Case No. 51/06
THE CONSTITUTIONAL COURT OF THE REPUBLIC OF LITHUANIA
DECISION
ON THE DISMISSAL OF THE LEGAL PROCEEDINGS IN THE CASE
SUBSEQUENT TO THE PETITION OF A GROUP OF MEMBERS OF THE
SEIMAS OF THE REPUBLIC OF LITHUANIA, THE PETITIONER,
REQUESTING TO INVESTIGATE WHETHER PARAGRAPH 1 (WORDING
OF 22 JUNE 2006) OF ARTICLE 19 OF THE REPUBLIC OF
LITHUANIA LAW ON PUBLIC TRADING IN SECURITIES IS NOT IN
CONFLICT WITH ARTICLES 23, 46 AND 48 OF THE CONSTITUTION
OF THE REPUBLIC OF LITHUANIA
25 February 2008
Vilnius
The Constitutional Court of the Republic of Lithuania,
composed of the Justices of the Constitutional Court Armanas
Abramavičius, Toma Birmontienė, Egidijus Kūris, Kęstutis
Lapinskas, Zenonas Namavičius, Ramutė Ruškytė and Vytautas
Sinkevičius,
with the secretary of the hearingDaiva Pitrėnaitė,
at a procedural sitting of the Constitutional Court
considered a petition of a group of Members of the Seimas of the
Republic of Lithuania, the petitioner, composed of Julius
Veselka, Vytautas Bogušis, Saulius Lapėnas, Liudvikas Sabutis,
Egidijus Klumbys, Marija Aušrinė Povilionienė, Ona
Valiukevičiūtė, Vytautas Galvonas, Rimantas Smetona, Algimantas
Matulevičius, Algirdas Ivanauskas, Skirmantas Pabedinskas,
Vladimiras Volčiok, Etela Karpickienė, Audronė Pitrėnienė,
Gintaras Šileikis, Vytautas Sigitas Draugelis, Jonas Pinskus,
Saulius Girdauskas, Andrius Baranauskas, Gintautas Mikolaitis,
Juozas Palionis, Bronius Bradauskas, Birutė Vėsaitė, Albertas
Sereika, Viktoras Rinkevičius, Rima Baškienė, Irina Rozova, Jonas
Juozapaitis, Romas Venclovas, Viačeslav Škil, Virginijus
Domarkas, Valentinas Mazuronis, Remigijus Ačas, Dailis Alfonsas
Barakauskas, Vilija Vertelienė, Ramunė Visockytė, Zita Žvikienė,
Zenonas Mikutis, Romualda Kšanienė, Vaclovas Stankevičius,
Vaclovas Karbauskis, Audrius Enzinas, Eligijus Masiulis, Algirdas
Monkevičius, Alvydas Sadeckas, Algirdas Sysas, Milda
Petrauskienė, Artūras Paulauskas, Virginija Baltraitienė,
Vytautas Kamblevičius, Edvardas Žakaris, Algimantas Salamakinas,
Algis Rimas, Algirdas Paleckis, Irena Šiaulienė, Vytautas Saulis,
Jadvyga Zinkevičiūtė, Dangutė Mikutienė, Petras Gražulis,
Alfredas Pekeliūnas, Laima Mogenienė, Arimantas Dumčius, Rimantas
Jonas Dagys, Jonas Čekuolis, Julius Dautartas, Rytis Kupčinskas,
Vida Marija Čigrejienė, Povilas Jakučionis, Antanas Napoleonas
Stasiškis, Kazys Starkevičius, Henrikas Žukauskas, Bronius Pauža,
Vladimir Orechov and Leokadija Počikovska, the petitioner,
requesting to investigate whether Paragraph 1 of Article19 of the
Republic of Lithuania Law on Amending and Supplementing Articles
2, 6, 7, 13, 14, 17, 18, 19, 19-1, 40, 45, 52 and 61 of the Law
on Public Trading in Securities, Supplementing the Law with the
Third-1 Section and Supplementing the Annex to the Law is not in
conflict with Articles 23, 46 and 48 of the Constitution of the
Republic of Lithuania.
The Constitutional Court
has established:
1. A group of Members of the Seimas, the petitioner, applied
to the Constitutional Court with a petition requesting to
investigate whether the provision "an issuer's shareholder, who
acts independently or concurrently with other persons, after he
has acquired shares amounting to not less than 95 per cent of the
capital which grants the right to vote and not less than 95 per
cent of all the shares of this issuer which grant the right to
vote in the general shareholder's meeting, shall have the right
to require that all other shareholders of this issuer sell the
shares which grant the right to vote and which belong to them,
and they must sell them under the procedure established in this
Law" of Paragraph 1 of Article 19 of the Law on Amending and
Supplementing Articles 2, 6, 7, 13, 14, 17, 18, 19, 19-1, 40, 45,
52 and 61 of the Law on Public Trading in Securities,
Supplementing the Law with the Third-1 Section and Supplementing
the Annex to the Law, which was adopted on 22 June 2006, is not
in conflict with Articles 23, 46 and 48 of the Constitution.
