Limitations to Foreigners

1. Are there in your national system any limitations to foreigner citizens or foreign companies/companies controlled by foreign citizens regarding the acquisition of immovable properties? If yes:

1.1. Which legal regulations regulate in your country the prohibitions or limitations for foreigners’ acquisitions in case of transfer of property? Please specify the legal regulation and/or the range of the regulation that contains the prohibition.

The right of foreigners to acquire real property is governed by the Constitution of Republic of Lithuania. In accordance with the provisions of Article 47(3), foreign entities may acquire the ownership of land, inland waters and forests according to a Constitutional Law.

Article 3 of the Constitutional Law on the Implementation of Article 47(3) of the Constitution of the Republic of Lithuania stipulates that foreigners (legal and natural persons) that meet the criteria of European and transatlantic integration embarked on by Lithuania may be allowed to acquire ownership of land, inland waters and forests.

The criteria for European and transatlantic integration embarked on by Lithuania shall be fulfilled by foreign legal entities, as well as other foreign organizations, established in states which are not members of political, military, economic or other unions or commonwealths of states established on the basis of the former Union of Soviet Socialist Republics, and which are members of at least one of these unions, agreements or organizations: (1) the European Union; (2) the North Atlantic Treaty Organization; (3) Agreement on the European Economic Area; (4) the Organization for Economic Co-operation and Development.

Article 3(6) of the Law of the Republic of Lithuania on establishing restrictive measures regarding military aggression against Ukraine suspends the right of citizens of the Russian Federation and legal entities established or controlled by them, as defined in the Law on Competition of the Republic of Lithuania, to acquire ownership of real property located in the territory of the Republic of Lithuania. Their right to acquire ownership shall be suspended, unless a citizen of the Russian Federation has been issued a temporary residence permit in the Republic of Lithuania or a permanent residence permit in the Republic of Lithuania, or unless a citizen of the Russian Federation acquires the ownership of real property by inheritance.

1.2. What do these limitations consist of?

Foreign persons have a right to purchase real estate in Lithuania, except certain restrictions or exceptions stipulated in the legal acts of the Republic of Lithuania.

The right of foreigners to acquire real estate is governed by the Constitution Constitution of Republic of Lithuania. According to the provisions of the Article 47 Part 3 – foreign subjects may acquire land, inland waters and forests in accordance with the Constitutional Law.

Constitutional Law on the Implementation of Article 47(3) of the Constitution of the Republic of Lithuania in Article 3 stipulates that foreigners (legal and natural persons) that meet the criteria of Lithuania’s chosen European and transatlantic integration may be allowed to acquire ownership of land, inland waters and forests. However, there is a list of limitations in Article 9 of the mentioned law (these limitations are listed in the answer of question No. 2.

The criteria for European and transatlantic integration chosen by Lithuania shall be fulfilled by foreign legal entities, as well as other foreign organisations, established in states which are not members of political, military, economic or other unions or commonwealths of states established on the basis of the Union of former Soviet Socialist Republics, and which are members of at least one of these unions, agreements or organisations: (1) the European Union; (2) the North Atlantic Treaty Organisation; (3) the European Economic Area Agreement; (4) the Organisation for Economic Co-operation and Development.

In case of purchasing buildings or premises by foreign citizens, there are no limitations Lithuania (only the same as for citizens), except the example in the answer of 1.b below.

1.3. Do these limitations apply to any foreign citizen, regardless their nationality, or only to non-EU Members national citizens?

According to the Law of the Republic of Lithuania on establishing restrictive measures regarding military aggression against Ukraine. Article 3 part 6 of the law suspends the right of citizens of the Russian Federation and legal entities established or controlled by them, as defined in the Law on Competition of the Republic of Lithuania, to acquire ownership of immovable property located in the territory of the Republic of Lithuania, shall be suspended, unless the citizen of the Russian Federation has been issued a temporary residence permit in the Republic of Lithuania or a permanent residence permit in the Republic of Lithuania, or unless a citizen of the Russian Federation acquires the ownership of immovable property by inheritance.

1.4. Do these limitations have?

• A defensive/protective purpose
• An economic purpose
• «Both economic and defensive/protective purposes»
• «Other purposes (please specify): restrictive measures regarding military aggression against Ukraine.»
  

2. To which kind of land registry unit do these limitations apply? (Example: only land plots, only rural areas, only foreign borders, dwellings and homes, other buildings?

As answered in 1.a – land, inland waters and forests, in 1.b – all the immovable property. Also there are other restrictions that apply for both – citizens and foreigners.

