Lietuviškai

           THE CONSTITUTIONAL COURT OF THE REPUBLIC OF           
                            LITHUANIA                            

                             RULING                              
         ON THE COMPLIANCE OF ITEM 3 OF THE PROCEDURE OF         
       THE TRANSFER OF BUILDINGS OR PREMISES BELONGING TO        
           THE STATE OR LOCAL GOVERNMENTS BY RIGHT OF            
       OWNERSHIP FOR SHARES (WORDINGS 4 FEBRUARY 1999 AND        
       14 APRIL 2000) WHICH WAS APPROVED BY GOVERNMENT OF        
        THE REPUBLIC OF LITHUANIA RESOLUTION NO. 120 "ON         
          THE PROCEDURE OF THE TRANSFER OF BUILDINGS OR          
            PREMISES BELONGING TO THE STATE OR LOCAL             
       GOVERNMENTS BY RIGHT OF OWNERSHIP FOR SHARES" OF 4        
         FEBRUARY 1999 WITH PARAGRAPH 5 OF ARTICLE 20 OF         
        THE REPUBLIC OF LITHUANIA LAW ON THE POSSESSION,         
          USE AND DISPOSAL OF STATE-OWNED AND MUNICIPAL          
                PROPERTY (WORDING OF 12 MAY 1998)                

                         21 August 2002                          
                             Vilnius                             

     The  Constitutional  Court  of  the  Republic  of Lithuania,
composed  of  the  Justices  of  the Constitutional Court Armanas
Abramavičius,   Egidijus  Jarašiūnas,  Egidijus  Kūris,  Kęstutis
Lapinskas,   Zenonas   Namavičius,  Augustinas  Normantas,  Jonas
Prapiestis, Vytautas Sinkevičius, and Stasys Stačiokas,
     with the secretary of the hearing-Daiva Pitrėnaitė,
     in the presence of:
     the  representative  of  the  Government  of the Republic of
Lithuania,  the  party concerned, who was Rimantas Stanevičius, a
lawyer of the Legal Division of the State Property Fund,
     pursuant  to  Articles  102  and  105 of the Constitution of
the  Republic  of  Lithuania  and  Article  1  of the Republic of
Lithuania  Law  on the Constitutional Court, on 14 August 2002 in
its  public  hearing  heard  Case No. 43/01 which originated in a
petition  of  the  Supreme Administrative Court of Lithuania, the
petitioner,  requesting  to  determine  whether the provisions of
Item  3  of  the  Procedure  of  the  Transfer  of  Buildings  or
Premises  Belonging  to  the  State or Local Governments by Right
of  Ownership  for  Shares (wording of 4 February 1999) which was
approved  by  Government  of the Republic of Lithuania Resolution
No.  120  "On  the  Procedure  of  the  Transfer  of Buildings or
Premises  Belonging  to  the  State or Local Governments by Right
of  Ownership  for  Shares"  of  4 February 1999 stating that the
premises  may  not  be  transferred for shares if the enterprises
pointed  out  in Item 1 of this procedure are behindhand with the
rent  payment,  are  in  arrears  overdue for the State Budget of
the  Republic  of  Lithuania,  also whether the provisions of the
same  item  (wording  of 14 April 2000) stating that the premises
may  not  be  transferred  for  shares if the enterprises pointed
out  in  Item  1  of  this procedure are behindhand with the rent
payment,  are  in  arrears  overdue  for  the State Budget (local
government  budget)  of  the Republic of Lithuania, and the State
Social  Insurance  Fund Budget, were in compliance with Paragraph
5  of  Article  20  of  the  Republic  of  Lithuania  Law  on the
Possession,   Use  and  Disposal  of  State-owned  and  Municipal
Property (wording of 12 May 1998).

