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Repairing Goods Instead of Replacing Them: New Obligations for Sellers and Consumer Rights 

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A new trend in consumer protection is emerging in the European Union—the so-called“right to repair,” which encourages the repair of goods rather than their replacement or disposal. Lithuanian law is also adopting this trend: amendments to the Civil Code impose additional obligations on sellers and give consumers more opportunities to demand repairs. According to Eimantas Čepas, an attorney at the law firm AVOCAD, the new provisions change not only the scope of consumer rights but also the duration of sellers’ liability, their duty to inform, and warranty service practices. This means that businesses will have to reassess how repair processes are organized, what information is provided to consumers, and how warranty service is documented.

A broader concept of product quality

The amendment to the Civil Code stipulates that a product must possess not only its standard characteristics, but also characteristics related to durability, repairability, functionality, compatibility, and safety.

In addition, public statements made by the seller or manufacturer in advertising or labeling are also important when assessing the quality of a product. This means that consumers’ expectations regarding a product’s characteristics may be shaped not only by the contract or technical specifications, but also by marketing communications.

As Eimantas Čepas points out, this amendment broadens the concept of product quality assessment. “This amendment means that product quality will be assessed more broadly than before. If an advertisement or the manufacturer’s communications emphasize the product’s durability or longevity, the consumer can reasonably expect the product to possess these characteristics—otherwise, this may be considered a failure to conform,” says the attorney.

According to him, a new focus is also emerging on repairability—it will become increasingly common to assess whether a product can reasonably be repaired at all. “If a manufacturer or seller communicates the possibility of repairing a product, replacing its parts, or extending its useful life, the consumer can expect that such a possibility actually exists. This may entail higher requirements for both product design and the availability of spare parts or service,” the lawyer emphasizes.

If the product is being repaired, the seller's warranty is extended

One of the most significant changes is the extension of the seller’s liability period. If a product is repaired to remedy a defect, the seller’s liability period is extended by another year. This means that repairs can have long-term legal consequences for the seller, as their liability for the quality of the product is effectively extended.

“This is a significant change for businesses—repairs not only fix the defect but also extend the seller’s liability period. Therefore, sellers will have to pay even closer attention to warranty service processes and documentation,” notes attorney E. Čepas.

New obligation to inform the consumer

Before addressing a consumer’s claim regarding product defects, the seller must clearly inform the consumer of their right to choose between having the product repaired or replaced with a new one. In addition, the consumer must be informed that, if they choose to have the product repaired, the seller’s liability period may be extended.

“In practice, this means that sellers will have to clearly inform consumers about their options and the possible consequences. If this duty to inform is not properly fulfilled, it could lead to additional disputes,” says E. Čepas.

The new provisions also provide for the possibility of providing the consumer with a replacement product while their product is being repaired. Depending on the product category and the consumer’s need for continuous use, the seller may temporarily provide another product for use. This may also be a refurbished product, provided it meets the requirements of the category.

“This provision is particularly relevant for goods such as phones, computers, or household appliances, which consumers often cannot do without for a short period of time. For businesses, this could mean an additional logistical and financial burden,” the lawyer comments.

If the consumer expressly agrees, the seller will be able to provide a refurbished product instead of a new one. This provision is linked to the broader objectives of the European Union—to promote the circular economy and reducewasteby extending the useful life of products.

“There is now a legal basis for using refurbished goods more frequently as an alternative to new ones. This can be beneficial from both an environmental and a business perspective, but the most important thing is the consumer’s explicit consent,” notes attorney Eimantas Čepas.

According to an AVOCAD attorney, the new amendments to the Civil Code mean that sellers should review their warranty service procedures, consumer information policies, repair documentation, and replacement goods policies.

“The legislative changes essentially encourage a shift from the‘replace the product’model to the‘repair it first’ model. Therefore, businesses should prepare in advance for the new practices and assess how these changes will affect their warranty service processes,” summarizes attorney Eimantas Čepas.

A few centimeters from the property line: when is a building code violation considered minor?

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Does every deviation—even by a few centimeters—from the minimum distance specified in legislation automatically constitute illegal construction? In its latest ruling, the Supreme Court of Lithuania sent a clear message: not always.  Commenting on the latest case law, AVOCAD attorney Kamilė Šemeklytė notes that a mere formal non-compliance does not necessarily mean that the structure or utility networks will have to be removed. 

