The Lithuanian legal system is based on the continental/civil legal tradition. Civil proceedings in all courts are based on the adversarial model and on the principle of orality, which means that the parties to a civil case and other participants in the proceedings shall give explanations, testimony and requests orally, except in cases provided for in the Code of Civil Procedure (CCP).

The national civil court system (ie, excluding administrative courts) consists of four types of courts, which comprise an integral judicial system of three instances.

• Courts of first instance: district and regional courts. Which court – district or regional – has jurisdiction to hear a case is determined by the special rules of jurisdiction set out in the CCP. Such rules are, for example, related to the subject matter and/or the value of the dispute.
• Court of appellate instance: if the appealed judgment was rendered by a district court as the court of first instance, the court of appellate instance would be a regional court. If the appealed judgment or decision was rendered by a regional court, the dispute will be examined by the Court of Appeal of Lithuania.
• Cassation: the Supreme Court of Lithuania performs the function of a cassation court. An application to review the case in the Supreme Court can be made after the decision or a judgment was appealed. The Supreme Court reviews cases only in terms of legal issues and does not accept every application, so the cassation instance is not deemed to be an additional appellate instance. According to the CCP, a selection board made up of judges of the Supreme Court decides to accept and to review only those cases where the legal issues are significant to the entire civil legal system.

According to Article 9 of the CCP, the general rule is that all hearings are public. Nevertheless, a court may pass a motivated ruling that the hearing should be not public (ie, closed) – for example, in order to protect the private or family life of a person, or when state or commercial secrets might be disclosed.

Article 10 of the CCP provides that all materials of a completed case are public and accessible unless the case was heard in a closed hearing. A person wishing to access materials of a publicly examined, completed case must submit an application to the chair of the respective court and indicate the purpose of accessing the materials.

Attorneys-at-law and assistant attorneys-at-law have the broadest rights to act as client representatives in court. In general, attorneys-at-law and assistant attorneys-at-law are both subject not only to general standards of conduct, but also to the specific requirements laid down in the Law on the Bar of the Republic of Lithuania and in the rules of professional conduct – only a person of impeccable professional conduct can be entrusted with the representation of a client’s interests in court. Attorneys-at-law and assistant attorneys-at-law shall meet the following requirements, among others:

• be a citizen of the Republic of Lithuania or another EU country;
• have proficiency in the official Lithuanian language; and
• have a higher university degree.

Assistant attorneys-at-law may represent a client's interests before court only if they have been authorised in writing by the attorney-at-law (head of their practice) to represent the client in a particular case. Assistant attorneys-at-law may only represent a client before a court of the first instance and after the approval of their one-year practice report by the Lithuanian Bar Association.

According to the Law on the Bar of the Republic of Lithuania, lawyers of EU member states are classified as temporary or permanent providers of legal services in Lithuania. In both cases, lawyers have the right to represent their clients in courts, but there are some exceptions – eg, lawyers who provide legal services permanently in Lithuania may not represent a client’s interests in cases pending before the Supreme Court of Lithuania (Article 65(1) of Law on the Bar of the Republic of Lithuania).

Third-party funding is not regulated in Lithuania, so there is no regulation prohibiting third parties from funding litigation.

This is not applicable in Lithuania.

This is not applicable in Lithuania.

This is not applicable in Lithuania.

This is not applicable in Lithuania.

In general, agreements on contingency fees between claimants and defendants are permitted, but not regulated.

This is not applicable in Lithuania.

There is no formal requirement to commence any pre-action procedures. However, the law may establish mandatory out-of-court settlement procedures for separate (and very limited) categories of cases – eg, labour law disputes. If the law requires a pre-action procedure, the consequences differ depending on whether that procedure could still be used: if it is still possible to use that procedure, the statement of claim is left unexamined (without prejudice), whereas if the pre-action procedure is no longer possible, the court terminates the case with prejudice, meaning that the same claim cannot be brought before a court.

The general limitation period for bringing civil claims is ten years (Article 1.125(1) of the Civil Code of the Republic of Lithuania). Shorter limitation periods are defined for specific types of claims, as follows:

• one month for claims arising from the results of a tender;
• three months for challenging decisions of executive bodies of legal entities;
• six months for claims concerning contractual penalties and defects of goods sold;

• six months for claims arising out of relationships between communication enterprises and their clients regarding shipments sent within the territory of Lithuania, or one month when the shipments were sent abroad;
• one year for claims arising out of insurance relationships;
• three years for claims concerning compensation of damage; and
• five years for claims concerning the recovery of interest and any other periodical payments.