As governed in Constitutional Law on the Implementation of Article 47(3) of the Constitution of the Republic of Lithuania Article 9 Foreigners may not acquire ownership of the following land:

1) land of objects belonging to the Republic of Lithuania with exclusive ownership;
2) lands of state parks, reserves, sanctuaries, biosphere monitoring territories;
3) agricultural land;
4) forestry land, except for plots of land required for the operation of buildings and facilities for economic activities, as provided for in approved territorial planning documents;
5) land for recreational and protective forests, rivers, other water bodies larger than 1 ha and their coastal protection zones;
6) land for resorts, public recreation and recreation areas, designated public recreation facilities;
7) lands of state-protected natural, historical, archaeological and other cultural objects and their protection areas;
8) land of territories reserved for public roads and engineering communications, public infrastructure facilities of towns or other areas and other general public needs in accordance with their planning documents;
9) land for public roads, railways, air, sea or river ports, trunk pipelines and other engineering communications of public use, and land necessary for their operation;
10) land allocated to the territory of a free economic zone as provided by law;
11) land in territories where minerals and other natural resources have been discovered, except for land plots which, according to the territorial planning documents, are directly intended for the construction of buildings and facilities necessary for the extraction or exploitation of these resources;
12) land of the Curonian Spit, the Baltic Sea and the Curonian Lagoon, with the exception of the land of towns without the status of a resort;
13) lands belonging to the border sections;
14) lands of territories designated or reserved for national defence needs, as well as lands of territories where land acquisition is restricted by law or by the Government of the Republic of Lithuania for security reasons.

3. To which kind of transfers or burdens do these limitations apply? (Example: to every transfer, non-free transfers, differently in case of inheritance than in case of purchase, mortgages in favor of foreigners….)

In case of land inheritance, i.e. when a citizen of the Republic of Lithuania who owned a plot of land dies and the transferee is a foreigner who does not meet the criteria for European and transatlantic integration, he or she is only entitled to the amount of money received after the sale of the inherited plot of land. In the case where the heir is a foreigner who fulfils the criteria for European and transatlantic integration, he/she acquires the ownership right to the land itself, i.e. he/she can freely use, dispose of and manage the land, as they are granted the right to acquire the ownership of the land in Lithuania in accordance with the procedure laid down in the laws of the Republic of Lithuania. It should be noted that the same rules apply in the case of a gift of a land plot to a foreigner. Where a contract of gift of a land plot is concluded with a foreigner who does not meet the criteria of European and transatlantic integration, such a contract is declared invalid from the moment of its conclusion as being contrary to the mandatory provisions of the law (these persons are not granted the right to acquire land in Lithuania in accordance with the procedure laid down by Lithuanian legislation). Meanwhile, foreigners who meet the criteria for European and transatlantic integration may acquire land in Lithuania without restriction, even on the basis of a gift agreement.

Restrictions mentioned in 1.b do not apply in cases of inheritance.

4. Apart from the previous limitation to acquisition of property by foreigners, are there any other measures at your country relevant for this topic? (Example: pre-emption rights in case of purchase un favor of a foreigner, social or residential measures bases on nationality and non in residential permits….)

Probably there are no such measures.

5. To what extent the land registrars’ controls in a deed of transfer the prohibitions imposed to foreigners to acquire land and buildings in your country?

5.1. Do you only check if the transfer administrative authorization requirement is met, or do you also confirm that the authorization is valid? For example, do you consider property type, like rural or forestry classification, which might limit foreign transfers? Or do you verify the percentage of foreign land ownership in a specific area, especially if there are restrictions on the number of buyers or land size?

The right of ownership is usually registered in the Real Property Register on the basis of a document (usually) approved by a notary or other entity authorized by the state. Therefore, all circumstances affecting the legality of the transaction are checked by a notary before approving the transaction. Registrars do not perform additional checks.

5.2. What would happen if an authorization were needed, and it does not come with the title submitted for registration?

If the document is not approved in accordance with the procedure established by legal acts, the application to register the ownership right in the Real Property Register on the basis of such document is rejected.

5.3. What would happen in case a deed of inheritance in favor of a foreigner transfers property over land or buildings subject to limitations for foreigners’ acquisitions in your country?

In all cases, the certificate of inheritance must be certified by a notary who verifies all the circumstances affecting the legality of this certificate. Registrars do not perform additional checks.

In case of land inheritance, i.e. when a citizen of the Republic of Lithuania who owned a land parcel dies and the heir is a foreigner who does not meet the criteria for European and transatlantic integration, they are only entitled to the amount of money received after the sale of the inherited land parcel. In the case where the heir is a foreigner who fulfils the criteria for European and transatlantic integration, they acquire the ownership right to the land parcel itself, i.e. they can freely use, dispose of and manage the land parcel, as they are granted the right to acquire the ownership of the land parcel in Lithuania in accordance with the procedure laid down by the laws of the Republic of Lithuania.

5.4. If the states have preemption right in case of transfer, would you reject the registration if no notification to the state to enhanced it right is done?

As already indicated above, notaries confirm the transfer of ownership rights to real property in Lithuania. They are responsible for the proper implementation of the preemption right. Registrars do not check these circumstances.

6. Do you expect any legal modifications on this issue?

No.