Case No. 71/06-12/07
THE CONSTITUTIONAL COURT OF THE REPUBLIC OF LITHUANIA
RULING
ON THE COMPLIANCE OF PARAGRAPH 5 (WORDING OF 20
NOVEMBER 2003) AND PARAGRAPH 17 (WORDING OF 20 NOVEMBER
2003) OF ARTICLE 26, AND ARTICLE 33 (WORDING OF 20
NOVEMBER 2003) OF THE REPUBLIC OF LITHUANIA LAW ON
TOBACCO CONTROL, AS WELL AS ITEM 39 (WORDING OF 18
DECEMBER 2006) AND ITEM 40 (WORDING OF 18 DECEMBER
2006) OF THE RULES FOR LICENSING RETAIL TRADE IN
TOBACCO PRODUCTS APPROVED BY RESOLUTION OF THE
GOVERNMENT OF THE REPUBLIC OF LITHUANIA NO. 383 "ON
APPROVING THE RULES FOR LICENSING RETAIL TRADE IN
ALCOHOL PRODUCTS AND THE RULES FOR LICENSING RETAIL
TRADE IN TOBACCO PRODUCTS" OF 7 APRIL 2004 WITH THE
CONSTITUTION OF THE REPUBLIC OF LITHUANIA
17 September 2008
Vilnius
The Constitutional Court of the Republic of Lithuania,
composed of the Justices of the Constitutional Court Armanas
Abramavièius, Toma Birmontienë, Pranas Kuconis, Kæstutis
Lapinskas, Zenonas Namavièius, Egidijus Ðileikis, Algirdas
Taminskas, and Romualdas Kæstutis Urbaitis,
with the secretary of the hearing—Daiva Pitrënaitë,
in the presence of the representatives of the Government of
the Republic of Lithuania, a party concerned, who were Neringa
Paþûsienë, Director of the Law and Public Procurement Department
of the Ministry of Economy of the Republic of Lithuania, Romalda
Zutkienë, chief specialist of the Internal Trade Division of the
Trade Department of the Ministry of Economy (representing the
Government of the Republic of Lithuania, a party concerned, in
the part of the case subsequent to the petition (No. 1B-12/2007)
of the Vilnius Regional Administrative Court, the petitioner),
pursuant to Articles 102 and 105 of the Constitution of the
Republic of Lithuania and Article 1 of the Law on the
Constitutional Court of the Republic of Lithuania, in its public
hearing on 8 September 2008 heard constitutional justice case No.
71/06-12/07 subsequent to the following:
1) the petition (No. 1B-75/2006) of the Vilnius Regional
Administrative Court, the petitioner, requesting to investigate
whether Paragraph 5 (wording of 20 November 2003) of Article 26
of the Republic of Lithuania Law on Tobacco Control to the extent
that, according to the petitioner, it does not provide for an
opportunity not to apply the sanction—abolishment of the validity
of the licence—after account is taken of the character of the
violation, the circumstances mitigating the liability as well as
of other important circumstances, and Paragraph 17 (wording of 20
November 2003) of Article 26 of the Republic of Lithuania Law on
Tobacco Control to the extent that it provides that new licences
shall not be issued to the enterprises the validity of whose
licences is abolished in accordance with Paragraph 5 of this
article, are not in conflict with the constitutional principles
of justice and a state under the rule of law;
2) the petition (No. 1B-12/2007) of the Vilnius Regional
Administrative Court, the petitioner, requesting to investigate:
- whether Paragraph 5 (wording of 20 November 2003) of
Article 26 of the Republic of Lithuania Law on Tobacco Control,
as well as the provisions "The validity of the licences held by
enterprises shall be abolished, if for the enterprises
themselves, heads of the enterprises or for other personnel of
the enterprises (who have acted on behalf of the enterprise, or
for the interests thereof) <…> a corresponding decision of <…>
the State Tobacco and Alcohol Control Service regarding the
imposition of a <…> penalty for the <…> marketing, storing or
transporting of tobacco products without legally valid documents
certifying the acquisition thereof <…> has become effective" and
"New licences shall not be issued to these enterprises and also
the enterprises the validity of whose licences shall be abolished
in accordance with Paragraph 5 of this Article" of Paragraph 17
of the same article are not in conflict with Paragraph 5 of
Article 31, Paragraph 1 of Article 109 of the Constitution of the
Republic of Lithuania and the constitutional principles of
justice and a state under the rule of law;
- whether Item 39.6 of the Rules for Licensing Retail Trade
in Tobacco Products approved by Item 1.1 of Resolution of the
Government of the Republic of Lithuania No. 383 "On Approving the
Rules for Licensing Retail Trade in Alcohol Products and the
Rules for Licensing Retail Trade in Tobacco Products" of 7 April
2004 is not in conflict with Paragraph 5 of Article 31, Paragraph
1 of Article 109 of the Constitution of the Republic of Lithuania
and the constitutional principles of justice and a state under
the rule of law;
- whether the Third Section of Item 40 of the Rules for
Licensing Retail Trade in Tobacco Products approved by Item 1.1
of Resolution of the Government of the Republic of Lithuania No.
383 "On Approving the Rules for Licensing Retail Trade in Alcohol
Products and the Rules for Licensing Retail Trade in Tobacco
Products" of 7 April 2004 is not in conflict with Paragraph 1 of
Article 109 of the Constitution of the Republic of Lithuania and
the constitutional principles of justice and a state under the
rule of law.
By the Constitutional Court decision "On joining petitions"
of 1 October 2007, petitions No. 1B-75/2006 and No. 1B-12/2007 of
the Vilnius Regional Administrative Court, the petitioner, were
joined into one case.
The Constitutional Court
has established:
I
1. The Vilnius Regional Administrative Court, the
petitioner, considered an administrative case. By its ruling the
court suspended the consideration of the case and applied to the
Constitutional Court with a petition (No. 1B-75/2006) requesting
to investigate whether Paragraph 5 (wording of 20 November 2003)
of Article 26 of the Law on Tobacco Control (hereinafter also
referred to as the Law) to the extent that, according to the
petitioner, it does not provide for an opportunity not to apply
the sanction—abolishment of the validity of the licence—after
account is taken of the character of the violation, the
circumstances mitigating the liability as well as of other
important circumstances, and Paragraph 17 (wording of 20 November
2003) of Article 26 of the Law to the extent that it provides
that new licences shall not be issued to the enterprises the
validity of whose licences is abolished in accordance with
Paragraph 5 of this article, are not in conflict with the
constitutional principles of justice and a state under the rule
of law.
2. The Vilnius Regional Administrative Court, the
petitioner, considered an administrative case. By its ruling the
court suspended the consideration of the case and applied to the
Constitutional Court with a petition (No. 1B-12/2007) requesting
to investigate:
- whether Paragraph 5 (wording of 20 November 2003) of
Article 26 of the Law, as well as the provisions "The validity of
the licences held by enterprises shall be abolished, if for the
enterprises themselves, heads of the enterprises or for other
personnel of the enterprises (who have acted on behalf of the
enterprise, or for the interests thereof) <…> a corresponding
decision of <…> the State Tobacco and Alcohol Control Service
regarding the imposition of a <…> penalty for the <…> marketing,
storing or transporting of tobacco products without legally valid
documents certifying the acquisition thereof <…> has become
effective" and "New licences shall not be issued to these
enterprises and also the enterprises the validity of whose
licences shall be abolished in accordance with Paragraph 5 of
this Article" of Paragraph 17 of the same article are not in
conflict with Paragraph 5 of Article 31, Paragraph 1 of Article
109 of the Constitution and the constitutional principles of
justice and a state under the rule of law;
- whether Item 39.6 of the Rules for Licensing Retail Trade
in Tobacco Products (hereinafter also referred to as the Rules)
approved by Item 1.1 of Government Resolution No. 383 "On
Approving the Rules for Licensing Retail Trade in Alcohol
Products and the Rules for Licensing Retail Trade in Tobacco
Products" of 7 April 2004 (hereinafter also referred to as
Government Resolution No. 383 of 7 April 2004) is not in conflict
with Paragraph 5 of Article 31, Paragraph 1 of Article 109 of the
Constitution and the constitutional principles of justice and a
state under the rule of law;
- whether the Third Section of Item 40 of the Rules approved
by Item 1.1 of Government Resolution No. 383 of 7 April 2004 is
not in conflict with Paragraph 1 of Article 109 of the and the
constitutional principles of justice and a state under the rule
of law.
II
1. The petition (No. 1B-75/2006) of the Vilnius Regional
Administrative Court, the petitioner, is substantiated by the
following arguments.
The imperative legal regulation consolidated in Paragraphs 5
and 17 (wording of 20 November 2003) of the Law is disputed,
whereby for each violation provided for in Items 1, 2, 3 or 4 of
Paragraph 3 of Article 14 of the Law the validity of the licence
must be abolished for good. In some cases, this sanction imposed
upon the violator can be clearly too big and disproportionate to
the committed violation and therefore unfair, especially when
another sanction, a fine, has been imposed on him for the same
violation. Such legal regulation is in conflict with the
principles of reasonableness, proportionality and justice which
arise form the principle of a state under the rule of law.
2. The petition (No. 1B-12/2007) of the Vilnius Regional
Administrative Court, the petitioner, is substantiated by the
following arguments.
2.1. The economic sanctions (a fine and abolishment of the
validity of the licence) imposed under Article 26 of the Law are
measures of repressive nature which give rise to negative
proprietary effects and are applied for violations of legal acts,
therefore in the course of their application one should follow
the principle non bis in idem.
Under the Law, the question of abolishment of the validity
of the licence is considered after a fine has already been
imposed for the violation provided for in Items 1, 2, 3 or 4 of
Paragraph 3 of Article 14 of the Law. Different institutions
apply individual sanctions (a fine and abolishment of the
validity of the licence) for violations of the Law, and they
apply them at a different time, and the content and character of
the applied sanctions themselves are also different. According to
its meaning and effects, the limitation of the activity of a
legal person is a sanction similar to the sanction applied in
penal law—abolishment of the validity of a licence permitting to
engaged in a certain type of activity, while it is impermissible
to impose a fine and limit the activity for the same criminal
deed. Thus, the disputed legal regulation established in the Law
is in conflict with Paragraph 5 of Article 31 of the
Constitution.
2.2. Paragraphs 5 and 17 (wording of 20 November 2003) of
Article 26 of the Law establish the legal regulation whereby the
validity of the licence is abolished and no new licence is issued
for violations of Items 1, 2, 3 or 4 of Paragraph 3 of Article 14
of the Law and the said legal regulation is imperative. In the
course of its application the powers of the court are restricted,
when account is taken of the character of the violation, the
circumstances mitigating the liability as well as of other
important circumstances (due to which the corresponding sanction
would be too big for the violator, since it would be
disproportionate to the committed violation of law and, thus,
unfair), and by following the criteria of justice and
reasonableness, to impose a smaller measure than that
consolidated in these provisions, or not to impose it at all.
Thus Paragraph 1 of Article 109 of the Constitution is violated
and court powers to execute justice are restricted.
2.3. In certain cases, the application of the sanction—
abolishment of the validity of the licence—consolidated in
Paragraphs 5 and 17 (wording of 20 November 2003) of Article 26
of the Law for violations of Items 1, 2, 3 or 4 of Paragraph 3 of
Article 14 of the Law to the violator may be clearly a penalty
too big and disproportionate to the committed violation of law,
especially after one takes account of the fact that a fine has
already been imposed upon the violator for the same violation of
law, as well as after one takes account of other important
circumstances. Thus, such legal regulation is in conflict with
the principles of justice and a state under the rule of law.
2.4. The legal regulation established in Items 39.6 and 40
of the Rules approved by Government resolution No. 383 of 7 April
2004 implements Paragraphs 5 and 17 (wording of 20 November 2003)
of Article 26 of the Law and is virtually analogous to the legal
regulation established in Paragraphs 5 and 17 (wording of 20
November 2003) of Article 26 of the Law, therefore, according to
the opinion of the Vilnius Regional Administrative Court, the
petitioner, which is substantiated by the analogous arguments,
Items 39.6 and 40 of the Rules are in conflict with Paragraph 1
of Article 109 of the Constitution, and the constitutional
principles of justice and a state under the rule of law, while
Item 39.6 of the Rules is also in conflict with Paragraph 5 of
Article 31 of the Constitution.