This list is not exhaustive, and separate laws may provide additional limitation periods, but in all cases only a law can regulate time bars. Parties cannot deviate from the legislative provisions regulating limitation periods – eg, they cannot agree to apply shorter time bars.

As a general rule, the limitation period starts at the time a claimant became aware or ought to have been aware about the breach of their rights.

As an EU member state, Lithuania follows the Brussels I Regulation regarding jurisdiction provisions in disputes involving foreign EU member states, so in most cases the law unified for the whole EU regarding the jurisdiction in civil matters applies in Lithuania. Therefore, the general rule is that a lawsuit could only be filed in Lithuania against a defendant who has their place of residence in Lithuania (excluding exceptions set forth in the Brussels I Regulation).

The initial complaint (a statement of claim in the vast majority of cases must comply with the general requirements and should include:

• the amount of the claim (if the claim is to be valued);
• the factual background on which the claimant bases its claim;
• the evidence in support of the factual background;
• the relief sought;
• the claimant’s opinion on the decision to be given in absentia if no statement of defence is filed;
• information on whether the proceedings will be conducted with a lawyer (if yes, then the main contact information of the lawyer shall also be indicated);
• the claimant’s opinion on the possibility of concluding a settlement agreement and the feasibility of resolving the dispute by judicial mediation; and
• proof that the stamp duty has been paid.

Before a court passes an order to hear the case, the claimant has the right to change the subject-matter or the request for relief of the claim. In order to make such an amendment, the claimant must submit a written application that complies with the general requirements for written submissions. A subsequent amendment of the subject matter or the request for relief might be made only if:

• the need for such an amendment has arisen subsequently;
• the consent of the other party has been obtained; or
• the court considers that it will not delay the proceedings.

Once the claim is admitted to the court, the respondent is served with the claim and a notice about further actions needed from the respondent. Usually, documents are served by the court, unless a party informs that it will serve the documents.

The most common means of service is via registered mail with a return receipt. The date of the service is deemed to be the date marked on the return receipt. If the parties are represented by attorneys, they are served via electronic means of communication, in particular via the national e-court system.

The court must endeavour to find the respondent in order to serve the claim. If the respondent is served with the court documents but does not respond to a lawsuit, the court may issue a judgment in absentia. The respondent cannot appeal such a decision, but it may request the same court to review the decision within 20 days after it has been rendered.

Class actions were introduced in Lithuania in 2014. A claim may be examined as a class action if it is based on the same or similar factual circumstances, and if it is aimed at protecting the same or similar rights or legal interests of a group of legal and natural persons by the same legal remedy (Article 4411(2) of the CCP).

A group must consist of at least 20 persons in order to bring a class action.

The formation of the group is based on the opt-in principle – a person who wants to join the group has to express their will by filling out a written form approved by the Ministry of Justice (Article 4413(2)(1) of the CCP).

There are no specific requirements to provide clients with a cost estimate of the potential dispute. However, professional lawyers usually provide information on estimated costs to the client.        

Some issues are dealt with by the courts at preliminary hearings or in writing before a substantive hearing, but they are limited to procedural and/or case management matters.

Parties can make interim applications, such as to extend the deadlines, to order document production, to summon witnesses, etc.

A party may ask the court to leave the lawsuit unexamined (without prejudice) or to terminate the case (with prejudice) before a substantive hearing of the claim. The outcome of both of these requests is that the claimant’s case would be struck out before a substantive hearing of the claim. The CCP provides a list of grounds for such motions. For example, a party may ask to leave the lawsuit unexamined (without prejudice) if there is a pending court case between the same parties, on the same subject matter and on the same grounds, or if the parties have concluded an arbitration agreement. When the circumstances that comprised the ground to leave the lawsuit unexamined disappear, a party may initiate the case again.

Examples of grounds to terminate the case with prejudice include cases when there is an effective court judgment between the same parties, on the same subject matter and on the same grounds, or when the claimant has waived its claim with prejudice, or the parties have entered into a settlement agreement. These circumstances are permanent and one cannot expect them to disappear, so the case is terminated with prejudice.