     The Constitutional Court
                        has established:                         

                                I                                
     1.  On  12  May  1998,  the  Seimas  enacted the Republic of
Lithuania   Law   on   the   Possession,   Use  and  Disposal  of
State-owned  and  Municipal  Property (Official Gazette Valstybės
žinios,  1998,  No.  54-1492; hereinafter also referred to as the
Law).
     On  4  February  1999, the Government adopted Resolution No.
120  "On  the  Procedure of the Transfer of Buildings or Premises
Belonging   to  the  State  or  Local  Governments  by  Right  of
Ownership  for  Shares" (Official Gazette Valstybės žinios, 1999,
No.  15-391),  whereby the Procedure of the Transfer of Buildings
or  Premises  Belonging  to  the  State  or  Local Governments by
Right  of  Ownership  for Shares (hereinafter also referred to as
the  Procedure)  was  approved.  On 14 April 2000, the Government
adopted   Resolution   No.  427  "On  the  Partial  Amendment  of
Government  of  the  Republic of Lithuania Resolution No. 120 'On
the   Procedure   of   the  Transfer  of  Buildings  or  Premises
Belonging   to  the  State  or  Local  Governments  by  Right  of
Ownership  for  Shares'  of  4  February  1999" (Official Gazette
Valstybės žinios, 2000, No. 32-907).
     2.  The  Supreme  Administrative  Court  of  Lithuania,  the
petitioner,  was  investigating  an administrative case. The said
court  suspended  the  investigation of the case by its order and
addressed  the  Constitutional  Court  with a petition requesting
to  determine  whether  the provisions of Item 3 of the Procedure
of  the  Transfer of Buildings or Premises Belonging to the State
or  Local  Governments by Right of Ownership for Shares which was
approved  by  Government  Resolution No. 120 "On the Procedure of
the  Transfer  of Buildings or Premises Belonging to the State or
Local  Governments  by  Right  of  Ownership  for  Shares"  of  4
February  1999  stating  that the premises may not be transferred
for  shares  if  the  enterprises  pointed  out in Item 1 of this
Procedure  are  behindhand  with the rent payment, are in arrears
overdue  for  the  State  Budget (local government budget) of the
Republic  of  Lithuania,  and  the  State  Social  Insurance Fund
Budget,  were  in  compliance  with the provisions of Paragraph 5
of  Article  20 of the Law on the Possession, Use and Disposal of
State-owned and Municipal Property.
  
                               II                                
     The  request  of  the  petitioner  is based on the following
arguments.
     Paragraph  5  of  Article  20  of  the  Law  establishes the
conditions  under  which  the  buildings or premises belonging to
the  state  or  local  governments by right of ownership the list
whereof  is  approved  by  a Seimas resolution on the proposal of
the  Government,  upon  their  evaluation according to the Law on
the  Privatisation  of  State-Owned  and Municipal Property, may,
under  procedure  established  by  the Government, be transferred
for  shares  to  a  newly  established or functioning joint-stock
company  or  private  company.  By Item 3 of the Procedure of the
Transfer  of  Buildings  or  Premises  Belonging  to the State or
Local  Governments  by  Right of Ownership for Shares approved by
Resolution   No.  120  "On  the  Procedure  of  the  Transfer  of
Buildings   or   Premises   Belonging   to  the  State  or  Local
Governments  by  Right  of  Ownership  for  Shares" of 4 February
1999,  the  Government  established  that the premises may not be
transferred  for  shares if the enterprises pointed out in Item 1
of  this  Procedure  are behindhand with the rent payment, are in
arrears  overdue  for  the State Budget (local government budget)
of  the  Republic  of  Lithuania,  and the State Social Insurance
Fund  Budget.  The  petitioner  maintains  that  Paragraph  5  of
Article  20  of  the  Law  on the Possession, Use and Disposal of
State-owned  and  Municipal  Property  does  not provide for such
conditions.  The  Law  on  the  Possession,  Use  and Disposal of
State-owned  and  Municipal  Property  does  not put requirements
for  an  enterprise  of private capital not to be behindhand with
the  rent  payment,  not  to  be in arrears overdue for the State
Budget  (local  government  budget) of the Republic of Lithuania,
and   the   State   Social   Insurance   Fund   Budget.  The  Law
commissioned  the  Government  to  establish  a  procedure  under
which  state-owned  property  is  transferred  to  enterprises of
private  capital,  however,  it  did  not  granted  powers to the
Government  to  establish  additional  conditions of the transfer
of  the  premises  for  shares. The petitioner doubts whether the
provisions   of   Item  3  of  the  aforesaid  Procedure  are  in
conformity  with  the  provisions of Paragraph 5 of Article 20 of
the Law.
  
