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Newsletter 2010 April

  • Lithuania


    Public Procurement

    The Law on Public Procurement has been amended

    As from 3 March 2010 the amendments to the Law on Public Procurement adopted by Seimas have come into force.

    The purpose of the adoption of the amendments is to harmonise the public procurement law of the Republic of Lithuania with the requirements of the EU law, to secure the compliance with the principles of transparency and nondiscrimination during the procurement procedures. By the amendments the improvement of the order of examination of public procurement disputes by granting an opportunity for the interested suppliers to use immediate and effective means of right protection, especially when the procurementprocedure has not been completed and the infringements can still be repaired, has been pursued.

    In accordance with the provisions of the Directive 2007/66/EC of the European Parliament and of the Council amending Council Directives 89/665/EEC and 92/13/EEC with regard to Improving the Effectiveness of Review Procedures concerning the Award of Public Contracts (hereinafter – the Directive), by the amendments the system of protection measures of suppliers‘ rights has been established, according to which the supplier who believes that a contracting authority has failed to comply with the requirements of this Law and violated or will violate his lawful interests, shall have the right to submit a claim to the regional court regarding:

    1. application of interim protective measures including termination of public
      procurement procedure, or termination of the performance of the decision adopted by the contracting authority;
    2. abolition or amendment of the decisions of the contracting authority, which do not meet the requirements of the Law;
    3. reimbursement of damage;
    4. recognition of public procurement contract as invalid;
    5. application of alternative penalties.

    By the amendments the condition that the submission of the claim to the contracting authority is a mandatory pre-trial stage of dispute settlement has been eliminated. In such a way the procurement procedures shall ensure more flexibility and effectiveness. The opportunity for suppliers to apply to the court after the conclusion of the procurement contract is granted even in such cases, when they have not submitted the claim to the contracting authority during the procurement procedures. However, the supplier willing to dispute the decisions or actions of the contracting authority prior to the conclusion of the contract shall have to submit the claim to the contracting authority following the order established by the law firstly.

    Longer limits to dispute the decisions and actions of the contracting authority have been set forth by the amendments. The limit to dispute the decisions of a contracting authority can last 10 or 15 days, and the limit for the application to the court regarding recognition of the procurement contract as invalid – 6 months after the conclusion of the contract.

    By the amendments the definition of low value procurement has been corrected by establishing that it is a simplified public procurement when at least one of the below listed conditions exists: (1) the value of goods or services contract is lower than LTL 100,000 (VAT exclusive), and the value of works is lower than LTL 500,000 (VAT exclusive); (2) goods or services of similar nature or works divided into separate parts are being purchased, and for every part of which a separate procurement contract is intended to be concluded, and the value of every separate part of which does not exceed 10 per cent of the total value of all parts of the public procurement in case of purchasing goods and services of a similar nature, and does not exceed 1,5 per cent of the total value of all procurement parts when purchasing works. Until now only first of the mentioned conditions has been established.

    By the amendments the new definition of “postponement term of conclusion of procurement contract“ has been established. The postponement term is a 15-day term starting from the day of sending of the notification regarding the decision to conclude the procurement contract by the contracting authority to the interested candidates and interested participants during which the procurement contract may not be concluded. Such a term grants the opportunity to the suppliers participating in the public procurement procedure to evaluate the decisions of the contracting authority and decide whether it is purposeful to dispute them. From now on the Law establishes that the procurement contract must be concluded immediately but not earlier then the postponement term is over. However, the cases when the postponement term can be not applied have been established (e.g. when there is only one interested participant and there are no interested candidates; in case of simplified procurement when the value of the contract is less than LTL 10,000).

    Upon coming into force of the amendments the requirements of the Law shall no longer be applicable to the procurement procedures if the contracting authority concludes the contract with the subject holding the status of separate legal entity, but controlled by the contracting authority as its own service or structural division and in which the contracting authority is the only participant (or implements the rights and obligations of the state or municipality as the only participant) and if the controlled subject receives not less than 90 per cent of its sales income from the activities intended for the supply of the needs or implementation of the functions of the contracting authority.