A party may submit a request to leave the lawsuit unexamined or to terminate the case at any time, including before a substantive hearing of the claim. However, the court is not bound to decide on such a request and may decide to resolve it in conjunction with the merits of the case in the final decision.

There is also a possibility to ask for bifurcation of the proceedings – eg, to decide on the liability at first, and later on quantum. However, that does not result in some sort of an early judgment, but rather in several judgments on the merits of the dispute.

This is not applicable in Lithuania.

An interested party may be involved in the court proceedings as:

• a third party who has independent demands regarding the subject matter of the case – such a party may join the case before the beginning of final speeches (Article 46(1) of the CCP) and have all the rights and obligations of claimants during the proceedings (Article 46(2) of the CCP); or
• a third party who has no independent demands – such a party may get involved in the case either upon the request of any of the parties or upon the court’s initiative. A person may join the case as a third party if the outcome of the case may have an influence on their rights or liabilities (Article 47(1) of the CCP). Such a party has all the procedural rights and obligations of a party (including the right to receive litigation costs), with some exceptions, such as the right to amend the subject matter and plea of the claim, to increase or reduce the value of the claim or to conclude an amicable settlement (Article 47(2) of the CCP).

The CCP permits the court to order a party to make a security deposit over legal costs if the court assumes that the party brought a frivolous or abusive lawsuit.

A claimant from a foreign country could also be asked to make a security deposit over legal costs if a defendant demands this. However, this rule is not applicable if a security deposit is prohibited by an applicable international treaty.

The parties’ applications do not usually have an impact on the court costs as stamp duty is pre-determined by the amount of the claim. There are, however, some exceptions – eg, if a party requests to appoint an expert, such a party has to pay the expert’s expenses, determined by the court in advance. A party also has to pay additional stamp duty if it asks to apply interim measures.

The CCP does not regulate the timeframe for a court to deal with an application submitted by the parties, with very limited exceptions. For example, the court has to decide on an application to apply interim restrictive measures within three days.

As in many states of the continental legal system, there is no principle of pre-trial discovery set forth in the CCP. However, there is a possibility to ask the court to order the production of particular written evidence (document production).

Generally, until the hearing of the merits of the case, the court accepts all evidence, and all evidence is added to the civil case. Afterwards, the court can refuse to add evidence that could have been added previously. Since the CCP does not provide for a discovery stage, cases are rarely overburdened by large volumes of evidence.

It is possible to obtain an order to produce documents directed towards a third party that is not involved in the case. To obtain such an order, a requesting party should follow the general procedure for document production.

This is not applicable in Lithuania.

Article 226 of the CCP provides that all parties have to submit all written evidence they have during the pre-trial stage, and to provide all explanations that are relevant for the subject matter of the case. Article 227(2) of the CCP sets out that the court may refuse to admit evidence that could have been submitted in the pre-trial stage, if the court deems that such an admission would postpone the examination of the case.

A party to a case may ask the court to order another person to produce certain evidence, provided that the party requesting document production:

• identifies what particular evidence is being asked for;
• proves that another person has the evidence; and
• indicates which circumstances could be proved with that evidence (Article 199(1) of the CCP).

If the court satisfies such a request, a term to produce the evidence is set. A person may not produce evidence only if there are justifiable reasons not to do so; otherwise, failure to produce evidence may be fined by the court (Article 199(6) of the CCP). The law does not provide a list of justifiable reasons, but in practice attorney-client privilege or commercial secrets are recognised as reasonable grounds not to produce evidence; mere confidentiality may be insufficient.

The most comprehensive regulation on legal privilege is set forth in the Law on the Bar of the Republic of Lithuania, Article 45 of which sets out that third parties are forbidden to obstruct any attorney’s communication or meeting with a client, and that the details of such a meeting or communication cannot be used as evidence in any case (however, if the information was obtained from public sources, it is not considered to fall under legal privilege). Moreover, legal privilege extends not only to the fact of referral to the attorney but also to all communications by the attorney that are carried out on a client’s behalf with third parties, and to the information provided by the client (Article 46 of the Law on the Bar). There is no division of privilege into litigation and legal advice privilege: if the information falls under the meaning of professional secrecy, it is observed equally in both cases.