                               III                               
     In  the  course  of  the  preparation  of  the  case for the
Constitutional   Court   hearing,   written   explanations   were
received  from  the  representative  of the Government, the party
concerned,  who  was  R.  Stanevičius,  a  lawyer  of  the  Legal
Division of the State Property Fund.
     The  representative  of  the  party concerned noted that the
Law  regulates  the  procedure  and conditions of possession, use
and  disposal  of  state-owned  and municipal property as well as
the  powers  of  state  and  self-governance institutions in this
area  as  much  as this is not regulated by other laws concerning
the  possession  and/or  use  and/or  disposal  of such property.
Paragraph   5  of  Article  20  of  the  Law  provides  that  the
buildings  or  premises  which  belong  to  the  state  or  local
governments  by  right  of ownership the list whereof is approved
by  a  Seimas  resolution  upon  the  proposal of the Government,
upon  their  evaluation according to the Law on the Privatisation
of  State-Owned  and  Municipal  Property,  may,  under procedure
established  by  the  Government,  be transferred for shares to a
newly  established  or functioning joint-stock company or private
company   provided   such   a   company,  upon  receiving,  under
procedure  established  by  the  Government, a permit to do major
repairs  in  the  same  buildings  or  premises,  invested, under
procedure  established  by  laws  until  26  July  1996,  private
capital  the  value  of  which  comprises  more  than  1/2 of the
buildings'   or   premises'  value  and  provided  no  bankruptcy
procedure  has  been  instituted  against the said company and no
out-of-court  bankruptcy  procedure has been initiated as regards
the same company.
     The  representative  of  the  party concerned maintains that
the  legislature  specified  in the Law that in certain cases the
property  belonging  to  the  state  by right of ownership may be
transferred   to   a  private  capital  company  under  procedure
established   by   the   Government.  This  provision  is  to  be
interpreted  together  with  Paragraph 3 of Article 20 of the Law
which  provides  that  the  Government  shall adopt a decision on
long-term   and  short-term  investments  concerning  substantive
property  belonging  to  the state by right of ownership. Article
20  of  the  Law  does  not  point  out  in  what  cases the said
transfer   is   obligatory:   it   merely   establishes   minimal
requirements,  and  the  Government  is  commissioned to take the
final   decision.  By  the  disputed  resolution  the  Government
implemented  the  legal norm on the establishment of the transfer
procedure,  thus  realising  the  right to adopt the decision and
particularising    the   legal   provision   "property   may   be
transferred".
     In   the   opinion   of  the  representative  of  the  party
concerned,   the   state,   conforming   to   the   principle  of
proportionality,  must  strive  for  the  harmonisation of public
and  private  interests.  Therefore,  it  is just reasonable that
before  transferring  the premises to the private capital company
one  requires  that such an enterprise perform its duties for the
state,  e.g.,  cover  tax arrears or pay the rent fee for the use
of the property belonging to the state by right of ownership.
     In  the  opinion  of R. Stanevičius, Item 3 of the Procedure
approved  by  Government  Resolution No. 120 "On the Procedure of
the  Transfer  of Buildings or Premises Belonging to the State or
Local  Governments  by  Right  of  Ownership  for  Shares"  of  4
February  1999  is  in  compliance with Paragraph 5 of Article 20
of  the  Law  on  the Possession, Use and Disposal of State-owned
and Municipal Property.
  
                               IV                                
     In  the  course  of  the  preparation  of  the  case for the
Constitutional   Court   hearing,   written   explanations   were
received   from   R.  Valentukevičius,  a  Seimas  ombudsman,  A.
Zuokas,  Mayor  of  the  Vilnius  City Municipality, K. Virketis,
Director  of  the  Law  Department  of  the Office of the Seimas,
Prof.   T.   Birmontienė,   Head   of   the   Constitutional  Law
Department, the Law Academy of Lithuania.

