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On the selection of the company implementing the project of a terminal of liquefied natural gas and on funding this project

Case No. 23/2012-38/2014-54/2014

 

 

THE CONSTITUTIONAL COURT OF THE REPUBLIC OF LITHUANIA

IN THE NAME OF THE REPUBLIC OF LITHUANIA

 

RULING

ON THE COMPLIANCE OF CERTAIN PROVISIONS OF THE REPUBLIC OF LITHUANIA’S LAW ON THE LIQUEFIED NATURAL GAS TERMINAL (WORDING OF 12 JUNE 2012) AND THE COMPLIANCE OF THE RESOLUTION OF THE GOVERNMENT OF THE REPUBLIC OF LITHUANIA (NO. 199) “ON THE IMPLEMENTATION OF THE REPUBLIC OF LITHUANIA’S LAW ON THE LIQUEFIED NATURAL GAS TERMINAL” OF 15 FEBRUARY 2012 (WORDING OF 11 JULY 2012) WITH THE CONSTITUTION OF THE REPUBLIC OF LITHUANIA

 

3 April 2015, No. KT10-N6/2015

Vilnius

 

The Constitutional Court of the Republic of Lithuania, composed of the Justices of the Constitutional Court: Elvyra Baltutytė, Vytautas Greičius, Danutė Jočienė, Pranas Kuconis, Gediminas Mesonis, Vytas Milius, Egidijus Šileikis, Algirdas Taminskas, and Dainius Žalimas

The court reporter—Daiva Pitrėnaitė

Advocate Gytis Kaminskas, acting as the representative of a group of members of the Seimas of the Republic of Lithuania, the petitioner

Seimas member Andrius Kubilius acting as the representative of the Seimas of the Republic of Lithuania, a party concerned, in the part of the case subsequent to the petition of a group of members of the Seimas of the Republic of Lithuania, a petitioner, and Dainius Kreivys acting as the representative of the Seimas of the Republic of Lithuania, a party concerned, in the part of the case subsequent to the petitions of the petitioners—the Court of Appeal of Lithuania and the Vilnius Regional Administrative Court

Agnė Amelija Petravičienė, Head of the Law Division of the Ministry of Energy of the Republic of Lithuania, and Dainius Bražiūnas, Head of the Oil and Gas Division of the same ministry, acting as the representatives of the Government of the Republic of Lithuania, a party concerned

The Constitutional Court of the Republic of Lithuania, 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, on 25 February 2015 and 17 March 2015, considered constitutional justice case No. 23/2012-38/2014-54/2014 subsequent to:

1) the petition (No. 1B-32/2012) of the group of members of the Seimas of the Republic of Lithuania, a petitioner, requesting an investigation into whether:

Paragraph 1 of Article 4 of the Republic of Lithuania’s Law on the Liquefied Natural Gas Terminal is not in conflict with Paragraph 1 of Article 46 of the Constitution of the Republic of Lithuania;

Paragraph 2 of Article 5 of the Republic of Lithuania’s Law on the Liquefied Natural Gas Terminal is not in conflict with Article 23 of the Constitution of the Republic of Lithuania;

Paragraphs 1, 2, and 3 of Article 11 of the Republic of Lithuania’s Law on the Liquefied Natural Gas Terminal, insofar as natural-gas enterprises importing natural gas into the Republic of Lithuania through interconnecting and other natural-gas pipelines of the transmission system are under an obligation to purchase, through the Liquefied Natural Gas Terminal, not less than 25 percent of the total natural-gas quantity that such an enterprise supplies to the natural-gas system per year, are not in conflict with Paragraph 1 of Article 23 and Paragraphs 1, 4, and 5 of Article 46 of the Constitution of the Republic of Lithuania;

the provision “the aforesaid natural-gas enterprises may not, on the grounds of agreements concluded after the entry into force of this Law, be under an obligation to pay for the untaken natural-gas quantity imported through interconnecting and other natural-gas pipelines of the transmission system (the so-called ‘take-or-pay’ obligation)” of Paragraph 2 of Article 11 of the Republic of Lithuania’s Law on the Liquefied Natural Gas Terminal, insofar as the obligation referred to in the said provision may not be applied only when paying for the untaken natural-gas quantity imported through interconnecting and other natural-gas pipelines of the transmission system, however, it is applied when paying for the untaken natural-gas quantity imported through the Liquefied Natural Gas Terminal, is not in conflict with Paragraph 1 of Article 29 and Paragraphs 1 and 4 of Article 46 of the Constitution of the Republic of Lithuania;

the Resolution of the Government of the Republic of Lithuania (No. 199) “On the Implementation of the Republic of Lithuania’s Law on the Liquefied Natural Gas Terminal” of 15 February 2012 (wording of 11 July 2012), insofar as the said resolution assents to the implementation of the project of the Liquefied Natural Gas Terminal by the joint-stock company “Klaipėdos nafta” as the company implementing the project of the Liquefied Natural Gas Terminal, is not in conflict with Paragraph 1 of Article 46 of the Constitution of the Republic of Lithuania;

2) the petition (No. 1B-52/2014) of the Vilnius Regional Administrative Court, a petitioner, requesting an investigation into whether Paragraph 2 (wording of 12 June 2012) of Article 5 of the Republic of Lithuania’s Law on the Liquefied Natural Gas Terminal was not in conflict with Paragraph 2 of Article 5, Item 15 of Article 67, and Paragraph 3 of Article 127 of the Constitution of the Republic of Lithuania and the constitutional principle of the separation of powers;

3) the petition (No. 1B-65/2014) of the Court of Appeal of Lithuania, a petitioner, requesting an investigation into whether Paragraph 2 (wording of 12 June 2012) of Article 5 of the Republic of Lithuania’s Law on the Liquefied Natural Gas Terminal was not in conflict with Paragraph 2 of Article 5, Item 15 of Article 67, and Paragraph 3 of Article 127 of the Constitution of the Republic of Lithuania and the constitutional principle of the separation of powers.

By the Constitutional Court’s decision of 18 February 2015, the aforesaid petitions were joined into one case, and it was given reference No. 23/2012-38/2014-54/2014.

The Constitutional Court

has established:

I

1. The petition of the group of members of the Seimas, the petitioner, is substantiated by the following arguments.

1.1. Under Paragraph 1 of Article 4 of the Law on the Liquefied Natural Gas Terminal (hereinafter referred to as the LNG Terminal Law), the project of the liquefied natural gas terminal (hereinafter referred to as the LNG Terminal) is implemented by a state-controlled enterprise (i.e. an enterprise whose shares carrying no less than 2/3 of all votes at a general meeting of the shareholders belong to the state) designated either by the Government or by an institution authorised by it. Such an enterprise is selected without a tender, regardless of whether there are (could be) other companies wishing to build the LNG Terminal. Due to this, the provisions of Paragraph 1 of Article 46 of the Constitution that Lithuania’s economy is based on the right of private ownership, freedom of individual economic activity and initiative are violated.

1.2. Upon the consolidation of the Liquefied Natural Gas Supplement (hereinafter—the LNG Supplement) in Paragraph 2 of Article 5 of the LNG Terminal Law, which is comprised of the costs (part thereof) of the installation of the LNG Terminal, its infrastructure and connection, and of its operation, where such costs are included into a part of the price of the service of the transmission of natural gas, a part of the costs of the LNG Terminal is shifted to all users of the transmission system of natural gas, without taking into account whether they will use the services of the LNG Terminal. This means that property of the payers of the LNG Supplement is taken for the needs of society. Being under an obligation to pay the LNG Supplement, which can mean large amounts of money, the users of the transmission system of natural gas may not freely dispose of their property, thus, essentially, a limitation is placed upon their property. Having recognised that the project of the LNG Terminal is a state project designed for ensuring state functions (for the purpose of national security), it must be financed by state funds, but not by funds of private participants of the natural-gas market and consumers.

Paragraph 2 of Article 5 of the LNG Terminal Law consolidates the duty of the transmission system operator to collect the LNG Supplement from consumers of natural gas, to administer it, and to transfer it to the company in charge of implementing the project of the LNG Terminal. This means that, essentially, a state function has been established for a private economic subject—the transmission system operator, which means the collection, administration, and transfer of the collected funds to the person specified in the law. Due to this, the transmission system operator incurs or may incur additional costs (e.g., the expenditure for bringing lawsuits against persons not paying the LNG Supplement). Paragraph 2 of Article 5 of the LNG Terminal Law provides only the inclusion of the costs (or part thereof) of the installation and operation of the LNG Terminal, its infrastructure and connection into the rate of the transmission service, however, the costs of the transmission system operator related to the commissioning of discharging such a state function are nor provided for. The Constitutional Court has held on more than one occasion that if a person has been commissioned with a state (public) function, a mechanism of financing the discharging of such a function should be established, and that no such legal regulation may be established whereby a continuous duty could be established for non-state-property subjects to use their property in order to discharge the state functions that should be financed from state funds.

1.3. After Article 11 of the LNG Terminal Law had established a duty for natural-gas enterprises to acquire at least 25 percent of the natural gas imported through the LNG Terminal, regardless of the conditions and economic expediency of such acquisition, the participants of the natural-gas market may be forced, on an unlimited basis, to acquire natural gas that is more expensive rather than to acquire the needed amount of natural gas imported through interconnecting or other pipelines. Thus, the funds of the participants of the natural-gas market (the funds that are meant to at least pay for the natural gas that has risen in price) are expropriated by giving exceptional profit for the operator of the LNG Terminal and the suppliers of natural gas through this terminal. Paragraphs 1, 2, and 3 of the Article 11 of the LNG Terminal Law have established a completely unreasonable and disproportionate obligation to buy an established amount of natural gas from another economic subject. Due to the obligation established in Article 11 of the LNG Terminal Law to buy at least 25 percent of the natural gas used from the LNG Terminal, the freedom of choice of consumers is clearly restricted.

1.4. Under Paragraph 2 of Article 11 of the LNG Terminal Law, natural-gas enterprises may not, on the grounds of agreements concluded after the entry into force of this Law, be under an obligation to pay for the untaken natural-gas quantity imported through interconnecting and other natural-gas pipelines of the transmission system (the so-called “take-or-pay” obligation). Such limitation is applied only if gas is imported through interconnecting and other natural-gas pipelines of the transmission system, however, it is not applied if natural gas is imported through the LNG Terminal. The said “take-or-pay” condition that is common in the market in natural-gas supply is assessed differently, by taking account of the infrastructure of the provision of natural gas. Thus, different conditions for the provision of natural gas are created and the principles of the equality of rights, freedom of economic activity, and the ensuring of fair competition are violated.

1.5. The Government Resolution (No. 199) “On the Implementation of the Republic of Lithuania’s Law on the Liquefied Natural Gas Terminal” of 15 February 2012 (wording of 11 July 2012) (hereinafter also referred to as government resolution No. 199 of 15 February 2012) assented to the implementation of the project of the LNG Terminal by the joint-stock company (“JSC”) “Klaipėdos nafta” as the company implementing the project of the LNG Terminal. This means that, by government decision, the JSC “Klaipėdos nafta” was selected without a tender as the company implementing the project of the LNG Terminal, regardless of whether there are (could be) other companies wishing to build the LNG Terminal. Due to this, the provisions of Paragraph 1 of Article 46 of the Constitution that Lithuania’s economy is based on the right of private ownership, freedom of individual economic activity and initiative are violated.

2. The petitions of the petitioners—the Vilnius Regional Administrative Court and the Court of Appeal of Lithuania—are substantiated by the following arguments.

2.1. Paragraph 2 of Article 5 of the LNG Terminal Law consolidates the so-called LNG Supplement—a part of the price of the service of the transmission of natural gas, which is comprised of the costs (part thereof) of the installation and operation of the LNG Terminal, its infrastructure and connection. The LNG Supplement should be regarded as a tax or another obligatory payment, since it meets all features of a tax or another obligatory payment: the LNG Supplement must be paid by all users of the natural-gas system to whom the service of the transmission of natural gas is provided (feature of obligatoriness); the payers of the LNG Supplement do not receive any services either from the administrator of this Supplement or from the company implementing the project of the LNG Terminal (feature of unrequitedness); the LNG Supplement is established by state institutions, without taking account of the will of the payers of this Supplement (feature of one-sidedness); the service of the transmission of natural gas is taxed (feature of a permanent taxable object); the LNG Supplement is calculated as a particular amount of money for sold natural gas and, by means of this Supplement, state functions are financed (feature of a monetary obligation for the state).

It has been held in the Constitutional Court’s jurisprudence that such essential elements of tax as the object of tax, subjects of tax relations, their rights and duties, sizes (rates) of tax, terms of payment, exceptions and concessions, fines and late payment interest should be established by law. Since the LNG Supplement corresponds to all said features of tax, therefore, under Item 15 of Article 67 and Paragraph 3 of Article 127 of the Constitution, its essential elements (its size (rates), terms of payment, exceptions, concessions, fines, late payment interest, etc.) should be established by law. However, neither the LNG Terminal Law nor any other laws establish the essential elements of the LNG Supplement.

2.2. The Seimas has no right to commission the Government or any other institution to implement the constitutional competence of the Seimas. The legislature, by establishing in Paragraph 2 of Article 5 of the LNG Terminal Law that the costs (or part thereof) of the installation and operation of the LNG Terminal may be included in the price for the natural-gas transmission service under procedure and conditions established by the National Commission for Energy Control and Prices, commissioned this institution to establish the essential elements of the LNG Supplement as a tax, i.e. to implement the constitutional function of the legislature itself, and thus violated Paragraph 2 of Article 5 of the Constitution and the constitutional principle of the separation of powers.

II

1. In the course of the preparation of the case for the Constitutional Court’s hearing, written explanations were received from Seimas member Andrius Kubilius (acting as the representative of the Seimas of the Republic of Lithuania, a party concerned, in the part of the case subsequent to the petition No. 1B-32/2012 of a group of members of the Seimas of the Republic of Lithuania, a petitioner) assenting to the arguments set forth by the representatives of the Government, a party concerned—Audinga Galubickienė, the then Head of the Law Division of the Ministry of Energy of the Republic of Lithuania, Agnė Amelija Petravičienė, Acting Deputy Head of the same division, and Laura Rimšaitė, a senior specialist of the same division—regarding the compliance of the impugned provisions of, inter alia, the LNG Terminal Law with the Constitution.

In the opinion of the representatives of the Government, the impugned provisions of the LNG Terminal Law are not in conflict with the Constitution. Their position, which is assented to by Seimas member Andrius Kubilius, is substantiated by the following arguments.

1.1. The regulation entrenched in Paragraph 1 of Article 4 of the LNG Terminal Law does not prohibit the construction of other LNG terminals. Quite to the contrary, upon the implementation of the project of the LNG Terminal, the participants of the natural-gas market will have more economic freedom: an opportunity will be created for the emergence of new importers and suppliers of natural gas, the importers will be able to acquire natural gas on the global market in liquefied natural gas, to make use of the advantages of a competitive market, etc. Even if it were decided that the impugned legal regulation limits freedom of economic activity, such limitation is not in conflict with Paragraph 1 of Article 46 of the Constitution, since freedom of economic activity is not absolute—it may be subject to limitation.

Energy is a strategically important sector for national security, whilst the state should control strategically important objects. It is a common thing to commission the companies that are strategically important to national security to develop and manage a certain energy infrastructure, e.g., the closed-type joint-stock company “Lietuvos energija” is the owner of strategic power plants; the JSC LITGRID is the operator of electricity transmission system; the JSC LESTO is an electricity distribution network operator. All these subjects are and, on the grounds of the Republic of Lithuania’s Law on the Enterprises and Facilities of Strategic Significance to National Security and Other Enterprises of Importance to Ensuring National Security (hereinafter referred to as the Law on Strategic Enterprises), must be controlled by the state. The strategic significance of the LNG Terminal is recognised by the LNG Terminal Law, the Law on Strategic Enterprises, the Republic of Lithuania’s Law on Energy, the Republic of Lithuania’s Law on Natural Gas, the National Energy Strategy as approved by Seimas resolution No. X-1046 of 18 January 2007, and the National Energy Independence Strategy as approved by Seimas resolution No. XI-2133 of 26 June 2012. The Government must exercise control over the company implementing the project of the LNG Terminal so that it could ensure the implementation of this project. By Paragraph 1 of Article 6 of Regulation (EU) No. 994/2010 of the European Parliament and of the Council of 20 October 2010 concerning measures to safeguard security of gas supply and repealing Council Directive 2004/67/EC (hereinafter referred to as Regulation (EU) No. 994/2010 concerning measures to safeguard security of gas supply), Member States are obligated to ensure the capacity of their natural gas infrastructure according to the N-1 standard by 3 December 2014 at the latest. Such a standard requires that Lithuania should have the infrastructure enabling the satisfaction of its natural-gas demand during a disruption of the existing supply. OAO Gazprom (Russia) exerts either direct or indirect influence on most of the enterprises that participate in the natural-gas market, therefore, it is within the interest of these enterprises to secure alternative sources of the provision of natural gas. Thus, in case the state insufficiently controls the company implementing the project of the LNG Terminal (in case it does not hold the shares of this company carrying no less than 2/3 of all votes at a general meeting of the shareholders), such a company could be made, either directly or indirectly, to delay the implementation of the project of the LNG Terminal or to discontinue it at all. Due to this, in seeking to implement the N-1 standard in time and properly, the state has to control the company implementing the project of the LNG Terminal. Since, according to this standard, the LNG Terminal must be built by 3 December 2014 at the latest, the financial situation, available human resources and other capacities of the company implementing the project of the LNG Terminal have to be adequate so that it would be possible to implement the project of crucial state importance within a short time period. Therefore, it was necessary that the Government approved the fact that the project of the LNG Terminal would be implemented by a concrete company whose shares carrying no less than 2/3 of all votes at a general meeting of the shareholders belong to the state. Upon establishing in the LNG Terminal Law that the company implementing the project of the LNG Terminal must be controlled by the state and enjoy approval by the Government, it was sought to ensure the legitimate objectives which are important to society: to implement the project of the LNG Terminal that is important to society, to ensure national security and interests of consumers, and to promote competition in the natural-gas sector.

Legal acts do not contain any requirements for holding a tender in order to select the company implementing the project of the LNG Terminal. The purpose of a tender is to select the best company for the implementation of the project of the LNG Terminal. Under the LNG Terminal Law, only state-controlled subjects, which meet the interests of national security, could be candidates in such a tender. Even though, theoretically, it was possible to establish a requirement for organising a tender in which only state-owned enterprises are allowed to participate, however, such a requirement would have been irrational, it would have taken much more time and, due to this, the implementation of the project of the LNG Terminal and the ensuring of secure provision of natural gas according to the N-1 standard might have fallen behind schedule. In addition, the state has all the information it needs about the enterprises managed by it even without a tender, therefore, a tender would only be an unnecessary formality for the organisation of which the use state funds would not be expedient. The company implementing the project of the LNG Terminal (JSC “Klaipėdos nafta”), even though designated without a tender, is an organisation carrying out procurement, therefore, it carries out public procurement connected with the project of the LNG Terminal (save the exceptions provided for by law). Thus, it is guaranteed that the project of the LNG Terminal be carried out in a transparent manner and with the least possible costs.

1.2. The so-called LNG Supplement consolidated in Paragraph 2 of Article 5 of the LNG Terminal Law is compensation for services, therefore, it is neither expropriation of property nor a limitation on the rights of ownership. This LNG Supplement is established only for the users of the transmission system of natural gas, but not for all residents of Lithuania in general. The LNG Supplement is compensation for services connected with the transmission of natural gas to the system of natural gas. Every service is subject to compensation unless agreed otherwise. Differently from the situation of expropriation of property, this payment must be paid not to the state, but to the operator of the transmission system, and only as long as the transmission system is used. Upon the obligation to pay the LNG Supplement, ownership is not limited, since the payment of the LNG Supplement is a monetary obligation established by the state for the users of the transmission system of natural gas for using this system. Natural gas will be transmitted to the transmission system through the LNG Terminal. The obligation of the users of the system of natural gas to pay for rendered services is provided for in legal acts. Paying for services should not be regarded as a limitation on the right of ownership let alone its expropriation.

Even if ownership is limited by the impugned legal regulation, such limitation is permissible. The ensuring of national energy security is doubtlessly a public interest recognised by the state and protected by law. This is also a common interest of all citizens of the Republic of Lithuania. The installation of the LNG Terminal and its connection with the transmission system of natural gas should be regarded as an inseparable part of the general development of the natural-gas system. The users of the system of natural gas must pay not only for the infrastructure directly used, but also for all the infrastructure of the transmission system of natural gas. The financing of the LNG Terminal by means of the funds of users is necessary in order to ensure national energy security. It would be impossible to implement the project effectively and on time without the LNG Supplement that will be paid by all consumers of natural gas. The inclusion of the LNG Supplement into the price for the transmission service is one of the most optimum financing mechanisms, since the costs fixed in such a way are distributed among all consumers of natural gas in a proportionate manner according to the amount of natural gas delivered to them. In addition, the payment of the LNG Supplement is under the control of the National Commission for Energy Control and Prices which ensures that only justified amounts of money be included into the price for the service and that this price would not become too big unreasonably.

1.3. The rights of ownership of the operator of the transmission system for which the duty is established to administer the funds of the LNG Supplement are not violated. The duty of a private subject to carry out state functions is implied by the social function of ownership. The costs of the operator of the transmission system connected with the commissioning to administer the funds of the LNG Supplement are not directly provided for in Paragraph 2 of Article 5 of the LNG Terminal Law, since the said paragraph provides that the costs (or part thereof) of the installation and operation of the LNG Terminal may be included in the price for the natural-gas transmission service under procedure and conditions established by the National Commission for Energy Control and Prices according to the requirements for regulating energy prices established in the Law on Energy, the Law on Natural Gas, and other legal acts. It is the legal acts of the National Commission for Energy Control and Prices that establish that the costs of administering the funds of the LNG Supplement are included into the LNG Supplement and approve a concrete amount of money for covering these administering costs. Thus, the administering costs of the funds of the LNG Terminal incurred by the private subject are properly compensated.