 

In this case, the court examined a dispute between the owners of neighboring plots regarding sewage networks installed too close to the plot boundary and a possible failure to maintain the required distance from a manhole. The plaintiff sought to have the defendants remove part of the sewage and water supply networks at their own expense, as, according to him, they had been installed less than 1 meter from the boundary of his plot, and the sewage networks—less than 10 meters from the manhole located on his plot. However, the courts at all levels dismissed the claim, and the Supreme Court of Lithuania upheld these decisions. 

 

The crux of this case is the court’s answer to the question of whether every instance of failure to comply with the minimum distance requirement must be formally regarded as automatically giving rise to an obligation to remedy the consequences of the construction. The Supreme Court of Lithuania clearly emphasized that the Civil Code cannot be applied mechanically. The court recalled previous case law, according to which very minor deviations from the distances established by law may be considered insignificant if they do not actually violate either public objectives or the rights of the owner of the neighboring plot. 

 

According to an AVOCAD attorney, this ruling is significant in that it demonstrates once again that disputes regarding construction and utility networks cannot be resolved solely on the basis of a ruler. “The Supreme Court clearly stated in this case that a mere formal discrepancy of a few centimeters does not automatically mean that the construction is unlawful. It is not only the deviation itself that is assessed, but also its significance—whether it actually infringes on a neighbor’s rights or undermines the objectives protected by law,” says K. Šemeklytė. 

 

What mattered was not the current data, but the data available at the time of completion of construction 

 

A key issue in the case was which distances should be taken into account—the current ones or those that existed at the time of completion of construction. 

The plaintiff relied on subsequent measurements, according to which the distance from the sewer lines to the boundary of his plot was even smaller in some places. However, the courts determined that, when deciding on the legality of the construction, the most important factor is the situation at the time of completion of the construction. And at that time, the distances measured were 1.04 m, 0.98 m, and 0.92 m. 

This meant that the deviations from the required 1-meter distance were only 2 and 8 centimeters. The Supreme Court of Lithuania acknowledged that such deviations are insignificant and do not in themselves constitute grounds for declaring the construction unlawful. “In practice, this is very important. The court emphasized that one cannot automatically rely on measurements taken several years later and conclude from them that the construction was unlawful from the very beginning. The actual situation at the time when the structure or networks were installed and construction was completed must be assessed,” the lawyer emphasizes. 

 

The court did not limit itself to formal logic, but considered the actual impact 

 

It is also important to note that the courts considered not only the specific measurements but also the broader context: the networks were installed in an area where other utilities were already present, and the plaintiff failed to propose any realistic alternatives for relocating such a network without infringing on the interests of others. This demonstrates a consistent approach by the courts—even when a certain deviation formally exists, the court still assesses proportionality, the actual consequences, and whether the most stringent measure is indeed justified. According to Kamilė Šemeklytė, this ruling sends an important message to both owners of neighboring plots and builders: it is not enough for the court to simply show that a figure does not meet the standard. “It is necessary to justify why the violation is significant, what actual consequences it causes, and why the removal of the construction’s effects is a proportionate measure,” she states.  

Another part of the case concerned the plaintiff’s claim that the sewer lines had been installed too close to a manhole located on his property. However, the courts found that there was insufficient evidence in the case to prove that this manhole actually existed at the time the disputed sewer lines were being designed and installed. 

The plaintiff argued that this was obvious, but the Supreme Court of Lithuania emphasized a fundamental principle of civil procedure: each party must prove the facts on which it bases its claims. If a claim is based on the fact that a certain object already existed during the period relevant to the dispute, it is precisely that fact that must be proven. 

 

The court also rejected the argument that a so-called surprise decision had been rendered in this part of the case. The Supreme Court explained that the existence of the shaft well had been one of the key facts of the case from the very beginning, and therefore the plaintiff should have understood that it was necessary to substantiate this claim with evidence. 

“This is a very clear reminder that in civil cases, a logical narrative or a belief in one’s own righteousness is not enough. If a claim is based on a specific factual circumstance—for example, that the well was already there before the pipes were installed—that circumstance must be proven. In other words, the procedural obligation to prove a fact does not disappear even when a party believes the fact is self-evident,” notes the AVOCAD attorney. 