III
In the course of the preparation of the case for the
Constitutional Court hearing, written explanations were received
from the representative of the Seimas, a party concerned, who was
V. Karbauskis, a Member of the Seimas, and the representatives of
the Government, a party concerned, who were N. Paþûsienë and R.
Zutkienë (who represented the Government, a party concerned, in
the part of the case subsequent to the petition (No. 1B-12/2007)
of the Vilnius Regional Administrative Court, the petitioner),
wherein it is maintained that the disputed legal regulation is
not in conflict with the Constitution.
1. It is maintained in the written explanations of V.
Karbauskis, a Member of the Seimas, the representative of the
Seimas, a party concerned, regarding petitions No. 1B-75/2006 and
No. 1B-12/2007 of the Vilnius Regional Administrative Court, the
petitioner, that the legal regulation consolidated in Paragraphs
5 and 17 of Article 26 of the Law on Tobacco Control is analogous
to the provisions of the Law on Alcohol Control, whose compliance
with the Constitution was investigated in the Constitutional
Court ruling of 21 January 2008. On the grounds of the official
constitutional doctrine formulated in the said Constitutional
Court ruling, and on the grounds of the fact that the legal
regulation disputed in the constitutional justice case at issue
is not designated for regulation of the relations linked with the
powers of a court to decide whether a monetary fine must be
imposed on an economic entity, while the validity of the licence
is not abolished, where due to certain very important
circumstances the sanction is clearly disproportionate
(inadequate) to the committed violation of law, the Member of the
Seimas draws a conclusion that Paragraphs 5 and 17 of Article 26
of the Law are not in conflict with the Constitution.
2. The position of N. Paþûsienë and R. Zutkienë, the
representatives of the Government, a party concerned, regarding
petition No. 1B-12/2007 of the Vilnius Regional Administrative
Court, the petitioner, is substantiated by the following
arguments.
2.1. Tobacco products not only create, but also sustain
dependence. The fact that the number of smoking children and
teenagers is increasing is a global problem. Consumption of
tobacco products and passive inhalation of tobacco smoke cause
diseases, disability and death, they are harmful to public health
and the environment, and have negative social and economic
effects. By means of the sanctions consolidated in the law one
attempts to decrease the consumption of tobacco products and to
protect people's health. Therefore, the activity linked with
tobacco growing, production of tobacco products, and wholesale
and retail trade thereof is subject to licensing, while sanctions
for violations of provisions of the Law on Tobacco Control are
strict ones.
When the prohibitions of marketing, storing or transporting
of tobacco products, which are established in Items 1, 2, 3 or 4
of Paragraph 3 of Article 14 of the Law, are violated knowingly,
the public interest is violated, therefore, when the validity of
the licence of an enterprise is abolished, the principle of
justice is not violated. The legal regulation established in
Paragraph 17 of Article 26 of the Law ensures that all violators
of law who committed the said violations are removed from the
market.
While following Paragraph 14 of Article 26 of the Law on
Tobacco Control, the fine imposed for the violations established
by the Law (including the prohibitions established in Items 1, 2,
3 or 4 of Paragraph 3 of Article 14 thereof) must be
differentiated and individualised by taking account of the
circumstances mitigating liability and those aggravating
liability (Paragraph 15 of Article 26 of the Law), while the
court that considers a complaint against decisions of competent
institutions to apply an economic sanction has the right to
impose a smaller monetary fine.
2.2. Tobacco products are attributed to special products and
special state regulation is applied to the activity related with
tobacco products, while due to committed violations of the Law on
Tobacco Control public interests are damaged, therefore the
monetary fine alone is not a sufficient penalty.
The economic sanctions established in Article 26 of the Law
should be likened to penalties for violations of administrative
law, the monetary fine should be regarded as the main penalty,
while the established abolishment of the validity of the
licence—as an additional penalty. The economic sanction—
abolishment of the validity of the licence—only supplements the
corresponding monetary fine imposed under the provision of the
Law on Tobacco Control, and it cannot be applied if the person
has not been imposed a monetary fine for the corresponding
violation of law. Meanwhile, if the violations specified in
Paragraphs 5 and 17 of the Law (or specified accordingly in Item
39.6 and the Third Section of Item 40 of the Rules) were
committed, the institution that issued the licence must abolish
the validity of the licence.
The fact that, according to the provisions of the Law on
Tobacco Control, some institutions are commissioned with issuing
the licences, while, under Paragraph 13 of Article 26 of the same
law, other institutions are commissioned to impose sanctions for
violations of this law, cannot change the essence of the
sanctions by attributing them to the main sanctions and
supplementary ones, and this should not be regarded as punishment
for the same violation of law twice.
2.3. Taking account of the fact that the legal regulation
consolidated in Item 39.6 and the Third Section of Item 40 of the
Rules is virtually analogous to the legal regulation established
in Paragraphs 5 and 17 of Article 26 of the Law, one is to draw a
conclusion that the disputed items of the Rules, insofar as they
are in compliance with the provisions of Paragraphs 5 and 17 of
Article 26 of the Law, are not in conflict with Paragraph 1 of
Article 109 of the Constitution, the constitutional principles of
a state under the rule of law and justice, while Item 39.6 of the
Rules is not in conflict with Paragraph 5 of Article 31 of the
Constitution.
IV
At the Constitutional Court hearing N. Paþûsienë and R.
Zutkienë, the representatives of the Government, a party
concerned, virtually reiterated the arguments set forth in their
written explanations, as well as presented additional
explanations.
At the Constitutional Court haring the specialist—L.
Petrauskaitë, Head of the Control-legal Division of the State
Service for Tobacco and Alcohol Control under the Government of
the Republic of Lithuania—took the floor and answered to
questions.
The Constitutional Court
holds that:
I
1. The Vilnius Regional Administrative Court, the
petitioner, requests to investigate (petition No. 1B-75/2006)
whether Paragraph 5 (wording of 20 November 2003) of Article 26
of the Law to the extent that, according to the petitioner, it
does not provide for an opportunity not to apply the sanction—
abolishment of the validity of the licence—after account is taken
of the character of the violation, the circumstances mitigating
the liability as well as of other important circumstances, and
Paragraph 17 (wording of 20 November 2003) of Article 26 of the
Law to the extent that it provides that new licences shall not be
issued to the enterprises the validity of whose licences is
abolished in accordance with Paragraph 5 of this article, are not
in conflict with the constitutional principles of justice and a
state under the rule of law.
2. The Vilnius Regional Administrative Court, the
petitioner, requests to investigate (petition No. 1B-12/2007):
- whether Paragraph 5 (wording of 20 November 2003) of
Article 26 of the Law, as well as the provisions "The validity of
the licences held by enterprises shall be abolished, if for the
enterprises themselves, heads of the enterprises or for other
personnel of the enterprises (who have acted on behalf of the
enterprise, or for the interests thereof) <…> a corresponding
decision of <…> the State Tobacco and Alcohol Control Service
regarding the imposition of a <…> penalty for the <…> marketing,
storing or transporting of tobacco products without legally valid
documents certifying the acquisition thereof <…> has become
effective" and "New licences shall not be issued to these
enterprises and also the enterprises the validity of whose
licences shall be abolished in accordance with Paragraph 5 of
this Article" of Paragraph 17 of the same article are not in
conflict with Paragraph 5 of Article 31, Paragraph 1 of Article
109 of the Constitution and the constitutional principles of
justice and a state under the rule of law;
- whether Item 39.6 of the Rules approved by Item 1.1 of
Government Resolution No. 383 of 7 April 2004 is not in conflict
with Paragraph 5 of Article 31, Paragraph 1 of Article 109 of the
Constitution and the constitutional principles of justice and a
state under the rule of law;
- whether the Third Section of Item 40 of the Rules approved
by Item 1.1 of Government Resolution No. 383 of 7 April 2004 is
not in conflict with Paragraph 5 of Article 31, Paragraph 1 of
Article 109 of the Constitution and the constitutional principles
of justice and a state under the rule of law.
3. The petitioner does not indicate in the resolution part
of the ruling (petition No. 1B-12/2007), by which it applied to
the Constitutional Court, the compliance of which wording of
Items 39 and 40 (provisions thereof) of the Rules approved by
Government Resolution No. 383 of 7 April 2004 with the
Constitution is disputed, however, it is clear from the arguments
of the petition that Items 39 and 40 (provisions thereof)
(wording of 18 December 2006) of the Rules approved by the said
Government resolution are disputed.
4. It is clear from the arguments of the petitions (Nos. 1B-
75/2006, 1B-12/2007) of the petitioner that the petitioner doubts
whether:
- Paragraph 5 (wording of 20 November 2003) of Article 26 of
the Law is not in conflict with Paragraph 5 of Article 31,
Paragraph 1 of Article 109 of the Constitution and the
constitutional principles of justice and a state under the rule
of law (petition No. 1B-12/2007), also whether Paragraph 5
(wording of 20 November 2003) of Article 26 of the Law to the
extent that, according to the petitioner, it does not provide for
an opportunity not to apply the sanction—abolishment of the
validity of the licence—after account is taken of the character
of the violation, the circumstances mitigating the liability as
well as of other important circumstances, is not in conflict with
the constitutional principles of justice and a state under the
rule of law (petition No. 1B-75/2006);
- the provision "The validity of the licences held by
enterprises shall be abolished, if for the enterprises
themselves, heads of the enterprises or for other personnel of
the enterprises (who have acted on behalf of the enterprise, or
for the interests thereof) <…> a corresponding decision of <…>
the State Tobacco and Alcohol Control Service regarding the
imposition of a <…> penalty for the <…> marketing, storing or
transporting of tobacco products without legally valid documents
certifying the acquisition thereof <…> has become effective. New
licences shall not be issued to these enterprises and also the
enterprises the validity of whose licences shall be abolished in
accordance with Paragraph 5 of this Article" of Paragraph 17
(wording of 20 November 2003) of Article 26 of the Law was not in
conflict with Paragraph 5 of Article 31 of the Constitution
(petition No. 1B-12/2007), Paragraph 1 of Article 109 of the
Constitution (petition No. 1B-12/2007), and the constitutional
principles of a state under the rule of law and justice
(petitions Nos. 1B-75/2006, 1B-12/2007);
- the provision "The validity of the licence shall be
abolished if <…> 39.6. the enterprise has violated the conditions
of the licensed activity which are established in one of these
items—30.2.1., 30.2.2, 30.2.3, or 30.2.4" (wording of 7 April
2004) of Item 39 (wording of 18 December 2006) of the Rules
approved by Government Resolution No. 383 of 7 April 2004 is not
in conflict with Paragraph 5 of Article 31, Paragraph 1 of
Article 109 of the Constitution and the constitutional principles
of a state under the rule of law and justice (petition No. 1B-
12/2007);
- the provision "The enterprise with regard to which the
validity of the licence was abolished due to the reasons
specified in one of these items—39.6, 39.7 <…>—shall not be
issued a new licence repeatedly" of Item 40 (wording of 18
December 2006) of the Rules approved by Government Resolution No.
383 of 7 April 2004 to the extent that it provides that upon
abolishment of the validity of the licence a new licence is not
issued repeatedly, is not in conflict with Paragraph 1 of Article
109 of the Constitution and the constitutional principles of a
state under the rule of law and justice (petition No. 1B-
12/2007).
5. It needs to be noted that, on 26 June 2008, the Seimas
adopted the Republic of Lithuania Law on Amending and
Supplementing Articles 10, 11, 12, 19, and 26 of the Law on
Tobacco Control, which came into force on 5 July 2008. By
Paragraph 3 of Article 5 of this law Paragraph 17 (wording of 20
November 2003) of Article 26 of the Law on Tobacco Control was
recognised as no longer valid.
It also needs to be noted that the Constitutional Court has
noted more than once that in the cases when a court investigating
a case applies to the Constitutional Court after it has had
doubts concerning the compliance of a law applicable in the case
with the Constitution (or a legal act of higher legal power), the
Constitutional Court has a duty to investigate the request of the
court regardless of whether the disputed law or other legal act
is valid or not.