1.4. Lithuania used to be supplied with natural gas by the sole external supplier. If the 25-percent rule were not consolidated in Article 11 of the LNG Terminal Law, the LNG Terminal would not guarantee the creation of a long-term competitive market. Under conditions of a free and competitive market, the importers and consumers of natural gas might be able to choose the infrastructure through which they would be supplied with natural gas. The 25-percent rule seeks to ensure the implementation and further activity of the LNG Terminal. This rule is necessary for ensuring the minimum technological and economic activity of the LNG Terminal. Paragraph 2 of Article 11 of the LNG Terminal Law provides for the duty to acquire 25 percent of natural gas not only through the LNG Terminal, but also interconnecting pipelines of natural gas. Thus, this ensures that the persons supplying natural gas through interconnecting pipelines and those supplying it through the LNG Terminal would have equal competitive opportunities, i.e., that each of them would have at least 25 percent of the market. The remaining 50 percent of the market would be non-regulated and would depend on the ability of the participants of the market to act under conditions of fair competition. The impugned legal regulation creates an opportunity for importers to choose the infrastructure of the provision of natural gas and a supplier of natural gas, therefore, freedom of economic activity is not limited but, rather, expanded.

Even if freedom of economic activity is limited, the impugned provisions of the LNG Terminal meet all the conditions applied to a constitutionally lawful limitation: the 25-percent rule is necessary in an attempt to implement the project of the LNG Terminal and, thus, to ensure the values consolidated in the Constitution and the constitutionally important objectives (general welfare of the nation, freedom of fair competition, protection of the interests of consumers and energy security); the 25-percent rule is applied both to the existing infrastructure of natural gas and to the new infrastructure—the LNG Terminal. This rule is not absolute: it allows choosing the supplier of the natural gas supplied through the LNG Terminal, concluding exchange transactions, etc.; the constitutional principle of proportionality is observed.

The LNG Terminal will create preconditions for consumers to acquire natural gas for a competitive price established in the global liquefied natural gas market. It is also possible that the price of natural gas supplied from Russia will drop due to competition. Since the National Commission for Energy Control and Prices will carry out the regulation of the price for the services rendered by the operator of the LNG Terminal and other price related to trade in natural gas through the LNG Terminal, the interests of consumers will be ensured and they will not be obliged to acquire natural gas for an unreasonably big price.

1.5. The legal regulation established in Paragraph 2 of Article 11 of the LNG Terminal Law that prohibits the application of the “take-or-pay” condition only to the suppliers that supply natural gas to the Republic of Lithuania through interconnecting and other transmission pipelines of natural gas, however, does not prohibit its application to the suppliers that supply natural gas through the LNG Terminal, is substantiated by the fact that the natural gas imported through natural-gas pipelines is supplied by the sole supplier which is the monopolist in the Lithuanian market. This supplier has the sole power of supplying natural gas in the market, therefore, it can impose the “take-or-pay” condition unilaterally. The different legal regulation in Paragraph 2 of Article 11 of the LNG Terminal Law is established for two groups of persons (economic subjects) whose situation is different with regard to their economic influence and power, experience in the market, and competitive environment. The “take-or-pay” obligation is a legal measure creating an opportunity for a supplier having a dominant or monopolistic position in the market to ensure itself a stable part of the market for a comparatively long period and, thus, to limit the opportunities of competitors to develop their activity. In case this opportunity of the monopolist were not subjected to limitation, it would be impossible to achieve the aims established in the LNG Terminal Law to create a competitive market in the natural-gas sector, which is the basis of the welfare of consumers. The impugned legal regulation is designed for regulating the monopoly, and the “take-or-pay” obligation condition will not be applied to the subjects supplying natural gas to the Lithuanian market through the LNG Terminal. The suppliers operating through the LNG Terminal will be new participants in the Lithuanian market in natural-gas supply, who will compete for buyers (importers) with each other and with the existing monopolist. Being new participants in the market, these subjects will not have negotiation power, nor will they have a significant part of the market, the possibilities of unilateral imposition of contract conditions, and the established business relations. They will have to operate under conditions of a competitive market. The law has reasonably established the prohibition against the application of the “take-or-pay” condition by the suppliers supplying natural gas through natural-gas pipelines, since, in case this prohibition were not established, the conditions would be established for retaining the monopolistic position of the sole supplier of natural gas. Differently from the supplier that supplies natural gas through natural-gas pipelines, the suppliers of natural gas who will supply natural gas through the LNG Terminal will operate in a competitive environment. Differently from the infrastructure of natural-gas pipelines, several competing suppliers will be able to supply natural gas through the LNG Terminal, whilst the importers of natural gas will have an opportunity to acquire, through the LNG Terminal, natural gas proposed by any supplier of natural gas operating in the international market. The established limitation does not restrict the rights of persons to develop the business of supplying natural gas, but, rather, establishes the necessary requirements for the content of agreements in an attempt to limit the opportunities of the persons operating in the market in natural-gas supply to demand that the buyers undertake long-term purchase obligations that limit the rights of the buyers and prevent any possible competition.

2. In the course of the preparation of the case for the Constitutional Court’s hearing, written explanations were received from Seimas member D. Kreivys (representing the Seimas, a party concerned, in the part of the case subsequent to the petition (No. 1B-52/2014) of the Vilnius Regional Administrative Court, a petitioner, and the petition (No. 1B-65/2014) of the Court of Appeal of Lithuania) in which it is asserted that Paragraph 2 (wording of 12 June 2012) Article 5 of the LNG Terminal Law was not in conflict with the Constitution. The position of the representative of the Seimas is substantiated by the following arguments.

2.1. The LNG Supplement as established in Paragraph 2 of Article 5 of the LNG Terminal Law does not have any features of taxes as understood by tax law. The LNG Supplement is not a monetary obligation for the state, but a state-established compulsory payment for the operator of the LNG Terminal—the JSC “Klaipėdos nafta”, which is paid by users under procedure established by the National Commission for Energy Control and Prices when they pay for the service of the transmission of natural gas. Thus, the LNG Supplement is paid not by all natural and legal persons, but only by those who use the service of the transmission of natural gas, it is not paid to the state budget and is used to cover the costs of the LNG Terminal specified in the law.

Tax relations are legal relations of an authoritative character between taxpayers and state executive institutions. Financial, administrative and criminal liability is applied for violations of tax laws. Meanwhile, the users of the system of natural-gas transmission pay the LNG Supplement to the operator of the LNG Terminal through the operator of the system of natural-gas transmission. The National Commission for Energy Control and Prices establishes the size of the LNG Supplement by invoking the principles of the regulation of energy prices. Any unpaid amount of money can be exacted by judicial procedure from the users of the system of natural-gas transmission who failed to pay the LNG Supplement, however, no administrative or criminal liability is applied to such users.

2.2. Investments to the infrastructure are a very important factor in ensuring the security of supply of natural gas. The costs of the LNG Terminal that are covered by the funds of the LNG Supplement collected from the users are costs incurred by a private economic subject (the operator of the LNG Terminal) which are nationalised in a similar manner as in the case of interconnecting pipelines. The nationalisation of the costs of the LNG Supplement is based on the public interest. The main purpose of the LNG Terminal is to ensure the security of the supply of natural gas. However, in order that the LNG Terminal could help the state reach this objective, it is necessary to create the conditions for the company implementing the project of the LNG Terminal so that it could implement its rights and carry out its duties in a more efficient manner. As held by the European Commission, without the LNG Supplement and the purchase obligation, the LNG Terminal would not be competitive or viable, there would be a funding gap and the investment would not be realised. Without the aid, the terminal project would not materialise and deliver its contribution to ensure the security of supply.

2.3. Several objective factors determine the nationalisation of the costs of the LNG Terminal. The fact that the sources of natural-gas supply have not been diversified is in essence the main cause of the big price for natural gas. The big price for natural gas has also been influenced by the fact that competition in the wholesale and retail markets in natural-gas supply is essentially impossible, since all natural gas is supplied from the same source, i.e. there is a monopoly in the market in external natural-gas supply due to which the Lithuanian consumers of natural gas have to acquire natural gas for exorbitant prices. The big price of natural gas exerts a negative influence not only on individual consumers, but also the entire economy of Lithuania, since the big prices of energy resources directly influence a bigger cost price of goods produced and services rendered in Lithuania and exerts a negative impact on the purchasing power of households. Under such circumstances, the nationalisation of the costs of the LNG Terminal by including the price of the transmission of natural gas into such costs is in line with the interests of the state and society, as well as the interests of the persons (e.g., consumers of heat produced by burning natural gas) who pay either directly or indirectly this component of the price for the transmission of natural gas.

The LNG Terminal together with the LNG Supplement will be of triple benefit. First, the LNG Terminal will ensure the security and reliability of the transmission of natural gas, since this is an alternative source of natural-gas supply, which, in case of necessity, could even be used by such users of natural gas that receive it only through pipelines from OAO Gazprom. Second, the LNG Terminal will enable ensuring the diversification of the sources of natural-gas supply and eliminate the dependence on the sole external supplier of natural gas. Third, the LNG Terminal will promote competition in the natural-gas sector, because the preconditions will be created for forming the market in natural gas, in which there will be new importers of natural gas, whilst the existing participants in the market will have an opportunity to choose the supplier of natural gas. With the introduction of competition in the natural-gas market, the price of natural gas will drop and this will be useful for the persons who use natural gas either directly or indirectly, and, alongside, for the state and entire society.

2.4. Not only investment costs, but also activity costs should be covered with the funds collected through the LNG Supplement. The compensation for the operator of the LNG Terminal for these costs is substantiated by the fact that the state commissions the operator of the LNG Terminal to discharge the service—to operate the LNG Terminal—that meets the public interest. The European Commission also recognised that the commission to install the LNG Terminal and to operate it is a task meeting services of general economic interest.

2.5. Thus, from the viewpoint of law, the LNG Supplement may not be regarded as a tax or another compulsory payment, since it does not have any features characteristic of taxes. The LNG Supplement is one from among the measures creating the preconditions for ensuring that all substantiated costs of the installation and operation of the LNG Terminal incurred by the economic subject implementing an economic project of state importance will be covered. This helps achieving the main objective—to ensure the security of the transmission of natural gas. This objective is a part of state policy, this policy should not necessarily be financed from taxes collected by the state, and it may be pursued by inducing economic subjects to implement projects that are important for the state. The costs of the installation and operation of the LNG Terminal that are covered by consumers of natural gas by paying for the transmission of natural gas are not and may not be regarded as an object of a state tax.

3. It has been mentioned that, in the course of the preparation of the case for the Constitutional Court’s hearing, written explanations were received from the representatives of the Government A. Galubickienė, A. A. Petravičienė, V. Greičiuvienė, and L. Rimšaitė. It is maintained in the explanations that government resolution No. 199 of 15 February 2012, insofar as it assents to the implementation of the project of the LNG Terminal by the JSC “Klaipėdos nafta” as the company implementing the project of the LNG Terminal, is not in conflict with Paragraph 1 of Article 46 of the Constitution. The position of the representatives of the Government is substantiated by the following arguments.

3.1. The impugned government resolution assenting to the implementation of the project of the LNG Terminal by the JSC “Klaipėdos nafta” as the company implementing the project of the LNG Terminal does not establish either any limitations on the respective economic activity or any prohibitions on constructing similar LNG terminals. The Government selected the company implementing the project of the LNG Terminal by following the requirements established for such a company by the LNG Terminal Law and by taking into account the abilities of such a company to implement the project of the LNG Terminal. Legal acts had not established any requirement for holding a tender for the selection of the company implementing the project of the LNG Terminal.

3.2. The JSC “Klaipėdos nafta” was the only and most suited company for implementing the project of the LNG Terminal. At the time of the adoption of the LNG Terminal Law and the impugned government resolution, the JSC “Klaipėdos nafta” already was a company of strategic importance for national security, whose two-thirds of the shares were owned by the state, i.e. it met the requirements established in the LNG Terminal Law and the Law on Strategic Enterprises. The JSC “Klaipėdos nafta” had already finished the preparation work for the implementation of the project of the LNG Terminal, therefore, it was most efficient to commission it to carry on with the project. In addition, the JSC “Klaipėdos nafta” operates in Klaipėda State Seaport which was regarded as the most realistic place for building the LNG Terminal, its activity is analogous to that of the LNG Terminal—the JSC “Klaipėdos nafta” runs a petroleum products transhipment terminal (the LNG Terminal will carry out the activity of “transfer” (regasification) of natural gas). Thus, the JSC “Klaipėdos nafta” had appropriate experience and the most suitable staff for implementing the project of the LNG Terminal. In addition, the JSC “Klaipėdos nafta” was financially capable of implementing this project. At the time when it was assented to the implementation of the project of the LNG Terminal by the JSC “Klaipėdos nafta”, there were no other subjects who would clearly express their wish to become the company implementing the project of the LNG Terminal.

4. It should be noted that, by means of the Ordinance of the Prime Minster of the Republic of Lithuania (No. 37) “On the Representation at the Constitutional Court of the Republic of Lithuania” of 24 February 2015, A. A. Petravičienė, Head of the Law Division of the Ministry of Energy, and D. Bražiūnas, Head of the Oil and Gas Division of the same ministry, were appointed for representing the Government, a party concerned, in this constitutional justice case.

III

In the course of the preparation of the case for the Constitutional Court’s hearing, written opinions were received from Deividas Kriaučiūnas, Director General of the Department of European Law under the Ministry of Justice of the Republic of Lithuania, and Diana Korsakaitė, Chair of the National Commission for Energy Control and Prices.

IV

1. At the Constitutional Court’s hearing, the advocate G. Kaminskas, acting as a representative of a group of members of the Seimas, the petitioner, virtually reiterated the arguments set forth in the petition, provided additional explanations, and answered the questions. At the Constitutional Court’s hearing, the representative of a group of members of the Seimas G. Kaminskas reiterated the request of the group of members of the Seimas that the Constitutional Court apply to the Court of Justice of European Union for a preliminary ruling in the constitutional justice case at issue.

2. At the Constitutional Court’s hearing, Seimas members A. Kubilius and D. Kreivys, the representatives of the Seimas, a party concerned, virtually reiterated the arguments set forth in their written explanations for the Constitutional Court, provided additional explanations, and answered the questions.

3. At the Constitutional Court’s hearing, A. A. Petravičienė, a representative of the Government, a party concerned, virtually reiterated the arguments set forth in her written explanations for the Constitutional Court, provided additional explanations, and answered the questions

The Constitutional Court

holds that:

I

1. A group of members of the Seimas, the petitioner, requests an investigation into whether, inter alia, Paragraphs 1, 2, and 3 of Article 11 of the LNG Terminal Law, insofar as natural-gas enterprises importing natural gas into the Republic of Lithuania through interconnecting and other natural-gas pipelines of the transmission system are under an obligation to purchase, through the Liquefied Natural Gas Terminal, not less than 25 percent of the total natural-gas quantity that such an enterprise supplies to the natural-gas system per year, are not in conflict with Paragraph 1 of Article 23 and Paragraphs 1, 4, and 5 of Article 46 of the Constitution.

A group of members of the Seimas, the petitioner, also requests an investigation into whether the provision “the aforesaid natural-gas enterprises may not, on the grounds of agreements concluded after the entry into force of this Law, be under an obligation to pay for the untaken natural-gas quantity imported through interconnecting and other natural-gas pipelines of the transmission system (the so-called ‘take-or-pay’ obligation)” of Paragraph 1 of Article 29 of the Law on the Liquefied Natural Gas Terminal, insofar as the obligation referred to in the said provision may not be applied only when paying for the untaken natural-gas quantity imported through interconnecting and other natural-gas pipelines of the transmission system, however, it is applied when paying for the untaken natural-gas quantity imported through the Liquefied Natural Gas Terminal, is not in conflict with Paragraph 1 of Article 29 and Paragraphs 1 and 4 of Article 46 of the Constitution.

1.1. On 12 June 2012, the Seimas adopted the Law on the Liquefied Natural Gas Terminal. Paragraphs 1, 2, and 3 (an investigation into whose compliance with the Constitution is requested by a group of members of the Seimas, the petitioner) of Article 11 “Trade in Natural Gas” of this law, prescribed:

1. In an attempt to ensure the necessary activity of the LNG Terminal, i.e., the technological capacity of the LNG Terminal required in order to satisfy the need for natural gas in the Republic of Lithuania on a permanent basis and in an efficient manner, also, in an attempt to guarantee the technological and economic soundness of the activity of the LNG Terminal and to promote an effective competitiveness of diversified sources of the supply of natural gas, the total amount of natural gas imported through the LNG Terminal and consumed in the internal natural-gas market of the Republic of Lithuania must comprise not less than 25 percent of the total natural-gas quantity consumed in the Republic of Lithuania per year.

2. Natural-gas enterprises importing natural gas into the Republic of Lithuania through the LNG Terminal and through interconnecting and other natural-gas pipelines of the transmission system (separately by each such a way) must acquire the percentage amount of the total natural-gas quantity that such an enterprise supplies to the natural-gas system per year, where such an amount is not lesser as one established in Paragraph 1 of this Article. Taking into account the principles of legitimate expectations, proportionality, the public interest, and the adjustment of private interests, the Government shall establish the procedure for the implementation of this obligation. Such natural-gas enterprises may not, on the grounds of agreements concluded after the entry into force of this Law, be under an obligation to pay for the untaken natural-gas quantity imported through interconnecting and other natural-gas pipelines of the transmission system (the so-called ‘take-or-pay’ obligation).

3. The Commission shall establish the ceiling of the price of the natural gas imported through the LNG Terminal and consumed in the internal natural-gas market of the Republic of Lithuania, whose quantity must comprise not less than 25 percent of the total natural-gas quantity consumed per year in the Republic of Lithuania. The Commission shall approve the methods for calculating the ceiling of the price of such natural gas.”

Thus, Paragraphs 1, 2, and 3 of Article 11 (wording of 12 June 2012) of the LNG Terminal Law established the legal regulation governing the compulsory purchase of natural gas from the LNG Terminal whereby, in an attempt to ensure the necessary activity of the LNG Terminal, the minimum quantity of the natural gas imported through the LNG Terminal and consumed in the internal natural-gas market of the Republic of Lithuania had to comprise not less than 25 percent of the total natural-gas quantity consumed in the Republic of Lithuania per year, whilst natural-gas enterprises importing natural gas into the Republic of Lithuania through interconnecting and other natural-gas pipelines of the transmission system were obligated to purchase, through the LNG Terminal, not less than 25 percent of the total natural-gas quantity that such enterprises supplied to the natural-gas system per year; such natural-gas enterprises could not, on the grounds of agreements concluded after the entry into force of this Law, be under an obligation to pay for the untaken natural-gas quantity imported through interconnecting and other natural-gas pipelines of the transmission system (the so-called “take-or-pay” obligation).

1.2. On 27 June 2013, the Seimas adopted the Republic of Lithuania’s Law Amending Articles 5, 10, and 11 of the Law on the Liquefied Natural Gas Terminal that came into force on 16 July 2013 (with a certain exception), by which it amended Article 11 (wording of 12 June 2012) of the LNG Terminal Law and set it forth in its new wording.

Article 11 “Trade in Natural Gas” (wording of 27 June 2013) of the LNG Terminal Law prescribes:

1. In an attempt to ensure the necessary activity of the LNG Terminal, i.e., the technological capacity of the LNG Terminal required in order to satisfy the need for natural gas in the Republic of Lithuania on a permanent basis and in an efficient manner, also, in an attempt to guarantee the technological and economic soundness of the activity of the LNG Terminal and to promote an effective competitiveness of diversified sources of the supply of natural gas, the natural gas imported through the LNG Terminal must be supplied by priority for ensuring the state-regulated production of electricity and/or heat. The Government shall approve the minimum annual quantity of natural gas subject to regasification needed for ensuring the necessary activity of the LNG Terminal. The quantity of liquefied natural gas declared by either the operator or the company of the LNG Terminal which is reasonably required in order to maintain a stable technological regasification process at the LNG Terminal under minimum uninterrupted operation regime (hereinafter—the minimum required quantity of the LNG Terminal) shall be deemed to be such minimum annual quantity.

2. The implementation of the obligation established in Paragraph 1 shall be ensured by a designated supplier according to the requirements established in this Law and by the Government. The Ministry of Energy shall designate by tender a designated supplier under procedure established by the Government. An enterprise, whose shares carrying no less than 2/3 of all votes at a general meeting of the shareholders belong, either directly or indirectly, to the state, may be a designated supplier. The designated supplier may not engage in activity connected with the transmission and/or distribution of energy. In addition, other activity of the designated supplier, its management and organisational structure may not be in conflict with the activity requirements for separation and independence in the sector of natural gas. The designated supplier is deemed to be an enterprise of strategic importance to national security.