 

This ruling by the Supreme Court of Lithuania is relevant to anyone dealing with property boundaries, the installation of utilities, renovations, or disputes regarding the legality of construction. On the one hand, it confirms that the courts uphold property rights and the distances established by law. On the other hand, this protection is not strictly formal—very minor deviations that do not cause actual harm may be considered insignificant.  The success of a dispute depends not only on whether a formal non-compliance can be demonstrated, but also on whether the party can precisely substantiate when the violation occurred, its extent, which rights it actually infringes, and what legal consequences should apply.  “From a practical standpoint, this is a very useful case. It demonstrates that in disputes over minimum distances, it is not only the text of the regulation that matters, but also the evidence, the timing, and the assessment of proportionality. This means that, whether planning construction or preparing for a dispute, it is essential to very carefully assess the factual circumstances and the evidence,” summarizes K. Šemeklytė. 

Will Europe finally simplify the process of starting a business—and will that be enough?

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The European Commission recently unveiled a proposal that could significantly change the rules for starting a business in Europe—the so-called “EU-Inc.” initiative. Its goal is to create a single legal form for companies across the European Union, which would allow businesses to operate across national borders more easily and quickly than ever before.

Today, business expansion in Europe often faces a paradox: although we have a single market, setting up and operating a business in different countries still means dealing with 27 different legal systems, different legal forms, and complex administrative procedures. As a result, even a simple step toward expanding into another EU country can take weeks or even months. The EU–Inc. system proposed by the European Commission aims to simplify this situation.

What does EU–Inc. offer? 

Under the proposal, a single European company form would be established, characterized by several key elements:

  • a company could be registered within 48 hours for less than 100 euros;
  • there would be no requirement for a minimum authorized capital;
  • the company could operate in all 27 EU member states under a single legal framework;
  • the information would be submitted once, and the data would automatically be transmitted to registries, tax authorities, and VAT systems across the EU;
  • provide for the possibility of implementing harmonized employee stock option plans (ESOPs) across the EU.

If the European Parliament and the Council approve this proposal, the initiative could become operational by the end of 2026.

The launch of such an initiative sends an important signal. For some time now, Europe has been looking for ways to help startups and fast-growing companies expand more easily within the single market and compete with technology ecosystems in the U.S. and Asia.

This is a welcome step, as it finally acknowledges a problem that the business community has been discussing for many years—the European single market remains highly fragmented from a legal standpoint.

However, the question arises: will simplifying the registration process alone really address the main obstacles to business growth in Europe?

The problem lies not only in registration 

The procedures for establishing a company are often seen as the main challenge, but in practice they are usually just the first—and often the shortest—stage of a business’s journey. Far more complex obstacles arise later on, as the company grows and expands into different jurisdictions.

The biggest obstacles in Europe are usually not related to company registration. They stem from differing tax systems, labor law regulations, inconsistent application of the law, and often rather slow dispute resolution in the courts.

Even if a company could be established within 48 hours, as the business expands, it would still have to deal with:

  • different labor law regimes in each country;
  • inconsistent taxation of employee stock options;
  • under different tax regimes;
  • inconsistent administrative and regulatory practices.

In practice, businesses often face another problem—one that may seem technical at first glance but is very real—namely, opening a bank account. Even today, when it is possible to establish a company relatively quickly in most EU countries, banks often take a very cautious approach to clients whose founders are not residents of that country. In such cases, opening an account can become a lengthy and complicated process requiring additional checks and documentation. Therefore, the question remains open as to whether the new EU–Inc. form will truly facilitate relations with banks, or whether this practical obstacle for businesses will persist.

Therefore, the question of whether EU–Inc. will actually operate under a unified system will essentially depend on the extent to which genuine harmonization is achieved in other areas.

ESOP – an important but insufficient step 

The unified ESOP model set out in the proposal is one of the strengths of this initiative. Employee stock options are an important incentive tool for startups, particularly in the technology sector.

However, if these options continue to be taxed differently in different countries, their practical application may remain limited.

If taxation remains a national matter, the system will still not be as simple and clear as the one we see today in the United States, for example. And capital and talent often flow to places where the regulatory environment is clearer and more predictable.

Is Europe truly ready for a unified business area? 