     The Constitutional Court
                           holds that:                           

                                I                                
     1.  On  12  May  1998,  the  Seimas  enacted the Republic of
Lithuania   Law   on   the   Possession,   Use  and  Disposal  of
State-owned  and  Municipal Property Article 20 whereof regulated
the   relations   of   long-term   and   short-term   investments
concerning state-owned and municipal substantive property.
     The  Government  approved  the  Procedure of the Transfer of
Buildings   or   Premises   Belonging   to  the  State  or  Local
Governments  by  Right  of Ownership for Shares by its Resolution
No.  120  "On  the  Procedure  of  the  Transfer  of Buildings or
Premises  Belonging  to  the  State or Local Governments by Right
of Ownership for Shares" of 4 February 1999.
     The   Supreme   Administrative   Court   of  Lithuania,  the
petitioner,  requests  to  determine  whether  the  provisions of
Item  3  of  the  Procedure  of  the  Transfer  of  Buildings  or
Premises  Belonging  to  the  State or Local Governments by Right
of   Ownership  for  Shares  which  was  approved  by  Government
Resolution   No.  120  "On  the  Procedure  of  the  Transfer  of
Buildings   or   Premises   Belonging   to  the  State  or  Local
Governments  by  Right  of  Ownership  for  Shares" of 4 February
1999  stating  that  the  premises  may  not  be  transferred for
shares  if  the  enterprises  pointed  out  in  Item  1  of  this
Procedure  are  behindhand  with the rent payment, are in arrears
overdue  for  the  State  Budget (local government budget) of the
Republic  of  Lithuania,  and  the  State  Social  Insurance Fund
Budget,  were  in  compliance  with the provisions of Paragraph 5
of  Article  20 of the Law on the Possession, Use and Disposal of
State-owned and Municipal Property.
     2. Item 3 of the procedure was amended for several times.
     2.1.   Item  3  of  the  Procedure  approved  by  Government
Resolution   No.  120  "On  the  Procedure  of  the  Transfer  of
Buildings   or   Premises   Belonging   to  the  State  or  Local
Governments  by  Right  of  Ownership  for  Shares" of 4 February
1999  prescribed  that  the  premises  may not be transferred for
shares  if  against the enterprises pointed out in Item 1 of this
Procedure    bankruptcy    cases   are   instituted   or   either
out-of-court    bankruptcy    or   liquidation   procedures   are
commenced,  or  provided  their  own  capital is less than 3/4 of
the  capital  pointed  out  in  their articles of association, if
they  are  behindhand  with  the  rent  payment,  are  in arrears
overdue  for  the  State  Budget  of the Republic of Lithuania or
are  insolvent  according  to  the  Republic  of Lithuania Law on
Enterprise Bankruptcy.
     By  Government  Resolution No. 427 "On the Partial Amendment
of  Government  of  the  Republic of Lithuania Resolution No. 120
'On  the  Procedure  of  the  Transfer  of  Buildings or Premises
Belonging   to  the  State  or  Local  Governments  by  Right  of
Ownership  for  Shares' of 4 February 1999" of 14 April 2000 Item
3  of  the  Procedure  was amended and set forth as follows: "The
premises  may  not  be  transferred  for  shares  if  against the
enterprises  pointed  out  in Item 1 of this Procedure bankruptcy
cases  are  instituted, or out-of-court bankruptcy procedures are
commenced,  or  there  has been a court decision to announce that
a  respective  enterprise  is liquidated due to bankruptcy or the
liquidation  procedure  of  the enterprise is commenced, which is
regulated   by  the  Republic  of  Lithuania  Law  on  Enterprise
Bankruptcy,  or  provided  the  capital of the enterprise is less
than   3/4  of  the  capital  pointed  out  in  its  articles  of
association,  if  it  is  behindhand with the rent payment, is in
arrears  overdue  for  the State Budget (local government budget)
of  the  Republic  of  Lithuania,  and the State Social Insurance
Fund Budget."
     By  Government  Resolution  No. 79 "On the Partial Amendment
of  Government  of  the  Republic of Lithuania Resolution No. 120
'On  the  Procedure  of  the  Transfer  of  Buildings or Premises
Belonging   to  the  State  or  Local  Governments  by  Right  of
Ownership  for  Shares'  of  4  February 1999" of 22 January 2000
Item  3  of  the  Procedure was amended and set forth as follows:
"The  premises  may  be transferred for shares to the enterprises
pointed  out  in  Item  1  of  this Procedure provided bankruptcy
cases   are   not   instituted   against  them,  or  out-of-court
bankruptcy  or  liquidation procedures are not commenced in their
regard."
     2.2.  The  petitioner  doubts whether the provisions of Item
3  of  the Procedure that the premises may not be transferred for
shares  if  against the enterprises pointed out in Item 1 of this
Procedure  are  behindhand  with the rent payment, are in arrears
overdue  for  the  State  Budget (local government budget) of the
Republic  of  Lithuania,  or  the  State  Social  Insurance  Fund