3. Once the operation of the LNG Terminal has started, the producers of electricity and/or heat among which the supported-electricity-production quantities are distributed under procedure and conditions established by means of legal acts and the price of energy produced by which is regulated by the state (hereinafter—the producers of energy), must ensure the supply of the natural gas used to produce electricity and/or heat under the following procedure:

1) the quantity of natural gas imported through the LNG Terminal corresponding to the required quantity for the LNG Terminal as specified in Paragraph 1 of this Article, is supplied by priority according to the agreements concluded with the designated supplier, on the grounds of which energy producers commission the designated supplier to purchase, according to valid legal acts, the liquefied natural gas and the natural gas regasified at the LNG Terminal in order to satisfy the demand of the producers of energy; taking account of the demand of the producers of energy for natural gas every particular year, such quantity of natural gas is distributed among the producers of energy under procedure and conditions established by the Government. The agreements shall be concluded with the designated supplied for a five-year period or, by agreement of the parties, for a longer period;

2) upon the implementation of the requirement established in Item 1 of this Paragraph, in order to satisfy the remaining demand of the producers of energy for natural gas, natural gas is supplied, while following the principle of economic expediency, on the grounds of bilateral agreements with suppliers of natural gas or is acquired in the exchange. The producers of energy carry out natural gas procurements under procedure and conditions established in legal acts;

3) if the producers of energy and other persons engaged in the production of electricity and/or heat wish so, upon the assessment of the requirement established in Item 1 of this Paragraph, the supply of the entire quantity of natural gas used for the production of electricity and/or heat is ensured by the designated supplier on the grounds of agreements concluded with it; by such agreements, the producers of energy grant the powers to the designated supplier to procure liquefied natural gas and/or natural gas for ensuring the demand of the producers of energy for natural gas.

4. In estimating the demand for natural gas and co-ordinating the schedule of the supply of natural gas according to agreements concluded with other suppliers of natural gas, the producers of energy ensure proper adherence to the agreements specified in Item 1 of Paragraph 3 of this Article and do not conclude any new agreements violating the compulsory requirement on the supply of the natural gas imported by priority though the LNG Terminal.

5. If the supply of the entire quantity of natural gas used for the production of electricity and/or heat is ensured by the designated supplier on the grounds of agreements concluded with it as specified in Item 3 of Paragraph 3 of this Article, the designated supplier carries out the balancing of the use of natural gas by the respective producer of energy. If the remaining demand of the producers of energy for natural gas is ensured in the manner provided for in Item 2 of Paragraph 3 of this Article, the producer of energy ensures itself the balancing of its use of natural gas.

6. The Commission approves the methods for calculating the price for natural gas sold by the designated supplier to the producers of energy. The Commission coordinates the price calculated by the designated supplier and the applicable price for this natural gas by taking account of the components of the price established in the methods for calculation and by taking into consideration the application of the said components. The price for natural gas sold by the designated supplier is deemed, upon the co-ordination with the Commission, to be justified costs of the acquisition of fuel by the producers of energy and subject to inclusion into the state-regulated prices for energy applicable to them.

7. The Commission, by invoking the Rules of Supervision over the Trade in Natural Gas approved by it, exercises supervision and control over the proper implementation of the requirements established in this Article. In order to discharge the functions commissioned for it, the Commission has the right to receive information from state institutions, establishments, and organisations, as well as form energy enterprises, about the import of natural gas to the Republic of Lithuania and quantities of natural gas acquired from different sources, also other related information required for an assessment of the actual diversification of the supply of natural gas in the natural-gas market of the Republic of Lithuania.

8. The requirements established in this Article are deemed to be a compulsory condition for the regulated activity in the energy sector. Fines may be imposed on energy enterprises under procedure and conditions established in the Law on Energy for failure to carry out the said condition and for other related violations of the regulated activity in the energy sector. The Government additionally assesses, under procedure and conditions established by means of legal acts, the proper fulfilment of the requirement established in Paragraph 1 of this Article, by approving the persons providing the services in the electricity sector that meet the public interests and by distributing, among the producers of energy, the supported amounts of the production of electricity.

9. The period of the application of the obligation established in Paragraph 1 of this Article, which may not be longer than the initial period of the operation of the LNG Terminal, i.e. 10 years from the beginning of the operation of the LNG Terminal, is established by the Government. By government decision, the fulfilment of this obligation may be suspended or discontinued prior to the end of this period, if the Commission, upon the co-ordination with the Ministry of Energy, submits the conclusion to the Government that the natural-gas market of the Republic of Lithuania is sufficiently developed and integrated so that, under conditions of an effective competitive market, the diversified supply and consumption of natural gas, the security and reliability of the supply of energy, and the protection of the interests of consumers would be ensured. The Commission assesses these circumstances by preparing annual accounts of the monitoring of the market in natural gas.

10. The prices for services rendered by the operator of the LNG Terminal are regulated under procedure established in the Law on Natural Gas. The prices for liquefaction may be differentiated for groups of users of the LNG Terminal by applying mutatis mutandis the provisions of Paragraph 14 of Article 9 of the Law on Natural Gas. The Commission carries out the regulation of prices in the sector of natural gas.”

Thus, Article 11 (wording of 27 June 2013) of the LNG Terminal Law establishes the legal regulation governing the compulsory purchase of natural gas from the LNG Terminal, according to which, in an attempt to ensure the necessary activity of the LNG Terminal, for a period of no longer than 10 years from the beginning of the operation of the LNG Terminal, in order to ensure the state-regulated production of electricity and/or heat, the natural gas imported through the LNG Terminal, whose annual quantity is approved by the Government, must be supplied by priority. The producers of electricity and/or heat among which the supported-electricity-production quantity is distributed under procedure and conditions established by means of legal acts and the price of the energy produced by which is regulated by the state must acquire this minimum annual amount of regasified natural gas in order to ensure that they are supplied with the natural gas used to produce electricity and/or heat.

1.3. The comparison of the legal regulation established in Paragraphs 1, 2, and 3 of Article 11 (wording of 12 June 2012) of the LNG Terminal Law with the legal regulation established in Article 11 (wording of 27 June 2013) of the same law that is valid at present makes it clear that this legal regulation has been changed as regards, inter alia, the aspect impugned by a group of members of the Seimas, the petitioner:

it has been prescribed that, in an attempt to ensure the necessary activity of the LNG Terminal, for a period of no longer than 10 years from the beginning of the operation of the LNG Terminal, the natural gas imported through the LNG Terminal, whose annual quantity is approved by the Government, must be acquired by the producers of electricity and/or heat only for the purpose of ensuring the state-regulated production of electricity and/or heat;

this article no longer contains the provision that the quantity of the natural gas imported through the LNG Terminal and consumed in the internal natural-gas market of the Republic of Lithuania must comprise not less than 25 percent of the total natural-gas quantity consumed per year in the Republic of Lithuania;

this article no longer contains the provisions that natural-gas enterprises importing natural gas into the Republic of Lithuania through interconnecting and other natural-gas pipelines of the transmission system are under an obligation to purchase, through the LNG Terminal, not less than 25 percent of the total natural-gas quantity that such enterprises supply to the natural-gas system per year, and that such natural-gas enterprises may not, on the grounds of agreements concluded after the entry into force of this law, be under an obligation to pay for the untaken natural-gas quantity imported through interconnecting and other natural-gas pipelines of the transmission system (the so-called “take-or-pay” obligation).

It should be noted that, upon the amendment of Article 11 (wording of 12 June 2012) of the LNG Terminal Law, the legal regulation that used to be prescribed in Paragraphs 1, 2, and 3 of this article has not been moved to the other paragraphs of the same article (wording of 27 June 2013) or other articles of this law.

1.4. Thus, upon the entry into effect of the Law Amending Articles 5, 10, and 11 of the Law on the Liquefied Natural Gas Terminal that was adopted by the Seimas on 27 June 2013, there were changes in the content of the legal regulation (the compliance of which with the Constitution is impugned to the specified extent by a group of members of the Seimas, a petitioner) established in Paragraphs 1, 2, and 3 of Article 11 (wording of 12 June 2012) of the LNG Terminal Law.

It should be noted that, in the constitutional justice case at issue, the constitutionality of the legal regulation established in Article 11 (wording of 27 June 2013) of the LNG Terminal Law is not impugned.

1.5. Paragraph 4 (wording of 11 July 1996) of Article 69 of the Law on the Constitutional Court provides that the annulment of the impugned legal act shall be grounds for adopting the decision to dismiss the instituted legal proceedings.

In its acts, the Constitutional Court has held on more than one occasion that the formulation “shall be grounds for dismissing the instituted legal proceedings” of Paragraph 4 of Article 69 of the Law on the Constitutional Court should be interpreted as establishing the Constitutional Court’s right, in cases when subjects other than courts, specified in Article 106 of the Constitution, have applied to the Constitutional Court, and the impugned legal act (part thereof) is no longer effective—it is judged to be no longer valid (annulled or amended) or its validity has ended, to dismiss the instituted legal proceedings by taking account of the circumstances of the case at issue (inter alia, the Constitutional Court’s rulings of 28 March 2006, 22 December 2011, and 2 May 2012).

1.6. In the light of the foregoing arguments, the Constitutional Court must dismiss the part of this constitutional justice case subsequent to the petition of a group of members of the Seimas, a petitioner, requesting an investigation into whether:

Paragraphs 1, 2, and 3 of Article 11 (wording of 12 June 2012) of the LNG Terminal Law, insofar as natural-gas enterprises importing natural gas into the Republic of Lithuania through interconnecting and other natural-gas pipelines of the transmission system are under an obligation to purchase, through the Liquefied Natural Gas Terminal, not less than 25 percent of the total natural-gas quantity that such an enterprise supplies to the natural-gas system per year, were not in conflict with Paragraph 1 of Article 23 and Paragraphs 1, 4, and 5 of Article 46 of the Constitution;

the provision “the aforesaid natural-gas enterprises may not, on the grounds of agreements concluded after the entry into force of this Law, be under an obligation to pay for the untaken natural-gas quantity imported through interconnecting and other natural-gas pipelines of the transmission system (the so-called ‘take-or-pay’ obligation)” of Paragraph 2 of Article 11 (wording of 12 June 2012) of the LNG Terminal Law, insofar as the obligation referred to in the said provision may not be applied only when paying for the untaken natural-gas quantity imported through interconnecting and other natural-gas pipelines of the transmission system, however, it is applied when paying for the untaken natural-gas quantity imported through the Liquefied Natural Gas Terminal, was not in conflict with Paragraph 1 of Article 29 and Paragraphs 1 and 4 of Article 46 of the Constitution.

II

1. A group of members of the Seimas, a petitioner, also requests an investigation into whether Paragraph 1 of Article 4 of the LNG Terminal Law is not in conflict with Paragraph 1 of Article 46 of the Constitution, and whether Paragraph 2 (wording of 12 June 2012) of Article 5 of the same law was not in conflict with Article 23 of the Constitution.

The petitioners—the Vilnius Regional Administrative Court and the Court of Appeal of Lithuania—request an investigation into whether Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law was not in conflict with Paragraph 2 of Article 5, Item 15 of Article 67, and Paragraph 3 of Article 127 of the Constitution and the constitutional principle of the separation of powers.

2. A group of members of the Seimas, a petitioner, also requests an investigation into whether government resolution No. 199 of 15 February 2012 (wording of 11 July 2012) insofar as it assents to the implementation of the project of the LNG Terminal by the JSC “Klaipėdos nafta” as the company implementing the project of the LNG Terminal, is not in conflict with Paragraph 1 of Article 46 of the Constitution.

Although a group of members of the Seimas, a petitioner, requests an investigation into the compliance of the entire specified extent of government resolution No. 199 of 15 February 2012 (wording of 11 July 2012) with the Constitution, it is clear from the petition that that the petitioner doubts whether Item 1 of this government resolution is not in conflict with Paragraph 1 of Article 46 of the Constitution. The said item prescribes: “To assent to the implementation of the project of the Liquefied Natural Gas Terminal by the joint-stock company ‘Klaipėdos Nafta’ as the company implementing the project of the Liquefied Natural Gas Terminal.”

3. Thus, in view of what has been stated above, in the constitutional justice case at issue, subsequent to the petitions of the petitioners—a group of members of the Seimas, the Vilnius Regional Administrative Court, and the Court of Appeal of Lithuania—the Constitutional Court will investigate whether:

Paragraph 1 of Article 4 of the LNG Terminal Law is not in conflict with Paragraph 1 of Article 46 of the Constitution;

Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law was not in conflict with Paragraph 2 of Article 5, Article 23, Item 15 of Article 67, and Paragraph 3 of Article 127 of the Constitution and with the constitutional principle of the separation of powers;

Item 1 of government resolution No. 199 of 15 February 2012 (wording of 11 July 2012) is not in conflict with Paragraph 1 of Article 46 of the Constitution.

III

1. In the course of the interpretation of the impugned legal regulation established in the LNG Terminal Law, it is important to reveal the situation in the Lithuanian sector of natural gas at the time of the adoption of the LNG Terminal Law, as well as the intentions of the legislature recorded in the travaux préparatoires of the LNG Terminal Law and in the preamble to this law.

1.1. The National Energy Strategy as approved by the Seimas Resolution (No. X-1046) “On the Approval of the National Energy Strategy” of 18 January 2007 stipulated in its Item 9, inter alia, that one of the weaknesses of Lithuania’s energy sector was natural gas prices, which depended on a monopolist supplier and were growing substantially, and the absence of any actual competition in the gas market. The same item also pointed out that a new LNG terminal in the Baltic region would substantially reduce dependence on the single source of natural gas from Russia. Item 13 thereof specified that the construction of an LNG terminal was one of the major tasks in seeking to implement the strategic objectives of Lithuania in the energy sector. It should be noted that this task is also established in the National Energy Independence Strategy as approved by the Seimas Resolution (No. XI-2133) “On the Approval of the National Energy Independence Strategy” of 26 June 2012. Item 79 of the said strategy names LNG Terminal as a priority project of the gas sector in order to decrease natural gas prices and to create the natural-gas market.

It is clear from the explanatory note to the draft LNG Terminal Law that, in the absence of any LNG terminal, the sole source of the natural gas used in the internal market of the Republic of Lithuania was the natural gas of OAO Gazprom imported via interconnecting pipelines of natural gas through the Republic of Belarus, that the monopolistic position of the said sole external supplier of natural gas determined not only the absence of the readiness of the system of the natural gas of the Republic of Lithuania to ensure the capacity of the natural gas infrastructure according to the N-1 standard as established in EU law acts (i.e. such technical capacity of the infrastructure of natural gas to satisfy total demand for natural gas in the territory of a state during a disruption of the operation of the largest infrastructure of natural gas during a day of exceptionally high natural-gas demand) and the complete energy dependence of the state on the sole supplier, but also the unilateral pricing of natural gas that had directly determined the general increase in the prices of natural gas, electricity and heat consumed in the Republic of Lithuania, as well as a general price increase.

1.2. The preamble to the LNG Terminal Law specifies, inter alia, that the LNG Terminal Law was adopted in the implementation of the strategic objectives and tasks of the state energy policy, by following the priority of the national security of the state and in view of the public interests in the sector of natural gas and the needs of the protection of such interests, and in an attempt to create the conditions for the technological and commercial alternatives of the supply of natural gas, which enhance the security and reliability of the supply of natural gas, and to promote the development of a competitive and integrated market in natural gas.

Tt is clear from the explanatory note to the draft LNG Terminal Law that the LNG Terminal Law, inter alia, seeks to increase the energy independence of the Republic of Lithuania from the sole external supplier of natural gas, to promote competition in the natural-gas market, and to remove the preconditions for unilateral establishment of the price for the import of natural gas.

1.3. Thus, summing up, it should be held that, in the absence of any LNG terminal, natural gas used to be supplied to the Republic of Lithuania by the sole external supplier, whilst its monopolistic position in the market in natural-gas supply used to exert a decisive influence on the prices of natural gas; by adopting the LNG Terminal Law, the legislature sought to implement the strategic objectives of the state energy policy, to take into account the public interests in the sector of natural gas and the needs for their protection, to reduce the dependence on the said sole external supplier of natural gas, to promote competition in the natural-gas market, to create the preconditions for the reduction of prices for natural gas and to create the conditions for technological and commercial alternatives of the supply of natural gas, as well as to enhance the security and reliability of providing consumers with natural gas.

2. On 12 June 2012, the Seimas adopted the Law on the Liquefied Natural Gas Terminal that came into force on 19 June 2012. Paragraph 1 of Article 1 titled “The Purpose and Objective of the Law” provides: “This Law establishes the general principles and requirements of the installation of a terminal of liquefied natural gas in the territory of the Republic of Lithuania and of its activity and operation, and creates the legal, financial and organisational conditions for the implementation of the project of a terminal of liquefied natural gas.”

Paragraph 2 of Article 2 “Main Definitions Used in This Law” of the LNG Terminal Law provides that the LNG Terminal is the entirety of energy-purpose structures and facilities, including the floating natural-gas storage unit, through which liquefied natural gas is imported to and offloaded in the Republic of Lithuania, and through which additional services could be rendered, which are required for the process of the regasification of liquefied natural gas and its subsequent supply to the system of the transmission of natural gas. According to Paragraph 1 of Article 2 of the LNG Terminal Law, the floating natural-gas storage unit means a tank ship used as a natural-gas storage unit with regasification facilities built and operated according to the requirements applied to ships if this class and the requirements established in the state where this ship is registered, and other requirements.

Under Paragraph 2 of Article 3 “Decision on the LNG Terminal” of the LNG Terminal Law, the LNG Terminal and the connection of the LNG Terminal, which is defined in Paragraph 4 of Article 2 of this law as a natural-gas pipeline, through which natural gas from the LNG Terminal is supplied to the system of the transmission of natural gas, are deemed to be facilities of strategic significance for national security, whilst, according to Paragraph 3 of Article 3 of the same law, the project of the LNG Terminal is deemed to be an economic project of special state importance.

Thus, the LNG Terminal Law regulates the general principles and requirements for the installation of the LNG Terminal—a facility deemed to be an economic project of special state importance and of strategic significance for national security, through which liquefied natural gas is imported to and offloaded in the Republic of Lithuania, and through which additional services could be rendered, which are required for the process of the regasification of liquefied natural gas and its subsequent supply to the system of transmission of natural gas—in the territory of the Republic of Lithuania, and the general principles and requirements for its activity and operation. In addition, by means of the said law, an attempt is made to create the legal, financial and organisational conditions for the implementation of the project of the LNG Terminal.

3. As mentioned before, in the constitutional justice case at issue, the Constitutional Court investigates whether, inter alia, Paragraph 1 of Article 4 of the LNG Terminal Law is not in conflict with the Constitution. Paragraph 1 of Article 4 “The Implementation of the Project” of the LNG Terminal Law prescribes: “Subsequent to a decision of the Government or an institution authorised by it, the project is implemented by a company implementing the project (hereinafter—the company), whose shares carrying no less than 2/3 of all votes at a general meeting of the shareholders belong to the state.”

Thus, under Paragraph 1 of Article 4 of the LNG Terminal Law, the Government or an institution authorised by it has the right to decide which company, whose shares carrying no less than 2/3 of all votes at a general meeting of the shareholders belong to the state, should implement the project of the LNG Terminal.

3.1. The legal regulation established in Paragraph 1 of Article 4 of the LNG Terminal Law should be interpreted in the context of the other provisions of the same law.

3.1.1. Paragraph 2 of Article 1 of the LNG Terminal Law prescribes: “This Law establishes the special legal regulation applicable to the project of the LNG Terminal implemented subsequent to a decision of the Government of the Republic of Lithuania (hereinafter—the Government) or an institution authorised by it.” Paragraph 3 of Article 1 of the LNG Terminal Law provides that the Law on Natural Gas and other laws regulating the activity of individual energy sectors are applicable to the legal relations arising on the basis of the LNG Terminal Law insofar as such laws are not in conflict with the latter law. Paragraph 1 of Article 3 of the LNG Terminal Law provides that the LNG Terminal and the infrastructure of natural gas ensuring its effective operation must be installed in the territory of the Republic of Lithuania and that the LNG Terminal should be installed in the territory of Klaipėda State Seaport.

Thus, under the special legal regulation consolidated in the LNG Terminal Law, subsequent to a decision of the Government or an institution authorised by it, a company, whose shares carrying no less than 2/3 of all votes at a general meeting of the shareholders belong to the state, implements the project of the LNG Terminal in Klaipėda State Seaport.

3.1.2. Paragraph 6 of Article 2 of the LNG Terminal Law defines the project of the LNG Terminal as a project including the design, the procurement of facilities and technologies, the development and installation of the infrastructure of the terminal, the connection of the terminal to the system of the transmission of natural gas, and other related work prior to the beginning of the operation of the terminal. As mentioned before, under Paragraph 2 of Article 3 of the LNG Terminal Law, the LNG Terminal and the connection of the LNG Terminal are deemed to be facilities of strategic significance for national security, whilst, according to Paragraph 3 of the same article, the project of the LNG Terminal is deemed to be an economic project of special state importance.

Paragraph 2 of Article 4 of the LNG Terminal Law provides that the company implementing the project of the LNG Terminal carries out the work of the development and installation of the infrastructure of the LNG Terminal or ensures that such work is finished prior to the connection of the LNG Terminal to the system of the transmission of natural gas and the beginning of its operation under procedure established by means of legal acts. Under Paragraph 1 of Article 7 “The Development and Installation of the Infrastructure of the LNG Terminal” of the LNG Terminal Law, the company implementing the project of the LNG Terminal either carries out or ensures the work of the development and installation of the LNG Terminal and the connection of the LNG Terminal until the connection point of the LNG Terminal to the system of the transmission of natural gas, whilst, according to Paragraph 3 of this article, the operator of the transmission system either carries out or ensures the work of the connection of the LNG Terminal to the system of natural gas, i.e. the preparation of the main pipeline of natural gas, including the installation of the pipeline(s) and the ensuring of the required capacity, the development and renewal of the system of the transmission of natural gas, and other work related with the integration of the LNG Terminal into the system of natural gas for joint activity.

Paragraph 2 of Article 7 of the LNG Terminal Law provides that the company implementing the project of the LNG, while following the requirements established in legal acts and normative technical documents, adopts decisions on the development and installation of the LNG Terminal and of the connection of the LNG Terminal, including decisions on the acquisition of the LNG facilities and/or technology by right of ownership or on other grounds of lawful management or disposal, or, in order to ensure the activity of the LNG Terminal, and on the acquisition of the right to use the required liquefied-natural-gas facilities or technology by means of an agreement with the provider of such facilities or technology.