The EU–Inc. initiative undoubtedly reflects a political ambition to strengthen Europe’s business environment. It could also serve as an important symbolic step—demonstrating that Europe aims to be a place where global businesses can be established and grown without leaving the continent.

However, simplifying the procedures for setting up a business can only be the first step.

If Europe truly wants to create a level playing field for business, a single corporate form will not be enough. Much deeper harmonization will be needed—particularly in the areas of taxation, labor law, and regulatory practices.

Nevertheless, it must be acknowledged that the EU-Inc. initiative sends an important signal that European institutions are beginning to address the problem of single market fragmentation in a more systematic manner. If the proposal is adopted and consistently developed further, it could become the first concrete step toward a truly unified business space in Europe.

However, the true impact of this initiative will depend on whether Europe is willing to address the deeper structural issues that often lead ambitious companies to plan their global expansion outside of Europe.

AVOCAD Partner, Corporate Law Expert, Attorney Jonas Zaronskis

International Transportation and the Risk of Double Taxation: What Transportation Companies Need to Know

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Today, the international transportation industry operates across multiple jurisdictions, which means not only broader markets but also greater tax risks. One of the most complex situations arises when different countries believe they have the right to tax the same income.

This is precisely the situation that can arise when Lithuanian transport companies post drivers to work in other European Union countries. Although the company pays taxes in Lithuania, the foreign tax authority may consider that part of the income should be taxed in the country where the work is actually performed.

In such cases, businesses may face a real risk of double taxation—when tax is levied on the same income in two countries.

Egidijus Kieras, an attorney at AVOCAD, says that such situations are not uncommon in the European transport sector. “The international transport business operates across multiple jurisdictions simultaneously, which is why there are sometimes differing interpretations of the same factual circumstances. One country may consider that employees are on a posting, while another may consider that they are actually working within its territory and therefore their income must be taxed there,” he notes.

In which country should taxes be paid?

Such situations are governed by international double taxation treaties, which Lithuania has concluded with many countries.

Under these agreements, the general rule is that wages are taxed in the country where the employee is a resident and where the employer is established. However, there are exceptions to this rule.

If an employee is actually working in another country, that country may also have the right to tax that income. In practice, however, the so-called 183-day rule is often applied, which allows such a situation to be avoided if certain conditions are met.

Generally, income is taxed only in the employer’s country if:

  • the employee works in another country for no more than 183 days per year,
  • the salary is paid by an employer who is not a resident of that country,
  • The salary is not paid through a permanent establishment located in that country.

In the transport sector, these conditions are often relevant because drivers regularly travel between different countries, and their working hours in a single country may be limited.

Why do disputes still arise?

In practice, problems usually arise not because of the rules themselves, but because of how they are interpreted.

Foreign tax authorities may sometimes consider that employees are actually working in their territory for an extended period of time, or that the employer is acting as a temporary staffing agency that “leases” employees to local companies.

In such a case, it can be argued that the remuneration should be taxed in that country.

According to attorney E. Kieras, it is crucial to properly assess the factual circumstances in such situations. “Tax authorities are increasingly analyzing the actual organization of work—who actually supervises the employee, where decisions are made, and where the salary is paid. If the documents and actual activities are not clearly distinguished, a dispute over tax law may arise,” says the AVOCAD attorney.

How are double taxation disputes resolved?

International treaties provide for a special mechanism for resolving such disputes—the mutual agreement procedure.

It allows tax authorities in both countries to:

  • exchange information,
  • to assess the facts of the case,
  • to ensure that the same income is not taxed twice.

In such a case, the taxpayer contacts the tax authority of their country of residence (in Lithuania, the State Tax Inspectorate), which initiates a dialogue with the authorities of the other country. If the parties reach an agreement, the double taxation situation is resolved.

Attorney E. Kieras emphasizes that such situations can be avoided or, at the very least, the risks associated with them can be significantly reduced. The transportation sector is one of those industries where employees regularly work in several countries at the same time. Therefore, it is very important to assess tax risks in advance and maintain clear documentation that would justify in which country taxes must be paid.

According to the lawyer, in practice, many disputes with foreign tax authorities arise not because of the legal provisions themselves, but because the factual circumstances are not sufficiently well documented. “Transport companies often operate at a fast pace and prioritize efficiency, but tax authorities evaluate documents and the actual circumstances of how work is organized. If these are not clearly documented, assumptions may be made that the activity is being carried out in another country,” says the lawyer.

