Foreign Investment Screening is mainly performed by the Commission on Coordination of Protection of Objects Important for Ensuring National Security (hereafter – the Commission). The Commission is chaired by the Chancellor of the Government and includes representatives from various ministries, the Bank of Lithuania, the General Prosecutor’s Office, the Police Department, the Special Investigation Service and the State Security Department.

The following potential investors are monitored:

• An investor seeking to acquire shares or voting rights that grant 1/4 or more votes at the general meeting of shareholders of a legal entity that is being incorporated in or which is operating in a designated important infrastructure protection zone or a business sector of strategic importance to the national security:

1. energy,
2. transportation,
3. IT and telecommunications, other high-tech,
4. finance and credit,
5. military equipment.

Specific spheres of business activities covered by these sectors are further detailed. However, in some cases, particularly with IT, there is substantial ambiguity and potential for quite broad application.

Such potential investors must inform the Commission about their intention to acquire the shares/voting rights and submit required information about itself, its activities and the UBO’s before the closing of the transaction. If no institution represented in the Commission is interested in performing detailed screening, the potential investor is informed about that within approx. 2 business weeks and is considered cleared. If any institution does wish to initiate full screening, a potential investor is required to provide additional information and the process can last for approx. 5 business weeks. In the end, the potential investor is either cleared, conditionally cleared with certain requirements (e.g. to cut ties with certain questionable parties) or barred from proceeding.

• An investor seeking to acquire any amount of shares in Schedule I companies of strategic importance (12 companies, e.g. Klaipeda seaport authority, operator of state registers, etc.) must apply to the Commission and must be cleared by the Parliament of Lithuania;
• An investor seeking to acquire shares or voting rights that grant 1/4 or more votes at the general meeting of shareholders in Schedule II companies of strategic importance (23 companies, e.g. state energy group Ignitis, Lithuanian Railways, etc.) must be cleared by the Commission or by the Parliament or Government of Lithuania if the transaction will cause the state’s participation in such company to drop below 2/3 of shares or votes;
• An investor seeking to acquire shares or voting rights that grant 1/3 or more votes at the general meeting of shareholders of a Schedule III company of strategic importance (5 companies owned by the state or private shareholders, including the operator of only oil refinery in the country AB ORLEN Lietuva, largest telecommunications company AB Telia Lietuva, etc.) must be cleared by the Commission.

Similar regimes are established for potential investments into certain strategic assets and infrastructure (nuclear facilities, roads of national importance, airspace management facilities, etc.).

National security has taken precedence, especially in the wake of Russia's 2022 full-scale invasion of Ukraine with limited support from Belarus. Additionally, the focus on national security has been influenced by the relationship with China becoming more complicated after Lithuania’s pronounced backing of Taiwan.

In most cases – any individual or legal entity based in Lithuania or abroad seeks to acquire shares or votes in a designated entity or to acquire certain designated assets.

Investments from all countries, including Lithuania, are covered.

However, a potential investor in certain cases will be subject to simpler screening procedures if it is summarily deemed to comply with national security interests, i.e. if it is a member country of EU, NATO, OECD, European Free Trade Association, or a stock company in which such country’s central, regional or municipal government own more than 1/2 of votes, also international financial organizations (in which Lithuania is a member), and other international financial institutions or organizations whose goals, investment policy and operations do not pose a threat to national security.

Energy, transportation, IT and telecommunications, other high-tech,  finance and credit, and military equipment sectors. Also, certain state-owned and privately-owned (public or closed stock) companies of high importance to national security are included in special lists. And also certain strategic assets and infrastructure.

Please see our response to "Please provide a short summary of the Foreign Investment Restrictions adopted by your jurisdiction."

Yes. In certain cases (i.e. sometimes when seeking to invest in companies operating in a business sector of strategic importance) the potential investor is always obliged to inform the Commission, but the Commission will not always start a detailed screening procedure.

Yes. 

There was a limited impact of COVID-19 on our foreign investment regime.

Certainly active in reviewing and sometimes delaying/modifying foreign investments. However, it is quite rare that the Commission blocks a foreign investment deal at least in high-profile cases (many low-profile deals can be blocked without public knowledge). But it does happen from time to time, mostly when the potential investors have or are alleged to have ties to Russia, other countries in the Commonwealth of the Independent States or China.

For example, the strategic institution is increasingly responding to security concerns related to ongoing energy projects. Currently, they are even more intensively questioning their business partners, especially in relation to contract agreements. In the case of solar parks, this issue becomes particularly pertinent as many components for these projects are purchased from China. This indicates that energy security and source diversification are becoming a significant priority in Lithuania.

Exact motives and grounds for blocking a foreign investor are usually not revealed. Deals are usually blocked based on information provided to the Commission by national law enforcement and anti-corruption agencies or counterintelligence agencies. Generally speaking, such grounds are often related to known or suspected connections of the potential investor or its related parties to governments or other influential parties in Russia, other countries in the Commonwealth of the Independent States or China, or to parties with proven or alleged criminal or corrupt background.

Official statistics about reviewed, cleared and blocked investments are not made public.

With the rapid expansion of wind farm infrastructure, there's an evolving landscape of safety measures and heightened standards. The growth of these facilities bolsters Lithuania's energy autonomy, reducing reliance on less amicable nations like Russia. We're already witnessing these shifts as developers of renewable projects face stringent guidelines, particularly concerning the limitation of Chinese technologies. Balancing these mandates can be challenging, especially since Chinese equipment and IT solutions are prevalent in renewable projects across Europe.