Paragraph 1 of Article 14 “The Implementation of the Law” of the LNG Terminal Law provides that, making use of the rights granted to it and carrying out the duties commissioned to it, the Government ensures a proper implementation of the legal, technical and organisational conditions so that the operation of the LNG Terminal might be started by 3 December 2014 at the latest as specified in Paragraph 1 of Article 6 of Regulation (EU) No. 994/2010 concerning measures to safeguard security of gas supply.

3.1.3. Thus, if Paragraph 1 of Article 4 of the LNG Terminal Law, whose compliance with the Constitution is investigated in the constitutional justice case at issue, is interpreted in the context of the other specified provisions of this law, it should be noted that the company implementing the project of the LNG Terminal:

subsequent to a decision of the Government (or an institution authorised by it), implements the project of the LNG Terminal deemed to be an economic project of state importance, where the LNG Terminal itself is deemed to be that of strategic significance for national security;

in implementing the project of the LNG Terminal, in Klaipėda State Seaport, performs the work of the development and installation of the infrastructure of, or ensures the installation of the infrastructure of the LNG Terminal, which must be integrated in the system of natural gas for joint activity and performs other related work until the connection of the LNG Terminal to the system of the transmission of natural gas and the beginning of its operation, i.e., by 3 December 2014 at the latest.

In the context of the constitutional justice case at issue, it should be noted that, under the aforesaid legal regulation established in the LNG Terminal Law, the LNG Terminal should be integrated in the system of natural gas for joint activity, thus, it is a constituent part of the system of natural gas.

3.2. Paragraph 1 of Article 4 of the LNG Terminal Law, whose compliance with the Constitution is investigated in the constitutional justice case at issue, should also be interpreted in the context of other laws.

3.2.1. Paragraph 1 titled “The Purpose of the Law” of the Republic of Lithuania’s Law on the Basics of National Security that was adopted by the Seimas on 19 December 1996 prescribes that this law shall establish the basics of ensuring the national security of Lithuania listed in the appendix to this law.

In the context of the constitutional justice case at issue, the following provisions of Chapter 4 “Principal Provisions of Lithuania’s Domestic Policy Aimed at Ensuring National Security” (wording of 19 February 2004) of the Appendix to the Law on the Basics of National Security should be mentioned:

– “The sectors of the Lithuanian economy which are of strategic importance to national security shall be: energy <…>”;

– “Seeking to ensure the protection of interests of national security, the Government shall, in compliance with the requirements set by European Union law, submit to the Seimas for approval by law the objects of strategic importance to national security which must belong to the State by right of ownership and the objects in which, and the conditions under which, a proportion of the capital may be held by a private national and foreign capital meeting the criteria of European and trans-Atlantic integration provided the power of decision is retained by the State <...>”;

– “The Government shall be in charge of the development of alternative energy sectors, including <…> ensuring the sources of fuel and raw materials necessary for national security and independent of the monopolist supplier as well as ensure the accumulation of the fuel stock required for the safeguarding of interests of national security in the event of crises. Provision of energy supplies may not be placed under the control of the subjects of the supplying countries. The foreign investments which meet the criteria of European and trans-Atlantic integration shall receive preferential treatment.”

Thus, under this legal regulation established in the Law on the Basics of National Security, the energy sector is an economic sector of Lithuania that is of strategic importance to national security; provision of energy supplies may not be placed under the control of the subjects of the supplying countries; the Government is in charge of ensuring the sources of fuel and raw materials necessary for national security and independent of the monopolist supplier; the objects of strategic importance to national security must belong to the State by right of ownership or a proportion of the capital in such objects may be held by a private national and foreign capital meeting the criteria of European and trans-Atlantic integration provided the power of decision is retained by the state.

3.2.2. The Law on Strategic Enterprises (wording of 21 June 2012), inter alia, prescribes:

– “The following enterprises in which the capital may be held by the private national and foreign persons conforming to the national security interests, provided the power of decision is retained by the State, shall be of strategic importance to national security: <…> 8) joint-stock company “Klaipėdos nafta”; <...> 11) the company implementing the project of a liquefied natural gas terminal” (Paragraph 1 of Article 4);

– “In this Law, the power of decision of the State shall mean that, in the enterprises indicated in Paragraph 1 of this Article, the State directly or through other companies controlled thereby must hold over 1/2 of the voting shares in these enterprises” (Paragraph 3 of Article 4);

– “‘Enterprises and facilities of strategic <…> importance to national security’ shall mean enterprises that are located or incorporated in the Republic of Lithuania, designed or constructed facilities that in accordance with their purpose and/or nature of operations are assigned strategic <…> importance to national security by this Law and which due to protection of essential national security interests are subject to conditions and requirements regarding property or management or any other rights of the enterprises and facilities <...>” (Paragraph 4 of Article 2);

– “‘National security interests’ shall mean protection of the independence and sovereignty of the State, European and trans-Atlantic integration, reduction of threats and risks for the energy and other economic sectors of vital importance to public security” (Paragraph 1 of Article 2);

– “<…> the liquefied natural gas terminal <…> shall be of particular strategic importance to national security” (Paragraph 1 of Article 6);

– “The Government and state institutions, when adopting decisions and concluding agreements, holders of shares owned by the State, when making decisions, concluding agreements and exercising the rights of shareholders of <…> the company implementing the project of a liquefied natural gas terminal <…> to the extent of the shares belonging to the State by right of ownership, shall ensure that: 1) <...> the company implementing the project of a liquefied natural gas terminal <…> efficiently and in accordance with [its] functional purpose contribute[s] to the implementation of the principal task of the power (energy) system of the Republic of Lithuania, namely to provide Lithuanian consumers with <…> natural gas under the most favourable economic conditions for an unlimited period of time and in an independent, safe and reliable manner” (Paragraph 2 of Article 6).

Thus, according to these provisions of the Law on Strategic Enterprises, the state must hold over 1/2 of the voting shares of the company implementing the project of the LNG Terminal as the enterprise of strategic importance to national security, whilst the remaining portion of the shares of the company may belong to private national or foreign subjects who meet the interests of national security.

It should be noted that, under the LNG Terminal Law, the state must hold the shares of the company implementing the project of the LNG Terminal carrying no less than 2/3 of all votes at a general meeting of the shareholders, whilst, according to the Law on Strategic Enterprises, the state must hold over 1/2 of the voting shares of this company. It should also be noted that that, in the discussed aspect, the LNG Terminal Law is a lex specialis vis-à-vis the Law on Strategic Enterprises.

3.2.3. The Republic of Lithuania’s Law on Companies regulates, inter alia, the adoption of decisions at a general meeting of shareholders of a company by a qualified majority of votes.

Paragraph 1 (wording of 11 December 2003 together with its supplement of 15 December 2011) of Article 28 “Decisions Taken by a Qualified Majority Vote” of the Law on Companies provides, inter alia, that the general meeting of shareholders shall take the following decisions by a qualified majority vote that must be not less than 2/3 of all the votes carried by the shares held by the shareholders attending the meeting: to amend the articles of association of the company (Item 1); to determine the class, number, nominal value and the minimum issue price of the shares issued by the company (Item 2); to distribute profit/loss (Item 5); to increase the authorised capital (Item 9); to reduce the authorised capital (Item 10); to reorganise or spin off the company or approve the terms of the reorganisation or spin-off of the company (Item 11); to liquidate the company and cancel the company’s liquidation (Item 14). It should be noted that, under Paragraph 1 (wording of 15 December 2011) of Article 20 “Powers of the General Meeting of Shareholders” of the Law on Companies, decisions on the aforesaid issues are assigned to the exceptional powers of a general meeting of shareholders.

If the legal regulation established in Paragraph 1 of Article 4 of the LNG Terminal Law is interpreted in conjunction with the legal regulation established in Paragraph 1 (wording of 15 December 2011) of Article 20 and Paragraph 1 (wording of 11 December 2003 together with its supplement of 15 December 2011) of Article 28 of the Law on Companies, it should be noted that, in the company implementing the project of the LNG Terminal, the state holds the number of shares in a general meeting of shareholders of this company enabling it to adopt the decisions within the exceptional powers of a general meeting of shareholders by a not less than a 2/3 qualified majority vote. Thus, by stipulating, in Paragraph 1 of Article 4 of the LNG Terminal Law, that the state must hold the number of shares carrying no less than 2/3 votes at a general meeting of the shareholders of the company implementing the project of the LNG Terminal, it was attempted to ensure that the state should have a decisive majority of votes at a general meeting of the shareholders of this company in order to decide the most important issues of managing it.

4. As mentioned before, in the constitutional justice case at issue, the Constitutional Court investigates, inter alia, whether Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law is not in conflict with the Constitution. Paragraph 2 (wording of 12 June 2012) of Article 5 “Financing the Project” of the LNG Terminal Law prescribed:

1. The development and installation of the infrastructure of the LNG Terminal are financed by the company’s own funds and/or borrowed funds.

2. The installation and operating costs (or part thereof) of the LNG terminal, its infrastructure and connection may be included in the price for the natural-gas transmission service under procedure and conditions established by the National Commission for Energy Control and Prices (hereinafter referred to as the Commission), by following the requirements for regulating energy prices as established in the Law on Energy, the Law on Natural Gas and other legal acts. The costs made up of the price for the natural-gas transmission service and revenues shall be administered and compensated for the LNG terminal operator by the natural-gas transmission system operator (hereinafter referred to as the transmission system operator) under procedure established by the Commission.

3. Funds from the support by the European Union and other legally-obtained finances may be used for financing the project. The measures ensuring the financing of the project (state guarantee, pledge, hypothecation and other measures) may be applied under procedure established by means of legal acts. A decision on issuing a state guarantee on a loan for financing the implementation of the project is adopted under procedure established in the Republic of Lithuania’s Law on State Debt.”

Thus, Article 5 of the LNG Terminal Law provides for the following sources of financing the project of the LNG Terminal: the own funds of the company implementing the project of the LNG Terminal; the borrowed funds of the company implementing the project of the LNG Terminal; the part of the price for the service of the transmission of natural gas comprised of the costs (part thereof) of the installation and operation of the LNG Terminal, its infrastructure and connection (so-called the LNG Supplement); funds from the support by the European Union; other legally-obtained finances.

Consequently, the LNG Supplement established in Paragraph 2 of Article 5 of the LNG Terminal Law is one of the sources of financing the project of the LNG Terminal.

4.1. The legal regulation established in Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law whereby the costs (part thereof) of the installation of the LNG Terminal, its infrastructure and connection, and of its operation may be included in the price for the service of the transmission of natural gas should be interpreted within the context of the LNG Terminal Law.

4.1.1. Paragraph 1 of Article 7 “The Development and Installation of the Infrastructure of the LNG Terminal” of the LNG Terminal Law provides that the company implementing the project of the LNG Terminal carries out and ensures the work of the development and installation of the LNG Terminal and the connection of the LNG Terminal until the connection point of the LNG Terminal to the system of the transmission of natural gas, whilst, under Paragraph 1 of Article 9 “The Operation of the LNG Terminal” of the same law, the operator of the LNG Terminal operates the LNG Terminal and the connection of the LNG Terminal by ensuring, under procedure established in legal acts, a safe and reliable functioning of the facilities of liquefied natural gas within the established requirements for the operation, supervision, and security of facilities of liquefied natural gas.

Thus, under this legal regulation consolidated in the LNG Terminal Law, the company implementing the project of the LNG Terminal and the operator of the LNG Terminal are subjects with independent functional purposes: the company implementing the project of the LNG Terminal installs or ensures the instalment of the LNG Terminal, whilst the operator of the LNG Terminal operates this terminal by ensuring its safe and reliable functioning.

4.1.2. If the legal regulation established in Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law, whose compliance with the Constitution is under investigation in the constitutional justice case at issue, is interpreted in the context of Paragraph 1 of Article 7 and Paragraph 1 of Article 9 of the same law, it should be noted that the costs (part thereof) of the company implementing the project of the LNG Terminal related to the installation of the LNG Terminal, its infrastructure and connection, as well as the costs (part thereof) of the operator of the LNG Terminal related to the operation of the LNG Terminal, its infrastructure and connection by ensuring a safe and reliable functioning of this terminal, may be included into the price of the service of the transmission of natural gas.

4.1.3. Consequently, under the legal regulation established in Paragraph 2 of Article 5 if the LNG Terminal Law, the company implementing the project of the LNG Terminal that is responsible for the installation of the LNG Terminal that must be connected to the system of the transmission of natural gas, is the recipient of the income received from the part of the price for the service of the transmission of natural gas, which is comprised of the costs (part thereof) of the installation of the LNG Terminal, its infrastructure and connection; the operator of the LNG Terminal that is responsible of the operation of this terminal is the recipient of the income received from the part of the price for the service of the transmission of natural gas, which is comprised of the costs (part thereof) of the operation of the LNG Terminal, its infrastructure and connection; the operator of the system of the transmission of natural gas is the administrator of the said income.

4.2. As mentioned before, Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law used to prescribe, inter alia, that the costs (or part thereof) of the installation and operation of the LNG Terminal may be included in the price for the natural-gas transmission service under procedure and conditions established by the National Commission for Energy Control and Prices according to the requirements for regulating energy prices established, inter alia, in the Law on Energy and the Law on Natural Gas. Therefore, in interpreting Paragraph 2 of Article 5 of the LNG Terminal Law, it is necessary to take into account the provisions of the Law on Energy and the Law on Natural Gas consolidating, inter alia, the requirements for regulating energy prices.

4.2.1. The Law on Energy (wording of 22 December 2011), inter alia, prescribes:

– “For the purposes of this Law, natural gas shall also be regarded as energy” (Paragraph 12 of Article 2);

– “‘Energy activities’ shall mean economic activities including surveillance, extraction, processing, production, storage, transportation, transmission, distribution, supply, trading, and marketing of energy sources or energy and/or operation of energy facilities and installations” (Paragraph 11 of Article 2);

– “The following bodies shall, within their respective remit, be in charge of the management, regulation, supervision and control of energy activities in the Republic of Lithuania: <...> 5) the National Commission for Energy Control and Prices (hereinafter: the ‘Commission’); <...>” (Paragraph 2 of Article 4);

– “The Commission shall perform the following functions: <...> 2) it approves the methodologies of setting state regulated prices, sets state-regulated prices and price caps; <…> 7) it estimates the costs of rendered services when setting state-regulated prices, subject to reasonable returns on investments; <…>” (Paragraph 9 of Article 8);

– “Energy enterprises engaged in the activity with regulated prices must coordinate planned investments with the Commission. Where such investments of the energy enterprises are not coordinated with the Commission, they may not be deemed justifiable for the review of prices regulated by the State” (Paragraph 3 of Article 15);

– “In the energy sector, prices shall be contract-based and state-regulated. Prices shall be regulated when approving the prices of services or energy or setting price caps or establishing a procedure for regulating prices. <...>” (Paragraph 1 of Article 19);

– “When setting state-regulated prices, the necessary costs of extraction of energy sources, energy production, purchase, transmission, distribution, supply <…> must be provided for, the reasonable return on investment and/or return on equity must be evaluated, account may also be taken of the development of the energy sector and energy efficiency, and provision of services meeting public interest” (Paragraph 2 of Article 19);

– “‘Services meeting public interest’ shall mean the services meeting public interest provided by energy enterprises in the cases specified by law under delegation of the Government of the Republic of Lithuania with a view to implementing the strategic goals of state energy, economic and/or environmental protection policy in the energy sector and defending legitimate public interests” (Paragraph 32 of Article 2).

Summing up these provisions of the Law on Energy, it should be held that, in establishing the state-regulated prices for energy, inter alia, for natural gas, it is permitted to take into account the development of the energy sector and the provision of services meeting public interest with a view to implementing the strategic goals of, inter alia, state energy policy in the energy sector and protecting legitimate public interests. In this context, it should be noted that the project of the LNG Terminal is being carried out in an attempt to implement the strategic goals of state energy policy in the energy sector and to protect the interests of the entire society, inter alia, the interests of consumers of natural gas, therefore, the installation and operation of this LNG Terminal, which, as mentioned before, is a constituent part of the system of natural gas, should be treated as the provision of services meeting public interests within the meaning of Paragraph 32 of Article 2 of the Law on Energy (wording of 22 December 2011).

Thus, if the legal regulation established in Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law is interpreted in the context of Paragraph 32 (wording of 22 December 2011) of Article 2 and Paragraph 2 of Article 19 of the Law on Energy, it should be noted that the part of the price for the service of the transmission of natural gas comprised of the costs (part thereof) of the installation and operation of the LNG Terminal, its infrastructure and connection is the state-regulated price for natural gas that is established by taking into consideration the installation and operation of the LNG Terminal as the provision of services meeting public interests.

4.2.2. It should be noted that Article 2 (wording of 22 December 2011) of the Law on Energy has been amended and supplemented on more than one occasion, inter alia, the numerical order of its paragraphs has been changed, however, the content of the cited legal regulation established in the paragraphs, inter alia, Paragraph 32 (wording of 22 December 2011), of Article 2 of the same law has not changed.

4.2.3. Paragraph 1 of Article 1 “The Purpose of the Law” of the Law on Natural Gas (wording of 30 June 2011) provides, inter alia, that this law lays down the rules relating to the organisation and functioning of the natural-gas sector and the supply of natural gas to the market.

Paragraph 24 of Article 2 “Definitions” of the Law on Natural Gas prescribes: “‘Natural-gas system’ means any main pipelines, distribution pipelines, liquefied-natural-gas facilities and/or natural-gas storage facilities owned and/or managed by a natural-gas enterprise, including its line-pack facilities and its facilities supplying ancillary services and those of related enterprises necessary for providing access to the transmission, the distribution, and the liquefied-natural-gas system.”

Paragraph 50 (wording of 30 June 2011) of Article 2 of the Law on Natural Gas prescribes: “‘Liquefied-natural-gas system’ means a terminal used for the liquefaction of natural gas, importation, offloading, and regasification of liquefied natural gas, including ancillary services and temporary storage facilities necessary for the regasification process and subsequent delivery to the transmission system, but not including any part of liquefied natural gas terminals used for storage of natural gas. The liquefied-natural-gas system (hereinafter: ‘the LNG system’) shall also be referred to as liquefied-natural-gas facilities (hereinafter: ‘the LNG facilities’).”

Thus, according to these provisions of the Law on Natural Gas, the LNG Terminal is a constituent part of the natural-gas system.

4.2.4. Paragraph 1 of Article 1 “The Purpose of the Law” of the Law on Natural Gas (wording of 30 June 2011) provides, inter alia, that this law lays down the relations linked with the transmission of natural gas.

4.2.4.1. Under Paragraph 8 of Article 2 of the Law on Natural Gas, transmission of natural gas is one of the services by natural-gas enterprises rendered to users of the natural-gas system and to consumers of natural gas. “Natural-gas system user” means a person who has signed an agreement with a natural-gas system operator and supplies natural gas to or is supplied from the system (Paragraph 26 of Article 2), whilst “natural-gas consumer” means a person that purchases natural gas (Paragraph 38 of Article 2).

Paragraph 13 of Article 2 of the Law on Natural Gas provides that “natural-gas transmission” means the transport of natural gas through a network, which mainly contains high-pressure pipelines, other than an upstream pipeline network and other than the part of high-pressure pipelines primarily used in the context of local distribution of natural gas, with a view to its delivery to consumers, but not including supply.

Under Paragraph 14 of Article 2 of the Law on Natural Gas, “natural-gas transmission system” means high-pressure pipelines and facilities, including gas-distribution stations, for the transmission of gas from enterprises and liquefied-natural-gas systems to natural-gas storage facilities, distribution pipelines or gas-consuming facilities, also structures and means ensuring the functioning of these pipelines; the transmission system is also referred to as a main pipeline.

Paragraph 15 of Article 2 of the Law on Natural Gas provides that the “natural-gas transmission system operator” means a person who, on the territory indicated in their licence, engages in the activity of transmission and is responsible for operating, ensuring the maintenance of, and, if necessary, developing the transmission system in a given area and its interconnections with other systems, and for ensuring the long-term ability of the system to meet reasonable demands for the transport of natural gas.

4.2.4.2. Thus, under the legal regulation specified in the Law on Natural Gas, the service of the transmission of natural gas is the service of the transportation of natural gas (as a rule, by means of high-pressure pipelines) rendered by the operator of the system of the transmission of natural gas to users of the natural-gas system and to consumers, where the rendition of such a service requires the use of the system of the transmission of natural gas designed for transmitting natural gas, inter alia, from the LNG system, which, as mentioned before, is a constituent part of the natural-gas system, to natural-gas storage units, distribution pipelines or facilities using natural gas.

4.2.5. The Law on Natural Gas (wording of 30 June 2011) also regulates the requirements related with the regulation of the price for natural gas.

4.2.5.1. Under Item 5 of Article 3 “Principles of Regulation of Activities in the Natural-Gas Sector” of the Law on Natural Gas, state management, regulation, supervision and control of activities in the natural-gas sector shall be based on the availability to consumers and sufficiency of natural gas for an economically reasonable price and the protection of the rights and legitimate interests of vulnerable groups of consumers.

Paragraph 1 of Article 9 “Price Regulation” of the Law on Natural Gas prescribes that, in the natural-gas sector, the National Commission for Energy Control and Prices shall regulate the prices of transmission, distribution, liquefaction, storage and guaranteed supply services by setting price caps.