II
1. On 20 December 1995, the Seimas adopted the Law on
Tobacco Control which came into force (save certain exceptions)
on 7 February 1996. This law was designated for regulation of
relations linked to tobacco growing, manufacturing of tobacco
products, domestic trade in tobacco products, their keeping,
import, tobacco advertising and consumption of tobacco products
and establishment of the foundations of state tobacco control in
the Republic of Lithuania (Paragraph 2 of Article 2). The Law has
been amended and/of supplemented more than once.
2. On 20 November 2003, the Seimas adopted the Republic of
Lithuania Law on Amending the Law on Tobacco Control and on
Recognising the Republic of Lithuania Law on Implementing the Law
on Tobacco Control as No Longer Valid by Article 1 whereof the
Law on Tobacco Control (wording of 20 December 1995 with
amendments and supplements made on 20 November 2003) was amended
and set forth in a new wording. The Law on Tobacco Control of the
new wording came into force (save certain exceptions) on 1 May
2004.
3. Paragraph 5 (wording of 20 November 2003) titled
"Economic Sanctions" of Article 26 of the Law, which is disputed
by the petitioner in the constitutional justice case at issue,
provides: "For infringement of the prohibitions set forth in
Items 1, 2, 3 or 4 of Paragraph 3 of Article 14 of this Law,
regarding marketing of tobacco products, storing or transporting
thereof if that does not impose criminal liability, legal persons
and branches of foreign legal persons shall be subject to a fine
from LTL 10,000 to LTL 30,000 and the validity of their licence
shall be abolished."
Items 1, 2, 3 or 4 (wording of 20 November 2003) of Article
14 of the Law inter alia provide:
"3. It shall be prohibited in the Republic of Lithuania, for
legal persons and branches of foreign state legal persons to
sell, store, transport tobacco products and also to import
tobacco products into the Republic of Lithuania:
1) without legally valid documents certifying acquisition
and transportation. Legally valid documents certifying the
acquisition or transportation must be kept in all tobacco product
sales outlets and/or places of storing. It is mandatory to hold
transportation documents or validly legal documents certifying
the acquisition of tobacco products, while transporting tobacco
products;
2) if the products are fake;
3) if the products are contraband;
4) without special marks—tax labels—according to the special
sample, established by the institution authorised by the
Government <…>, except in cases when based upon the Republic of
Lithuania Law on Excise Tax and other legal acts the tobacco
products special marks—tax labels—are not mandatory."
4. Paragraph 17 (wording of 20 November 2003) of Article 26
of the Law, the compliance of the provisions of which with the
Constitution are disputed in the constitutional justice case at
issue used to provide:
"17. The validity of the licences held by enterprises shall
be abolished, if for the enterprises themselves, heads of the
enterprises or for other personnel of the enterprises (who have
acted on behalf of the enterprise, or for the interests thereof)
a court judgement of conviction, a court ruling, decision has
become effective, a corresponding decision of the customs
department, tax inspectorate, police, or the State Tobacco and
Alcohol Control Service regarding the imposition of a punishment
or penalty for the contraband of tobacco or tobacco products,
marketing, storing or transporting of falsified tobacco products,
marketing, storing or transporting of tobacco products without
legally valid documents certifying the acquisition thereof and
also, for unlawful storing, transporting or marketing of tobacco
products without the special marks—tax labels—has become
effective. New licences shall not be issued to these enterprises
and also the enterprises the validity of whose licences shall be
abolished in accordance with Paragraph 5 of this Article."
5. The Law on Tobacco Control (wording of 20 November 2003)
was amended and/or supplemented by the Republic of Lithuania Law
on Amending Articles 2, 1, 5, 6, 8, 14, 17, 18, and 26 of the Law
on Tobacco Control, which was adopted by the Seimas on 15
November 2005 and which came into force on 3 December 2005, by
the Republic of Lithuania Law on Amending and Supplementing
Articles 19 and 26 of the Law on Tobacco Control, which was
adopted on 11 May 2006 and which came into force on 1 January
2007, the Republic of Lithuania Law on Amending Articles 2, 4,
14, 25, and 26 of the Law on Tobacco Control, which was adopted
on 15 June 2006 and which came in force on 30 June 2006, however,
Paragraphs 5 and 17 (wording of 20 November 2003) of Article 26
of the Law were not amended and/or supplemented by the said
amendments to the Law.
6. The legal regulation consolidated in Paragraph 5 (wording
of 20 November 2003) of Article 26 and the provision of Paragraph
17 (wording of 20 November 2003) of the Law, which are disputed
by the petitioner, is to be construed inter alia in the context
of other provisions of this Law (wordings of 20 November 2003, 15
November 2005, 11 May 2006, and 15 June 2006).
Under the Law, tobacco products shall be attributed to
special products, for whose manufacture, marketing, introduction,
import, advertising and other related types of activities and
consumption, extraordinary state and legal regulation shall apply
in accordance with this and other laws and legal acts (Paragraph
3 (wording of 20 November 2003) of Article 1); it shall be
permitted to engage in tobacco growing, manufacture of tobacco
products, wholesale and retail marketing in the Republic of
Lithuania, only by having licences, which have been issued
according to the established procedure (Paragraph 1 (wording of
20 November 2003) of Article 10); the Law indicates the
institutions which are empowered to impose monetary fines for
violations of provisions of the Law; in this context, it needs to
be noted that the State Tobacco and Alcohol Control Service is
empowered to impose fines also inter alia for violations of Items
1, 2, 3, 4 and 6 (Paragraph 2 (wordings of 20 November 2003 and
11 May 2006) of Article 26) of Article 14 of the Law; for
violations of the requirements and/or prohibitions specified in
inter alia Paragraph 1 (wording of 20 November 2003), Paragraph 2
(wording of 20 November 2003), Paragraph 3 (wording of 15 June
2006), Paragraph 4 (wording of 20 November 2003), Paragraph 6
(wording of 15 June 2006), Paragraph 7 (wording of 15 June 2006),
Paragraph 8 (wording of 15 June 2006), Paragraph 9 (wording of 20
November 2003), Paragraph 10 (wording of 20 November 2003),
Paragraph 11 (wording of 15 June 2006), Paragraph 12 (wording of
11 May 2006) of Article 26 of the Law, persons are punished by
monetary fines (which are subject to differentiation); for
violations of the requirements specified in Paragraph 7 (wording
of 15 June 2006) of Article 26 of the Law, persons are (were)
imposed a monetary fine and the validity of the licence is
abolished with respect to the sales outlet wherein the violation
has been identified and a new licence is not issued within a
certain time period established in the Law (Paragraph 7 (wording
of 15 June 2006) and Paragraph 16 (wording of 15 June 2006) of
Article 26); for violations of the prohibitions specified in
Paragraph 5 (wording of 20 November 2003) of Article 26 of the
Law, a monetary fine is (was) imposed, the validity of the
licence is (was) abolished and no new licence is (was) issued
(Paragraph 5 (wording of 20 November 2003) and Paragraph 17
(wording of 20 November 2003) of Article 26).
It was established in Article 11 (wording of 20 November
2003) of the Law that licences to engage in the activities
indicated in Paragraph 1 of Article 10 shall not be issued to the
enterprises, whose founders or administration chiefs (if they had
acted on behalf of the enterprise or for its interests), had been
the founders, administration chiefs or other personnel members of
the enterprises, whose licence validity has been abolished in
accordance with Paragraph 5 of Article 26 of this Law; licences
to engage in tobacco growing, manufacture of tobacco products and
wholesale marketing of tobacco products, shall be issued by the
State Tobacco and Alcohol Control Service in pursuance with the
licensing rules approved by the Government (Paragraph 3);
licences to engage in retail marketing of tobacco products shall
be issued by the executive institution of the local government,
on the territory whereof the enterprise shall engage in retail
marketing of tobacco products (Paragraph 4).
It was established in Article 18 (wording of 20 November
2003) of the Law that the validity of a licence shall be
abolished by institutions, which within the scope of their
competence shall issue licences to engage in the manufacturing of
tobacco products and wholesale or retail marketing of tobacco
products.
Article 33 titled "Lodging Complaints Against Decisions on
Imposition of Economic Sanctions" (wording of 20 November 2003)
of the Law provides that persons, who do not agree with the
decision on imposition of economic sanctions, shall have the
right to lodge a complaint against it in court within one month
from the day of the handing down of the decision in accordance
with the procedure set forth by the Republic of Lithuania Law on
Proceedings of Administrative Cases (Paragraph 1); an application
to a court shall suspend the execution of the decision to impose
economic sanctions (Paragraph 2).
7. Summing up the legal regulation entrenched in the Law
(wording of 20 November 2003 with subsequent amendments and
supplements made until the entry into force of the Law on
Amending and Supplementing Articles 10, 11, 12, 19, and 26 of the
Law on Tobacco Control on 26 June 2008), in the context of the
constitutional justice case at issue it needs to be held that:
- tobacco products are attributed to special products and a
special state legal regulation is applied to trade in such
products, and to other types of activity related to them and
their consumption;
- the wholesale and retail trade in tobacco products is an
activity subject to licensing, i.e. an activity to engage in
which a person is allowed only when he has a corresponding
permit—a licence;
- various so-called economic sanctions are established for
violations of requirements and/or prohibitions established in the
Law: for some violations of law, the persons who committed them
and who are specified in the law are imposed only a monetary fine
(which is subject to differentiation), for other violations a
monetary fine is imposed and the validity of the licence is
abolished with respect to the sales outlet wherein the violation
has been identified and a new licence is not issued within a
certain time period established in the Law, and for some other
violations of the requirements and/or prohibitions established in
the Law the validity of the licence is abolished and no new
licence is issued;
- under the Law, in the case where a person committed a
corresponding violation of a requirement and/or prohibition
established in the Law (inter alia that established in Paragraphs
5 and 17 (wording of 20 November 2003) of Article 26 of the Law)
for which a monetary fine must be (had to be) imposed and the
validity of the licence must be (had to be) abolished, the
institution empowered to impose the monetary fine may not (was
not allowed to) decide not to impose the monetary fine provided
for in the Law for commission of such violation of law, while,
upon the imposition of the fine and upon the entry into effect of
the decision on imposing the fine, the institution authorised to
abolish the validity of the licence, may not (was not allowed to)
decide not to abolish the validity of the licence;
- as a rule, for violations of the requirements and/or
prohibitions specified in the Law, in the cases provided for in
the Law, different institution have (had) powers to apply the so-
called economic sanctions (to impose a monetary fine and abolish
the validity of the licence): some institutions have (had) the
right to impose monetary fines, while other institutions have
(had) the right to abolish the validity of the licence;
- the persons who disagree with a decision (decisions) of
the institutions (empowered to apply the so-call economic
sanctions established in the Law, i.e., to impose monetary fines,
to abolish the validity of the licence) specified in the Law to
apply an economic sanction (economic sanctions), have (had) the
right to lodge a complaint against such a decision in a court;
- the Law did not provide for the powers of the court to
abolish the decision (if a person's complaint has been lodged
against such decision adopted by an institution established in
the Law regarding the abolishment of validity of the licence) if
the decision on imposition of a fine for corresponding violations
of the Law had come in effect.
8. By Article 2 of the Law on Amending and Supplementing
Articles 10, 11, 12, 19, and 26 of the Law on Tobacco Control,
which was adopted by the Seimas on 26 June 2008, Article 11
(wording of 15 June 2006) of the Law on Tobacco Control was
amended and set forth in a new wording, while by Paragraph 3 of
Article 5 of the same law Paragraph 17 (wording of 20 November
2003) of Article 26 of the Law on Tobacco Control was recognised
as no longer valid.