Legal privilege extends only to attorneys-at-law and assistant attorneys-at-law, which means that in-house lawyers are not protected under legal privilege.

If a court orders document production, a party may refuse to submit documents due to justifiable reasons. Justifiable reasons are not described by law, but according to the case law usually relate to the confidentiality of the documents. If the court still orders the submission of confidential documents to the case file, a party may invoke Article 10(4) of the CCP, which sets out that a party who submits documents or materials containing information on a professional or commercial secret (trade secret) may request the court not to make such documents available for others. In such a case, documents become available to the court but not to the other party to the dispute.

The award of injunctive relief in Lithuania is also known as interim measures. Lithuanian case law has clarified that the application of interim measures must meet the following two conditions.

• The plausible (prima facie) validity of the claimant’s claim – the court shall assess whether the claim is properly formulated and whether a judgment in favour of the claimant is likely to be given on the basis of the claim. Such an assessment allows the court to refuse interim measures only in cases where the claimant’s claim is unfounded (eg, the claimant has chosen an unauthorised or impracticable means of defending their rights).
• The risk that the judgment may not be enforced or may be more difficult to enforce if interim measures are not imposed. The purpose of this assessment is to preserve the status quo pending the examination of the substance in the dispute.

The main and most often used interim measures are:

• seizure of assets;
• notice in the public register prohibiting the sale or transfer of property;
• prohibition on performing certain transactions or taking other particular actions;
• prohibition on third persons transferring property to the defendant or performing other obligations to the defendant; and
• prohibition on leaving the permanent residence.

Article 145 of the CCP provides the abovementioned types of interim measures and also sets out that the list is non-exhaustive. It enables courts to apply such interim remedies as they deem necessary.

As a rule, the court shall decide on the application for interim measures by written procedure as soon as possible, but no later than within three business days after the application is received (Article 147(1) of the CCP). There is no arrangements for out-of-hours judges.

Article 147(1) of the CCP provides that the counterparty shall be notified of the application for interim measures only if the court considers it necessary. In all other cases, the court decides on interim measures on an ex parte basis. The right to be heard is conferred on such parties at a later stage – ie, if and when they submit an appeal against the order made by the court. Moreover, a party against which interim measures have been applied has a right not just to appeal, but also to submit a request to lift the measures.

According to Article 146 of the CCP, the court may order the claimant or any other person applying for interim measures to provide security for the respondent’s damages that may occur due to the application of interim measures. The respondent or other person seeking security has to ask for this measure as it is not applied ex officio by the court.

Once the judgment dismissing the claim becomes final, the respondent is entitled to claim compensation from the claimant for the loss suffered as a result of the application of interim measures. The respondent has a right to bring such a claim within 14 days of the date on which the judgment in the case becomes final. If the respondent fails to do that, the security for damages is released, but that does not preclude the respondent from bringing a claim for damages in the ordinary proceedings.

Injunctive relief can be granted and enforced in EU member states and in member states of the Lugano Convention. In other countries, the enforcement of injunctive relief is governed by bilateral and multilateral international treaties. If there is no international treaty, the procedure is regulated by national legislation.

Injunctive relief produces legal effects only in the Republic of Lithuania, meaning that the assets that are not in the territory of Lithuania will not be subject to the effects of seizure or other interim measures.

There are no formal limitations to granting injunctive relief against a third party. The only requirement is that the injunctive relief must be in such a form as to ensure the enforcement of a future court decision.

Article 145 of the CCP states that the defendant can be fined up to EUR300 per day for failure to comply with these injunctive relief measures. Also, a fine may be imposed on a third person if the defendant failed to comply with the following interim measures and the third person was involved in such a failure:

• prohibition on the defendant engaging in certain transactions or taking certain actions;
• prohibition on other persons transferring property to the defendant or performing other obligations; or
• in exceptional cases, a prohibition on the defendant's departure from their habitual residence and/or on the removal of the child from their habitual residence without the authorisation of the court.

In addition, the claimant shall be entitled to recover from those persons the damages resulting from the non-execution of the order for interim measures.

Lastly, the Criminal Code of the Republic of Lithuania sets out criminal liability in special cases when a respondent transfers, conceals, destroys or damages property that has been seized by interim measures.

Typical civil proceedings in Lithuania consist of four main stages.