Budget  are  in  compliance with Paragraph 5 of Article 20 of the
Law.  The  provisions the compliance of which with Paragraph 5 of
Article  20  of  the  Law  are doubted by the petitioner were set
forth in the wordings of 4 February 1999 and 14 April 2000.
     3.   By  the  Law  on  the  Amendment  of  the  Law  on  the
Possession,   Use  and  Disposal  of  State-owned  and  Municipal
Property  enacted  by  the  Seimas on 23 May 2002, the Law on the
Possession,   Use  and  Disposal  of  State-owned  and  Municipal
Property  was  amended  and  set  forth  in  a  new  wording. The
provisions  of  Paragraph  5 of Article 20 of the Law (wording of
12  May  1998)  which  are  pointed  out  by  the petitioner were
abolished  in  the  Law  on  the  Possession, Use and Disposal of
State-owned and Municipal Property (wording of 23 May 2002).
     4.  Under  the  Constitution,  only the Constitutional Court
shall  decide  whether  the  laws and other legal acts adopted by
the  Seimas  are  in conformity with the Constitution and whether
legal  acts  adopted  by  the  President  of the Republic and the
Government   of   the   Republic   are  in  conformity  with  the
Constitution  or  laws  (Paragraph 1 of Article 102). Paragraph 1
of  Article  110 of the Constitution provides that judges may not
apply   laws   which   conflict   with  the  Constitution.  Under
Paragraph  2  of  the  same  article,  in  cases  when  there are
grounds  to  believe  that  the law or other legal act applicable
in  a  certain  case  conflicts  with the Constitution, the judge
shall   suspend   the  investigation  and  shall  appeal  to  the
Constitutional  Court  to  decide  whether the law or other legal
act in question complies with the Constitution.
     These  constitutional  provisions  mean that in cases when a
court  investigating  a  case,  after it questions the compliance
of  the  law  applicable in the case with the Constitution or the
compliance  of  another  act adopted by the Seimas, the President
of  the  Republic  or the Government with the Constitution or the
laws,  appeals  to  the  Constitutional  Court,  the latter has a
duty  to  consider  the  petition of the said court regardless of
the  fact  whether the disputed law or another legal act is valid
or not.
     Under   Paragraph  4  of  Article  69  of  the  Law  on  the
Constitutional  Court,  the  annulment  of a disputable legal act
shall  be  grounds  to  adopt a decision to dismiss the initiated
legal  proceedings.  The  provisions of Paragraph 4 of Article 69
of  the  Law  on  the  Constitutional  Court may not be construed
without  taking  into consideration the provisions of Article 110
of  the  Constitution.  The  formula "shall be grounds to adopt a
decision  to  dismiss  the  initiated legal proceedings" employed
in  Paragraph  4  of  Article 69 of the Law on the Constitutional
Court  is  to  be  construed  as  establishing  the  right to the
Constitutional  Court,  in  cases  when  not courts but the other
entities   pointed   out  in  Article  106  of  the  Constitution
appealed  to  the  Constitutional  Court, while taking account of
the  circumstances  of  the  case, to dismiss the initiated legal
proceedings,  but  not  as  establishing  that in every case when
the   disputed  legal  act  was  annulled  the  instituted  legal
proceedings must be dismissed.
     It  needs  to be noted that after the Supreme Administrative
Court  of  Lithuania,  the petitioner, appealed with the petition
requesting  to  determine whether the disputed provisions of Item
3  of  the  Procedure  (wordings  of 4 February 1999 and 14 April
2000)   approved   by  Government  Resolution  No.  120  "On  the
Procedure  of  the Transfer of Buildings or Premises Belonging to
the  State  or  Local  Governments  by  Right  of  Ownership  for
Shares"  of  4  February 1999 were in compliance with Paragraph 5
of  Article  20  of the Law (wording of 12 May 1998), in case the
Constitutional  Court  had not decided this issue in essence, the
doubts  of  the  Supreme  Administrative Court of Lithuania would
not  be  removed  as  regards  the  compliance  of  the  disputed
provisions of the Procedure with the Law.
     5.  Subsequent  to  the  petition  of  the  petitioner,  the
Constitutional  Court  will  consider  whether  the provisions of
Item  3  of  the  Procedure (wording of 4 February 1999) that the
premises  may  not  be  transferred for shares if the enterprises
pointed  out  in Item 1 of this Procedure are behindhand with the
rent  payment  and are in arrears overdue for the State Budget of
the  Republic  of Lithuania, and whether the provisions Item 3 of
the  Procedure  (wording  of 14 April 2000) that the premises may
not  be  transferred for shares if the enterprises pointed out in
Item  1  of  this  Procedure are behindhand with the rent payment
and   are   in  arrears  overdue  for  the  State  Budget  (local
government  budget)  of  the Republic of Lithuania, and the State
Social  Insurance  Fund Budget, were in compliance with Paragraph
5 of Article 20 of the Law (wording of 12 May 1998).
  
