Lithuania Tightens Asset Confiscation Laws Against Unlawful Profits

Lithuania is set to strengthen its legal framework for confiscating assets acquired through unlawful means, targeting individuals who have profited unjustly. The proposed legislative package aims to modernize the fight against illicit enrichment, bringing the country into compliance with a European Union directive that mandates member states to establish mechanisms for confiscating assets gained without a legal basis.

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The anticipated peaceful settlement institute will allow for the conclusion of the process at the pre-trial stage, a broader definition of criminal offenses for which the institute is applied, and a mechanism that allows for the swift protection of assets in cooperation with other EU member states.

According to Marijus Šalčius, a judge at the Kaunas Regional Court and one of the drafters of the bill, the new measures will introduce a peaceful settlement institute. This will allow for the conclusion of proceedings at the pre-trial stage. The legislation will also provide a clearer definition of criminal offenses subject to asset confiscation and enhance the operational mechanisms for safeguarding assets through cooperation with other EU member states.

The comprehensive legal reform will involve amendments to several existing Lithuanian laws. These include the Civil Asset Confiscation Law, the Criminal Intelligence Law, the Organized Crime Prevention Law, the Civil Procedure Code, and the Criminal Procedure Code. Additionally, it will address legal acts concerning the mutual recognition and enforcement of criminal judgments within EU member states.

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The title of the law itself – 'civil asset confiscation' – can be misleading in the context of international cooperation: foreign law enforcement agencies tend to view this institute as an independent civil law measure, not falling within the scope of mutual assistance in criminal cases, although in reality, it is inseparable from criminal proceedings.

Šalčius, who has 23 years of experience in the prosecutor's office, explained that the current Civil Asset Confiscation Law, in effect since July 1, 2020, has provided valuable practical experience. However, this experience revealed several challenges. Notably, the law's title was found to be potentially misleading in international cooperation contexts, as foreign law enforcement agencies sometimes viewed it as a purely civil matter rather than one intrinsically linked to criminal proceedings. Furthermore, the previous list of criminal offenses triggering asset investigations was deemed too narrow.

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Secondly, the list of criminal offenses enshrined in the law, for which property investigations can be initiated, has proven to be too narrow in practice.