• Commencement stage: this takes up to ten business days for a judge to decide if there are any obstacles to commencing the proceedings. If there are no such obstacles, the judge decides to admit the claim and sends it for the respondent to respond. When the respondent’s answer is received (or the term for its submission expires), the court may proceed to the pre-trial stage or set a date for a main hearing, if the court decides that the case is ready to be examined on its merits (Article 225(7) of the CCP).
• Pre-trial stage: this may be conducted either orally (in which case the court appoints a preliminary hearing) or in writing. If both parties are represented by professional lawyers, the court usually decides that the preparation will be conducted in writing (Article 227(1) of the CCP). At this stage, the parties are ordered to provide the court their statements, arguments, evidence, etc. The preparatory stage for the hearing usually lasts up to one to two months in simple cases.
• Hearings on the merits of the case (trial): when the pre-trial stage ends, the court sets a date for a hearing. The number of hearings and the timeframe depend on the complexity and circumstances of the case. At this stage, witnesses and experts may be examined. This stage is usually the lengthiest.
• Closing arguments: at the end of the hearings stage, the court usually selects a date on which the closing arguments will be heard. Such arguments are usually oral, but written closing arguments may sometimes be used, after consultation with the parties. The oral closing arguments stage usually lasts one court session. No new evidence or arguments may be introduced at this stage.

Case management issues are usually decided in writing, especially if all parties are represented by professional lawyers. The court is also free to organise the pre-trial stage orally, scheduling a so-called preparatory hearing. The timeframe of the pre-trial stage depends on the complexity of the case, and also on the method of preparation (written submissions or oral preliminary hearings). The preparatory stage for the hearing usually lasts up to one to two months in simple cases. When the pre-trial stage is finished, the case reaches the stage when hearings on the merits take place. If any case management issues are raised in that stage, these issues are decided during the ordinary oral hearings.

Jury trials are not available in Lithuania at all.

Article 177(1) of the CCP provides that evidence in a civil case is any factual matter that supports the parties’ respective claims and defences, or other matters relevant to the fair determination of the case. Evidence shall be adduced at the discretion of the parties and other persons involved in the case proceedings.

The court shall admit only such evidence as confirms or disproves the facts relevant to the case (Article 180 of the CCP). This means that, in addition to being relevant to the case, the evidence must be obtained in an admissible manner (Article 184 of the CCP). Furthermore, the court may refuse to admit evidence if it could have been submitted earlier and its later submission would delay the proceedings (Article 181(2) of the CCP). Written evidence shall comply with the requirement of the official language – ie, translated into the Lithuanian language.

In order to clarify questions arising in the proceedings which require special scientific, medical, technical, artistic or craft knowledge, the court may appoint an expert (Article 212(1) of the CCP). Parties have the right to ask questions in writing on which they wish to obtain an expert’s opinion. The final list of the questions on which the expert’s report is required shall be determined by the court. After that, the expert must provide an independent written opinion. The court may invite the expert to explain their report orally. The expert could be examined in the hearing by the court and the parties, and their oral explanation is recorded in the minutes of the hearing.

According to Article 9 of the CCP, the general rule is that all hearings are public. Nevertheless, a court may pass a motivated ruling that the hearing should not be public (closed) (eg, in order to protect the private or family life of a person, or when state or commercial secrets might be disclosed).

Article 10 of the CCP provides that all materials of a completed case are public and accessible, unless the case was heard in a closed hearing. A person wishing to access materials of a completed case has to submit an application to the chair of the respective court and indicate the purpose of accessing the materials.

Civil proceedings in all courts are conducted in accordance with the adversarial principle. Each party has the burden of proving the facts in support of the claim or statement of defence, except the events where facts are pleaded which do not require proof (Article 12 of the CCP). However, in certain cases the court may (must) be active if it finds that there is a public interest in a particular case or that the rights and legitimate interests of a person, society or the state would be insulted (Articles 179(2), 320(2) and 353(2) of the CCP).

Article 179(2) of the CCP provides for an exception to the general rule, which states that the court has the right to take evidence on its own initiative in non-dispositive cases and proceedings such as insolvency proceedings or restructuring proceedings, and in cases arising out of family law or labour law. In such cases, the court is obliged to act ex officio.

As regards the issues to be decided at the hearing, the principal rule is that the judge cannot rule on any issues that are related to the merits of the case.