                               II                                
     1.  Paragraph  5 of Article 20 of the Law (wording of 12 May
1998) specified:
     "The  buildings  or  premises  which  belong to the state or
local  governments  by  right  of  ownership  the list whereof is
approved  by  a  Seimas  resolution  upon  the  proposal  of  the
Government,  upon  their  evaluation  according to the Law on the
Privatisation  of  State-Owned and Municipal Property, may, under
procedure  established  by  the  Government,  be  transferred for
shares   to   a  newly  established  or  functioning  joint-stock
company   or  private  company  provided  such  a  company,  upon
receiving,  under  procedure  established  by  the  Government, a
permit  to  do  major  repairs in the same buildings or premises,
invested,  under  procedure  established  by  laws  until 26 July
1996,  private  capital  the  value  of which comprises more than
1/2  of  the  buildings'  or  premises'  value  and  provided  no
bankruptcy   procedure  has  been  instituted  against  the  said
company   and  no  out-of-court  bankruptcy  procedure  has  been
initiated  as  regards  the  same company and if the buildings or
premises meet at least one of the following conditions:
     1)  not  less  than  1/2 of the main constructions have been
changed;
     2)  the  general area or capacity has been increased by more
than 1/3;
     3)  more  than  1/2  of  the engineering communications have
been changed or new ones have been installed;
     4)  part  of  the  works  pointed out in Items 1, 2 and 3 of
Paragraph   5   of  this  Article  have  been  performed  or  the
technological  equipment  or  manufacturing  facilities have been
installed,  while  in  the  case  of  its  dismantling  essential
damage might be inflicted to the building or premises."
     Thus,  Paragraph  5  of Article 20 of the Law (wording of 12
May  1998)  inter  alia  established  conditions  which had to be
satisfied  by  a  newly  established  or  functioning joint-stock
company  or  private  company to which the buildings or premises,
which  belong  to  the  state or the local government by right of
ownership,  the  list  whereof is approved by a Seimas resolution
upon  the  proposal  of  the Government and upon their evaluation
according  to  the  Law  on  the Privatisation of State-Owned and
Municipal Property, might be transferred for shares.
     2.  On  4  February  1999, the Government adopted Resolution
No.  120  "On  the  Procedure  of  the  Transfer  of Buildings or
Premises  Belonging  to  the  State or Local Governments by Right
of  Ownership  for  Shares" whereby the Procedure of the Transfer
of  Buildings  or  Premises  Belonging  to  the  State  or  Local
Governments  by  Right of Ownership for Shares was approved. Item
3  of  the  Procedure  (wording  of  4 February 1999) prescribed:
"The  premises  may  not be transferred for shares if against the
enterprises  pointed  out  in Item 1 of this Procedure bankruptcy
cases   are  instituted  or  either  out-of-court  bankruptcy  or
liquidation  procedures  are  commenced,  or  provided  their own
capital  is  less  than  3/4  of the capital pointed out in their
articles  of  association,  if  they are behindhand with the rent
payment,  are  in  arrears  overdue  for  the State Budget of the
Republic   of   Lithuania  or  are  insolvent  according  to  the
Republic of Lithuania Law on Enterprise Bankruptcy."
     It  was  inter  alia  established  in  the above item of the
Procedure  that  the  premises  may not be transferred for shares
to  the  enterprises  pointed  out  in  Item  1 of this Procedure
(i.e.  newly  established or functioning joint-stock companies or
private  companies)  if they are behindhand with the rent payment
and  are  in arrears overdue for the State Budget of the Republic
of Lithuania.
     Upon  the  partial  amendment  of  Government Resolution No.
120  "On  the  Procedure of the Transfer of Buildings or Premises
Belonging   to  the  State  or  Local  Governments  by  Right  of
Ownership  for  Shares"  of  4  February  1999 made by Government
Resolution  No.  427  "On  the Partial Amendment of Government of
the  Republic  of  Lithuania Resolution No. 120 'On the Procedure
of  the  Transfer of Buildings or Premises Belonging to the State
or  Local  Governments  by  Right  of  Ownership for Shares' of 4
February  1999"  of  14  April  2000,  Item  3  of  the Procedure