Items 5 and 6 of Paragraph 6 and Items 3 and 4 of Paragraph
8 of Article 11 titled "Issuance of Licences, Refusal to Issue
the Licence, Suspension of the Validity of the Licence,
Abolishment of the Validity of the Licence" (wording of 26 June
2008) of the Law provide:
"6. Licences to engage in the activity the types of which
are specified in Paragraph 1 of Article 10 of this Law shall not
be issued, if: <…>
5) with regard of the enterprise, or heads thereof a court
judgement of conviction, a court ruling, decision has become
effective, a corresponding decision of the customs department,
the State Tax Inspectorate, police, or the State Tobacco and
Alcohol Control Service under the Government of the Republic of
Lithuania regarding the imposition of a punishment or penalty for
the contraband of tobacco or tobacco products, marketing, storing
or transporting of falsified tobacco products, marketing, storing
or transporting of tobacco products without legally valid
documents certifying the acquisition thereof and also, for
unlawful storing, transporting or marketing of tobacco products
without the special marks—tax labels—has become effective
(licences shall not be issued at all);
6) founders or heads of the enterprises are (were) founders,
heads or other employees of the enterprises in whose regard the
validity of the licence was abolished <…> on the grounds
established in Paragraph 5 of Article 26 of this Law, provided
they have acted on behalf of the enterprise, or for the interests
thereof (licences shall not be issued at all); <…>
8. The validity of the licence shall be abolished: <…>
3) if for the enterprises themselves, heads of the
enterprises or for other personnel of the enterprises (who have
acted on behalf of the enterprise, or for the interests thereof)
a court judgement of conviction, a court ruling, decision has
become effective, a corresponding decision of the customs
department, the State Tax Inspectorate, police, or the State
Tobacco and Alcohol Control Service under the Government of the
Republic of Lithuania regarding the imposition of a punishment or
penalty for the contraband of tobacco or tobacco products,
marketing, storing or transporting of falsified tobacco products,
marketing, storing or transporting of tobacco products without
legally valid documents certifying the acquisition thereof and
also, for unlawful storing, transporting or marketing of tobacco
products without the special marks—tax labels—has become
effective;
4) on the grounds established in Paragraphs <…> 5 of Article
26 of the Law; <…>".
In this context it needs to be noted that Items 5 and 6 of
Paragraph 6 and Items 3 and 4 of Paragraph 8 of Article 11
(wording of 26 June 2008) of the Law is virtually analogous to
that established in Paragraph 17 (wording of 20 November 2003) of
Article 26 of the Law, whose provision is disputed in this
constitutional justice case by the petitioner.
III
On the compliance of Paragraphs 5 and 17 (wording of 20
November 2003) of Article 26 of the Law on Tobacco Control with
Paragraph 5 of Article 31 and Paragraph 1 of Article 109 of the
Constitution as well as the constitutional principles of a state
under the rule of law and justice.
1. The doubts of the Vilnius Regional Administrative Court,
the petitioner, regarding the compliance of Paragraph 5 (wording
of 20 November 2003) and the disputed provision of Paragraph 17
(wording of 20 November 2003) of Article 26 of the Law with
Paragraph 5 (wherein it is provided "No one may be punished for
the same crime a second time") of Article 31 of the Constitution
are substantiated by the fact that, in its opinion, when not only
a monetary fine, but also abolishment of the validity of a
licence and non-issuance of a new licence were established for
corresponding violations of law, and after all this was named as
"economic sanctions" in the Law, the constitutional principle non
bis in idem is (was) violated (petition No. 1B-12/2007).
2. As mentioned, tobacco products are attributed to special
products and a special state legal regulation is applied to trade
in such products, and to other types of activity related to them
and their consumption. The abolishment of the validity of a
licence and non-issuance of a new licence has (had) to be applied
upon establishing that the person had committed a corresponding
violation of law—failed to follow the imperative requirements of
law—and the said violator of law, a person, was punished by a
monetary fine (from which he cannot (could not) be exonerated).
As mentioned, as a rule, for violations of the requirements and/
or prohibitions specified in the Law, in the cases provided for
in the Law, different institution have (had) powers to apply the
so-called economic sanctions (to impose a monetary fine and
abolish the validity of the licence): some institutions have
(had) the right to impose monetary fines, while other
institutions have (had) the right to abolish the validity of the
licence.
3. In this context it needs to be noted that the
Constitutional Court has considered a constitutional justice case
and, on 21 January 2008, it adopted the Ruling "On the compliance
of Paragraph 8 (wording of 9 March 2004) of Article 18, Paragraph
17 (wordings of 9 March 2004 and 25 April 2006) of Article 34 and
Article 41 (wording of 9 March 2004) of the Republic of Lithuania
Law on Alcohol Control with the Constitution of the Republic of
Lithuania, on the compliance of Items 28.5 and 51.5 (wording of
20 May 2004) and Item 51 (wording of 20 May 2004) of the Rules of
Licensing the Wholesale and Retail Trade in Alcoholic Products
approved by Government of the Republic of Lithuania Resolution
No. 618 'On Approving the Rules of Licensing the Wholesale and
Retail Trade in Alcoholic Products and the Rules of the Retail
Trade in Alcoholic Beverages at the Enterprises of Trade and
Public Catering' of 20 May 2004 with the Constitution of the
Republic of Lithuania, Paragraph 17 (wordings of 9 March 2004 and
25 April 2006) of Article 34 of the Republic of Lithuania Law on
Alcohol Control, on the compliance of Item 51 (wording of 17
October 2006) of these rules with the Constitution of the
Republic of Lithuania and Paragraph 17 (wording of 25 April 2006)
of Article 34 of the Republic of Lithuania Law on Alcohol
Control, as well as on the compliance of Item 51 (wording of 2
May 2007) of these rules with the Constitution of the Republic of
Lithuania, and Paragraph 17 (wordings of 25 April 2006 and 21
June 2007) of Article 34 of the Republic of Lithuania Law on
Alcohol Control".
In the said constitutional justice case it was requested
inter alia to investigate whether Paragraph 17 (wording of 9
March 2004) of Article 34 of the Law on Alcohol Control was not
in conflict with Paragraph 5 of Article 31 of the Constitution;
the doubts of the Supreme Administrative Court of Lithuania, the
petitioner, regarding the compliance of Paragraph 17 (wordings of
9 March 2004 and 25 April 2006) of Article 34 of the Law on
Alcohol Control with the Constitution were grounded on the fact
that, in its opinion, when not only a monetary fine, but also
abolishment of the validity of a licence and non-issuance of a
new licence were established for corresponding violations of law,
and after all this was named as "economic sanctions" in the Law
on Alcohol Control, inter alia the constitutional principle non
bis in idem is violated.
It is clear from what has been set forth that in the
constitutional justice case at issue the compliance of the legal
regulation entrenched in the provisions of the Law on Tobacco
Control which are disputed by the Vilnius Regional Administrative
Court, the petitioner, and in the aforementioned constitutional
justice case, wherein the Constitutional Court ruling of 21
January 2008 was adopted, the compliance of the legal regulation
in the disputed provision of the Law on Alcohol Control with
Paragraph 5 of Article 31 of the Constitution is virtually
disputed in the same aspect, i.e. the abolishment of the validity
of the licence and non-issuance of a new licence had to be
applied in all cases, when an economic entity was imposed a
monetary fine for a corresponding violation of law.
4. In its ruling of 21 January 2008, the Constitutional
Court held that the Law on Alcohol Control had enshrined such
overall legal regulation, under which, the discussed prohibition
sanction—abolishment of the validity of the licence and non-
issuance of a new licence—was such a sanction, which is
inseparable from another sanction—the fine—which is imposed upon
the same violator of law—the economic entity for the
corresponding (the same) violation of law. First of all, one had
to establish the fact of the corresponding violation of law and
that this violation of law was committed by the economic entity
which is brought to legal liability and that for the said
violation of law the violator of law—the economic entity—had to
be imposed a fine.
In this context it needs to be noted that the legal
regulation entrenched in the Law on Alcohol Control, which was
disputed in the aforesaid constitutional justice case, and the
legal regulation entrenched in the Law on Tobacco Control, which
is disputed in the constitutional justice case at tissue, in the
aspect of application of the so-called economic sanctions (a
monetary fine and abolishment of the validity of a licence) were
virtually analogous.
In this ruling of 21 January 2008, the Constitutional Court
held that:
- the content and purpose of the "economic sanctions"—the
fine and the abolishment of the validity of the licence and non-
issuance of a new licence—established in of the Law on Alcohol
Control and some other laws are different;
- the fine is a sanction of repressive nature, whereby the
violator of law—an economic entity—is punished and whereby direct
negative impact to the property and economic situation of that
economic entity, thus, also to the ownership right and freedom of
economic activity is made because its monetary funds are
alienated; on the other hand, such violator of law, after it has
paid the fine, may continue engaging in the corresponding
activity without feeling any additional limitations, as well as
implement its other rights;
- the abolishment of the validity of the licence and non-
issuance of a new licence (as deprivation of a special right) is
such a sanction whose negative impact to the property and
economic situation of the economic entity is made not directly,
i.e. not by alienating (as in case of the fine) its monetary
funds, but by not permitting it to engage in the corresponding
activity (for a certain time); such sanctions are called
prohibition sanctions;
- the purpose of the abolishment of the validity of the
licence and non-issuance of a new licence as the prohibition
sanction is not only—and not as much as—to punish the violator of
law, but, first of all, to carry out prevention: a subject of
law, which used the licence and violated the conditions with
which the use of that licence is linked, is removed from the
corresponding market so that it would no longer make harm for the
values which are defended and protected by law; and it is removed
from the market because of the fact that at that time when it was
still the participant of that market, it violated the essential
conditions of being in that market (the conditions which,
doubtless to say, were known and understood by that subject): it
did not comply with the imperative requirements of law;
- the abolishment of the validity of the licence and non-
issuance of a new licence is an indivisible sanction in the
aspect that any "partial", i.e. non-absolute, incomplete
abolishment of the validity of the licence is in general
impossible: the validity of the licence may be either abolished
(if there is the ground established in the Law), or it may not be
abolished (if there is no such ground);
- the abolishment of the validity of the licence is not an
end in itself, it is the condition and precondition of non-
issuing of a new licence; the non-issuing of a new licence
extends and supplements, essentially gives sense to the action of
the abolishment of the validity of the licence, as the
abolishment of the validity of the licence itself would hardly
have any clearly definable sense if the violator of law—the
economic entity—whose licence was revoked for non-compliance with
the imperative requirements of law could immediately get the same
licence anew;
- taking account of the nature of the violations of law for
which the corresponding sanctions are established, as well as of
the socially significant objectives which are sought by such
legal regulation, one may establish by the law that for a certain
violation of law, any of the following may be imposed: the
monetary fine, the abolishment of the validity of the licence and
non-issuing of a new licence;
- the constitutional principle non bis in idem does not
prohibit from applying the prohibition sanction—a preventive
measure—together with another administrative penalty to a person;
- in itself the constitutional principle non bis in idem
does not deny a possibility to impose more than one sanction upon
the person for the same violation of law; it is possible to
answer whether the corresponding legal regulation does not
violate the said constitutional principle only upon assessing the
nature of the violations of law for which the corresponding
sanctions are established, as well as the socially significant
objectives which are sought by the legislator; the fact whether a
certain administrative penalty (or punishment) established by a
law is attributed to the main, or additional categories, or
whether it is not attributed to any of these categories, is of no
significance in the aspect of the compliance of the corresponding
legal regulation with the constitutional principle non bis in
idem, because the division of administrative penalties (as well
as punishments) into main and additional ones stems not from the
Constitution, but from the law, i.e. from ordinary law;
- the constitutional principle non bis in idem means
prohibition of punishment a second time for the same deed that is
contrary to law, i.e. for the same crime, as well as for the same
violation of law which is not a crime; however, this
constitutional principle does not mean that different kinds of
liability may not be applied to the person for a violation of
law; in addition, in itself, the constitutional principle non bis
in idem does not deny a possibility for the same violation to
apply more than one sanction of the same kind (i.e. defined by
the norms of the same branch of law) to a person, i.e. the main
and additional punishment or the main and additional
administrative penalty.
5. In its ruling of 21 January 2008, the Constitutional
Court inter alia recognised that Paragraph 17 (wordings of 9
March 2004 and 25 April 2006) of Article 34 of the Law on Alcohol
Control was not in conflict with the Constitution.