Under Paragraph 4 of Article 9 of the Law on Natural Gas, by fixing the regulated prices referred to, inter alia, in Paragraph 1 of this article, the National Commission for Energy Control and Prices shall:

set requirements for natural-gas enterprises with regard to the provision of services for cost-based prices, including reasonable return on investment, and shall have the right to request the natural-gas enterprises to provide evidence of cost-orientation of prices; the Commission shall have the right to set a mandatory reasonable time limit for such cost-orientation; where a person fails to provide evidence of cost-orientation, such costs of the person shall be considered unreasonable (Item 1);

set requirements for cost accounting systems, methods and/or models designed for the provision of specific types of services (Item 2);

establish a mechanism for the coverage of costs intended to promote effectiveness and increase the long-term benefit for customers in the best possible manner (Item 3).

Paragraph 5 of Article 9 of the Law on Natural Gas provides, inter alia, that, while setting regulated price caps on services or specific prices of services, as referred to in Paragraph 1 of this article, necessary investments must be envisaged to ensure effective operation of natural-gas enterprises.

Paragraph 16 of Article 9 of the Law on Natural Gas provides, inter alia, that specific transmission, liquefaction, storage and distribution prices, which are kept below the set price caps, shall be fixed by natural-gas enterprises on an annual basis; having verified and determined that prices and/or tariffs set for household consumers are calculated in breach of the requirements for setting prices and/or tariffs laid down in methodologies for the calculation of set price caps and that they discriminate customers and/or are false, the National Commission for Energy Control and Prices shall give instructions to natural-gas enterprises in relation to the calculation of specific prices and tariffs.

4.2.5.2. As mentioned before, one of the requirements for the regulation of natural gas is the requirement to render cost-oriented services (Item 1 of Paragraph 4 of Article 9 of the Law on Natural Gas).

Item 2 of Paragraph 1 of Article 7 “Functions and Duties of the Commission in the Natural-Gas Sector” of the Law on Natural Gas provides that the National Commission for Energy Control and Prices shall supervise the costs of regulated activities of natural-gas enterprises. Under Item 2 of Paragraph 2 of Article 19 “Preparation and Publication of Technical Rules and Methodologies” of the Law on Natural Gas, in adopting the rules, criteria and methodologies implementing this law, the National Commission for Energy Control and Prices invokes, inter alia, the criteria of reasonableness, justice, fairness, objectivity and cost orientation.

Paragraph 1 of Article 44 of the Law on Natural Gas provides, inter alia, that natural-gas enterprises shall keep separate accounts for each of their activities of natural-gas transmission, liquefaction, distribution, and storage, as well as supply for non-household and household consumers. Under Paragraph 1 of Article 7 of the Law on Natural Gas, in the natural-gas sector, the National Commission for Energy Control and Prices shall supervise the unbundling of accounts with a view to avoiding cross-subsidies (Item 5), and the absence of cross-subsidies between transmission, distribution, storage, liquefaction and supply activities (Item 13).

4.2.5.3. Thus, under the specified legal regulation established in the Law on Natural Gas, the price for transmitting natural gas is a state-regulated price that is established by taking into account the costs of the operator of the system of natural-gas transmission, the cost-orientation of which is under supervision of the National Commission for Energy Control and Prices. The account-keeping of the activity of the operator of the system of natural-gas transmission must be separated from the account-keeping of the activity of other kinds (natural-gas liquefaction, distribution, storage, supply) so as to avoid cross-subsidies between the activities of natural-gas transmission, distribution, storage, liquefaction and supply.

4.2.6. If the legal regulation established in Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law, whose compliance with the Constitution is investigated in this constitutional case, is interpreted in conjunction with the afore-discussed legal regulation established in the Law on Natural Gas, it should be noted that the part of the price of the service of the transmission of natural gas, which is comprised of the costs (part thereof) of the installation and operation of the LNG Terminal, its infrastructure and connection (the so-called LNG Supplement), is a constituent part of the state-regulated price for natural gas; this LNG Supplement is established for all recipients of the service of the transmission of natural gas (users of the natural-gas transmission system and consumers of natural gas) in an effort to cover not the costs (part thereof) of the activity of natural-gas transmission, but the costs (part thereof) of the installation of the LNG Terminal, its infrastructure and connection, and of its operation, where such costs must be justified and separated from the costs of the natural-gas transmission activity.

Thus, in pursuance of the requirements established in the Law on Natural Gas for the regulation of prices for natural gas, which are referred to by Paragraph 2 of Article 5 of the Law on Natural Gas, the part of the price of the service of the transmission of natural gas, which is comprised of the costs (part thereof) of the installation and operation of the LNG Terminal, its infrastructure and connection (the so-called LNG Supplement) is established as a separate part of the state-regulated price for natural gas based not on the costs (part thereof) of the activity of natural-gas transmission, bust on the costs (part thereof) of the installation of the LNG Terminal, its infrastructure and connection, and of its operation.

4.3. On 27 June 2013, the Seimas adopted the Republic of Lithuania’s Law Amending Articles 5, 10, and 11 of the Law on the Liquefied Natural Gas Terminal that came into force on 16 July 2013 (with a certain exception), by which it amended Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law and set it forth as follows: “The costs of the installation of the LNG Terminal, its infrastructure and connection, whose financing is impossible from any other sources available for the company, and all the routine costs of the operation of the LNG Terminal, its infrastructure and connection required for ensuring the activity of the LNG Terminal, shall be included, under procedure established by the National Commission for Energy Control and Prices (hereinafter—the Commission), into the additional natural-gas-transmission-security component of the price for the transmission of natural gas (hereinafter—the additional component). Under procedure established by the Commission, the operator of the natural-gas transmission system (hereinafter—the operator of the transmission system) shall collect and administer the additional component and shall pay it to the operator of the LNG Terminal or the enterprise.”

In comparing the legal regulation established in Paragraph 2 (wording of 27 June 2013) of Article 5 of the LNG Terminal Law with that established in Paragraph 2 (wording of 12 June 2012) of Article 5 of the same law in the aspects that are important in the constitutional justice case at issue, it should be noted that the content of the legal regulation established in the said paragraph insofar as it consolidates the so-called LNG Supplement as one of the sources for financing the project of the LNG Terminal, regardless of the partially amended terminology, has remained unchanged. It should also be noted that, both according to Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law and Paragraph 2 (wording of 27 June 2013) of Article 5 of the same law, the so-called LNG Supplement was (and is) a constituent part of the state-regulated price for natural gas. It should be mentioned that, after the said amendments had been made, the purpose of the LNG Supplement remained the same.

5. It has been mentioned that, under the legal regulation established in the LNG Terminal Law, the project of the LNG Terminal is implemented by a decision of the Government or an institution authorised by it. As mentioned before, in the constitutional justice case at issue, the Constitutional Court investigates the constitutionality of, inter alia, Item 1 of government resolution No. 199 of 15 February 2012 (wording of 11 July 2012), which assents to the implementation of the project of the LNG Terminal by the JSC “Klaipėdos nafta” as the company implementing the project of the LNG Terminal.

5.1. On 15 February 2012, the Government adopted the Resolution (No. 199) “On the Installation of a Terminal of Liquefied Natural Gas” that came into force on 29 February 2012. Item 1 of the said resolution prescribed: “To assent to the installation, in the territory of the Republic of Lithuania, of a terminal of liquefied natural gas for the importation, offloading, and regasification of liquefied natural gas and/or for rendering additional services, including temporary storage required for carrying out the process of regasification and further supply to the natural-gas transmission system, by the JSC ‘Klaipėdos nafta’ as the company implementing the project of the LNG Terminal.”

It is clear from the material of the preparation of the sitting of the Government, in which government resolution No. 199 of 15 February 2012 was adopted, that it was proposed to assent to the fact that the implementation of the project of the LNG Terminal will be carried out by the JSC “Klaipėdos nafta” as the company implementing the project of the LNG Terminal after an assessment of an effective management of this enterprise, its financial stability, its high-qualification specialists, the most progressive technologies applied by it, and the preparatory work done by it regarding the project of the LNG Terminal. In this context, it should be noted that, by its Resolution (No. 1097) “On the Development of the Project of a Natural-Gas Terminal” of 21 July 2010, the Government assented to the preparation of the project of the LNG Terminal by the joint-stock company “Klaipėdos Nafta” (Item 1).

It should be noted that it is clear from the preamble to government resolution No. 199 of 15 February 2012 that this government resolution was adopted by invoking, inter alia, Item 7 of Paragraph 1 of Article 4 of the Law on Strategic Enterprises (wording of 21 July 2009), according to which the joint-stock company “Klaipėdos Nafta” is strategically important to national security. Thus, upon the Government’s assent to the installation of the LNG Terminal by the joint-stock company “Klaipėdos Nafta” as the company implementing the project of the LNG Terminal, the joint-stock company “Klaipėdos Nafta” had (and has) a special legal status—it was deemed by law to be an enterprise that is strategically important to national security.

5.2. On 11 July 2012, the Government adopted the Resolution (No. 864) “On Amending the Resolution of the Government of the Republic of Lithuania (No. 199) ‘On the Installation of a Terminal of Liquefied Natural Gas’ of 15 February 2012” whereby it amended government resolution No. 199 of 15 February 2012 and set it forth in its new wording by stipulating in Item 1 thereof: “To assent to the implementation of the project of the Liquefied Natural Gas Terminal by the joint-stock company ‘Klaipėdos Nafta’ as the company implementing the project of the Liquefied Natural Gas Terminal.” It is clear from the preamble to government resolution No. 199 of 15 February 2012 (wording of 11 July 2012) that this government resolution is designed for the implementation of, inter alia, Paragraph 1 of Article 4 of the LNG Terminal Law by which, by a decision of the Government or an institution authorised by it, the project of the LNG Terminal is implemented by the a company implementing the project of the LNG Terminal, whose shares carrying no less than 2/3 of all votes at a general meeting of the shareholders belong to the state.

The comparison of the legal regulation established in Item 1 (wording of 15 February 2012) of government resolution No. 199 of 15 February 2012 with one established in government resolution No. 199 of 15 February 2012 (wording of 11 July 2012) makes it clear that the legal regulation regarding the aspect important in the constitutional justice case at issue has not changed, i.e., the Government assents to the implementation of the project of the LNG Terminal by the joint-stock company “Klaipėdos Nafta” as the company implementing the project of the LNG Terminal. It should be noted that government resolution No. 199 of 15 February 2012 (wording of 11 July 2012) the constitutionality of Item 1 whereof is investigated in the constitutional justice case at issue is designed for the implementation of the LNG Terminal Law.

5.3. Government resolution No. 199 of 15 February 2012 (wording of 11 July 2012) has been amended and/or supplemented on more than one occasion, however, Item 1 thereof, whose constitutionality is investigated in the constitutional justice case at issue, has not changed.

IV

1. The Annex “Implemented Acts of the European Union” of the LNG Terminal Law indicates Directive 2009/73/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in natural gas and repealing Directive 2003/55/EC (hereinafter referred to as Directive 2009/73/EC concerning common rules for the internal market in natural gas) and Regulation (EU) No 994/2010 of the European Parliament and of the Council of 20 October 2010 concerning measures to safeguard security of gas supply. In addition, Paragraph 1 of Article 14 “The Implementation of the Law” of the LNG Terminal Law provides, inter alia, that the Government ensures a proper implementation of the legal, technical and organisational conditions so that the operation of the LNG Terminal might be started by 3 December 2014 at the latest as specified in Paragraph 1 of Article 6 of Regulation (EU) No. 994/2010 concerning measures to safeguard security of gas supply. Thus, the LNG Terminal Law, the constitutionality of the provisions of which is under investigation in the constitutional justice case at issue, was adopted in order to implement, inter alia, the respective provisions of EU legal acts.

2. Paragraph 1 of Article 194 of the Treaty on the Functioning of the European Union (hereinafter referred to as the TFEU) provides, inter alia, that, in the context of the establishment and functioning of the internal market, Union policy on energy shall aim to ensure security of energy supply in the Union and to promote the interconnection of energy networks. Thus, ensuring the security of energy supply and promoting the interconnection of energy networks are among the most important aims of Union policy on energy.

2.1. The aforesaid Regulation (EU) No 994/2010 of 20 October 2010 concerning measures to safeguard security of gas supply, inter alia, prescribes:

– “Where the security of supply of a Member State is threatened, there is a clear risk that measures developed unilaterally by that Member State may jeopardise the proper functioning of the internal gas market and the supply of gas to customers. Recent experience has demonstrated the reality of that risk” (Recital 5);

– “The diversification of gas routes and of sources of supply for the Union is essential for improving the security of supply of the Union as a whole and its Member States individually. Security of supply will depend in the future on the evolution of the fuel mix, the development of production in the Union <…> and in the diversification of gas routes and of sources of supply within and outside the Union including Liquefied Natural Gas (LNG) facilities” (Recital 7);

– “In order to reduce the impact of potential crises triggered by the disruption of gas supplies, Member States should facilitate the diversification of energy sources and gas delivery routes and supply sources” (Recital 8);

– “A major disruption of gas supply to the Union <…> can also lead to severe economic damage across the Union’s economy. Likewise, the disruption of gas supply can have a severe social impact, in particular on vulnerable groups of customers” (Recital 9);

– “<…> the growing reliance on imported energy [is] a significant additional risk for the Union’s security of energy supply and <…> energy security [is] one of the new challenges for security policy. The internal gas market is a central element to increase the security of energy supply in the Union and to reduce the exposure of individual Member States to the harmful effects of supply disruptions” (Recital 11);

– “The failure of the single largest gas infrastructure, the so-called N–1 principle, is a realistic scenario. Using the failure of such an infrastructure as a benchmark of what Member States should be able to compensate is a valid starting point for an analysis of the security of gas supply of each Member State” (Recital 13);

– “Sufficient and diversified gas infrastructure within a Member State and across the Union, including in particular new gas infrastructure connecting current isolated systems forming gas islands to their neighbouring Member States, is essential for tackling supply interruptions” (Recital 14);

– “Investments in new gas infrastructure should be strongly promoted <…>. Such new infrastructure should enhance the security of gas supply while ensuring the proper functioning of the internal market in gas” (Recital 15);

– “Directive 2008/114/EC together with this Regulation contribute to creating a comprehensive approach to the energy security of the Union” (Recital 40);

– “Member States or, where a Member State so provides, the Competent Authority shall ensure that the necessary measures are taken so that by 3 December 2014 at the latest, in the event of a disruption of the single largest gas infrastructure, the capacity of the remaining infrastructure, determined according to the N–1 formula as provided in point 2 of Annex I, is able <…> to satisfy total gas demand of the calculated area during a day of exceptionally high gas demand occurring with a statistical probability of once in 20 years. <...>” (Paragraph 1 of Article 6);

– “National Regulatory Authorities shall take into account the efficiently incurred costs of fulfilling the obligation set out in paragraph 1 <…> when fixing or approving, in a transparent and detailed manner, the tariffs or methodologies in accordance with Article 41(8) of Directive 2009/73/EC and Article 13 of Regulation (EC) No 715/2009” (Paragraph 8 of Article 6).

Thus, according to the provisions of this regulation, a disruption of natural-gas supply is considered a threat to the security of natural-gas supply and such a disruption can lead to severe damage across economy, society and, first of all, across vulnerable groups of consumers. Therefore, Member States are obligated to take the necessary measures so that by 3 December 2014 at the latest, in the event of a disruption of natural-gas supply, would have the respective gas infrastructure enabling to satisfy a certain demand for natural gas. Account may be taken of the costs incurred in the course of carrying out this duty by Member States when the respective National Regulatory Authorities approve the tariffs or methodologies applied by the operators of transmission systems. The diversification of sources of supply, investments to new natural-gas infrastructure, including LNG facilities, should enhance the security of gas supply and ensure the proper functioning of the internal market in gas.

2.2. Recital 22 of the aforementioned Directive 2009/73/EC concerning common rules for the internal market in natural gas, inter alia, prescribes: “The security of energy supply is an essential element of public security and is therefore inherently connected to the efficient functioning of the internal market in gas and the integration of the isolated gas markets of Member States. Gas can reach the citizens of the Union only through the network. Functioning open gas markets and, in particular, the networks and other assets associated with gas supply are essential for public security, for the competitiveness of the economy and for the well-being of the citizens of the Union. <...> therefore additional safeguards are necessary regarding the preservation of the security of supply of energy to the Community to avoid any threats to public order and public security in the Community and the welfare of the citizens of the Union. <...>”

Thus, according to this directive, the security of energy supply is an essential element of public security, whilst gas networks and other assets associated with gas supply are essential for public security, for the competitiveness of the economy and for the well-being of citizens, therefore, safeguards are necessary regarding the preservation of the security of supply of energy.

2.3. Regulation (EU) No 347/2013 of the European Parliament and of the Council of 17 April 2013 on guidelines for trans-European energy infrastructure and repealing Decision No 1364/2006/EC and amending Regulations (EC) No 713/2009, (EC) No 714/2009 and (EC) No 715/2009, inter alia, provides:

– “The European Council of 4 February 2011 underlined the need to modernise and expand Europe’s energy infrastructure and to interconnect networks across borders, in order to make solidarity between Member States operational, to provide for alternative supply or transit routes and sources of energy <…>. It insisted that no Member State should remain isolated from the European gas and electricity networks after 2015 or see its energy security jeopardised by lack of the appropriate connections” (Recital 4);

– “Accelerating <...> the deployment of new energy infrastructure is vital to achieve the Union’s energy <…> policy objectives, consisting of completing the internal market in energy, guaranteeing security of supply, in particular for gas and oil <...>” (Recital 7);

– “<…> reception, storage and regasification <…> facilities for liquefied natural gas <…> have an increasingly important role to play in the European energy infrastructure. The expansion of such energy infrastructure facilities forms an important component of a well-functioning network infrastructure” (Recital 12);

– “This Regulation applies only to the granting of permits for, public participation in, and the regulatory treatment of projects of common interest within the meaning set out herein. Member States may nevertheless apply, by virtue of their national law, the same or similar rules to other projects which do not have the status of projects of common interest within the scope of this Regulation. <…>” (Recital 39);

– “This Regulation shall apply to the following trans-European energy infrastructure priority corridors <…> 8) Baltic Energy Market Interconnection Plan in gas (‘BEMIP Gas’): gas infrastructure to end the isolation of the three Baltic States and Finland and their dependency on a single supplier, to reinforce internal grid infrastructures accordingly, and to increase diversification and security of supplies in the Baltic Sea region” (Annex I);

– “The energy infrastructure categories to be developed in order to implement the energy infrastructure priorities listed in Annex I are the following: <…> 2) concerning gas: <…> c) reception, storage and regasification <…> facilities for liquefied natural gas <…>” (Annex II).

Thus, according to the provisions of this regulation, accelerating the deployment of new energy infrastructure is vital to achieve the Union’s energy policy objectives, inter alia, guaranteeing the security of supply in the natural-gas sector; one of the priorities of such energy infrastructure is the gas infrastructure, including the LNG facilities, in order to end the isolation of the three Baltic States and their dependency on a single supplier, and, accordingly, to increase diversification and security of supplies in the Baltic Sea region.

2.4. Council Directive 2008/114/EC of 8 December 2008 on the identification and designation of European critical infrastructures and the assessment of the need to improve their protection, inter alia, prescribes:

– “critical infrastructure” means an asset, system or part thereof located in Member States which is essential for the maintenance of vital societal functions, health, safety, security, economic or social well-being of people, and the disruption or destruction of which would have a significant impact in a Member State as a result of the failure to maintain those functions (Article 2(a));

– “European critical infrastructure” means critical infrastructure located in Member States the disruption or destruction of which would have a significant impact on at least two Member States (Article 2(b)).

It should be noted that, inter alia, LNG terminals have been included into the list of the sectors of European critical infrastructure given in Annex I to this directive.

Thus, according to this directive, LNG terminals should be regarded as objects of critical infrastructure that are essential, inter alia, for the maintenance of societal security and economic well-being, where the disruption or destruction of which would have a significant impact in a Member State.

2.5. Regulation (EC) No 715/2009 of the European Parliament and of the Council of 13 July 2009 on conditions for access to the natural gas transmission networks and repealing Regulation (EC) No 1775/2005 (hereinafter referred to as Regulation (EC) No. 715/2009 on conditions for access to the natural gas transmission networks), inter alia, prescribes:

– “In calculating tariffs for access to networks, it is important to take account <…> of the need to provide appropriate return on investments and incentives to construct new infrastructure <…>” (Recital 8);

– “Tariffs, or the methodologies used to calculate them, applied by the transmission system operators and approved by the regulatory authorities pursuant to Article 41(6) of Directive 2009/73/EC, as well as tariffs published pursuant to Article 32(1) of that Directive, shall be transparent, take into account the need for system integrity and its improvement and reflect the actual costs incurred, insofar as such costs correspond to those of an efficient and structurally comparable network operator and are transparent, whilst including an appropriate return on investments, and, where appropriate, taking account of the benchmarking of tariffs by the regulatory authorities. Tariffs, or the methodologies used to calculate them, shall be applied in a non-discriminatory manner” (first section of Article 13(1));

– “Tariffs, or the methodologies used to calculate them, shall facilitate efficient gas trade and competition, while at the same time avoiding cross-subsidies between network users and providing incentives for investment and maintaining or creating interoperability for transmission networks” (third section of Article 13(1));

– “In order to ensure transparent, objective and non-discriminatory tariffs and facilitate efficient utilisation of the gas network, transmission system operators or relevant national authorities shall publish reasonably and sufficiently detailed information on tariff derivation, methodology and structure” (Article 18 (2));

– “In order to ensure transparent, objective and non-discriminatory tariffs and facilitate efficient utilisation of the infrastructures, the LNG <…> facility operators or relevant regulatory authorities shall make public sufficiently detailed information on tariff derivation, the methodologies and the structure of tariffs for infrastructure under regulated third-party access” (Article 19 (5)).

Thus, under the provisions of this regulation, inter alia, tariffs applied by the transmission system operators and approved by the regulatory authorities, in calculating which account is taken, inter alia, of incentives to construct new infrastructure, must be transparent, objective and non-discriminatory, and sufficiently detailed information about them must be made public.