(wording  of  14  April 2000) specified: "The premises may not be
transferred  for  shares  if  against the enterprises pointed out
in  Item  1 of this Procedure bankruptcy cases are instituted, or
out-of-court  bankruptcy  procedures  are commenced, or there has
been  a  court  decision to announce that a respective enterprise
is  liquidated  due to bankruptcy or the liquidation procedure is
commenced,  which  is  regulated by the Republic of Lithuania Law
on   Enterprise  Bankruptcy,  or  provided  the  capital  of  the
enterprise  is  less  than  3/4 of the capital pointed out in its
articles  of  association,  if  it  is  behindhand  with the rent
payment,  is  in  arrears  overdue  for  the  State Budget (local
government  budget)  of  the  Republic  of  Lithuania,  the State
Social Insurance Fund Budget."
     Thus,  Item  3  of  the Procedure (wording of 14 April 2000)
inter  alia  established  additional conditions when the premises
may  not  be  transferred  for  shares to the enterprises pointed
out  in  Item 1 of the Procedure: they are in arrears overdue for
the  local  government budget and the State Social Insurance Fund
Budget.
     3.  The  Constitutional  Court  has noted in its rulings for
more  than  once  that  norms  of  the  law  are  realised  by  a
substatutory  legal  act,  however,  such  a  legal  act  may not
replace  the  law  itself  or  create  new legal norms of general
character  which  would  compete  with  the  norms  of  the  law.
Otherwise,  the  supremacy  of  laws  in  respect to substatutory
acts   which   is   established  in  the  Constitution  would  be
violated.
     The  Government  resolution  is a substatutory legal act. It
may  not  contain  any  legal  norms  competing with those of the
law.
     4.  Comparing  the  disputed  provisions  of  Item  3 of the
Procedure  (wordings  of  4 February 1999 and 14 April 2000) with
the  provisions  of Paragraph 5 of Article 20 of the Law (wording
of  12  May  1998),  one can notice that the conditions contained
in  Item  3  of  the  Procedure (wording of 4 February 1999) that
the  premises  may  not be transferred to the enterprises pointed
out   in  Item  1  of  the  Procedure  for  shares  if  they  are
behindhand  with  the  rent  payment,  are in arrears overdue for
the   State   Budget  of  the  Republic  of  Lithuania,  and  the
conditions  contained  in  Item 3 of the Procedure (wording of 14
April  2000)  that  the  premises  may  not be transferred to the
enterprises  pointed  out  in  Item 1 of the Procedure for shares
if  they  are  behindhand  with  the rent payment, are in arrears
overdue  for  the  State  Budget (local government budget) of the
Republic  of  Lithuania  and  the  State  Social  Insurance  Fund
Budget,  had  not  been  established in Paragraph 5 of Article 20
of the Law (wording of 12 May 1998).
     Thus  Item  3  of the Procedure (wordings of 4 February 1999
and  14  April  2000)  established  additional conditions for the
enterprises,  which  had  not  been  provided for in the Law, and
under  which  the  premises  could  not be transferred for shares
under  procedure  established  by  the Government. It needs to be
noted  that  it  was not permitted for the Procedure to establish
additional  or  different  conditions  from those provided for in
Paragraph  5  of  Article  20  of the Law, which had to be met by
the  enterprises  pointed out in Item 1 of the Procedure to which
the  premises  might  be  transferred  for shares under procedure
established by the Government.
     5.  On  the  grounds  of  the arguments set forth, one is to
conclude   that  the  provisions  of  Item  3  of  the  Procedure
(wording  of  4  February  1999)  that  the  premises  may not be
transferred  to  the  enterprises  pointed  out  in Item 1 of the
Procedure  for  shares  if  they  are  behindhand  with  the rent
payment,  are  in  arrears  overdue  for  the State Budget of the
Republic  of  Lithuania,  and  the  provisions  of  Item 3 of the
Procedure  (wording  of  14 April 2000) that the premises may not
be  transferred  to  the enterprises pointed out in Item 1 of the
Procedure  for  shares  if  they  are  behindhand  with  the rent
payment,  are  in  arrears  overdue  for  the State Budget (local
government  budget)  of  the  Republic of Lithuania and the State
Social   Insurance   Fund   Budget,  were  in  conflict  with  in
Paragraph 5 of Article 20 of the Law (wording of 12 May 1998).
  