To reduce the risk of such disputes, the attorney advises transportation and logistics companies to pay attention to several important aspects.

Clearly document business trips and employees' hours of attendance

One of the most important issues in double taxation situations is how much time employees actually spend in a particular country.

It is particularly important to have clear data on: drivers’ work schedules, the duration of business trips, and the length of time spent in different countries.

In the transport sector, this information can often be substantiated by tachograph data, route documents, business trip orders, or other logistics documents. The clearer and more consistent this information is, the easier it is to prove that the employee did not work in a particular country for longer than permitted by double taxation agreements.

Ensure that labor relations are clearly regulated in Lithuania

Another important aspect is who is actually considered the employer. Foreign tax authorities often analyze who organizes the employee’s work, who gives instructions, and who actually receives the results of the work. If it appears that the employee is actually working for the benefit of a foreign company, it may be concluded that the employment income should be taxed in that country.

Therefore, it is important for transportation companies to ensure that the following is clearly visible:

  • that the employees are employed by a Lithuanian company,
  • that wages and other employment-related payments are paid specifically by Lithuanian companies,
  • that work is organized and decisions are made in Lithuania.

These circumstances are often supported by employment contracts, internal documents, business trip orders, and payroll records.

Assess the risk to permanent habitats

Another important consideration is whether the company actually carries out permanent activities in another country. If activities in a particular country become permanent, if the company has representatives there or organizes work there, there is a risk of establishing a so-called permanent establishment. In such a case, part of the company’s income may be considered taxable in that country.

In the transport sector, this risk may arise, for example, when operations are consistently organized from a specific foreign country, a permanent operational center or management structure is located there, or employees effectively work exclusively in one country for an extended period of time.

Therefore, it is important for companies to regularly review their business model and ensure that it does not give rise to additional tax liabilities in other jurisdictions.

Consult with tax and legal professionals early on

Ultimately, one of the most important preventive measures is to identify risks in a timely manner. Tax regulations in the international transport sector are constantly changing, and different countries may interpret the same situations differently. Therefore, early legal and tax analysis helps avoid situations where, during an audit conducted several years later, significant additional tax payments are demanded.

According to attorney E. Kieras, experience shows that such disputes can drag on for years and pose a tax risk amounting to hundreds of thousands of euros. “It is important for transportation companies not only to comply with the rules but also to have a clear strategy for documenting their activities. This often becomes a decisive factor in disputes with foreign tax authorities,” says the attorney.

Where should you turn in the event of a dispute?

If a foreign tax authority demands payment of taxes for a period for which they have already been paid in Lithuania, the company has the right to initiate a double taxation dispute procedure.

The first step is usually to contact the Lithuanian tax authority—the State Tax Inspectorate (VMI)—which, under international agreements, can initiate dialogue with the authorities of another country.

In such cases, it is important to quickly gather all the necessary documents and properly formulate a legal position. “Double taxation situations are not just a theoretical problem—they can pose a tax risk amounting to hundreds of thousands of euros. Therefore, it is important for transport companies not only to know their rights but also to actively defend them,” says attorney E. Kieras.

 

Europe may force banks to take greater responsibility for financial fraud

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Financial fraud is currently one of the fastest-growing forms of crime in Europe. Phishing emails, fake bank messages, scam calls, and social engineering schemes swindle millions of euros from consumers every year.

In practice, the same scenario often plays out in such situations: the bank refuses to compensate for the lost funds, arguing that the customer “disclosed the information” themselves and must therefore bear the financial consequences.

However, there is a growing trend in European Union law to change this practice. A recently published opinion by the Advocate General of the Court of Justice of the European Union addresses an important question: can a bank refuse to immediately refund a customer for an unauthorized payment solely on the grounds that it suspects the customer of gross negligence?

The Advocate General’s proposed answer is quite clear and unequivocal.

According to his conclusion, the bank must immediately refund the amount of the unauthorized transaction to the customer, and only then may it determine whether the customer acted with gross negligence.

In other words, the logic of the legislation is as follows: first, the protection of consumers’ money must be ensured, and only then is the issue of liability allocation addressed.