3. Paragraph 2 of Article 106 (ex Article 86 TEC) of the TFEU provides: “Undertakings entrusted with the operation of services of general economic interest or having the character of a revenue-producing monopoly shall be subject to the rules contained in the Treaties, in particular to the rules on competition, in so far as the application of such rules does not obstruct the performance, in law or in fact, of the particular tasks assigned to them. The development of trade must not be affected to such an extent as would be contrary to the interests of the Union.”

According to Article 14 of the TFEU, without prejudice to Article 4 of the Treaty on European Union or to Articles 93, 106 and 107 of the TFEU, and given the place occupied by services of general economic interest in the shared values of the Union as well as their role in promoting social and territorial cohesion, the Union and the Member States, each within their respective powers and within the scope of application of the Treaties, shall take care that such services operate on the basis of principles and conditions, particularly economic and financial conditions, which enable them to fulfil their missions.

Article 36 “Access to Services of General Economic Interest” of the Charter of Fundamental Rights of the European Union provides that the Union recognises and respects access to services of general economic interest as provided for in national laws and practices, in accordance with the Treaty establishing the European Community, in order to promote the social and territorial cohesion of the Union.

Article 1 of Protocol (No. 26) to the Treaty on the European Union and the TFEU on services of general interest prescribes, inter alia, that the shared values of the Union in respect of services of general economic interest within the meaning of Article 14 of the TFEU include in particular: the wide discretion of national authorities in providing, commissioning and organising services of general economic interest as closely as possible to the needs of the users; the diversity between various services of general economic interest.

Thus, the aforesaid provisions of the primary law of the EU have consolidated the legal grounds for rendering the services of general economic interest; the rules, inter alia, the rules on competition, established in the EU treaties are not applied to undertakings entrusted with the operation of services of general economic interest insofar as the application of such rules does not obstruct the performance of the particular tasks assigned to them; Member States enjoy a wide discretion in providing, commissioning and organising services of general economic interest as closely as possible to the needs of the users, whilst the Union recognises and respects the right to use such services.

3.1. Directive 2009/73/EC concerning common rules for the internal market in natural gas, inter alia, prescribes:

– “Respect for the public service requirements is a fundamental requirement of this Directive, and it is important that common minimum standards, respected by all Member States, are specified in this Directive, which take into account the objectives of <…> security of supply <…> in all Member States. It is important that the public service requirements can be interpreted on a national basis, taking into account national circumstances and subject to the respect of Community law” (Recital 44);

– “The citizens of the Union and, where Member States deem it to be appropriate, small enterprises, should be able to enjoy public service obligations, in particular with regard to security of supply and reasonable tariffs” (Recital 47);

– “Having full regard to the relevant provisions of the Treaty, in particular Article 86 thereof, Member States may impose on undertakings operating in the gas sector, in the general economic interest, public service obligations which may relate to security, including security of supply, regularity, quality and price of supplies, and environmental protection, including energy efficiency, energy from renewable sources and climate protection. Such obligations shall be clearly defined, transparent, non-discriminatory, verifiable and shall guarantee equality of access for natural gas undertakings of the Community to national consumers. <...>” (Article 3 (2));

– “Natural gas undertakings shall <...> keep separate accounts for each of their transmission, distribution, LNG and storage activities as they would be required to do if the activities in question were carried out by separate undertakings, with a view to avoiding discrimination, cross-subsidisation and distortion of competition. <...>” (Article 31 (3)).

Thus, according to the provisions of this directive, obligations may be established for enterprises operating in the sector of natural gas to provide public services, where such obligations are connected, inter alia, with the security of supply, whilst the citizens of the Union and small enterprises should be able to enjoy public service obligations, in particular with regard to security of supply and reasonable tariffs; with a view to avoiding discrimination, cross-subsidisation and distortion of competition, natural-gas undertakings must keep separate accounts for their transmission and other types of activity.

3.2. Commission Directive 2006/111/EC of 16 November 2006 on the transparency of financial relations between Member States and public undertakings as well as on financial transparency within certain undertakings, inter alia, prescribes:

– “The Member States shall ensure that financial relations between public authorities and public undertakings are transparent as provided in this Directive <...>” (Article 1 (1));

– “<...> the Member States shall ensure that the financial and organisational structure of any undertaking required to maintain separate accounts is correctly reflected in the separate accounts, so that the following emerge clearly: a) the costs and revenues associated with different activities; b) full details of the methods by which costs and revenues are assigned or allocated to different activities” (Article 1 (2));

– “‘public undertakings’ means any undertaking over which the public authorities may exercise directly or indirectly a dominant influence by virtue of their ownership of it, their financial participation therein, or the rules which govern it” (Article 2b);

– “‘undertaking required to maintain separate accounts’ means any undertaking that <…> is entrusted with the operation of a service of general economic interest pursuant to Article 86(2) of the Treaty, that receives public service compensation in any form whatsoever in relation to such service and that carries on other activities” (Article 2d);

– “‘different activities’ means, on the one hand, <…> all services of general economic interest with which an undertaking is entrusted and, on the other hand, each other separate product or service in respect of which the undertaking is active” (Article 2e);

– “To ensure the transparency referred to in Article 1(2), the Member States shall take the measures necessary to ensure that for any undertaking required to maintain separate accounts: (a) the internal accounts corresponding to different activities are separate; (b) all costs and revenues are correctly assigned or allocated on the basis of consistently applied and objectively justifiable cost accounting principles; (c) the cost accounting principles according to which separate accounts are maintained are clearly established” (Article 4 (1)).

Thus, according to the requirements for financial transparency within certain undertakings, the undertakings which are entrusted with the operation of a service of general economic interest, and which, due to this, receive compensation in any form for public services, and which are also engaged in other activity, are required to maintain separate accounts according to the operation of a service of general economic interest entrusted to them and according to other services with which the activity of such undertakings is related.

4. The Constitutional Court has noted on more than one occasion that the jurisprudence of the Court of Justice of the European Communities (now—the Court of Justice of the European Union), as a source of the interpretation of law, is also important to the interpretation and application of the Lithuanian law (the Constitutional Court’s rulings of 21 December 2006, 15 May 2007, 4 December 2008, 27 March 2009, 22 December 2011, and 14 April 2014). In the context of the constitutional justice case at issue, the jurisprudence of the Court of Justice of the European Union should be mentioned in which, inter alia, the aforesaid provisions of EU law are interpreted.

4.1. It is held in the jurisprudence of the Court of Justice in connection with the security of supply of energy resources that petroleum products, because of their exceptional importance as an energy source in the modern economy, are of fundamental importance for a country’s existence since not only its economy but above all its institutions, its essential public services and even the survival of its inhabitants depend upon them; an interruption of supplies of petroleum products, with the resultant dangers for the country’s existence, could therefore seriously affect the public security (judgment of 10 July 1984 in the case 72/83 Campus Oil Limited and others, Paragraph 34). In cases where a state which is totally or almost totally dependent on imports for its supplies of petroleum products may rely on grounds of public security in justifying the measures taken by that state in order to secure the required supply of petroleum products provided that such measures did not exceed what was necessary to achieve this objective (the same judgment in the case of Campus Oil Limited and others, Paragraph 51). The objective of guaranteeing adequate investment in the electricity and gas-distribution systems is designed to ensure, inter alia, security of energy supply, an objective which the Court of Justice has also deemed to be an overriding reason in the public interest (judgment of 22 October 2013 in the case C‑105/12–C‑107/12 Essent and others, Paragraph 59).

4.2. The Court of Justice has held that services of general economic interest exhibit special characteristics as compared with the general economic interest of other economic activities (judgment of 10 December 1991 in the case C‑179/90 Merci convenzionali Porto di Genova, Paragraph 27; judgment of 18 June 1998 in the case C‑266/96 Corsica Ferries France, Paragraph 45). Article 106(2) TFEU, whereby undertakings may be entrusted with the operation of services of general economic interest, is designed to reconcile the Member States’ interest in using certain undertakings as an instrument of economic or social policy with the Community’s interest in ensuring compliance with the rules on competition and preservation of the unity of the common market (judgment of 21 September 1999 in the case C‑67/96 Albany, Paragraph 103; judgment of 20 April 2010 in the case C-265/08 Federutility and others, Paragraph 28). In that context, Member States are entitled, while complying with the law of the Union, to define the scope and the organisation of their services in the general economic interest and, in particular, they may take account of objectives pertaining to their national policy (judgment in Federutility and others, Paragraph 29). According to the distribution of powers among state institutions established in national law, the national, regional or local authorities of Member States enjoy a broad discretion for defining what they regard as services of general economic interest (judgment of the Court of First Instance (at present—the General Court) of 15 June 2005 in the case T-17/02 Fred Olsen, SA v. Commission of the European Communities, Paragraph 215; judgment of the same court of 22 October 2008 in the case T‑309/04, T‑317/04, T‑329/04 and T‑336/04 TV 2 / Danmark A/S and Others v. The Commission, Paragraph 101). The requirements concerning the public service must be capable of being interpreted, subject to the observance of the law of the Union, “on a national basis”, and “taking into account national circumstances” (judgment in Federutility and Others, Paragraph 30). It is not incompatible with the Treaty to include in the price of the service a component designed to cover the cost of maintaining a universal service, inasmuch as it corresponds to the supplementary cost occasioned by the special characteristics of that service (judgment in Corsica Ferries France, Paragraph 46). An undertaking which is to discharge public service obligations may also be chosen by not applying a public procurement procedure (judgment of the Court of Justice of 24 July 2003 in the case C-280/00 Altmark Trans and Regierungspräsidium Magdeburg, Paragraph 93).

5. To sum up the discussed provisions in the aspects that are important in the constitutional justice case at issue, it should be noted that, according to EU law:

ensuring the security of energy supply and promoting the interconnection of energy networks are among the most important aims of Union policy on energy;

a disruption of natural-gas supply is considered a threat to the security of natural-gas supply and such a disruption can lead to severe damage across economy, society and, first of all, across vulnerable groups of consumers; therefore, Member States are obligated to take the necessary measures so that by 3 December 2014 at the latest, in the event of a disruption of natural-gas supply, would have the respective gas infrastructure enabling the satisfaction of a certain demand for natural gas; account may be taken of the costs incurred in the course of carrying out this duty by Member States when the respective National Regulatory Authorities approve the tariffs or methodologies applied by the operators of transmission systems;

tariffs applied by the transmission system operators and approved by the regulatory authorities, in calculating which account is taken, inter alia, of incentives to construct new infrastructure, must be transparent, objective and non-discriminatory, and sufficiently detailed information about them must be made public; with a view to avoiding discrimination, cross-subsidisation and distortion of competition, natural gas undertakings must keep separate accounts for their transmission and other types of activity;

accelerating the deployment of new energy infrastructure is vital to achieve the Union’s energy policy objectives, inter alia, guaranteeing the security of supply in the natural-gas sector; one of the priorities of such energy infrastructure is the gas infrastructure, including the LNG facilities, in order to end the isolation of the three Baltic States and their dependency on a single supplier, and, accordingly, to increase diversification and security of supplies in the Baltic Sea region;

with regard to general economic interest, obligations may be established for enterprises operating in the sector of natural gas to provide public services, where such obligations are connected, inter alia, with the security of supply, whilst the citizens of the Union and small enterprises should be able to enjoy public service obligations, in particular with regard to security of supply and reasonable tariffs;

Member States enjoy a wide discretion in providing, commissioning and organising services of general economic interest as closely as possible to the needs of the users, whilst the Union recognises and respects the right to use such services;

the undertakings which are entrusted with the operation of a service of general economic interest, and which, due to this, receive compensation in any form for public services, and which are also engaged in other activity, are required to maintain separate accounts according to the operation of a service of general economic interest entrusted to them and according to other services with which the activity of such undertakings is related;

Member States may use certain undertakings as an instrument of economic or social policy.

6. In the context of the constitutional justice case at issue, the Constitutional Court should also mention Decision No. SA.36740 of the European Commission of 20 November 2013, in which, on the basis of the assessment regarding the state aid connected with the installation and operation of the LNG Terminal in Klaipėda State Seaport and rendered to the JSC “Klaipėdos nafta”, the European Commission decided, on the basis of the assessment regarding state aid, to consider the state aid to be compatible with the internal market, pursuant to Articles 107(3)(c) of the TFEU as regards the investment aid and pursuant to 106(2) of the TFEU as regards the operating aid. In the same decision it was held, inter alia, that the JSC “Klaipėdos nafta” has been entrusted with a service of general economic interest by commissioning it to install the LNG Terminal and to operate it by charging regulated tariffs for its services, whilst the LNG Supplement covering operating expenses incurred by the JSC “Klaipėdos nafta” constitutes the compensation.

A mention should be made of the provisions of Decision No. SA.36740 of the European Commission of 20 November 2013 that are important to the constitutional justice case at issue:

the European Commission would agree that in a competitive market where security of supply is already ensured by market forces, the designation of an LNG Terminal as a service of general economic interest would not be warranted; however, the situation of Lithuania in this regard is very specific: Lithuania has so far no access to the market in liquefied natural gas; rather, it is fully dependent on one single supply source, which raises security of supply issues;

the LNG Supplement for the years 2013–2014 actually functions more like a financial back-up or a guarantee in that the funds are available for the JSC “Klaipėdos nafta” should it not obtain necessary financial resources from loans;

the LNG Supplement collected after 3 December 2014 will be paid out to the JSC “Klaipėdos nafta” at regular intervals after the start of operation; it will cover investment-related costs like the lease and purchase of the floating liquefied-natural-gas storage and regasification unit, depreciation costs, return on capital and fixed operating costs;

the simulations provided by Lithuania show that without the LNG Supplement and the purchase obligation, the LNG Terminal would not be competitive or viable, there would be a funding gap and the investment would not be realised; without the state aid, the terminal project would not materialise and deliver its contribution to ensure security of supply; no other type of investment would provide Lithuania with the same degree of security of supply;

the LNG Supplement does indeed not constitute a transmission fee and is not supposed to cover part of the transmission costs; the LNG Supplement constitutes a special levy that serves to finance the (investment and operational) costs of the LNG Terminal; provided that this special levy is clearly identified as such and does not accrue to the transmission system operator as an excessive profit for its transmission tasks, Directive 2009/73/EC concerning common rules for the internal market in natural gas and Regulation (EC) No. 715/2009 on conditions for access to the natural gas transmission networks do not prohibit that the transmission system operator is mandated to collect special levies established by the state from gas users;

the LNG Terminal project is of major importance for Lithuania. Lithuania depends only on one single supplier for its gas demand (OAO Gazprom) and has an urgent need to develop access to alternative sources of supply to ensure its security of supply. In order to develop access to alternative gas supply sources, the project can only fruitfully be implemented by an entity that is independent both on the corporate but also on the economic level from the single supplier. However, if the project manager (operator) would be selected in a transparent competitive procedure under Directive 2004/18/EC of the European Parliament and of the Council of 31 March 2004 on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts (hereinafter referred to as Directive 2004/18/EC on public procurement) or the TFEU, there would be a risk that it would have (at the time of the tender) or later develop ties to the single supplier that would allow the latter to influence its market behaviour in a way that could negatively affect the fulfilment of its mission regarding services of general economic interest. In fact, currently the single gas supplier has corporate and/or economic bonds with a vast number of undertakings in Lithuania, in particular companies active in the gas sector and Lithuania has provided examples of energy-related projects that had to be cancelled following various interventions at different levels of the single gas supplier. Against this background, and in order to avoid any undue pressure or influence to be exercised on the contractor, Lithuania concluded that the project manager (operator) of the project of the LNG Terminal would have to be state-controlled and would have to meet certain security requirements. Based on those elements, the Commission concluded that the JSC “Klaipėdos nafta” is in a unique position of being able to provide the requested service and meeting the security requirements necessary for the completion of the project and found that the exemption from procurement rules for the protection of essential (security) interests within the meaning of Article 14 of Directive 2004/18/EC on public procurement applies in this case.

Summing up the aforesaid provisions of the decision of the European Commission in the aspect important for the constitutional justice case at issue, it should be noted that, in the opinion of the European Commission, the provisions of the legal acts of the Republic of Lithuania regulating the selection of the company implementing the project of the LNG Terminal, and the LNG Supplement as one of the sources for financing the project of the LNG Terminal are compatible with EU law.

7. It should be noted that the European Commission has emphasised on more than one occasion the special importance of the LNG Terminal for the energy security of Lithuania and of all Baltic states.

7.1. According to the Communication of 28 May 2014 from the Commission to the Council and the European Parliament: European Energy Security Strategy (COM(2014) 330 final), Lithuania’s LNG terminal is very important for EU energy security in the short-term and could provide more possibilities of diversified supply.

7.2. The Communication of 16 October 2014 from the Commission to the Council and the European Parliament on the short term resilience of the European gas system: preparedness for a possible disruption of supplies from the East during the fall and winter of 2014/2015 (COM(2014) 654 final) welcomed the forthcoming commissioning of the Klaipėda LNG terminal in Lithuania. In the same document, the European Commission noted that:

the existence of such infrastructure enabling supply diversification is vital both in order to diversify supply but also to ensure a more flexible gas network; ensuring security of supply is about preparing well for a possible disruption—this is a shared responsibility between public authorities and the industry; the N-1 standard specified in Regulation (EU) No. 994/2010 concerning measures to safeguard security of gas supply should be implemented and applied in practice;

the possibility of additional pipeline gas to the EU is limited and some Member States have limited access to alternative pipeline sources other than Russian, therefore liquefied natural gas is the key alternative to increase supplies in case of serious shortfalls;

the European Commission recommends that Lithuania continue the work on the upgrade of the Klaipėda-Kuršėnai pipeline to allow for an enhanced use of Klaipeda LNG terminal, and that Estonia finalise an agreement with Lithuania before December 2014 for the supply of protected customers in case of an emergency from Klaipėda LNG terminal.

7.3. The Commission staff working document “Report on the Findings of the Baltics and Finland Focus Group” (SWD/2014/322 final) accompanying the Communication of the European Commission of 16 October 2014 notes that: a severe disruption of gas supplies from Russia can have serious negative impacts in this region; even in the scenario of a one-month disruption of all Russian gas flows, there would be important gas shortages for non-protected customers in Estonia and Lithuania; once the Klaipeda LNG terminal enters into operation, however, the supply for the protected customers would be ensured in the three Baltic States in all scenarios.

8. To sum up the aforesaid provisions of the documents of the European Commission, it should be noted that:

the European Union considers the development of LNG facilities to be a part of the infrastructure of a well-operating network helping Member States to avoid a disruption of natural-gas supply, whilst Lithuania’s LNG Terminal—to be an object of special importance for EU energy security;

the European Commission has recognised that the JSC “Klaipėdos nafta” has been entrusted with a service of general economic interest by commissioning it to install the LNG Terminal and to operate it by charging regulated tariffs for its services, whilst the LNG Supplement covering operating expenses incurred by the JSC “Klaipėdos nafta” constitutes the compensation;

in the opinion of the European Commission, the provisions of the legal acts of the Republic of Lithuania regulating the selection of the company implementing the project of the LNG Terminal, and the LNG Supplement as one of the sources for financing the project of the LNG Terminal are compatible with EU law.

9. It has been mentioned that, at the Constitutional Court’s hearing, the representative of a group of members of the Seimas reiterated the request of the group of members of the Seimas that the Constitutional Court apply to the Court of Justice of European Union for a preliminary ruling in the constitutional justice case at issue. The issues raised in this request are connected with the interpretation of Article 13 of Regulation (EC) No. 715/2009 on conditions for access to the natural gas transmission networks, Article 31(3), Article 31(4), and Article 41(1)(f) of Directive 2009/73/EC concerning common rules for the internal market in natural gas, and Article 6(1) of Regulation (EU) No. 994/2010 concerning measures to safeguard security of gas supply.

It should be noted that, under Article 267(1)(b) and Article 267(3) of the TFEU, if a court of a Member State is faced with the issue of the interpretation of, inter alia, acts issued by institutions of the Union, this constitutes the grounds for making a reference to the Court of Justice for a preliminary ruling. Taking into account the EU legal regulation discussed in this ruling of the Constitutional Court, in the constitutional justice case at issue, the Constitutional Court is not faced with doubts about the interpretation of the provisions of EU legal acts specified by the representative of the petitioner. In addition, it should be noted that one of the questions raised by the representative of a group of members of the Seimas, the petitioner, regarding the interpretation of EU legal acts is connected with the impugned legal regulation established in Paragraphs 1, 2, and 3 of Article 11 (wording of 12 June 2012) of the LNG Terminal Law, where the said legal regulation, as mentioned before, was amended and, regarding this issue, this part of the constitutional justice case must be dismissed.

V

1. In deciding this constitutional justice case, it is important to reveal the content of the provisions of Article 46 of the Constitution.

2. Article 46 of the Constitution prescribes:

Lithuania’s economy shall be based on the right of private ownership, freedom of individual economic activity and initiative.

The State shall support economic efforts and initiative that are useful to society.

The State shall regulate economic activity so that it serves the general welfare of the Nation.

The law shall prohibit monopolisation of production and the market and shall protect freedom of fair competition.

The State shall defend the interests of the consumer.”

3. The Constitutional Court has held on more than one occasion that the principles consolidated in Article 46 of the Constitution, inter alia, the principle of the protection of freedom of economic activity and initiative consolidated in Paragraph 1 of the same article, are seen as a whole—the constitutional basis of the economy of this country—therefore, the provisions of all the paragraphs of this article are interrelated and supplement each other; there is a balance among the principles entrenched therein, therefore, each such principle should be interpreted without negating the other principles.