6. As mentioned, in the constitutional justice case at issue
the compliance of the legal regulation entrenched in Paragraph 5
and in the disputed provision of Paragraph 17 (wording of 20
November 2003) of Article 26 of the Law on Tobacco Control and in
the aforementioned constitutional justice case, wherein the
Constitutional Court ruling of 21 January 2008 was adopted, the
compliance of the legal regulation entrenched in Paragraph 17
(wordings of 9 March 2004 and 25 April 2006) of Article 34 of the
Law on Alcohol Control with Paragraph 5 of Article 31 of the
Constitution is virtually disputed in the same aspect of the
legal regulation established in the said laws, i.e. the
abolishment of the validity of the licence and non-issuance of a
new licence had to be applied in all cases, when an economic
entity was imposed a monetary fine for a corresponding violation
of law.
Taking account of this, one is to hold that the provisions
of the constitutional doctrine formulated in the Constitutional
Court ruling of 21 January 2008 which was adopted in the
aforesaid constitutional justice case regarding the compliance of
the legal regulation entrenched in Paragraph 17 (wordings of 9
March 2004 and 25 April 2006) of Article 34 of the Law on Alcohol
Control with Paragraph 5 of Article 31 of the Constitution in the
aspect that the prohibition sanction—abolishment of the validity
of the licence and non-issuance of a new licence—had to be
applied in all cases when a monetary fine was imposed upon an
economic entity for a corresponding violation of law, are to be
applied mutatis mutandis also while deciding whether Paragraph 5
(wording of 20 November 2003) and the disputed provision of
Paragraph 17 (wording of 20 November 2003) of Article 26 of the
Law is (was) not in conflict with Paragraph 5 of Article 31 of
the Constitution.
7. Taking account of the arguments set forth, one is to hold
that:
- Paragraph 5 (wording of 20 November 2003) of Article 26 of
the Law is not in conflict with Paragraph 5 of Article 31 of the
Constitution;
- the provision "The validity of the licences held by
enterprises shall be abolished, if for the enterprises
themselves, heads of the enterprises or for other personnel of
the enterprises (who have acted on behalf of the enterprise, or
for the interests thereof) <…> a corresponding decision of <…>
the State Tobacco and Alcohol Control Service regarding the
imposition of a <…> penalty for the <…> marketing, storing or
transporting of tobacco products without legally valid documents
certifying the acquisition thereof <…> has become effective. New
licences shall not be issued to these enterprises and also the
enterprises the validity of whose licences shall be abolished in
accordance with Paragraph 5 of this Article" of Paragraph 17
(wording of 20 November 2003) of Article 26 of the Law was not in
conflict with Paragraph 5 of Article 31 of the Constitution.
8. It has been mentioned that the Vilnius Regional
Administrative Court, the petitioner, also doubts whether
Paragraph 5 (wording of 20 November 2003) the Law is not in
conflict with Paragraph 1 of Article 109 of the Constitution and
the constitutional principles of justice and a state under the
rule of law (petition No. 1B-12/2007), whether Paragraph 5
(wording of 20 November 2003) of Article 26 of the Law on to the
extent that, according to the petitioner, it does not provide for
an opportunity not to apply the sanction—abolishment of the
validity of the licence—after account is taken of the character
of the violation, the circumstances mitigating the liability as
well as of other important circumstances, is not in conflict with
the constitutional principles of justice and a state under the
rule of law (petition No. 1B-75/2006), as well as whether the
provision "The validity of the licences held by enterprises shall
be abolished, if for the enterprises themselves, heads of the
enterprises or for other personnel of the enterprises (who have
acted on behalf of the enterprise, or for the interests thereof)
<…> a corresponding decision of <…> the State Tobacco and Alcohol
Control Service regarding the imposition of a <…> penalty for the
<…> marketing, storing or transporting of tobacco products
without legally valid documents certifying the acquisition
thereof <…> has become effective. New licences shall not be
issued to these enterprises and also the enterprises the validity
of whose licences shall be abolished in accordance with Paragraph
5 of this Article" of Paragraph 17 (wording of 20 November 2003)
of Article 26 of the Law was not in conflict with Paragraph 1 of
Article 109 of the Constitution (petition No. 1B-12/2007) and the
constitutional principles of justice and a state under the rule
of law (petitions Nos. 1B-75/2006 and 1B-12/2007).
In the opinion of the Vilnius Regional Administrative Court,
the petitioner, Paragraph 5 (wording of 20 November 2003) and the
disputed provision of Paragraph 17 (wording of 20 November 2003)
of Article 26 of the Law are (were) in conflict with Article 109
of the Constitution and the constitutional principles of justice
and a state under the rule of law inter alia due to the fact
that, after not only a monetary fine, but also the abolishment of
the validity of a licence and non-issuance of the licence is
established, the powers of a court are restricted, when account
is taken of the character of the violation, the circumstances
mitigating the liability as well as of other important
circumstances (due to which the corresponding sanction would be
too big for the violator, since it would be disproportionate to
the committed violation of law and, thus, unfair), and by
following the criteria of justice and reasonableness, not to
impose the sanction—the abolishment of the validity of a
licence—therefore the powers of the court to administer justice
are restricted.
9. In the constitutional justice case wherein the
Constitutional Court adopted the ruling of 21 January 2008, inter
alia it was requested to investigate into the compliance of
Paragraph 17 (wordings of 9 March 2004 and 25 April 2006) of
Article 34 of the Law on Alcohol Control with Article 109 of the
Constitution and the constitutional principles of justice and a
state under the rule of law inter alia due to the fact that,
after not only a monetary fine, but also the abolishment of the
validity of a licence and non-issuance of the licence is
established, the powers of a court are restricted, when account
is taken of the character of the violation, the circumstances
mitigating the liability as well as of other important
circumstances (due to which the corresponding sanction would be
too big for the violator, since it would be disproportionate to
the committed violation of law and, thus, unfair), and by
following the criteria of justice and reasonableness, not to
impose the sanction—the abolishment of the validity of a
licence—therefore the powers of the court to administer justice
are restricted.
It is clear from what has been set forth that in the
constitutional justice case at issue the compliance of the legal
regulation entrenched in the disputed provisions of the Law on
Tobacco Control and in the aforementioned constitutional justice
case the compliance of the legal regulation in the disputed
provision of Article 34 of the Law on Alcohol Control with
Article 109 of the Constitution and the constitutional principles
of justice and a state under the rule of law is virtually
disputed in the same aspect, i.e. that, after not only a monetary
fine, but also the abolishment of the validity of a licence and
non-issuance of the licence is established, the powers of a court
are restricted, when account is taken of the character of the
violation, the circumstances mitigating the liability as well as
of other important circumstances (due to which the corresponding
sanction would be too big for the violator, since it would be
disproportionate to the committed violation of law and, thus,
unfair), and by following the criteria of justice and
reasonableness, not to impose the sanction—the abolishment of the
validity of a licence—therefore the powers of the court to
administer justice are restricted.
10. In its ruling of 21 January 2008, the Constitutional
Court held that Paragraph 17 (wordings of 9 March 2004 and 25
April 2006) of Article 34 of the Law on Alcohol Control
established as for which violations of this law the prohibition
sanction—abolishment of the validity of a licence and non-
issuance of a new licence (within the established time)—is
imposed upon the enterprises which hold licences to engage in
wholesale and retail trade in alcoholic beverages, but which do
not follow the requirements of this law. Under the Law on Alcohol
Control, the institutions which enjoyed powers to issue
corresponding licences, had to adopt a decision of abolishment of
the validity of a licence: if a violation of law specified in
Paragraph 17 (wordings of 9 March 2004 and 25 April 2006) of
Article 34 of the Law on Alcohol Control had been made, a
corresponding institution had to abolish the validity of the
licence. While investigating the compliance of this provision
with Article 109 of the Constitution and the constitutional
principles of justice and a state under the rule of law, the
Constitutional Court also assessed the compliance of Article 41
of the Law on Alcohol Control (wording of 9 March 2004) with the
Constitution, since precisely the said article was designed for
the regulation of the relations linked with lodging complaints
against the so-called economic sanctions established in the Law
on Alcohol Control with a court. In its ruling of 21 January
2008, the Constitutional Court held that the provisions of
Paragraph 17 (wordings of 9 March 2004 and 25 April 2006) of
Article 34 and those of Article 41 (wording of 9 March 2004) of
the Law on Alcohol Control are related, since Paragraph 17
(wordings of 9 March 2004 and 25 April 2006) of Article 34 of the
Law establishes "economic sanctions" (in the considered case—the
abolishment of the validity of the licence and non-issuance of a
new licence (for the established time)), and Article 41 (wording
of 9 March 2004) is designed for the regulation of lodging
complaints against these sanctions with a court.
In this context it needs to be noted that in Paragraph 5 and
the disputed provision of Paragraph 17 (wording of 20 November
2003) of Article 26 of the Law is (was) established as for which
violations of this law the prohibition sanction—abolishment of
the validity of a licence and non-issuance of a new licence
(within the established time)—is imposed upon the enterprises
which hold licences to engage in the corresponding activity
related with tobacco and tobacco products and which do not follow
the requirements of this law. Under the Law on Tobacco Control,
the institutions which enjoyed powers to issue corresponding
licences, had to adopt a decision of abolishment of the validity
of a licence: if one or several violations of law specified in
Paragraph 5 and the disputed provision of Paragraph 17 (wording
of 20 November 2003) of Article 26 of the Law had been made, a
corresponding institution has (had) to abolish the validity of
the licence. Article 33 titled "Lodging Complaints Against
Decisions on Imposition of Economic Sanctions" (wording of 20
November 2003) of the Law on Tobacco Control was designed for the
regulation of the relations linked with lodging complaints
against the so-called economic sanctions (a monetary fine and
abolishment of the validity of a licence) established in the Law
on Tobacco Control with a court. Taking account of this, one is
to hold that Paragraph 5, the disputed provision of Paragraph 17
(wording of 20 November 2003) of Article 26 and the provision of
Article 33 (wording of 20 November 2003) of the Law on Tobacco
Control are (were) related: Paragraph 5 and the disputed
provision of Paragraph 17 (wording of 20 November 2003) of
Article 26 of the Law on Tobacco Control establishes
(established) the so-called economic sanctions for violations of
the Law, while Article 33 (wording of 20 November 2003) thereof
is designed for the regulation of lodging complaints against
these sanctions with a court.
It also needs to be noted that the discussed legal
regulation which is entrenched in the Law on Alcohol Control and
which was disputed in the constitutional justice case wherein the
Constitutional Court ruling of 21 January 2008 was adopted, and
the legal regulation entrenched in the Law on Tobacco Control,
differ from each other in certain aspects, inter alia:
1) Article 41 (wording of 9 March 2004) of the Law on
Alcohol Control generally did not contain the right of economic
entities to lodge a complaint against a decision on abolishment
of the validity of a licence for violations specified in
Paragraph 17 (wordings of 9 March 2004 and 25 April 2006) of
Article 34 of this law, while the right of enterprises is
entrenched in Article 33 (wording of 20 November 2003) of the Law
on Tobacco Control to lodge complaints against decisions on
applying economic sanctions, inter alia against abolishment of
the validity of a licence for violations of law specified in
Paragraphs 5 and 17 (wording of 20 November 2003) of Article 26
of the Law on Tobacco Control;
2) Paragraph 17 (wordings of 9 March 2004 and 25 April 2006)
of Article 34 of the Law on Alcohol Control established the legal
regulation whereby the validity of a licence had to be abolished
and a new licence could not be issued, within the time period
precisely defined in the law, to the violator of law—the person
who committed one or several violations of law specified in the
disputed provisions of the Law on Alcohol Control, while in the
disputed provision of Paragraph 17 (wording of 20 November 2003)
of Article 26 of the Law on Tobacco Control such overall legal
regulation was established, whereby with regard to the violator
of law, a person, who committed one or several violations of law
specified in the Law, the validity of a licence had to be
abolished and it was prohibited to issue new licences to him. In
this context, it needs to be noted that the aspect of the legal
regulation that new licences shall not be issued upon abolishment
of the validity of the licences was consolidated in the provision
"New licences shall not be issued to these enterprises and also
the enterprises the validity of whose licences shall be abolished
in accordance with Paragraph 5 of this Article" of Paragraph 17
(wording of 20 November 2003) of Article 26 of the Law on Tobacco
Control, therefore the compliance of the cited provision of
Paragraph 17 (wording of 20 November 2003) of Article 26 of the
Law on Tobacco Control with Paragraph 1 of Article 109 of the
Constitution will be investigated in this constitutional justice
case separately.