In his opinion, the Advocate General emphasizes that European Union legislation has deliberately sought to put an end to the practice whereby payment service providers refuse to refund funds on the grounds of alleged improper conduct on the part of the customer. Such practices often forced consumers to take legal action themselves in order to recover their money.

That is precisely why the Payment Services Directive stipulates that:

  • the payment service provider must immediately refund the amount of the unauthorized transaction;
  •  If the service provider believes that the customer acted in bad faith or with gross negligence, the service provider must prove these circumstances and, if necessary, seek compensation through the courts.

This means that the financial risk falls primarily on the bank or other payment service provider, rather than on the consumer.

If the Court of Justice upholds this conclusion, it will fundamentally change the practical approach to fraud disputes. Until now, in most cases, consumers have had to prove themselves that they were not at fault for the lost funds. This often meant lengthy disputes with the bank or even litigation in court.

Under the interpretation proposed by the Advocate General, the situation would be different: consumers would not have to spend years in court fighting for their money. The bank would be required to compensate for the loss first, and if it believes that the customer acted with extreme negligence, it would have to prove those circumstances itself.

This logic is also consistent with a general principle of European payment law: the consumer is considered the weaker party in the relationship, and therefore the payment system must ensure a high level of protection for the consumer. Under the PSD2 Directive, the payment service provider is generally liable for unauthorized transactions, except in cases where the consumer acted fraudulently or with gross negligence.

However, even in such cases, the burden of proof lies with the bank.

This case is not an isolated incident. There is growing discussion in European legislative circles about the need to strengthen consumer protection in cases of financial fraud. The European Commission is already proposing new payment regulation rules that would, in certain cases, hold payment service providers liable even in cases of so-called“authorized push payment”fraud—where the customer authorizes the payment themselves but does so after being misled by a fraudster.

This points to a clear regulatory direction: the fintech and payments sector must play a more active role in fraud prevention and assume a greater share of the risk.

A Signal for Lithuania

The number of financial fraud cases in Lithuania is skyrocketing. Disputes between banks and customers over lost funds are also not uncommon. Therefore, the European Court of Justice’s ruling in this case could have very real implications for Lithuanian legal practice.

If the Court agrees with the Advocate General’s opinion, it will become significantly more difficult for banks across Europe—including in Lithuania—to refuse to compensate victims of fraud for their losses. This would mark a significant shift: in the financial services market, the center of responsibility is gradually shifting from the individual consumer to the institutions that manage the payment infrastructure.

 

Laurynas Staniulis
Partner at the law firm AVOCAD, attorney

A single comment on social media could end up in court 

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On social media, it often seems like you can say anything. However, the reality is different—words shared in the public sphere can have very specific legal consequences. Julius Sakalauskas, an attorney with the law firm AVOCAD, says that in Lithuania, there are increasingly frequent cases where comments or posts on the internet become the subject of legal disputes in court. “The internet is not a free zone where you can say anything. Liability for words in the public sphere can be the same as in traditional media,” the lawyer emphasizes.

The Constitution of the Republic of Lithuania stipulates that human dignity is protected by law. This means that the same rules apply on social media as in any other public space. According to the attorney, a person’s honor and dignity are violated when information that does not correspond to reality is disseminated about them, thereby damaging their reputation. In such cases, courts evaluate several key factors: whether the information was disseminated publicly, whether it relates to a specific person, whether it is untrue, and whether it demeans a person’s honor and dignity. “If all these conditions are met, the person who disseminated such information may face legal liability. It is important to note that even a single post on a social network can be considered public dissemination of information,” explains J. Sakalauskas.

Not all criticism is defamation

However, the lawyer emphasizes that not every sharp or critical comment is considered a violation. In a democratic society, people have the right to express their opinions, and freedom of expression is protected. “An opinion is a subjective assessment—for example, that someone’s actions appear unprofessional. However, a problem arises when an opinion that does not correspond to reality is presented as a fact,” says the lawyer. If a person claims that another person committed a specific act—for example, embezzled money—and this is not true, such a statement may already be considered a violation of honor and dignity.

Furthermore, an opinion that is unethical, dishonest, unsupported by any arguments or facts, or that omits certain facts may also violate a person’s honor and dignity and result in legal liability.