3.1. The duty of the state consolidated in Paragraph 3 of Article 46 of the Constitution to regulate, by taking account of the resources of the state, its material and financial possibilities and other important factors, the economic activity so that it would serve the general welfare of the nation implies the requirement for the legislature to coordinate various constitutional values in regulating such activity (the Constitutional Court’s rulings of 2 March 2009 and 5 March 2015), inter alia, to coordinate freedom of individual economic activity and initiative, freedom of fair competition, and the protection of consumers’ interests.

The Constitutional Court has held on more than one occasion that freedom of individual economic activity and initiative are the whole complex of legal opportunities, which creates preconditions for a person to independently adopt decisions necessary for their economic activity (inter alia, the Constitutional Court’s rulings of 6 October 1999, 31 May 2006, 29 April 2009, and 9 May 2014). The economic activity of persons may be subject to limitation, where it is necessary to defend the interests of consumers, to protect fair competition and other values consolidated in the Constitution (inter alia, the Constitutional Court’s rulings of 6 October 1999, 4 December 2008, and 29 September 2010). The protection of fair competition is the main method to ensure harmony between the interests of the person and society while regulating economic activity, to create the self-regulation of economy as a system, and to increase economic growth and to improve the welfare of consumers (inter alia, the Constitutional Court’s rulings of 2 March 2009 and 5 March 2015).

3.2. The Constitutional Court has noted that, in order to regulate economic activity in such a way that it can serve the general welfare of the nation, the state may establish a differentiated legal regulation determined by the specificity of a certain economic activity; the state, by taking account of the specificity of a certain economic activity, may use different means of legal regulation (inter alia, the Constitutional Court’s rulings of 2 March 2009, 24 May 2013, and 9 May 2014).

The Constitutional Court has also pointed out that the establishment of certain exceptions to a certain general legal regulation may be constitutionally justified if these exceptions are aimed at ensuring a constitutionally justifiable and universally important interest, and only to the extent to which this is sought; the said exceptions must be proportional to the constitutionally justifiable objective that is being sought and must not limit the rights of the subjects concerned more than it is necessary to ensure the said constitutionally justifiable and universally significant interest (the Constitutional Court’s rulings of 12 December 2005, 2 March 2009, 24 May 2013, and 5 July 2013).

3.3. In addition, the Constitutional Court has held that the provision consolidated in Paragraph 5 of Article 46 of the Constitution that the state shall defend the interests of the consumer implies that laws and other legal acts should establish various measures of the protection of consumers’ interests and that state institutions should control economic subjects how they observe such measures (inter alia, the Constitutional Court’s rulings of 18 October 2000, 17 March 2003, 2 March 2009, and 29 September 2010).

The imperative of the guarantee of an efficient protection of the rights and interests of consumers which stems from the Constitution, inter alia, Paragraph 5 of Article 46 thereof, also implies that the legislature must establish the legal regulation whereby the preconditions would be created for each consumer to receive electricity under non-discriminatory conditions, and ensuring that electricity would be supplied to all consumers in a safe and reliable manner (the Constitutional Court’s rulings of 2 March 2009 and 29 September 2010). The establishment of limits on prices is one of the ways to defend the interests of consumers; the legislature has the duty to define, by means of a law, the criteria for the establishment of limits on prices of electricity; such criteria and the methodology and procedure for establishing them must be clear, transparent and reasonable so that no preconditions would be created for abuse when establishing the prices of electricity and, thus, so that no preconditions would be created for violating the rights and interests of the consumers of electricity (the Constitutional Court’s ruling of 2 March 2009).

These provisions of the official constitutional doctrine should also be applied mutatis mutandis in the sphere of the protection of the rights and interests of consumers of natural gas.

3.4. In the context of the constitutional justice case at issue, it should be noted that the economic activity conducted in the sphere of energy, inter alia, the provision of all consumers with energy resources (inter alia, natural gas), is a specific economic activity; such an activity is characterised, inter alia, by the fact that when this activity is carried out, a direct influence is exerted on the entire national economy. The security and reliability of the energy system is a constitutionally important objective; it is a public interest justifying a particular differentiated legal regulation of economic activity in this sphere. Thus, while regulating, in accordance with the Constitution, inter alia, Paragraph 3 of Article 46 thereof, the economic activity in the sphere of energy so that it serves the general welfare of the nation, the legislature is obliged to establish such legal regulation that would ensure the security, stability, and reliability of the energy system, inter alia, an opportunity to receive energy supplies from multiple sources (suppliers) under non-discriminatory conditions and at fair prices. For this purpose, projects of special importance for the state designed for putting an end to the dependence of the national economy upon a monopolist supplier of certain energy resources (inter alia, natural gas) may be implemented under procedure and conditions established by law. The special importance of these projects for the state implies that the legislature, having established the legal regulation commissioning certain state-controlled economic subjects to implement these projects, must also establish an efficient mechanism of control over the implementation of such projects.

3.5. In the context of the constitutional justice case at issue, it should also be noted that, under Paragraph 3 of Article 46 of the Constitution, the legislature, while regulating the economic activity in the sphere of energy so that it could serve the general welfare of the nation, and being under obligation to ensure an efficient implementation of projects of special importance for the state, may, inter alia, establish the legal regulation enabling the financing of the said projects from multiple sources, inter alia, including the funds raised from consumers of energy resources. These funds may be accumulated by applying the tariff of a state-regulated price, where such a tariff is established, inter alia, in view of the law-established obligations for the economic subjects implementing the aforesaid projects of special importance for the state to provide public services in the sphere of energy—to install and operate the energy infrastructure in seeking to ensure that energy resources would be supplied in a secure and reliable manner.

3.6. Having chosen such financing of projects of special importance for the state, which is based, inter alia, on the funds raised from consumers of energy resources, the legislature, while following the imperative, arising out of Paragraph 5 of Article 46 of the Constitution, for ensuring the protection of the rights and interests of consumers, must establish an efficient mechanism of control over the justified costs of the implementation of such projects so that the inclusion of these costs into the price of particular energy resources would not create preconditions for abuse and, thus, for violating the interests of consumers.

4. The Constitutional Court has held on more than one occasion that the constitutional values upon which the national economy is based are tightly linked to other constitutional values.

4.1. The content of the provisions of Article 46 of the Constitution should be interpreted in a systemic manner and in the context of the entire constitutional regulation, by taking account, inter alia, of the provisions of Paragraph 2 of Article 128 of the Constitution (the Constitutional Court’s ruling of 2 March 2009).

In interpreting Paragraph 2 of Article 128 of the Constitution, which provides that the procedure for the possession, use and disposal of state property shall be established by law, the Constitutional Court has held that, under the Constitution, the state is a subject of the right of ownership (the Constitutional Court’s rulings of 17 June 1997, 30 September 2003, and 30 October 2008); the property that belongs to the state by right of ownership should be managed in a way so that it could serve the general welfare of the nation and the interest of society at large (the Constitutional Court’s rulings of 30 September 2003, 30 October 2008, and 24 October 2012).

The provisions of Paragraph 2 of Article 128 of the Constitution should be interpreted bearing in mind the constitutional concept of the state. The Constitutional Court has held that, in discharging its functions, the state should act in the interests of society at large (inter alia, the Constitutional Court’s rulings of 13 December 2004, 30 October 2008, and 8 June 2009); the mission of the state is to ensure human rights and freedoms, as well as to guarantee the public interest (inter alia, the Constitutional Court’s rulings of 30 December 2003, 13 December 2004, and 21 December 2006); the public interest, as a common interest of the state, the entire society or part of the society, must be coordinated with autonomous interests of individuals, because not only the public interest, but also the rights of persons are constitutional values; a just balance must be ensured in this sphere (the Constitutional Court’s ruling of 21 September 2006).

In its ruling of 30 September 2003, the Constitutional Court held that the provisions of Paragraph 2 of Article 128 of the Constitution are inseparable from the provisions of the Constitution which consolidate such constitutional values as independence of the state and integrity of its territory, security of the state, welfare of the nation, public order and justice. One of the fundamental constitutional values consolidated in Article 1 of the Constitution—the independence of the state—is closely interrelated with the geopolitical orientation of the State of Lithuania, which is consolidated in the Constitution and implies, inter alia, the membership of the Republic of Lithuania in the EU as well as the necessity to fulfil the corresponding international commitments related with the said membership (the Constitutional Court’s rulings of 7 July 2011 and 24 January 2014). In the context of the constitutional justice case at issue, it should be noted that the commitments of the Republic of Lithuania arising from its membership in the EU in the sphere of energy, by means of which efforts are made to ensure the security and reliability of the energy system, are inseparable from the duty of the state consolidated in Paragraph 3 of Article 46 of the Constitution to ensure the general welfare of the nation.

4.2. The content of the provisions of Article 46 of the Constitution should be interpreted by taking account of the provisions of Article 94 thereof consolidating the powers of the Government as an institution of state power (the Constitutional Court’s ruling of 26 February 2010). Under Item 1 of Article 94 of the Constitution, the Government shall administer the affairs of the country and guarantee state security. In interpreting the provisions of Article 94 of the Constitution, the Constitutional Court has held that, when the Government exercises the functions established to it by the Constitution, its powers may depend on the economic and social situation of this country, the problems at issue and a number of other circumstances, after the change of which the content and scope of the powers of the Government may also be changed; only the main powers of the Government are provided for in the Constitution (the Constitutional Court’s ruling of 23 November 1999). Everything that the Government performs, while implementing the powers established for it in the Constitution and laws, is resolving the affairs of state administration (the Constitutional Court’s ruling of 29 November 2001). Under the Constitution, the Government, as an institution of the executive, enjoys broad discretion for forming and pursuing the economic policy of the state and for regulating economic activity correspondingly (the Constitutional Court’s ruling of 23 May 2007).

4.3. In the context of the constitutional justice case at issue, it should be noted that, under the Constitution, inter alia, under Paragraph 3 of Article 46 thereof, if it is interpreted together with Item 1 of Article 94 establishing the competence of the Government to administer the affairs of the country and guarantee state security, and Paragraph 2 of Article 128 consolidating the constitutional grounds for the possession, use and disposal of state property, the legislature, in regulating the economic activity in the sphere of energy so that it could serve the general welfare of the nation may consolidate by means of both general norms and special norms of legal regulation the powers of the Government to use the state-controlled economic subjects as an instrument in an economic policy in order to meet public interests in the sphere of economy. In implementing these powers and choosing a concrete state-controlled economic subject for carrying out a certain project which is of special importance for the state, the Government must heed, inter alia, the constitutional principle of responsible governance.

5. In the constitutional justice case at issue, it is also important to reveal the content of Item 15 of Article 67 and Paragraph 3 and Article 127 of the Constitution, which consolidate the constitutional grounds for establishing taxes and other compulsory payments.

5.1. In disclosing the features characteristic of taxes and other compulsory payments, the Constitutional Court has held that taxes and other compulsory payments are compulsory and unrequited payments of an appropriate size which are established by law and made by legal and natural persons to the state (municipal) budget in due time (the Constitutional Court’s ruling of 24 January 2006); taxes form an essential part of the financial system of the state and they constitute the main part of the revenue of the state budget (the Constitutional Court’s rulings of 9 October 1998, 15 March 2000, and 5 July 2013); state taxes and other compulsory payments are a pecuniary obligation of legal subjects to the state (the Constitutional Court’s ruling of 3 June 2002); according to the Constitution, only the Seimas may establish state taxes and other compulsory payments, and it may establish them only by law, which is an important guarantee of the protection of persons’ rights (the Constitutional Court’s ruling of 3 June 2002); within the meaning of Item 15 of Article 67 of the Constitution, state taxes are characterised by compulsory and unrequited nature as well as one-sidedness (the Constitutional Court’s ruling of 12 February 2010); taxes are characterised by the fact that they are paid regularly at specified intervals and they are not of directly repayable nature, i.e., after they are paid to the state institution which accepts the said tax, the aforementioned institution is under no obligation to perform any actions or render any particular service for the taxpayer (the Constitutional Court’s ruling of 15 March 1996).

5.2. The Constitutional Court has held that Paragraph 3 of Article 127 of the Constitution (if one takes account of Items 2 and 15 of Article 67 of the Constitution) means, inter alia, that the establishment of taxes is within the competence of the Seimas (the Constitutional Court’s ruling of 6 December 2000). The Seimas may not transfer its constitutional powers to establish state taxes and other compulsory payments to any other institution, including the Government; neither the Government nor any other institution may take over such powers (the Constitutional Court’s ruling of 3 June 2002). It should be noted that, in interpreting the constitutional principle of the separation of powers (which is consolidated in Article 5 of the Constitution and in other articles of the Constitution establishing the powers of state institutions exercising state power), the Constitutional Court has held in its acts on more than one occasion that this constitutional principle means, inter alia, that that after the powers to a concrete institution of state power have been directly established in the Constitution, such a state institution may not transfer such powers to another institution of state power or waive such powers, and no other institution of state power may take over such powers; such powers may neither be changed nor restricted by law (inter alia, the Constitutional Court’s rulings of 11 July 2002, 13 December 2004, and 2 March 2009).

6. Article 23 of the Constitution consolidates the inviolability of ownership and its protection.

The Constitutional Court has held on more than one occasion that, under the Constitution, the right of ownership is not absolute, and that this right can be limited by means of a law, inter alia, due to the character of an object of ownership and/or due to a constitutionally justifiable need that is essential to society; also, heed should be paid to the principle of proportionality whereby the measures provided for in laws must be in line with the objectives sought (inter alia, the Constitutional Court’s rulings of 19 September 2002, 13 May 2005, 31 January 2011, and 5 July 2013).

The Constitutional Court has held on more than one occasion that ownership also performs a social function and that it includes obligations (inter alia, the Constitutional Court’s rulings of 14 March 2006 and 20 May 2008); the inviolability of property and the protection of subjective rights of ownership which are both entrenched in the Constitution cannot be interpreted as grounds for opposing the rights and interests of the owner against the public interest (inter alia, the Constitutional Court’s rulings of 13 May 2005 and 20 May 2008).

VI

On the compliance of Paragraph 1 of Article 4 of the Law on the Liquefied Natural Gas Terminal with Paragraph 1 of Article 46 of the Constitution

1. In the constitutional justice case at issue, subsequent to the petition of a group of members of the Seimas, the Constitutional Court investigates whether, inter alia, Paragraph 1 of Article 4 of the LNG Terminal Law is not in conflict with Paragraph 1 of Article 46 of the Constitution. The doubts of the petitioner are essentially substantiated by the fact that, by its decision, either the Government or an institution authorised by it selects a state-controlled company without a tender for the implementation of the project of the LNG Terminal, i.e. a company whose shares carrying no less than 2/3 of all votes at a general meeting of the shareholders belong to the state, regardless of the fact that there are (may be) other companies that are willing to construct the LNG Terminal.

2. In deciding whether Paragraph 1 of Article 4 of the LNG Terminal Law is not in conflict with Paragraph 1 of Article 46 of the Constitution, it should be noted that, as mentioned before:

the principles consolidated in Article 46 of the Constitution, inter alia, the principle of the protection of freedom of economic activity and initiative consolidated in Paragraph 1 of the same article, are seen as a whole—the constitutional basis of the economy of this country—therefore, the provisions of all the paragraphs of this article are interrelated and supplement one another; there is a balance among the principles entrenched therein, therefore, each such principle should be interpreted without negating the other principles; when the state regulates, within the meaning of Paragraph 3 of this article, economic activity so that it would serve the general welfare of the nation, various constitutional values should be coordinated;

while regulating, in accordance with the Constitution, inter alia, Article 46 thereof, the economic activity in the sphere of energy so that it serves the general welfare of the nation, the legislature may establish a differentiated legal regulation so as to ensure the constitutionally important objective—a public interest—the security, stability, and reliability of the energy system, inter alia, an opportunity of all consumers to receive energy supplies from multiple sources (suppliers) under non-discriminatory conditions and at fair prices;

for this purpose, projects of special importance for the state designed for putting an end to the dependence of the national economy upon a monopolist supplier of certain energy resources (inter alia, natural gas) may be implemented under procedure and conditions established by law; the legislature, having established the legal regulation commissioning certain state-controlled economic subjects to implement these projects, must also establish an efficient mechanism of control over the implementation of such projects;

the legislature, in regulating the economic activity in the sphere of energy so that it could serve the general welfare of the nation and by taking account of both the grounds consolidated in the Constitution for the possession, use and disposal of state property and the competence of the Government to administer the affairs of the country and to guarantee state security, may consolidate by means of both general norms and special norms of legal regulation the powers of the Government to use the state-controlled economic subjects as an instrument in an economic policy in order to meet public interests in the sphere of economy, inter alia, in selecting a concrete state-controlled economic subject for the implementation of a certain project of special state importance;

the geopolitical orientation of the State of Lithuania consolidated in the Constitution implies, inter alia, the membership of the Republic of Lithuania in the European Union and the necessity to fulfil the obligations connected with such membership, inter alia, in the sphere of energy, which are inseparable from the duty consolidated in Paragraph 3 of Article 46 of the Constitution for the state to ensure the general welfare of the nation.

3. It has been mentioned that under the legal regulation established in Paragraph 1 of Article 4 of the LNG Terminal Law, the Government or an institution authorised by it has the right to decide which company, whose shares carrying no less than 2/3 of all votes at a general meeting of the shareholders belong to the state, should implement the project of the LNG Terminal.

Under the legal regulation established in the LNG Terminal Law, if it is, inter alia, interpreted in conjunction with the provisions of other laws:

the LNG Terminal as one of the constituent parts of the natural-gas system is a facility of strategic significance to national security and is deemed to be an economic project of state importance, through which liquefied natural gas is imported to Lithuania.

in Klaipėda State Seaport, the company implementing the project of the LNG Terminal performs the work of the development and installation of the infrastructure of, or ensures the installation of the LNG Terminal, and performs other related work until the connection of the this terminal to the system of the transmission of natural gas and the beginning of its operation, i.e., by 3 December 2014 at the latest;

the project of the LNG Terminal is carried out in an effort, inter alia, to implement the requirements established in EU law and, among other things, to ensure that the necessary measures should be taken so that, by 3 December 2014 at the latest, in the event of a disruption of the single largest gas infrastructure, the capacity of the remaining infrastructure is able to satisfy total gas demand of the calculated area during a day of exceptionally high gas demand;

by stipulating that the state must hold the number of shares carrying no less than 2/3 votes at a general meeting of the shareholders of the company of strategic significance to national security that implements the project of the LNG Terminal, an effort was made to ensure that the state should have a decisive majority of votes at a general meeting of the shareholders of this company in order to decide the most important issues of managing it; the rest of the shares of this company may belong to private national and foreign persons that meet national security interests.

It has been mentioned that, in the absence of any LNG terminal, natural gas used to be supplied to the Republic of Lithuania by the sole external supplier, whilst its monopolistic position in the market in natural-gas supply used to exert a decisive influence on the prices of natural gas, and that the LNG Terminal Law was adopted, inter alia, in an attempt to implement the strategic objectives of the state energy policy, to reduce the dependence on the said sole external supplier of natural gas, as well as to enhance the security and reliability of providing consumers with natural gas.

In the context of the constitutional justice case at issue, it should be noted that, as mentioned before, under the Law on the Basics of National Security, energy is a strategically important sector for national security, whilst the provision of energy supplies may not be placed under the control of the subjects of the supplying countries. The special legal regulation consolidated in the LNG Terminal Law attempts to create the legal preconditions for installing and operating a concrete LNG terminal of strategic significance to national security, through which it would be possible to supply all consumers of Lithuania with energy resources (natural gas) and thus to end the dependence on the sole monopolist external supplier of such energy resources.

4. Thus, the legal regulation whereby, subsequent to a decision of the Government or an institution authorised by it, a company, whose shares carrying no less than 2/3 of all votes at a general meeting of the shareholders belong to the state, implements the project of the LNG Terminal, should be deemed to be an attempt of the legislature to create the preconditions for the state to control the said company as well as the preconditions for implementing the project of the LNG Terminal of strategic significance to national security in the manner so as to ensure a constitutionally important objective—a public interest—the security and reliability of the energy system; at the same time, this legal regulation was aimed at creating preconditions for the timely fulfilment of the obligations of the Republic of Lithuania arising from its membership in the European Union in the sphere of energy, thus, inter alia, in order to guarantee the security of the supply of natural gas.

Consequently, by the said legal regulation, in guaranteeing the security of the supply of natural gas in Lithuania, the legislature has created the legal preconditions for ensuring the interest of the entire society to receive energy resources from multiple sources under non-discriminatory conditions and, by such legal regulation, it implemented the duty consolidated in Paragraph 3 of Article 46 of the Constitution to regulate economic activity so that it serves the general welfare of the nation. Therefore, there is no ground for stating that the legal regulation established in Paragraph 1 of Article 4 of the LNG Terminal Law, stipulating that, by a decision of the Government or an institution authorised by it, a certain company whose shares carrying no less than 2/3 of all votes at a general meeting of the shareholders belong to the state, implements the project of the LNG Terminal, violates Paragraph 1 of Article 46 of the Constitution.

5. In the light of the foregoing arguments, the conclusion should be drawn that Paragraph 1 of Article 4 of the LNG Terminal Law is not in conflict with Paragraph 1 of Article 46 of the Constitution.

VII

On the compliance of Paragraph 2 (wording of 12 June 2012) of Article 5 of the Law on the Liquefied Natural Gas Terminal with Paragraph 2 of Article 5, Article 23, Item 15 of Article 67, and Paragraph 3 of Article 127 of the Constitution and with the constitutional principle of the separation of powers

1. In the constitutional justice case at issue, subsequent to the petitions of the petitioners, the Constitutional Court investigates, inter alia, the compliance of Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law with Paragraph 2 of Article 5, Article 23, Item 15 of Article 67, and Paragraph 3 of Article 127 of the Constitution and with the constitutional principle of the separation of powers.