The time it takes for a civil case to proceed from the commencement of a claim to getting to trial depends on a number of circumstances. However, the general time limits set out in the CCP are as follows:

• once a claim is admitted, the court sets a term of at least 14 days for a respondent to submit a statement of defence – this term may be extended up to 60 days (Article 142(1) of the CCP);
• after receiving the respondent’s answer, the court can set a date for the preliminary hearing or ask the parties to provide additional pre-trail written submissions (response to the answer to the claim and rejoinder) – each party is given up to 14 days to submit their additional documents (courts extend this term in some cases); and
• once all the documents are submitted, the court shall pass a ruling to advance to the trial stage and to schedule a hearing on the merits of the case. The hearing is usually scheduled in around one month after the court decides that the case is ready to be heard in trial. Therefore, the time to get to trial varies, taking roughly one to three months to have a main hearing scheduled, but this number may vary significantly if the case is more complex.

It is difficult to put a specific figure on the typical duration of trials. However, the CCP lays down a general rule that the court must ensure that a civil case is dealt with by the court in the shortest possible time, that there is no delay in the hearing of the case, and that the court must endeavour to deal with the civil case in a single hearing. However, when a court deals with a particularly complex civil case, it often takes more than one year to hear the case.

Court approval is always required if the parties seek to conclude the case by a document (but not a court decision on the merits) having the force of res judicata, which is enforceable by a bailiff.

Cases concerning the legal status or capacity of a person cannot be settled, nor can matters governed by imperative legal norms or matters of public policy.

Court approval is required when settling a lawsuit. Article 10 of the CCP states that the court has the right to declare all or a part of a case (Settlement Agreement included) to be non-public when it is delivering an order concluding proceedings in cases where there is a need to protect the privacy of a person’s private life and the confidentiality of their possessions, and the confidentiality of information about a person's health. It can also do this where there is a reasonable ground for supposing that the disclosure of a secret of the state, a public office, a profession or a trade, or any other secret protected by the law, would result in the disclosure of the file or of a part of it.

Settlement agreements are enforced in the same manner as court rulings. First, the court ruling to approve the settlement agreement must enter into force. If the settlement agreement is not being performed correctly, the court should issue an execution writ at the request of a party, which is a document enforceable by a bailiff.

Settlement agreements can be set aside by the court. Article 6.986 of the Civil Code provides that a settlement agreement may be recognised as being null and void in the following circumstances:

• if there is essential inequality between the parties;
• on other grounds of the invalidity of transactions;
• if the settlement agreement is made based on a transaction that was not in force at the time the settlement agreement was made;
• if the settlement agreement is based on written documents that later appear to be forged;
• if at the moment of entering into the settlement agreement one or both parties did not know that the subject matter of the agreement had already been resolved by a final court judgment;
• if after entering into the settlement agreement documents appear to confirm that one of the parties does not and did not have the right to what is recognised by the settlement agreement; and
• if the terms of the contract contradict imperative legal norms.

There are three main groups of court decisions:

• those regarding the recognition of certain rights or obligations;
• those awarding certain financial compensation, property or rights; and
• those regarding the modification of legal relationships.

There are no rules limiting maximum damages. However, the courts have wide discretion to reduce the amount of damages, which the courts are keen on exercising. Also, claims for damages are subject to a shorter limitation period of three years (compared to the general limitation period of ten years).

Article 6.249 of the Civil Code states that the following can be recognised as damages:

• loss of or injury to a person's property due to illegal actions;
• the costs incurred (direct losses) through another's illegal actions;
• the lost income that a person would have received if there had been no illegal actions; and
• if the responsible person has benefited from their illegal actions, the benefit can be recognised as a loss at the creditor's request.

In addition to direct losses and lost income, losses include:

• reasonable expenses for the prevention or reduction of damage;
• reasonable costs related to the assessment of civil liability and damages; and
• reasonable expenses related to the recovery of losses outside of court.

Punitive damages are not generally recognised in Lithuania. However, pre-agreed compensatory payments for the breach of contract or delays, usually called penalties, are recognised and common. They can take various forms, such as default interest per each day of delay, a penalty for the failure to close a contract, etc.