It is often assumed that only the person who wrote a comment is responsible for it. In practice, however, liability may extend further. “First and foremost, the responsibility lies with the author of the comment. However, in certain cases, it may also fall on the platform or website administrator if they are aware of clearly illegal content, tolerate it, and fail to remove it in a timely manner,” explains the attorney. This means that liability can also be joint and several, which is why most platforms actively monitor comments and respond to violations.

What should you do if false information is spread about you?

When faced with defamatory information, the most important thing is to respond quickly. According to the lawyer, the first step is to contact the author of the information or the platform and demand that the false information be removed or refuted. It is also possible to file a formal complaint and seek compensation for damages.

“If the information is clearly defamatory, you can also contact the police. And if an amicable resolution cannot be reached, the dispute goes to court,” says J. Sakalauskas.

The consequences of defamatory comments can be very real and tangible. Civil liability is most commonly applied—a court may order the removal of the information, require a retraction, and award compensation for both pecuniary and non-pecuniary damages. This may also include litigation and attorney’s fees.

“The amount of non-pecuniary damages depends on the nature of the information published and its dissemination. On the internet, this can be particularly extensive, so the impact on a person’s reputation can be very significant,” the lawyer emphasizes.

Cases in which a person is unjustly accused of committing a crime are viewed with particular severity.

Social media platforms are increasingly finding themselves in court

In Lithuania, there is a growing number of cases where social media posts become the subject of legal disputes. “We see many situations where politicians or individuals who consider themselves media representatives publicly accuse others of, for example, embezzling funds intended for aid. Such cases are treated strictly in court,” says the lawyer.

If it is determined that false information has been disseminated that defames a person’s honor and dignity—that is, violates that person’s rights—legal liability shall apply.

The lawyer has a simple but important piece of advice for all social media users. “Before posting a comment, ask yourself: could you say the same thing to someone face to face?” says J. Sakalauskas.

According to him, it is important to remember that there is a real person behind every profile, and carelessly shared information can have long-term consequences.

Criticism is both permissible and necessary, but it must be well-reasoned, respectful, and based on facts. If there is any doubt about the accuracy of information, it should be presented as an opinion rather than a fact.

“Social media is no longer a place where responsibility disappears—it remains just as it is in real life. Speaking responsibly online is the best way to avoid legal problems,” the lawyer concludes.

Compensation for unused vacation days: mistakes made by employees and employers  

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When terminating an employment contract, many employees—and often employers as well—believe that compensation for unused vacation time can be paid for a maximum of three years of service. However, according to lawyers, the regulations do not provide for such a rule.

According to Sandra Mickienė, a senior lawyer at the law firm AVOCAD, this misconception often leads to compensation being calculated incorrectly for employees whose employment contracts have been terminated, while employers face the risk of legal disputes. “This approach is still very common in the market, which is why quite a few mistakes are made when calculating compensation for unused annual leave,” she notes.

According to the lawyer, the Labor Code does not establish a rule that, upon termination of an employment contract, compensation for unused annual leave may be paid for a maximum of three years. The law does not set a limit on the compensation period, but rather establishes the conditions under which an employee loses the right to take all or part of their annual leave (or to receive monetary compensation for it upon termination of the employment contract). Therefore, in each case, the employer must individually assess the specific employee’s situation and, in accordance with the rules established by law, accurately calculate the compensation due to them. To determine when the right to take all or part of the annual leave (or to receive monetary compensation for it upon termination of the employment contract) is lost, it is important to establish the following key points: the date on which the right to the full duration of annual leave was acquired, the end of the calendar year in which the right to the full duration of leave was acquired, and, accordingly, to count three years from the end of that calendar year.

For example, if an employee started work on April 15, 2022, the annual leave accrued for the period from April 15, 2022, to April 14, 2023, must be calculated according to the aforementioned criteria. The right to the full duration of annual leave is acquired on April 15, 2023, and the end of the calendar year in which this right was acquired is December 31, 2023. The three-year period calculated from this date ends on December 31, 2026; therefore, the right to use the vacation accrued during the period from April 15, 2022 – April 14, 2023 (or to receive compensation for them upon termination of the employment contract) would be lost as of January 1, 2027.