This petition was received at the Constitutional Court on 20
October 2006.
2. By ordinance of the President of the Constitutional Court
No. 2B-160 of 2 November 2006, subsequent to the petition of a
group of Members of the Seimas, the petitioner, the preparation
of case No. 51/06 of the Constitutional Court hearing was begun.
The Constitutional Court
holds that:
1. On 22 June 2006, the Seimas adopted the Law on Amending
and Supplementing Articles 2, 6, 7, 13, 14, 17, 18, 19, 19-1, 40,
45, 52 and 61 of the Law on Public Trading in Securities,
Supplementing the Law with the Third-1 Section and Supplementing
the Annex to the Law which came into force on 14 July 2006.
Article 6 of this law inter alia amended Paragraph 1 (wording of
23 June 2005) of Article 19 of the Republic of Lithuania Law on
Public Trading in Securities and set it forth in a new wording.
2. The Law on Amending and Supplementing Articles 2, 6, 7,
13, 14, 17, 18, 19, 19-1, 40, 45, 52 and 61 of the Law on Public
Trading in Securities, Supplementing the Law with the Third-1
Section and Supplementing the Annex to the Law was composed of 12
articles; it did not include Article 19.
It needs to be held that the petition of a group of Members
of the Seimas, the petitioner, requesting to investigate whether,
according to the petitioner, Paragraph 1 of Article 19 of the Law
on Amending and Supplementing Articles 2, 6, 7, 13, 14, 17, 18,
19, 19-1, 40, 45, 52 and 61 of the Law on Public Trading in
Securities, Supplementing the Law with the Third-1 Section and
Supplementing the Annex to the Law is not in conflict with
Articles 23, 46 and 48 of the Constitution, is to be considered
as a request to investigate whether Paragraph 1 (wording of 22
June 2006) of Article 19 of the Republic of Lithuania Law on
Public Trading in Securities is not in conflict with Articles 23,
46 and 48 of the Constitution.
3. Paragraph 1 (wording of 22 June 2006) of Article 19 of
the Law on Public Trading in Securities established: "An issuer's
shareholder, who acts independently or concurrently with other
persons, after he has acquired shares amounting to not less than
95 per cent of the capital which grants the right to vote and not
less than 95 per cent of all the shares of this issuer which
grant the right to vote in the general shareholder's meeting,
shall have the right to require that all other shareholders of
this issuer sell the shares which grant the right to vote and
which belong to them, and they must sell them under the procedure
established in this Law".
4. On 18 January 2007, the Seimas adopted the Republic of
Lithuania Law on Securities which came into force on 8 February
2007. Paragraph 1 of Article 48 of this law established: "Upon
coming into force of this Law, <...> Section Two, save Article
14-1, Sections Three and Three-1 and Items 1, 2, 5 and 9 of
Paragraph 1 of Article 61 of the Republic of Lithuania Law on
Public Trading in Securities shall become no longer effective."
Article 19 (wording of 22 June 2006) of the Law on Public
Trading in Securities, the legal regulation enshrined in
Paragraph 1 whereof is disputed by the group of Members of the
Seimas, the petitioner, was set forth in Section Three-1 of this
law. Thus, Paragraph 1 (wording of 22 June 2006) of Article 19 of
the Public Trading in Securities which is disputed by a group of
Members of the Seimas, the petitioner, became no longer effective
on 8 February 2007.
5. In this context, it also needs to be mentioned that, on
18 January 2007, the Seimas adopted the Republic of Lithuania Law
on Markets in Financial Instruments which (as well as the Law on
Securities) came into force on 8 February 2007. Paragraph 2 of
Article 99 of the Law on Markets in Financial Instruments inter
alia established that "upon entry into force of this law, the
following shall become no longer valid: <...> (15) the Republic
of Lithuania Law on Amending and Supplementing Articles 2, 6, 7,
13, 14, 17, 18, 19, 19-1, 40, 45, 52 and 61 of the Law on Public
Trading in Securities, Supplementing the Law with the Third-1
Section and Supplementing the Annex to the Law", i.e. the law
which becomes no longer valid is the law which is specified by
the group of Members of the Seimas, the petitioner, in its
petition, and by Article 6 of which, as it has been mentioned,
Paragraph 1 (wording of 23 June 2005) of Article 19 of the Law in
Securities was amended and set forth in a new wording.