2. It has been mentioned that, under the legal regulation established in Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law, the costs (part thereof) of the installation of the LNG Terminal, its infrastructure and connection, and of its operation may be included in the price for the service of the transmission of natural gas and such costs made up of the price for the natural-gas transmission service and revenues are administered and compensated for the LNG terminal operator by the natural-gas transmission system operator under procedure established by the National Commission for Energy Control and Prices.

3. A group of members of the Seimas, the petitioner, has doubts about the compliance of Paragraph 2 of Article 5 of the LNG Terminal Law with Article 23 of the Constitution due to the fact that, on the one hand, having established in the said paragraph the so-called LNG Supplement (i.e., a part of the price of the service of the transmission of natural gas, which is comprised of the costs (part thereof) of the installation of the LNG Terminal, its infrastructure and connection, and of its operation), a part of the costs of the LNG Terminal is shifted to all users of the transmission system of natural gas, without taking into account whether they will use the services of the LNG Terminal, whilst this means that property of the payers of the LNG Supplement is taken for the needs of society. On the other hand, due to the fact that, being under an obligation to pay the LNG Supplement, which can mean large amounts of money, the users of the transmission system of natural gas may not freely dispose of their property, thus, essentially, a limitation is placed upon their property. In addition, the function is established for the transmission system operator to administer the funds of the LNG Supplement, however, no compensation is provided for the costs of administering such funds, therefore, the rights of ownership of the transmission system operator are violated.

3.1. In deciding whether Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law was not in conflict with Article 23 of the Constitution in that, having consolidated, according to the petitioner, the so-called LNG Supplement, property of the users of the system of natural-gas transmission is essentially limited on the one hand, and, on the other hand, is taken for the needs of society, it should be noted that, under the Constitution:

in an attempt to ensure the security and reliability of the energy system, inter alia, a possibility of receiving energy resources from multiple sources (suppliers) under non-discriminatory conditions and at fair prices, it is allowed, under procedure and conditions established by law, to implement projects of special state importance designed for putting an end to the dependence on a monopolist supplier of certain energy resources (inter alia, natural gas);

being under obligation to ensure an efficient implementation of such projects of special state importance, the legislature may establish the legal regulation whereby the said projects could be financed from multiple sources, inter alia, from funds of the consumers of energy resources; these funds may be accumulated by applying the tariff of a state-regulated price, where such a tariff is established, inter alia, in view of the law-established obligations for the economic subjects implementing the aforesaid projects of special importance for the state to provide public services in the sphere of energy—to install and operate the energy infrastructure in seeking to ensure that energy resources would be supplied in a secure and reliable manner to all consumers; the legislature must also establish an efficient mechanism of control over the justified costs of the implementation of such projects.

3.2. It has been mentioned that, according to the legal regulation established in Paragraph 2 of Article 5 of the LNG Terminal Law, if it is interpreted, inter alia, in the context of other provisions of the same of law, the Law on Energy, and the Law on Natural Gas:

the LNG Supplement—a part of the price of the service of the transmission of natural gas, which is comprised of the costs (part thereof) of the installation and operation of the LNG Terminal, its infrastructure and connection—is one of the sources of financing the project of the LNG Terminal that is deemed to be an economic project of special state importance in the course of the implementation of which a facility of strategic significance to national security is installed;

the costs (part thereof) of the company implementing the project of the LNG Terminal related to the installation of the LNG Terminal, its infrastructure and connection, and of its operation, as well as the costs (part thereof) of the operator of the LNG Terminal related to the operation of the LNG Terminal, its infrastructure and connection by ensuring a safe and reliable functioning of this terminal, by separating such costs from the costs of the activity of the transmission of natural gas, are included into a part of the price of the service of the transmission of natural gas;

the part of the price for the service of the transmission of natural gas comprised of the costs (part thereof) of the installation and operation of the LNG Terminal, its infrastructure and connection (so-called the LNG Supplement) is a constituent part of the state-regulated price of natural gas; it is established for all recipients of the service of the transmission of natural gas (users of the natural-gas transmission system and consumers of natural gas) in an effort to cover the costs (part thereof) of the installation and operation of the LNG Terminal through which natural gas is supplied to the system of the transmission of natural gas; the costs comprising this part of the price must be justified and such justification is supervised by the National Commission for Energy Control and Prices;

the project of the LNG Terminal is carried out in an effort to implement the strategic objectives of the energy policy of the state, to protect the interests of the entire society, inter alia, the consumers of natural gas, therefore, the installation and operation of this terminal should be regarded as the provision of services meeting public interests which must be taken into account while establishing the state-regulated prices for natural gas.

3.3. Thus, Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law established the legal regulation whereby the LNG Terminal which is of strategic significance to national security is installed and operated by using, as one of the sources for financing the project of the LNG Terminal, the funds of all the recipients of the service of the transmission of natural gas (users of the system of the transmission of natural gas and consumers of natural gas), where such funds are collected on the grounds of the tariff of the state-regulated price for natural gas for the public services—the installation and operation of the infrastructure of natural gas in order to ensure that natural gas would be supplied in a secure and reliable manner to all consumers—provided both by the company implementing the project of the LNG Terminal and by the operator of the LNG Terminal. In the course of the implementation of the project of the LNG Terminal, it is sought to ensure the security and reliability of the system of natural gas which is used by all aforesaid recipients of the service of the transmission of natural gas.

It should be noted that, according to the legal regulation consolidated in Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law, in itself, the duty established for all consumers using the system of the transmission of natural gas to pay for the provision of the aforementioned public services in the sphere of energy on the grounds of the tariff of the state-regulated price may not be regarded as a limitation on the rights of ownership, let alone as taking over the property for the needs of society, thus, such a duty may not be regarded as a violation of Article 23 of the Constitution, either.

Consequently, there is no ground for stating that the legal regulation established in Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law violated the rights of the recipients of the service of the transmission of natural gas arising from Article 23 of the Constitution.

3.4. It has been mentioned that a group of members of the Seimas, the petitioner, has doubts about the compliance of the legal regulation consolidated in Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law with Article 23 of the Constitution, among other things, due to the fact that the function is established for the transmission system operator to administer the funds of the LNG Supplement, however, no compensation is provided for the costs of administering such funds, therefore, in the opinion of the petitioner, the rights of ownership of the transmission system operator are violated.

3.4.1. It has been mentioned that, under the legal regulation established in Paragraph 2 of Article 5 if the LNG Terminal Law, the company implementing the project of the LNG Terminal that is responsible for the installation of the LNG Terminal that must be connected to the system of the transmission of natural gas, is the recipient of the income received from the part of the price for the service of the transmission of natural gas, which is comprised of the costs (part thereof) of the installation of the LNG Terminal, its infrastructure and connection; this income is meant for covering the costs of the company implementing the project of the LNG Terminal related to the installation of the LNG Terminal.

It has been mentioned that the operator of the LNG Terminal that is responsible of the operation of this terminal is the recipient of the income received from the part of the price for the service of the transmission of natural gas, which is comprised of the costs (part thereof) of the operation of the LNG Terminal, its infrastructure and connection; this income is meant for covering the costs of the operator of the LNG Terminal related to the operation of the LNG Terminal.

As mentioned before, the operator of the system of the transmission of natural gas is the administrator of the aforementioned income of the company implementing the project of the LNG Terminal and of the aforementioned income of the operator of the LNG Terminal.

3.4.2. Thus, the costs of the operator of the system of the transmission of natural gas incurred in the course of administering the income received from the part of the price of the service of the transmission of natural gas, which is comprised of the costs (part thereof) of the installation of the LNG Terminal, its infrastructure and connection, and of its operation (i.e., from the so-called LNG Supplement), are incurred not due to the transmission activity carried out by the operator of the transmission of natural gas, but rather due to the fact that this operator was commissioned to administer the income meant for financing the activity of the company implementing the project of the LNG Terminal in installing the LNG Terminal and for financing the activity of the LNG operator in operating this terminal.

Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law did not contain any such legal regulation that would have established the duty for the operator of the transmission system to use its own property for discharging the function of administering the funds of the so-called LNG Supplement. It should be noted that the said administration costs incurred by the operator of the transmission system should be compensated from the income received from the part of the price of the service of the transmission of natural gas, which is comprised of the costs (part thereof) of the installation of the LNG Terminal, its infrastructure and connection, and of its operation (i.e. from the funds of the so-called LNG Supplement), but not from the income received from the transmission activity performed by this operator.

Consequently, there is no ground for stating that there was a violation of the rights of the operator of the system of the transmission of natural gas arising from Article 23 of the Constitution.

4. It has been mentioned that, in the constitutional justice case at issue, subsequent to the petitions of the petitioners—the Vilnius Regional Administrative Court and the Court of Appeal of Lithuania, the Constitutional Court investigates, inter alia, the compliance of Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law with Paragraph 2 of Article 5, Item 15 of Article 67, and Paragraph 3 of Article 127 of the Constitution and with the constitutional principle of the separation of powers.

The petitioners have doubts about the compliance of the legal regulation consolidated in Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law with Item 15 of Article 67 and Paragraph 3 of Article 127 of the Constitution due to the fact that such legal regulation establishes the LNG Supplement which is a tax, therefore, all the essential elements of this Supplement should have been established by law. According to the petitioners, the Seimas has no right to commission either the Government or any other institution to implement the constitutional competence of the Seimas. The legislature, by establishing in Paragraph 2 of Article 5 of the LNG Terminal Law that the costs (or part thereof) of the installation and operation of the LNG Terminal may be included in the price for the natural-gas transmission service under procedure and conditions established by the National Commission for Energy Control and Prices, commissioned this institution to establish the essential elements of the LNG Supplement as a tax, i.e. to implement the constitutional function of the legislature itself, and thus violated Paragraph 2 of Article 5 of the Constitution and the constitutional principle of the separation of powers.

4.1. It has been mentioned that, in construing Item 15 of Article 67 and Paragraph 3 of Article 127 of the Constitution, the Constitutional Court has held that taxes and other compulsory payments are compulsory and unrequited payments of an appropriate size which are established by law and made by legal and natural persons to the state (municipal) budget in due time; state taxes and other compulsory payments are a pecuniary obligation of legal subjects to the state; taxes are not of directly repayable nature, i.e., after they are paid to the state institution which accepts the said tax, the aforementioned institution is under no obligation to perform any actions or render any particular service for the taxpayer.

4.2. It has been mentioned that, according to the legal regulation established in Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law, if it is interpreted in the context of other provisions of the same of law, the Law on Energy, and the Law on Natural Gas:

the LNG Terminal through which natural gas is supplied to the transmission system, the terminal being a constituent part of the natural-gas system, is an economic project of special state importance carried out in an effort to implement the strategic objectives of the energy policy of the state;

the installation and operation of this terminal of strategic significance for national security should be treated as the provision of services meeting public interests which must be taken into account while establishing the state-regulated prices for natural gas;

one of the sources for financing the project of the LNG Terminal is the so-called LNG Supplement, which is a constituent part of the state-regulated price for natural gas and paid by all recipients of the service of the transmission of natural gas in an effort to cover the costs (part thereof) of the installation and operation of the LNG Terminal through which natural gas is supplied to the system of the transmission of natural gas;

the company implementing the project of the LNG Terminal is the recipient of the income received from the part of the price for the service of the transmission of natural gas, which is comprised of the costs (part thereof) of the installation of the LNG Terminal, its infrastructure and connection, whilst the operator of the LNG Terminal is the recipient of the income received from the part of the price for the service of the transmission of natural gas, which is comprised of the costs (part thereof) of the operation of the LNG Terminal, its infrastructure and its connection.

4.3. Thus, the so-called LNG Supplement established in Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law is part of the state-regulated price for natural gas paid by all the recipients of the service of the transmission of natural gas. This part of the state-regulated price is paid to the independent economic subjects—the company implementing the project of the LNG Terminal and the operator of the LNG Terminal—for the public services provided for in the law, which is the installation and operation of the infrastructure of natural gas in an attempt to ensure that natural gas would be supplied to all consumers in a secure and reliable manner. The aforementioned part of the state-regulated price is paid not to the state (municipal) budget, but to the said independent economic subjects that provide the public services.

In the context of the constitutional justice case at issue, it needs to be emphasised that the so-called LNG Supplement is a constituent part of a natural gas price established according to the mechanism, consolidated by law, for price regulation by the state; this mechanism enables the establishment of prices for natural gas by taking into account, inter alia, the provision of services meeting public interests. Therefore, the legal regulation laid down in Paragraph 2 (wording of 12 June 2012) Article 5 of the LNG Terminal Law consolidating the LNG Supplement as a constituent part of the state-regulated price for natural gas that is paid for the law-established public services rendered by certain economic subjects, i.e., for the installation and operation of the infrastructure of natural gas in order to ensure that natural gas would be supplied in a secure and reliable manner to all consumers, may not be interpreted as meaning that it regulated tax relations. Thus, the said legal regulation laid down in Paragraph 2 (wording of 12 June 2012) Article 5 of the LNG Terminal Law regulated the relations whose character was different from ones regulated in Item 15 of Article 67 and Paragraph 3 of Article 127 of the Constitution. In view of this fact, the so-called LNG Supplement should not be regarded as a state tax or another obligatory payment within the meaning of Item 15 of Article 67 and Paragraph 3 of Article 127 of the Constitution.

Consequently, there is no ground for stating that the legal regulation laid down in Paragraph 2 (wording of 12 June 2012) Article 5 of the LNG Terminal Law violated Item 15 of Article 67 and Paragraph 3 of Article 127 of the Constitution.

4.4. It has been mentioned that, in the constitutional justice case at issue, subsequent to the petitions of the petitioners—the Vilnius Regional Administrative Court and the Court of Appeal of Lithuania, the Constitutional Court investigates whether Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law was not in conflict, inter alia, with Paragraph 2 of Article 5 of the Constitution and with the constitutional principle of the separation of powers.

The doubts of the petitioners about the compliance of Paragraph 2 of Article 5 of the LNG Terminal Law with Paragraph 2 of Article 5 of the Constitution and with the constitutional principle of the separation of powers are essentially connected with their doubts regarding the compliance of Paragraph 2 of Article 5 of the same law with Item 15 of Article 67 and Paragraph 3 of Article 127 of the Constitution, i.e., with the fact that, within the meaning of the Constitution, the so-called LNG Supplement is either a tax or another compulsory payment.

Therefore, having held that Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law was not in conflict with Item 15 of Article 67 of the Constitution, there is no ground for stating that the legal regulation established in Paragraph 2 of Article 5 of the LNG Terminal Law violated Paragraph 2 of Article 5 of the Constitution and the constitutional principle of the separation of powers.

5. In the light of the foregoing arguments, the conclusion should be drawn that Paragraph 2 (wording of 12 June 2012) of Article 5 of the LNG Terminal Law was not in conflict with Paragraph 2 of Article 5, Article 23, Item 15 of Article 67, and Paragraph 3 of Article 127 of the Constitution and with the constitutional principle of the separation of powers.

VIII

On the compliance of Item 1 of the Government Resolution (No. 199) “On the Implementation of the Republic of Lithuania’s Law on the Liquefied Natural Gas Terminal” of 15 February 2012 (wording of 11 July 2012) is not in conflict with Paragraph 1 of Article 46 of the Constitution

1. It has been mentioned that, in the constitutional justice case at issue, subsequent to the petition of a group of members of the Seimas, a petitioner, the Constitutional Court investigates whether Item 1 of government resolution No. 199 of 15 February 2012 (wording of 11 July 2012) is not in conflict with Paragraph 1 of Article 46 of the Constitution.

2. Item 1 of government resolution No. 199 of 15 February 2012 (wording of 11 July 2012) prescribes: “To assent to the implementation of the project of the Liquefied Natural Gas Terminal by the joint-stock company ‘Klaipėdos Nafta’ as the company implementing the project of the Liquefied Natural Gas Terminal.”

3. It is clear from the preamble to government resolution No. 199 of 15 February 2012 (wording of 11 July 2012) that this government resolution is designed for the implementation of the LNG Terminal Law, inter alia, Paragraph 1 of Article 4 thereof. As mentioned before, this provision of the law prescribes that, subsequent to a decision of the Government or an institution authorised by it, the project of the LNG Terminal is implemented by a company implementing the project of the LNG Terminal, whose shares carrying no less than 2/3 of all votes at a general meeting of the shareholders belong to the state.

4. It is clear from the entirety of the petition of the group of members of the Seimas that it impugns the compliance of Item 1 of government resolution No. 199 of 15 February 2012 (wording of 11 July 2012) with Paragraph 1 of Article 46 of the Constitution due to the fact that, in the opinion of the petitioner, by the same item, the Government implemented Paragraph 1 of Article 4 of the LNG Terminal Law allegedly conflicting with the same provision of the Constitution. Thus, a group of members of the Seimas, the petitioner, impugns the compliance of Item 1 of government resolution No. 199 of 15 February 2012 (wording of 11 July 2012) with Paragraph 1 of Article 46 of the Constitution on virtually the same grounds as it impugns the compliance of Paragraph 1 of Article 4 of the LNG Terminal Law with Paragraph 1 of Article 46 of the Constitution. In addition, it should be noted that, even though the representative of a group of members of the Seimas, the petitioner, asserted in the Constitutional Court’s hearing that the selection of the JSC “Klaipėdos nafta” as a company implementing the project of the LNG Terminal is not objectively grounded, he did not provide any arguments substantiating the fact that this enterprise of strategic importance to national security is unfit for implementing the project of the LNG Terminal that is deemed to be a project of special state economic importance.

5. As mentioned before, government resolution No. 199 of 15 February 2012 (wording of 11 July 2012) is designed for the implementation of the LNG Terminal Law.

It has been held in this ruling of the Constitutional Court that Paragraph 1 of Article 4 of the LNG Terminal Law is not in conflict with Paragraph 1 of Article 46 of the Constitution.

Having held this, on the grounds of the same arguments, it should also be held that Item 1 of government resolution No. 199 of 15 February 2012 (wording of 11 July 2012) is not in conflict with Paragraph 1 of Article 46 of the Constitution.

6. In the light of the foregoing arguments, the conclusion should be drawn that Item 1 of government resolution No. 199 of 15 February 2012 (wording of 11 July 2012) is not in conflict with Paragraph 1 of Article 46 of the Constitution.

Conforming to Articles 102 and 105 of the Constitution of the Republic of Lithuania and Articles 1, 53, 54, 55, 56, and 69 of the Law on the Constitutional Court of the Republic of Lithuania, the Constitutional Court of the Republic of Lithuania gives the following

ruling:

1. To recognise that Paragraph 1 of Article 4 of the Republic of Lithuania’s Law on the Liquefied Natural Gas Terminal (Official Gazette Valstybės žinios, 2012, No. 68-3466) is not in conflict with Paragraph 1 of Article 46 of the Constitution of the Republic of Lithuania.

2. To recognise that Paragraph 2 of Article 5 (wording of 12 June 2012; Official Gazette Valstybės žinios, 2012, No. 68-3466) of the Law on the Liquefied Natural Gas Terminal was not in conflict with the Constitution of the Republic of Lithuania.

3. To recognise that Item 1 of the Resolution of the Government of the Republic of Lithuania (No. 199) “On the Implementation of the Republic of Lithuania’s Law on the Liquefied Natural Gas Terminal” of 15 February 2012 (wording of 11 July 2012; Official Gazette Valstybės žinios, 2012, No. 83-4387) is not in conflict with Paragraph 1 of Article 46 of the Constitution of the Republic of Lithuania.

4. To dismiss the part of the case subsequent to the petition of a group of members of the Seimas of the Republic of Lithuania, the petitioner, requesting an investigation into whether Paragraphs 1, 2, and 3 of Article 11 (wording of 12 June 2012; Official Gazette Valstybės žinios, 2012, No. 68-3466) of the Republic of Lithuania’s Law on the Liquefied Natural Gas Terminal, insofar as natural-gas enterprises importing natural gas into the Republic of Lithuania through interconnecting and other natural-gas pipelines of the transmission system are under an obligation to purchase, through the Liquefied Natural Gas Terminal, not less than 25 percent of the total natural-gas quantity that such an enterprise supplies to the natural-gas system per year, were not in conflict with Paragraph 1 of Article 23 and Paragraphs 1, 4, and 5 of Article 46 of the Constitution of the Republic of Lithuania.

5. To dismiss the part of the case subsequent to the petition of a group of members of the Seimas of the Republic of Lithuania, the petitioner, requesting an investigation into whether the provision “the aforesaid natural-gas enterprises may not, on the grounds of agreements concluded after the entry into force of this Law, be under an obligation to pay for the untaken natural-gas quantity imported through interconnecting and other natural-gas pipelines of the transmission system (the so-called ‘take-or-pay’ obligation)” of Paragraph 2 of Article 11 (wording of 12 June 2012; Official Gazette Valstybės žinios, 2012, No. 68-3466) of the Republic of Lithuania’s Law on the Liquefied Natural Gas Terminal, insofar as the obligation referred to in the said provision may not be applied only when paying for the untaken natural-gas quantity imported through interconnecting and other natural-gas pipelines of the transmission system, however, it is applied when paying for the untaken natural-gas quantity imported through the Liquefied Natural Gas Terminal, was not in conflict with Paragraph 1 of Article 29 and Paragraphs 1 and 4 of Article 46 of the Constitution of the Republic of Lithuania.

This ruling of the Constitutional Court is final and not subject to appeal.

Justices of the Constitutional Court:                  Elvyra Baltutytė

                                                                                       Vytautas Greičius

                                                                                       Danutė Jočienė

                                                                                       Pranas Kuconis

                                                                                       Gediminas Mesonis

                                                                                       Vytas Milius

                                                                                       Egidijus Šileikis

                                                                                       Algirdas Taminskas

                                                                                       Dainius Žalimas