11. It has been mentioned that the sanction—abolishment of
the validity of a licence—is established in Paragraph 5 (wording
of 20 November 2003) of Article 26 of the Law for violations of
the Law; the disputed provision of Paragraph 17 (wording of 20
November 2003) of Article 26 of the Law established not only the
sanction—abolishment of the validity of the licence in cases
provided for in this paragraph—but also in what cases new
licences are not issued upon abolishment of the validity of the
licence.
Taking account of this, first of all one is to decide
whether Paragraph 5 (wording of 20 November 2003) of Article 26
of the Law to the disputed extent is not in conflict with
Paragraph 1 of Article 109 of the Constitution and the
constitutional principles of a state under the rule of law and
justice, also whether the provision "The validity of the licences
held by enterprises shall be abolished, if for the enterprises
themselves, heads of the enterprises or for other personnel of
the enterprises (who have acted on behalf of the enterprise, or
for the interests thereof) <…> a corresponding decision of <…>
the State Tobacco and Alcohol Control Service regarding the
imposition of a <…> penalty for the <…> marketing, storing or
transporting of tobacco products without legally valid documents
certifying the acquisition thereof <…> has become effective" of
Paragraph 17 (wording of 20 November 2003) of Article 26 of the
Law was not in conflict with Paragraph 1 of Article 109 of the
Constitution and the constitutional principles of a state under
the rule of law and justice.
12. In its ruling of 21 January 2008, the Constitutional
Court held that:
- courts, when they administer justice, must ensure the
implementation of law expressed in the Constitution, laws and
other legal acts, they must guarantee the supremacy of law,
protect human rights and freedoms; a duty to courts stems from
Paragraph 1 of Article 109 of the Constitution to consider cases
justly and objectively and to adopt reasoned and reasonable
decisions; the principle of justice entrenched in the
Constitution as well as the provision that justice is
administered solely by courts mean that the constitutional value
is not the adoption of a decision in court, but rather the
adoption of a just court decision; the constitutional concept of
justice implies not only a formal and nominal justice
administered by the court, not only an outward appearance of
justice administered by the court, but, most importantly, such
court decisions (other court final acts), which by their content
are not unfair; the justice administered only formally by the
court is not the justice which is consolidated in and protected
and defended by the Constitution;
- the constitutional principles of justice and a state under
the rule of law also imply that the measures established by the
state for the violations of law must be proportionate (adequate)
to the violation of law and must comply with the lawful and
socially significant objectives sought and do not have to
restrain a person more than it is necessary in order to reach
these objectives; there must be a fair balance (proportionality)
between the objective sought to punish the violators of law and
to ensure the prevention of the violations of law and the
measures chosen for reaching this objective; the constitutional
principle of justice requires to differentiate the established
penalties so that while applying them, one could take account of
the nature of the violation of law, of the circumstances
mitigating the liability and other circumstances, that, while
taking account of this, one could impose a smaller penalty than
the minimal one provided for in the sanction, etc.; the monetary
fines established in the laws for violations of law must be of
such size which is necessary while seeking the legitimate and
socially significant objective—to ensure the observance of laws
and carrying out of the established duties;
- the penalties in their system which are established in
laws must be such so that a court, when it imposes the penalties,
would be able to administer justice;
- the provision of the official constitutional doctrine
quoted in this Constitutional Court ruling that in itself
(without assessment of the character, danger (gravity), the scale
and other features of a certain violation of law) the
consolidation of strict (to violators of law) sanctions for
violations of law cannot be construed as unfair or inadequate to
the respective violation of law is to be applied not only to big
monetary fines, but also to other sanctions, as well as to the
so-called prohibition sanctions;
- the powers (which arise from the Constitution) of the
court to decide whether the corresponding violator of law—an
economic entity—has to be applied a monetary fine, but not the
abolishment of the validity of the licence, do not at all mean
that the court may disregard the principled provision that the
said person, at the time when he was a participant of the market
of trade (for which the particular state regulation regime is
applied) in alcoholic products, violated the essential conditions
of being in that market (the conditions which, doubtless to say,
were known and understood by that participant)—it did not comply
with the imperative requirements of law, and the principled
provision that this market must be protected from such
participants of the market which, being in that market, acted not
according to its rules, but in breach of the rules. Thus, such
cases, when the said prohibition sanction does not have to be
applied, may only be very rare and exceptional ones; it is
obvious that in every such case, in the corresponding court act
one must clearly and rationally argue what values, which are
enshrined in, and protected and defended by the Constitution,
would be violated by the abolishment of the validity of the
licence.
13. In its ruling of 21 January 2008, the Constitutional
Court inter alia recognised that Article 41 (wording of 9 March
2004) the Law on Alcohol Control, to the extent that it does not
provide for the possibility for the court, taking account of the
nature of the violation of law, its extent, the circumstances
mitigating the liability and other significant circumstances and
following the principles of justice and reasonableness, to decide
that this sanction—the abolishment of the validity of the
licence—does not have to be applied to the enterprise for the
violations of law established in Paragraph 17 (wordings of 9
March 2004 and 25 April 2006) of Article 34 of this law, because
due to certain very important circumstances it is obviously
disproportionate (inadequate) to the committed violation of law,
thus, unfair, was in conflict with Paragraph 1 of Article 109 of
the Constitution, and with the constitutional principles of
justice and a state under the rule of law.
In the same ruling the Constitutional Court recognised that
Paragraph 17 (wordings of 9 March 2004 and 25 April 2006) of the
Law on Alcohol Control was not in conflict with Paragraph 1 of
Article 109 of the Constitution, and with the constitutional
principles of justice and a state under the rule of law.
14. While deciding whether Paragraph 5 (wording of 20
November 2003) of Article 26 and the disputed provision "The
validity of the licences held by enterprises shall be abolished,
if for the enterprises themselves, heads of the enterprises or
for other personnel of the enterprises (who have acted on behalf
of the enterprise, or for the interests thereof) <…> a
corresponding decision of <…> the State Tobacco and Alcohol
Control Service regarding the imposition of a <…> penalty for the
<…> marketing, storing or transporting of tobacco products
without legally valid documents certifying the acquisition
thereof <…> has become effective" of Paragraph 17 (wording of 20
November 2003) of Article 26 of the Law on Tobacco Control is
(was) not in conflict with Paragraph 1 of Article 109 of the
Constitution and the constitutional principles of a state under
the rule of law and justice, it needs to be noted that, as
mentioned, the compliance of the legal regulation entrenched in
these disputed provisions of the Law on Tobacco Control and the
compliance of the legal regulation of the Law on Alcohol Control
disputed in the aforementioned constitutional justice case,
wherein the Constitutional Court ruling of 21 January 2008 was
adopted, with Article 109 of the Constitution and the
constitutional principles of a state under the rule of law and
justice, is virtually disputed in the same aspect.
Taking account of this, one is to hold that the provisions
of the constitutional doctrine, formulated in the Constitutional
Court ruling of 21 January 2008, regarding the compliance of the
legal regulation entrenched in Paragraph 17 (wordings of 9 March
2004 and 25 April 2006) and Article 41 (wording of 9 March 2004)
of Article 34 of the Law on Alcohol Control with Article 109 of
the Constitution and the constitutional principles of a state
under the rule of law and justice, to the extent that it does not
provide for the possibility for the court, taking account of the
nature of the violation of law, its extent, the circumstances
mitigating the liability and other significant circumstances and
following the principles of justice and reasonableness, to decide
that this sanction—the abolishment of the validity of the
licence—does not have to be applied to the enterprise for the
violations of law established in Paragraph 17 (wordings of 9
March 2004 and 25 April 2006) of Article 34 of this law, because
due to certain very important circumstances it is obviously
disproportionate (inadequate) to the committed violation of law,
thus, unfair, are to be applied mutatis mutandis also while
deciding whether Paragraph 1 of Article 33 (wording of 20
November 2003) of the Law, to the extent that it does not provide
for the possibility for the court, taking account of the nature
of the violation of law, its extent, the circumstances mitigating
the liability and other significant circumstances and following
the principles of justice and reasonableness, to decide that this
sanction—the abolishment of the validity of the licence—does not
have to be applied to persons, because due to certain very
important circumstances it is obviously disproportionate
(inadequate) to the committed violation of law, thus, unfair, is
not in conflict with Paragraph 1 of Article 109 of the
Constitution and the constitutional principles of a state under
the rule of law and justice.
15. Taking account of the arguments set forth, one is to
conclude that:
- Paragraph 5 (wording of 20 November 2003) of Article 26 of
the Law is not in conflict with Paragraph 1 of Article 109 of the
Constitution and the constitutional principles of a state under
the rule of law and justice;
- the provision "The validity of the licences held by
enterprises shall be abolished, if for the enterprises
themselves, heads of the enterprises or for other personnel of
the enterprises (who have acted on behalf of the enterprise, or
for the interests thereof) <…> a corresponding decision of <…>
the State Tobacco and Alcohol Control Service regarding the
imposition of a <…> penalty for the <…> marketing, storing or
transporting of tobacco products without legally valid documents
certifying the acquisition thereof <…> has become effective" of
Paragraph 17 (wording of 20 November 2003) of Article 26 of the
Law was not in conflict with Paragraph 1 of Article 109 of the
Constitution and the constitutional principles of a state under
the rule of law and justice;
- Paragraph 1 (wording of 20 November 2003) of Article 33 of
the Law to the extent that it does not provide for the
possibility for the court, taking account of the nature of the
violation of law, its extent, the circumstances mitigating the
liability and other significant circumstances and following the
principles of justice and reasonableness, to decide that this
sanction—the abolishment of the validity of the licence—does not
have to be applied to persons, because due to certain very
important circumstances it is obviously disproportionate
(inadequate) to the committed violation of law, thus, unfair, is
in conflict with Paragraph 1 of Article 109 of the Constitution
and the constitutional principles of a state under the rule of
law and justice.
16. While deciding whether the disputed provision "New
licences shall not be issued to these enterprises and also the
enterprises the validity of whose licences shall be abolished in
accordance with Paragraph 5 of this Article" of Paragraph 17
(wording of 20 November 2003) of Article 26 of the Law was not in
conflict with Paragraph 1 of Article 109 of the Constitution and
the constitutional principles of a state under the rule of law
and justice, it needs to be noted that the Law provides for the
requirements which must be followed by the persons who hold
licences to engage in the activity linked with tobacco and its
products. The so-called economic sanctions entrenched in Article
26 titled "Economic Sanctions" (wording of 20 November 2003 with
subsequent amendments and supplements) of the Law are applied to
those persons who do not follow the requirements established in
the Law. It has been mentioned that for some violations specified
in the Law, the persons who committed them and who are specified
in the Law are imposed only a monetary fine (which is subject to
differentiation), for other violations a monetary fine is imposed
and the validity of the licence is abolished with respect to the
sales outlet wherein the violation has been identified and a new
licence is not issued within a certain time period established in
the Law, and for some other violations of law established in the
Law the validity of the licence is abolished and no new licence
is issued. In this context it needs to be noted that the
strictest legal liability, which is applied to the violator of
law—a person—for violations of law established in the Law, is
namely monetary sanctions and abolishment of the validity of the
licence as well as non-issuance of new licences.
17. The Constitutional Court has held that in a democratic
state under the rule of law the legislator has the right and duty
to prohibit by means of laws such deeds that may essentially harm
people, society or interests of the state or there might be a
threat of such harm to appear (Constitutional Court rulings of 8
May 2000, 10 June 2003, 29 December 2004 and 10 November 2005).
While establishing in laws as to which deeds are contrary to law,
as well as establishing legal liability for deeds that are
contrary to law, the legislator enjoys broad discretion. While
taking account of various important factors, he can also amend
the corresponding legal regulation.
In this context it needs to be noted that, as it has been
held by the Constitutional Court, under the concept of a
democratic state, which is consolidated in the Constitution, the
state not only seeks to protect and defend the person and society
from crimes and other dangerous violations of law, but also is
able to do this efficiently (Constitutional Court rulings of 29
December 2004 and 16 January 2006).
18. As mentioned, tobacco products are attributed to special
products and a special state legal regulation is applied to trade
in such products, and to other types of activity related to them
and their consumption.