Broadly speaking, there can be two kinds of interest:

• substantive interest, which accrues as a matter of fact before the claim is filed in court; and
• procedural interest, which accrues from the date the claim is filed until the full payment of the amounts awarded. The interest is calculated on the amount claimed, and is awarded only when a party to the dispute claims it.

Domestic laws establish the procedural interest rates, which can be:

• 5% if the other party is a natural person;
• 6% if the other party is a legal entity; or
• 8% plus the fixed rate applicable to the most recent main refinancing operation of the European Central Bank if the most recent main refinancing operation of the European Central Bank was executed by means of a fixed-rate tender procedure, or plus the marginal lending rate if the most recent main refinancing operation of the European Central Bank was executed by means of a variable-rate tender procedure (if the dispute arose from a commercial transaction).

When the court judgment enters into force, at the request of a party the court should issue an execution writ, which is a document to be executed by a bailiff. Execution by a bailiff is subject to special procedural rules and involves various methods of recovering the money (writing-off cash balances on bank accounts, selling assets by auction, etc).

Enforceable foreign judgments must be recognised by the Court of Appeal.

EU member states’ court judgments are recognised and enforced on the basis of Brussels I and Brussels II EU Regulations.

Icelandic, Norwegian and Swiss judgments are recognised and enforced on the basis of the Lugano Convention.

The enforcement of the judgments of other countries is governed by international treaties. If there is no international treaty in place, the procedure is regulated by the national legislation, namely the CCP, as well as the principles of reciprocity and judicial comity.

There are two levels of appeal in Lithuania.

Judgments of the courts of first instance (ie, when the dispute is decided on the merits) can be appealed to the appellate instance. Judgments of the district courts are to be appealed to regional courts. Judgments of regional courts with respect to cases decided by them as courts of the first instance are to be appealed to the Court of Appeal of Lithuania.

Judgments of the appellate instance may be further appealed on points of law to the Supreme Court of Lithuania (so-called cassation). An application to review the case in the Supreme Court can be made after the decision or a judgment was appealed and becomes effective.

The cassation instance is not deemed to be an appellate instance, because the Supreme Court reviews cases only in terms of legal issues and does not accept every application.

A selection board, comprising judges of the Supreme Court, decides to accept and to review only such cases where the legal issues are significant to the entire civil legal system of the country.

The right to appeal is granted by law. Generally speaking, all first instance court decisions on the merits of the case can be appealed. Nevertheless, there are a few exceptions regarding first instance court decisions made in summary proceedings. In such cases, the first instance court decision cannot be appealed.

However, cases decided in summary proceedings have a separate mechanism for reviewing court decisions. If objections are raised against a summary judgment, the court of first instance will examine the merits of the case in full in accordance with the general rules on litigation. The decision of the court following a trial under the general rules of litigation is subject to an appeal.

A judgment of the court of first instance enters into force within 30 days of the date it is issued. Appeals against such judgments must be filed within this period. If the deadline for filing an appeal is missed for important reasons, the deadline can be renewed. An appeal is filed through the court of first instance whose decision is appealed. Stamp duty must be paid when filing an appeal (if applicable).

Lithuania has a partial (limited) appeal model, which is defined as a form of review of the decision made by the court of first instance in order to check the legality and/or reasonableness of the decision on the basis of an appeal.

The appellant may not raise new claims in their appeal that were not raised at the first instance court. It is also prohibited to adduce new evidence that was not adduced before the court of first instance (although there are exceptions).

The conditions for submitting an appeal, which according to the law must be fulfilled by the appellant, are verified by the court of first instance through which the appeal is filed. The appellate court does not determine the conditions for filing an appeal.

Having examined the case, the appellate courthas the right to:

• leave the decision of the court of first instance unchanged;
• annul the decision of the court of first instance (in whole or in part) and make a new decision;
• change the decision of the court of first instance;
• annul the decision of the court of first instance in whole or in part and transfer the case to the court of first instance for retrial; or
• annul the decision of the court of first instance (in whole or in part) and close the case or leave the claim unexamined, if grounds to do so are established.

Lithuania uses the principle that “costs follow the event”, meaning that the losing party covers all legal costs. Such expenses can be awarded if they were actually paid and relevant evidence was submitted before the end of the main hearing – ie, before the court announces the closing of the main hearing and the parties start closing arguments. In the event of partial success, the costs will be compensated by the losing party in proportion to the amount of claims satisfied.