    The amendments also establish that the procurement documents must establish the requirement to the candidate or the participant to indicate in his tender, what subcontractors, subsuppliers or subproviders he intends to hire, or might establish the requirement that the candidate or the participant would indicate in his tender, for which part of the procurement he intends to hire subcontractors, subsuppliers or subproviders. However, such an indication does not change the liability of the general contractor as regards the performance of the contract to be concluded.

    By the amendments as well as other provisions of the law have been amended according to the proposals of business representatives and of the Commission of Improvement of Business Environment (Saulėtekio Commission), as well as under other provisions of the Directive.

    Company Law

    The amendments and supplements to the Requirements for Audit Committees have been adopted

    As from 10 February 2010 the amendments and supplements to the Requirements for Audit Committees and to the Guidelines of Application of the Requirements for Audit Committees have come into force.

    The amendments and supplements to the above-mentioned legal acts have been adopted in pursuance of solving practical problems, arising when applying the mentioned legal acts and in such a way to correct the existing legal regulation.

    From now on in the Requirements for Audit Committees the purpose of such a committee is established: to ensure a more effective supervision of compliance with the principles of drafting of financial reports and performance of audit processes, internal control, management of risk and effectiveness of internal audit systems, independence and impartiality of an auditor and auditor’s company.

    Moreover, by the amendments the order of approval of composition of the audit committee and the internal rules has been established. From now on it has been clearly established that in case the supervisory board is formed in the company, the composition of the audit committee and the internal rules shall be approved by this body. In case the supervisory board is not formed or the member elected by the general meeting of shareholders is included in the composition of the audit committee, the internal rules and the composition of the audit committee shall be approved by the general meeting of shareholders.

    By the amendments the requirements to the member of the audit committee has been softened: the requirement for the member of the audit committee to have professional experience of 5 years has been reduced to 3 years.

    According to the amendments of the Requirements, the Guidelines of Application of the Requirements for Audit Committees have also been amended.

    Other News

    The law firm Eversheds Saladžius, a member of Eversheds International Limited, was delighted to host the International Women Day, March 8th celebration – Traditional English Afternoon Tea meeting.

    Celebration of the International Women's Day, a day of global celebration for the economic, political and social achievements of women has already become a tradition in many of Eversheds offices worldwide, through highlighting women‘s achievements and raising money for breast cancer research. Based on this noble purpose Eversheds Saladžius kindly invited clients, potential clients, diplomats and other contacts for a pleasant chat, luscious traditional English tea and snacks as well as to support the activities of the local breast cancer campaign foundation Nedelsk.

    During the event the welcoming speeches were made by Jonas Saladžius, Managing Partner of Eversheds Saladžius and Agne Zuokiene, founder of the foundation Nedelsk. The event was also featured by a famous Lithuanian fashion designer Mrs Julija Žileniene who shared a cup of tea with the audience and introduced with the fashion tendencies for spring/summer 2010. The most adorable collection of the designer collected loads of applauses and was highly appreciated.

    The Traditional English Afternoon Tea took place on 8th March 3.00 p.m. at the Shakespeare Hotel Restaurant. During the Afternoon Tea ladies were provided with a possibility to raise money for the Eversheds campaign Wear it Pink by acquiring a pink badge. All the donations collected will be forwarded to the foundation Nedelsk.

    Eversheds Saladžius follows the track of delivering Pro Bono tribute to the society. This time we have invited a group of students from Vilnius Secondary School Versme to visit our law firm and get introduced with the legal profession. A very nice company of young people spent a couple of hours enjoying our lawyers’ acquaintance, discussing on legal and economic issues and having some informal chats. The essence of the project was the visit of high school students with a purpose to gain some direct experience and knowledge from the law firm and its employees.

    In 2009 Eversheds Saladžius signed the sponsorship agreement with the Lithuanian National Ice Hockey League. In March 2010 the Lithuanian National Ice Hockey League championship was arranged. Managing Partner Jonas Saladžius presented Eversheds Saladžius established trophy to a young player with the most points during the championship.

    On behalf of the French Chamber of Commerce Head of Marketing Aušra Jefremovienė participated at the fifth Investors‘ Forum meeting with the Government of the Republic of Lithuania on 21 April 2010. The meeting was arranged at the office of the Lithuanian Government and summoned representatives of the largest and most active foreign investors in Lithuania. During the meeting a very impressive and constructive discussion was lead between the Government and representatives of the private capital.




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