     Conforming  to  Articles  102 and 105 of the Constitution of
the  Republic  of  Lithuania and Articles 1, 53, 54, 55 and 56 of
the  Republic  of  Lithuania Law on the Constitutional Court, the
Constitutional  Court  of  the  Republic  of Lithuania has passed
the following
  
                             ruling:                             

     To   recognise   that  the  provisions  of  Item  3  of  the
Procedure  of  the Transfer of Buildings or Premises Belonging to
the  State  or Local Governments by Right of Ownership for Shares
(wording  of  4  February  1999)  that  the  premises  may not be
transferred  to  the  enterprises  pointed  out  in Item 1 of the
Procedure  for  shares  if  they  are  behindhand  with  the rent
payment,  are  in  arrears  overdue  for  the State Budget of the
Republic  of  Lithuania  and  the  provisions  of  the  same item
(wording  of  14  April  2000)  that  the  premises  may  not  be
transferred  to  the  enterprises  pointed  out  in Item 1 of the
Procedure  for  shares  if  they  are  behindhand  with  the rent
payment,  are  in  arrears  overdue  for  the State Budget (local
government  budget)  of  the  Republic of Lithuania and the State
Social  Insurance  Fund  Budget, which was approved by Government
of   the  Republic  of  Lithuania  Resolution  No.  120  "On  the
Procedure  of  the Transfer of Buildings or Premises Belonging to
the  State  or  Local  Governments  by  Right  of  Ownership  for
Shares"  of  4  February  1999,  conflicted  with  Paragraph 5 of
Article  20  of  the Republic of Lithuania Law on the Possession,
Use  and  Disposal of State-owned and Municipal Property (wording
of 12 May 1998).
  
     This  Constitutional  Court  ruling is final and not subject
to appeal.
     The  ruling  is  promulgated  on  behalf  of the Republic of
Lithuania.