In its ruling of 3 November 2005, the Constitutional Court
held that tobacco use is harmful to health and can give rise to
negative social effects. Due to this, tobacco products are to be
ascribed to special products whose production, circulation and
consumption may and must be controlled by the state, which, under
the Constitution, is inter alia under obligation to look after
the health of the people (Paragraph 1 of Article 53 of the
Constitution) and is empowered to regulate economic activity so
that it serves the general welfare of the Nation (Paragraph 3 of
Article 46 of the Constitution); the legislator, who has the
right, under the Constitution, to establish the means and a
procedure for control of tobacco as a special product, may
establish special legal regulation, inter alia certain
prohibitions, limitations, etc., which are not characteristic of
the legal regulation of relations of production, circulation and
consumption of other products; the disregard of the means and
procedure—prohibitions, limitations, etc.—of tobacco control,
which are established by laws, and other violations of
requirements of production, circulation and consumption of
tobacco and its products, which are established by other legal
acts, are harmful to the economic system of the state, inter alia
its financial order; under the Constitution, the legislator
enjoys powers to establish legal liability for violations of the
said legal regulation, inter alia to establish respective
sanctions to violators of law; these sanctions can also be strict
to violators of law; alongside, it needs to be emphasised that in
itself (without assessment of the character, danger (gravity),
the scale and other features of a certain violation of law) the
consolidation of strict (to violators of law) sanctions for
violations of the requirements of production, circulation and
consumption of tobacco and its products cannot be construed as
unfair or inadequate to the respective violation of law.
19. It has been held in this Constitutional Court ruling
that Paragraph 5 (wording of 20 November 2003) of Article 26 of
the Law is not in conflict with Paragraph 5 of Article 31 and
Paragraph 1 of Article 109 of the Constitution, and with the
constitutional principles of a state under the rule of law and of
justice. Thus the sanction—abolishment of the validity of the
licence—established in Paragraph 5 (wording of 20 November 2003)
of Article 26 of the Law, which has (had) to be applied to a
person together with another sanction—a monetary fine—established
in this paragraph, was, doubtless to say, reasonable from the
constitutional point of view. As already mentioned, the
abolishment of the validity of the licence is not an end in
itself, it is the condition and precondition of non-issuing of a
new licence; the non-issuing of a new licence extends and
supplements, and essentially gives sense to the action of the
abolishment of the validity of the licence, as the abolishment of
the validity of the licence itself would hardly have any clearly
definable sense if the violator of law—the economic entity—whose
licence was revoked for non-compliance with the imperative
requirements of law could immediately get the same licence anew.
20. Taking account of what has been set forth, one is to
draw a conclusion that there are not sufficient legal arguments
which would permit to assert that the fact that the disputed
provision "New licences shall not be issued to these enterprises
and also the enterprises the validity of whose licences shall be
abolished in accordance with Paragraph 5 of this Article" of
Paragraph 17 (wording of 20 November 2003) of Article 26 of the
Law consolidates that the validity of the licences shall be
abolished and new licences shall not be issued to the persons who
committed the violations of law specified in the Law, in itself
(without assessing a certain character of the violation of law,
its danger (gravity), scale, other factors, and other
circumstances) is unfair or inadequate to the corresponding
violation of law.
21. Paragraph 1 (wording of 20 November 2003) of Article 31
of the Law consolidates the right of the person who disagrees
with a decision to apply an economic sanction (inter alia
abolishment of the validity of the licence) against him to lodge
a complaint against such a decision with a court. It needs to be
noted that it has been held in this Constitutional Court ruling
that Paragraph 1 (wording of 20 November 2003) of Article 31 of
the Law to the extent that it does not provide for the
possibility for the court, taking account of the nature of the
violation of law, its extent, the circumstances mitigating the
liability and other significant circumstances and following the
principles of justice and reasonableness, to decide that this
sanction—the abolishment of the validity of the licence—does not
have to be applied to persons, because due to certain very
important circumstances it is obviously disproportionate
(inadequate) to the committed violation of law, thus, unfair, is
in conflict with Paragraph 1 of Article 109 of the Constitution
and the constitutional principles of a state under the rule of
law and justice.
The control of the reasonableness and lawfulness of
decisions adopted by institutions established in the Law to apply
a sanction to a person—abolishment of the validity of a licence—
is secured by the court. The court, while taking account of the
character of the violation of law, its scale, the circumstances
which mitigate the liability as well as other important
circumstances, and while following the criteria of justice and
reasonableness, has the right to decide that the sanction—
abolishment of the validity of the licence—cannot be applied to
the persons, if due to certain very important circumstances it is
clearly disproportionate (inadequate) to the committed violation
of law and thus it is unfair.
22. Taking account of the arguments set forth, one is to
draw a conclusion that the provision "New licences shall not be
issued to these enterprises and also the enterprises the validity
of whose licences shall be abolished in accordance with Paragraph
5 of this Article" of Paragraph 17 (wording of 20 November 2003)
of Article 26 of the Law to the extent that it provides that upon
abolishment of the validity held by the enterprises new licences
shall not be issued was not in conflict with Paragraph 1 of
Article 109 of the Constitution and the constitutional principles
of justice and a state under the rule of law.
IV
On the compliance of Item 39 (wording of 18 December 2006)
of the Rules for Licensing Retail Trade in Tobacco Products
approved by Item 1.1 of Resolution of the Government of the
Republic of Lithuania No. 383 "On Approving the Rules for
Licensing Retail Trade in Alcohol Products and the Rules for
Licensing Retail Trade in Tobacco Products" of 7 April 2004 with
Paragraph 5 of Article 31, Paragraph 1 of Article 109 of the
Constitution and the constitutional principles of justice and a
state under the rule of law, and on the compliance of Item 40
(wording of 18 December 2006) of the Rules with Paragraph 1 of
Article 109 of the Constitution and the constitutional principles
of justice and a state under the rule of law.
1. As mentioned, inter alia the following is disputed in the
constitutional justice case at issue:
- the compliance of the provision "The validity of the
licence shall be abolished if <…> 39.6. the enterprise has
violated the conditions of the licensed activity which are
established in one of these items—30.2.1., 30.2.2, 30.2.3, or
30.2.4" (wording of 7 April 2004) of Item 39 (wording of 18
December 2006) of the Rules approved by Government Resolution No.
383 of 7 April 2004 with Paragraph 5 of Article 31, Paragraph 1
of Article 109 of the Constitution and the constitutional
principles of a state under the rule of law and justice (petition
No. 1B-12/2007);
- the compliance of the provision "The enterprise with
regard to which the validity of the licence was abolished due to
the reasons specified in one of these items—39.6, 39.7 <…>—shall
not be issued a new licence repeatedly" of Item 40 (wording of 18
December 2006) of the Rules approved by Government Resolution No.
383 of 7 April 2004 to the extent that it provides that upon
abolishment of the validity of the licence a new licence is not
issued repeatedly, with Paragraph 1 of Article 109 of the
Constitution and the constitutional principles of a state under
the rule of law and justice (petition No. 1B-12/2007).
2. On 7 April 2004, the Government adopted Resolution No.
383 "On Approving the Rules for Licensing Retail Trade in Alcohol
Products and the Rules for Licensing Retail Trade in Tobacco
Products" which came into force on 1 May 2004. By Item 1 of this
resolution the Rules for Licensing Retail Trade in Tobacco
Products were approved.
Item 39 (wording of 7 April 2004) of the Rules established
the following:
"39. The validity of the licence shall be abolished if:
39.1. the holder of the licence submits an application
requesting to abolish the validity of the licence;
39.2. the enterprise is liquidated or reorganised while
completing its activity as an independent economic entity;
39.3. the enterprise to whom the validity of the licence was
suspended according to the requirements of Item 37 of these Rules
does not remove, within the established time period, the
violations due to which the validity of the licence was
suspended;
39.4. in the same place of trade and within one year of
imposition of a fine, there is a repeated violation of the
prohibition to sell tobacco products to persons who are under 18
years of age, which is established in the Republic of Lithuania
Law on Tobacco Control (the validity of the licence is abolished
in the place of trade in which the violation is established);
39.5. within one year of the imposition of a fine, the
enterprise repeatedly violates the conditions of the licensed
activity established in one of these items—30.1, 30.2.5, or 31;
39.6. the enterprise has violated the conditions of the
licensed activity which are established in one of these
items—30.2.1., 30.2.2, 30.2.3, or 30.2.4;
39.7. for the heads (heads of administration) of the
enterprises or for other personnel of the enterprises (who have
acted on behalf of the enterprise, or for the interests thereof)
a court judgement of conviction, a court ruling, decision has
become effective, a corresponding decision of the customs, tax
inspectorate, police, or the State Tobacco and Alcohol Control
Service regarding the imposition of a punishment or penalty for
the contraband of tobacco or tobacco products, marketing, storing
or transporting of falsified tobacco products, marketing, storing
or transporting of tobacco products without legally valid
documents certifying the acquisition thereof and also, for
unlawful storing, transporting or marketing of tobacco products
without the special marks—tax labels—has become effective;
39.8. the enterprise does not eliminate, within the
established time period, the reasons due to which it was warned,
according to the requirements of Item 36 of these Rules, about
possible abolishment of the licence."
The following was established in Item 40 (wording of 7 April
2004) of the Rules:
"40. The enterprise with regard to which the validity of the
licence was abolished due to the reasons specified in Item 39.3
or Item 39.4 of these Rules, may be issued a new licence not
earlier than one year after the day of abolishment of the
validity of the licence.
The enterprise with regard to which the validity of the
licence was abolished due to the reasons specified in Item 39.5
of these Rules, may be issued a new licence not earlier than 5
years after the day of abolishment of the validity of the
licence.
The enterprise with regard to which the validity of the
licence was abolished due to the reasons specified in one of
these items—39.6, 39.7 or 39.8—shall not be issued a new licence
repeatedly."
3. On 18 December 2006, the Government adopted Resolution
No. 1291 "On Amending Resolution of the Government of the
Republic of Lithuania No. 383 'On Approving the Rules for
Licensing Retail Trade in Alcohol Products and the Rules for
Licensing Retail Trade in Tobacco Products' of 7 April 2004"
(hereinafter also referred to as Government Resolution No. 1291
of 18 December 2006) which came into force on 22 December 2006.
The following was done by Government Resolution No. 1291 of
18 December 2006:
- by Item 4 thereof Item 39.4 (wording of 7 April 2004) of
the Rules was amended: instead of the word "one" the word "three"
was entered, instead of the words "in which the violation is
established" the words "in which the violation is committed" were
entered;
- by Item 5 thereof Item 39.4 (wording of 7 April 2004) of
the Rules was recognised as no longer valid;
- by Item 6 thereof Item 40 (wording of 7 April 2004) of the
Rules was amended and set forth in a new wording; Item 40
(wording of 18 December 2006) of the Rules established the
following:
"40. The enterprise with regard to which the validity of the
licence was abolished due to the reasons specified in Item 39.3
of these Rules, may be issued a new licence not earlier than one
year after the day of abolishment of the validity of the licence.
The enterprise with regard to which the validity of the
licence was abolished due to the reasons specified in Item 39.4
of these Rules, may be issued a new licence not earlier than
three years after the day of abolishment of the validity of the
licence.
The enterprise with regard to which the validity of the
licence was abolished due to the reasons specified in one of
these items—39.6, 39.7 or 39.8—shall not be issued a new licence
repeatedly."
It needs to be noted that the legal regulation established
in the disputed provision of Item 39 (wording of 18 December
2006) and the disputed provision of Item 40 (wording of 18
December 2006) of the Rules has remained unchanged since 1 May
2004, when the Rules approved by Government resolution No. 383 of
7 April 2004 came into force.
4. Item 30 (wording of 7 April 2004) of the Rules inter alia
provides:
"30. The enterprises which hold the licence shall be
prohibited: <…>
30.2. to sell, store and transport tobacco products, as well
as to import them to the Republic of Lithuania:
30.2.1. without legally valid documents certifying the
acquisition or transporting of the tobacco products. The presence
of legally valid documents certifying the acquisition or
transporting of tobacco products is required in all places of
sale and/or storing of tobacco products. While transporting
tobacco products, one is required to hold the transportation
documents or legally valid documents certifying the acquisition
of tobacco products;
30.2.2. if these products are falsified;
30.2.3. if these products are contraband;
30.2.4. without special markings—tax labels—of the form
established by the Ministry of Finance, save the cases when,
under the Republic of Lithuania Law on Excises (Official Gazette
Valstybës þinios, 2001, No. 98-3482; 2004, No. 26-802) and other
legal acts, the special markings—tax labels—are not mandatory".