Nonetheless, the legal fees are not always fully reimbursed, as the law provides that the compensation for legal fees cannot exceed the amounts indicated in the recommendations approved by the Minister of Justice (Article 98(2) of the CCP).

Also, the part of the decision regarding the award of litigation costs may be appealed.

In terms of the apportionment of costs, only the outcome of the case matters.

However, when deciding on the reasonableness of legal fees, the court will consider:

• the complexity of the case;
• the complexity of legal services and the need for special knowledge;
• previous (repeated) participation in the same case;
• the need to travel to a different location than the lawyer's registered place of work;
• the amount in dispute;
• the permanence and nature of the provision of legal services;
• the novelty of the legal issues being addressed;
• the conduct of the parties during the process;
• the cost of the lawyer's working time; and
• other important circumstances.

Interest is not awarded on costs in the Republic of Lithuania.

The most frequently used methods of alternative dispute resolution are arbitration and mediation. In some family disputes, mediation is mandatory.

ADR methods are becoming increasingly popular. Nevertheless, it should be noted that ADR methods are more prevalent in commercial/business disputes rather than in domestic disputes, despite ADR being mandatory in family cases.

Before starting the hearing on the merits, the courts must always ask the parties if they wish to settle and are generally obliged to encourage and facilitate a settlement.

In order to increase the popularity of mediation, Lithuania adopted a new Law on Mediation in 2015. Article 80(8) of the CCP incentivises parties to mediate a dispute, as it provides for the reduction of stamp duty to 25% if the parties have attempted to settle the dispute through a mediation process.

In addition, the law may establish mandatory out-of-court settlement procedures for separate categories of cases – eg, in labour law disputes. If the law requires a pre-action procedure, the consequences differ depending on whether that procedure could still be used:

• if it is still possible to use the procedure, the statement of claim is left unexamined (without prejudice); or
• if the pre-action procedure is no longer possible, the court terminates the case (with prejudice).

The Lithuanian Chamber of Mediators is a well-organised institution with a council and a chair. It is mainly a professional organisation for court mediators, although it is less active outside the profession.

The Law on Commercial Arbitration of the Republic of Lithuania is a modern piece of legislation, prepared in accordance with the UNCITRAL Model law, which makes Lithuania an attractive jurisdiction to choose for the seat of arbitration.

Arbitration cannot be used in family, labour or consumer disputes. With respect to labour disputes, an exception may be made if the arbitration agreement was entered into after the dispute arose. Arbitration cannot decide:

• patent, trade mark or design registration matters;
• disputes relating to contract prices determined through public procurement procedures; or
• administrative and constitutional cases.

The Lithuanian Court of Appeal may set aside an arbitral award when the party filing the complaint provides evidence that:

• one of the parties to the arbitration agreement was incapacitated under the applicable law, or the arbitration agreement is invalid under the law applicable to the agreement of the parties or, where the parties have not agreed on the law applicable to the arbitration agreement, under the law of the country in which the award was rendered;
• the party against whom the award is sought to be invoked has not been given adequate notice of the appointment of the arbitrator or the arbitration proceedings, or was not otherwise given an opportunity to be heard;
• the arbitral award was rendered in respect of a dispute or part of a dispute that was not submitted to arbitration – if the part of the dispute that has been referred to arbitration can be distinguished, the part of the arbitral award that resolves the matters referred to arbitration may be recognised and enforced;
• the composition of the arbitral tribunal or the arbitral proceedings was not under the agreement of the parties and/or the mandatory provisions of the Commercial Arbitration Act;
• the dispute is not arbitrable under the laws of the Republic of Lithuania; or
• the arbitral award is contrary to the public policy of the Republic of Lithuania.

The process of enforcing domestic arbitral awards is easier than foreign arbitral awards. For domestic awards, the court should issue an execution writ at the request of the party. The execution writ is a document enforceable by a bailiff.

A foreign arbitral award must be recognised and the enforcement must be granted by the Court of Appeal. After such recognition and granting of the enforcement, the arbitral award is enforced by the bailiff.

Lithuania is a party to the New York Convention (ratified on 17 January 1995). When enforcing an arbitral award under the New York convention, the Lithuanian court will not review the award on its merits. The recognition and enforcement may only be refused on the grounds set out in the Convention.

Currently there are no proposals for dispute resolution reform.