Conference “Reform on Pledge and Mortgage in the Republic of Lithuania“ 23 Mar 2010
Varul Vilgerts Smaliukas, in cooperation with the Ministry of Justice
of the Republic of Lithuania, organized a conference on reform on
pledge and mortgage in the Republic of Lithuania. The conference took
place on March 18, 2010.
The conference was led by the managing partner of our Lithuanian office, Mr. Robert Juodka and the conference included presentations from the partners of our law firm Varul Vilgerts Smaliukas Mr. Andrius Smaliukas and Mr Paul Varul; the Minister of Justice of Lithuania, Mr. Remigijus Simasius; professor of Vilnius University Law Faculty, Mr. Valentinas Mikelenas; the president of the Lithuanian Chamber of Notaries, Mr. Marius Stračkaitis; the president of the Lithuanian Bank Association, Mr. Stasys Kropas; the leader of the working group of reform on pledge and mortgage, Mrs. Renata Juzikienė and other respected speakers.
The objective of the conference was to provide an overview of the progress of reform on pledge and mortgage in the Republic of Lithuania, to discuss the problems with the existing regulations and to share insights in order to promote the development of best practices.
Mr. Remigijus Simasius expressed his hopes that the Lithuanian Parliament would make the necessary changes to the current pledge and mortgage legislation and that the respective legislative amendments would be approved as early as in April of 2010 – thereby marking the start of the practical realization of the reform.
It is also expected that as a result of the reform the workload of the courts would be reduced and a considerable amount of state outlay saved.
Dr. Andrius Smaliukas stated that the implementation of the reform would facilitate the registration of the mortgage.Dr. Andrius Smaliukas noted that by removing the functions currently performed by mortgage judges and incorporating them into the general judicial sphere, the workload of the courts, especially that of the courts of first instance, would be significantly reduced, thereby making the entire court system more efficient.
Today the legitimacy of mortgage contracts is assessed by notaries and mortgage judges. The initiators of the reform suggest repealing the need for judicial registration. If the mortgage contracts were registered only by notaries, the process would become an administrative rather than a judicial procedure.
During the conference proposals were also made to the Parliament to legitimise the pledging of a company’s assets. The opportunity to pledge the whole or part of a company would increase the chances of obtaining loans from banks, and the banks would then not need to require pledges over the personal assets of businessmen.