute resolution. Article 6 (2) of the Law on Investment of the Republic of Lithuania (“Law on Investment”) provides that disputes between foreign
Lithuania maintains a clear and consistent policy regarding investor–state arbitration, which broadly aligns with the legal and political framework of the EU. Lithuania recognises the importance of providing foreign investors with access to effective dispute reso- lution mechanisms, including international arbitration, while also adapting its treaty practice to reflect evolv- ing EU jurisprudence and geopolitical realities. Lithuania has not expressed a general reluctance to enter into treaties containing investor–state arbitration clauses. On the contrary, it has historically conclud- ed numerous bilateral investment treaties (BITs) that include such provisions, reflecting its commitment to investor protection and legal certainty. However, recent developments demonstrate a delib- erate recalibration of Lithuania’s treaty policy, particu- larly in response to EU legal obligations and broader geopolitical considerations. Following the Achmea judgment of the Court of Jus- tice of the European Union, which held that intra-EU investor–state arbitration clauses are incompatible with EU law, Lithuania joined other EU member states (“Member States”) in signing the Agreement for the Termination of Bilateral Investment Treaties between the Member States of the European Union on 15 January 2019. As a result, these intra-EU BITs were officially terminated as of 4 September 2021. Lithuania has also taken steps to terminate BITs with certain non-EU countries due to serious geopolitical concerns. Notably, Lithuania announced the termina-
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