5. Item 39 (wordings of 7 April 2004 and 18 December 2006)
of the Rules inter alia provides:
"39. The validity of the licence shall be abolished if: <…>
39.6. the enterprise has violated the conditions of the
licensed activity which are established in one of these
items—30.2.1, 30.2.3, 30.2.3 or 30.2.4;
39.7. for the heads (heads of administration) of the
enterprises or for other personnel of the enterprises (who have
acted on behalf of the enterprise, or for the interests thereof)
a court judgement of conviction, a court ruling, decision has
become effective, a corresponding decision of the customs, tax
inspectorate, police, or the State Tobacco and Alcohol Control
Service regarding the imposition of a punishment or penalty for
the contraband of tobacco or tobacco products, marketing, storing
or transporting of falsified tobacco products, marketing, storing
or transporting of tobacco products without legally valid
documents certifying the acquisition thereof and also, for
unlawful storing, transporting or marketing of tobacco products
without the special marks—tax labels—has become effective <…>."
6. In the context of the constitutional justice case at
issue it needs to be noted that, under the disputed provision
"The validity of the licence shall be abolished if: <…> 39.6. the
enterprise has violated the conditions of the licensed activity
which are established in one of these items—30.2.1, 30.2.3,
30.2.3 or 30.2.4" (wording of 7 April 2004) of Item 39 (wording
of 18 December 2006) of the Rules, the validity of the licence is
abolished if the enterprise violates the prohibition
(prohibitions) to sell, store and transport tobacco products, as
well as to import them to the Republic of Lithuania without
legally valid documents certifying the acquisition or
transporting of the tobacco products; the presence of legally
valid documents certifying the acquisition or transporting of
tobacco products is required in all places of sale and/or storing
of tobacco products; while transporting tobacco products, one is
required to hold the transportation documents or legally valid
documents certifying the acquisition of tobacco products (Item
30.2.1 (wording of 7 April 2004) of the Rules); if these products
are falsified (Item 30.2.2 (wording of 7 April 2004) of the
Rules); if these products are contraband (Item 30.2.3 (wording of
7 April 2004) of the Rules); without special markings—tax
labels—of the form established by the Ministry of Finance, save
the cases when, under the Republic of Lithuania Law on Excises
and other legal acts, the special markings—tax labels—are not
mandatory (Item 30.2.4 (wording of 7 April 2004) of the Rules).
7. It has been mentioned that Paragraph 5 (wording of 20
November 2003) of Article 26 of the Law provides: "For
infringement of the prohibitions set forth in Items 1, 2, 3 or 4
of Paragraph 3 of Article 14 of this Law, regarding marketing of
tobacco products, storing or transporting thereof if that does
not impose criminal liability, legal persons and branches of
foreign legal persons shall be subject to a fine from LTL 10,000
to LTL 30,000 and the validity of their licence shall be
abolished."
It has been held in this Constitutional Court ruling that
Paragraph 5 (wording of 20 November 2003) of Article 26 of the
Law is not in conflict with Paragraph 5 of Article 31 and
Paragraph 1 of Article 109 of the Constitution, and the
constitutional principles of a state under the rule of law and
justice.
8. The prohibitions established in Items 30.2.1, 30.2.3,
30.2.3 or 30.2.4 (wording of 7 April 2004) of the Rules, for
violation of which the abolishment of the validity of the licence
is provided for in the disputed provision of Item 39 (wording of
18 December 2006) of the Rules, are correspondingly analogous to
those established in Items 1, 2, 3 or 4 (wording of 20 November
2003) of Paragraph 3 of Article 14 of the Law, for violation of
which the validity of the licence is abolished under Paragraph 5
(wording of 20 November 2003) of Article 26 of the Law.
The legal regulation established in the disputed provision
of Item 39 (wording of 18 December 2006) of the Rules implements
Paragraph 5 (wording of 20 November 2003) of Article 26 of the
Law and, from the aspect that it is disputed, it is identical
with the latter.
9. On the grounds of the arguments analogous to those on the
grounds of which it was recognised in this Constitutional Court
ruling that Paragraph 5 (wording of 20 November 2003) of Article
26 of the Law is not in conflict with the Constitution, it needs
to be held that the provision "The validity of the licence shall
be abolished if: <…> 39.6. the enterprise has violated the
conditions of the licensed activity which are established in one
of these items—30.2.1, 30.2.3, 30.2.3 or 30.2.4" (wording of 7
April 2004) of Item 39 (wording of 18 December 2006) of the Rules
is not in conflict with the Constitution as well.
10. It has been mentioned that Paragraph 17 (wording of 20
November 2003) of Article 26 of the Law used to provide:
"17. The validity of the licences held by enterprises shall
be abolished, if for the enterprises themselves, heads of the
enterprises or for other personnel of the enterprises (who have
acted on behalf of the enterprise, or for the interests thereof)
a court judgement of conviction, a court ruling, decision has
become effective, a corresponding decision of the customs
department, tax inspectorate, police, or the State Tobacco and
Alcohol Control Service regarding the imposition of a punishment
or penalty for the contraband of tobacco or tobacco products,
marketing, storing or transporting of falsified tobacco products,
marketing, storing or transporting of tobacco products without
legally valid documents certifying the acquisition thereof and
also, for unlawful storing, transporting or marketing of tobacco
products without the special marks—tax labels—has become
effective. New licences shall not be issued to these enterprises
and also the enterprises the validity of whose licences shall be
abolished in accordance with Paragraph 5 of this Article."
It has been held in this Constitutional Court ruling that
the provision "The validity of the licences held by enterprises
shall be abolished, if for the enterprises themselves, heads of
the enterprises or for other personnel of the enterprises (who
have acted on behalf of the enterprise, or for the interests
thereof) <…> a corresponding decision of <…> the State Tobacco
and Alcohol Control Service regarding the imposition of a <…>
penalty for the <…> marketing, storing or transporting of tobacco
products without legally valid documents certifying the
acquisition thereof <…> has become effective. New licences shall
not be issued to these enterprises and also the enterprises the
validity of whose licences shall be abolished in accordance with
Paragraph 5 of this Article" of Paragraph 17 (wording of 20
November 2003) of Article 26 of the Law was not in conflict with
Paragraph 5 of Article 31 of the Constitution.
11. In the context of the constitutional justice case at
issue it needs to be noted that the legal regulation established
in the provision "The enterprise with regard to which the
validity of the licence was abolished due to the reasons
specified in one of these items—39.6, 39.7 <…>—shall not be
issued a new licence repeatedly" of Item 40 (wording of 18
December 2006) of the Rules implemented Paragraph 17 (wording of
20 November 2003) of Article 26 of the Law and was virtually
analogous to the legal regulation established in Paragraph 17
(wording of 20 November 2003) of Article 26 of the Law.
12. In this context it needs to be noted that, as it has
been mentioned, on 26 June 2008, the Seimas adopted the Republic
of Lithuania Law on Amending and Supplementing Articles 10, 11,
12, 19, and 26 of the Law on Tobacco Control, and by Paragraph 3
of Article 5 of this law Paragraph 17 (wording of 20 November
2003) of Article 26 of the Law on Tobacco Control was recognised
as no longer valid; also, by Article 2 of the same law Article 11
(wording of 15 June 2006) of the Law on Tobacco Control was
amended and set forth in a new wording. The legal regulation
established in Items 5 and 6 of Paragraph 6 and Items 3 and 4 of
Paragraph 8 of Article 11 (wording of 26 June 2006) of the Law on
Tobacco Control is virtually analogous to the legal regulation
established in Paragraph 17 (wording of 20 November 2003) of
Article 26 of the Law.
13. On the grounds of the arguments analogous to those upon
which it has been recognised in this Constitutional Court ruling
that Paragraph 17 (wording of 20 November 2003) of Article 26 of
the Law was not in conflict with the Constitution, one is to hold
that the provision "The enterprise with regard to which the
validity of the licence was abolished due to the reasons
specified in one of these items—39.6, 39.7 <…>—shall not be
issued a new licence repeatedly" of Item 40 (wording of 18
December 2006) of the Rules to the extent that after the validity
of the licence is abolished a new licence is not issued
repeatedly, is not in conflict with the Constitution.
Conforming to Articles 102 and 105 of the Constitution of
the Republic of Lithuania and Articles 1, 53, 54, 55 and 56 of
the Law on the Constitutional Court of the Republic of Lithuania,
the Constitutional Court of the Republic of Lithuania has passed
the following
ruling:
1. To recognise that Paragraph 5 (wording of 20 November
2003; Official Gazette Valstybës þinios, 2003, No. 117-5317) of
Article 26 of the Republic of Lithuania Law on Tobacco Control is
not in conflict with the Constitution of the Republic of
Lithuania.
2. To recognise that the provision "The validity of the
licences held by enterprises shall be abolished, if for the
enterprises themselves, heads of the enterprises or for other
personnel of the enterprises (who have acted on behalf of the
enterprise, or for the interests thereof) <…> a corresponding
decision of <…> the State Tobacco and Alcohol Control Service
regarding the imposition of a <…> penalty for the <…> marketing,
storing or transporting of tobacco products without legally valid
documents certifying the acquisition thereof <…> has become
effective. New licences shall not be issued to these enterprises
and also the enterprises the validity of whose licences shall be
abolished in accordance with Paragraph 5 of this Article" of
Paragraph 17 (wording of 20 November 2003; Official Gazette
Valstybës þinios, 2003, No. 117-5317) of Article 26 of the
Republic of Lithuania Law on Tobacco Control was not in conflict
with the Constitution of the Republic of Lithuania.
3. To recognise that Paragraph 1 (wording of 20 November
2003; Official Gazette Valstybës þinios, 2003, No. 117-5317) of
Article 33 of the Republic of Lithuania Law on Tobacco Control to
the extent that it does not provide for the possibility for the
court, taking account of the nature of the violation of law, its
extent, the circumstances mitigating the liability and other
significant circumstances and following the principles of justice
and reasonableness, to decide that this sanction—the abolishment
of the validity of the licence—does not have to be applied to
persons, because due to certain very important circumstances it
is obviously disproportionate (inadequate) to the committed
violation of law, thus, unfair, is in conflict with Paragraph 1
of Article 109 of the Constitution of the Republic of Lithuania
and the constitutional principles of a state under the rule of
law and justice.
4. To recognise that the provision "The validity of the
licence shall be abolished if: <…> 39.6. the enterprise has
violated the conditions of the licensed activity which are
established in one of these items—30.2.1, 30.2.3, 30.2.3 or
30.2.4" (wording of 7 April 2004; Official Gazette Valstybës
þinios, 2004, No. 53-1799) of Item 39 (wording of 18 December
2006; Official Gazette Valstybës þinios, 2006, No. 139-5320) of
the Rules for Licensing Retail Trade in Alcohol Products approved
by Resolution of the Government of the Republic of Lithuania No.
383 "On Approving the Rules for Licensing Retail Trade in Alcohol
Products and the Rules for Licensing Retail Trade in Tobacco
Products" of 7 April 2004 and the provision "The enterprise with
regard to which the validity of the licence was abolished due to
the reasons specified in one of these items—39.6, 39.7 <…>—shall
not be issued a new licence repeatedly" of Item 40 (wording of 18
December 2006; Official Gazette Valstybës þinios, 2006, No. 139-
5320) of the same rules to the extent that after the validity of
the licence is abolished a new licence is not issued repeatedly,
are not in conflict with the Constitution of the Republic of
Lithuania.
This ruling of the Constitutional Court is final and not
subject to appeal.
The ruling is promulgated in the name of the Republic of
Lithuania.
Justices of the Constitutional Court:
Armanas Abramavièius
Toma Birmontienë
Pranas Kuconis
Kæstutis Lapinskas
Egidijus Ðileikis
Algirdas Taminskas
Romualdas Kæstutis Urbaitis