6. Paragraph 1 of Article 37 of the Law on Securities
established the following: "An issuer's shareholder, who acts
independently or with other persons who act concurrently, after
he has acquired shares amounting to not less than 95 per cent of
the capital which grants the right to vote and not less than 95
per cent of all the votes in the general shareholder's meeting,
shall have the right to require that all other shareholders of
this issuer sell the shares which grant the right to vote and
which belong to them, and they must sell them under the procedure
established in this Law".
Thus, the legal regulation established in Paragraph 1 of
Article 37 of the Law on Securities is virtually analogous to the
legal regulation which is enshrined in Paragraph 1 (wording of 22
June 2006) of Article 19 of the Law on Public Trading in
Securities, whose compliance with the Constitution is disputed
with a group of Members of the Seimas, the petitioner.
Alongside, it needs to be noted that the legal regulation
established in Paragraph 1 of Article 37 of the Law on Securities
is to be construed and assessed (inter alia in the aspect of its
compliance with the Constitution) in the context of the legal
regulations which is established in this law and which is far
from being analogous to the legal regulation which was enshrined
in the Law on Public Trading in Securities which was no longer
effective.
7. It needs also to be noted that 75 Members of the Seimas
applied to the Constitutional Court with a petition requesting to
investigate the compliance of Paragraph 1 (wording of 22 June
2006) of Article 19 of the Law on Public Trading in Securities
with the Constitution. It is obvious from the shorthand records
of the sitting of the Seimas of 18 January 2007, in which the Law
on Securities was adopted, that 51 Members of the Seimas from the
group of Members of the Seimas, which had requested the
Constitutional Court to investigate the compliance of Paragraph 1
(wording of 22 June 2006) of Article 19 of the Law on Public
Trading in Securities voted for the adoption of the Law on
Securities, the legal regulation enshrined in Article 37 whereof,
as it has been held in this Constitutional Court decision, is
essentially analogous to the legal regulation enshrined in
Paragraph 1 (wording of 22 June 2006) of Article 19 of the Law on
Public Trading in Securities. The fact that 51 Members of the
Seimas, who doubted the compliance of the corresponding provision
of the law with the Constitution, later voted for an essentially
analogous provision enshrined in another law, creates the ground
to think that the doubt which had arisen earlier to these Members
of the Seimas regarding the compliance of the provision disputed
by the group of Members of the Seimas, the petitioner, with the
Constitution, disappeared; otherwise, they would hardly have
voted for the adoption of the provision, the compliance of which
with the Constitution they doubted and which they had disputed.
8. In Paragraph 4 of Article 68 of the Law on the
Constitutional Court it is established that the annulment of the
disputed legal act shall be grounds to adopt a decision to
dismiss the instituted legal proceedings and that if it becomes
clear before the beginning of the Court hearing, the
Constitutional Court shall decide this question in the
deliberation room.
The Constitutional Court has held in its acts more than once
that the formula "shall be the grounds <...> to dismiss the
instituted legal proceedings" of Paragraph 4 of Article 69 of the
Law on the Constitutional Court is to be construed as
establishing the powers of the Constitutional Court, in cases,
when not courts, but other subjects specified in Article 106 of
the Constitution apply to the Constitutional Court, to dismiss
the instituted legal proceedings upon taking account of the
circumstances of the case at issue.
Conforming to Article 28 and Paragraph 4 of Article 69 of
the Republic of Lithuania Law on the Constitutional Court, the
Constitutional Court of the Republic of Lithuania has adopted the
following
decision:
To dismiss the instituted legal proceedings in case No. 51/
06 subsequent to the petition of a group of Members of the Seimas
of the Republic of Lithuania, the petitioner, requesting to
investigate whether Paragraph 1 (wording of 22 June 2006,
Official Gazette Valstybės žinios, 2006, No. 77-2963) of Article
19 of the Republic of Lithuania Law on Public Trading in
Securities is not in conflict with Articles 23, 46 and 48 of the
Constitution of the Republic of Lithuania.
This decision of the Constitutional Court is final and not
subject to appeal.
The decision is promulgated in the name of the Republic of
Lithuania.
Justices of the Constitutional Court:
Armanas Abramavičius
Toma Birmontienė
Egidijus Kūris
Kęstutis Lapinskas
Zenonas Namavičius
Ramutė Ruškytė
Vytautas Sinkevičius