Accordingly, when terminating an employment contract with an employee, all periods of their employment with the company must be assessed in the same manner—determining the aforementioned points for each period separately and calculating how much annual leave the employee has accrued and not used, for which compensation must be paid (the employee would lose the leave for the second year of employment (April 15, 2023–April 14, 2024) on January 1, 2028, for the third year of employment on January 1, 2029, and so on).

Let’s imagine a hypothetical situation in which an employee was hired on April 15, 2022, under a standard 5-day workweek schedule and never took any vacation. Their employment contract is terminated on March 19, 2026. Calculating the accrued vacation days according to the rules established above, we would arrive at a total of approximately 79 unused vacation days:

April 15, 2022 – April 14, 2023 – a full 20 days;

April 15, 2023 – April 14, 2024 – a full 20 days;

April 15, 2024 – April 14, 2025 – a full 20 days;

April 15, 2025 – March 19, 2026 – approximately 18.58 days.

In such a case, compensation should be paid not for 60 working days, as is often assumed (in a typical scenario, an employee is entitled to 20 days of vacation per year, in which case 3 × 20 = 60 days), but for all 79 accumulated unused vacation days.

Another very important aspect that, according to an AVOCAD lawyer, should be noted, – the general rule: the right to take all or part of annual leave is forfeited upon the expiration of the aforementioned three-year period, which is calculated separately for each year worked. However, there is one significant exception: if an employee was actually unable to take the leave for objective reasons, this right is not lost and compensation for unused leave must be paid, regardless of the usual three-year period.

The Labor Code does not specifically define what constitutes an objective reason if an employee was actually unable to take leave, nor does it specify the timeframe within which such leave must be taken once the objective reasons have ceased to exist. In practice, such circumstances may include, for example, temporary incapacity for work, parental leave, quarantine, or emergencies, as well as actions by the employer that prevented the employee from taking annual leave. Since the principle of disposability applies in labor law, each situation should be assessed individually: a decision should be made as to whether to extend the deadline for using accrued leave or to consider this deadline expired.

Due to the mistaken belief that compensation for unused annual leave must be calculated for a maximum period of three years, workplaces have, to this day, seen inaccurate calculations of compensation for unused vacation days, which often lead to disputes between employers and employees. Disputes often also concern the legality of “writing off” vacation days: employees claim that the employer unlawfully “wrote off” vacation days because the conditions for using them were not actually provided. There are also cases where vacation days are not “carried over” to the next year, but upon termination of the employment contract, they are suddenly “written off” on the day of dismissal, which leads to additional disputes.

What is important to know when resolving such disputes?

First,the deadline for forfeiting the right to vacation set forth in the LaborCode is mandatory—it cannot be altered by agreement or by the employer’s decision. The only exception applies when an employee was actually unable to take the vacation—in such cases, the vacation days are not forfeited.

Second, in the event ofa dispute, the employer must prove that the employee was given a realistic opportunity to take leave (the employee was encouraged to take leave, leave was scheduled according to the leave rotation, but the employee refused, etc.), while the employee must prove that, for objective reasons, they did not have such opportunities (requests for leave were denied, leave was canceled, there was no possibility of finding a replacement, the nature of the work or the scope of duties did not allow for taking leave, etc.). Each party must submit supporting documents.

Third, unusedvacation days should not be “written off” on the day of termination. This should be done on a regular basis, typically annually, with employees being informed of their accrued days to avoid surprises and disputes.

Sandra Mickienė points out that decisions regarding the “write-off” of vacation days are made not by the accountant, but by the manager or another responsible person. “An accountant cannot independently ‘write off’ vacation days, because each employee’s situation is unique and requires assessment (the accountant cannot determine on their own whether the employee had the opportunity to take vacation or was unable to do so for objective reasons, and therefore cannot decide whether the days should be ‘written off’ or whether an extension should be granted to use them). Furthermore, accounting entries can only be made if there is a supporting document. Therefore, the “write-off” of vacation days must be formalized by a decision of the manager—only then can the accountant take the appropriate actions,” the lawyer emphasizes.

The Labor Code does not specify detailed procedures for how unused annual leave must be “written off” (the Labor Code does not specify whether such “write-offs” must be formalized by a manager’s order or other decision, nor does it specify the period during which an employee has the opportunity to use accumulated leave that, for objective reasons, could not be taken within the prescribed timeframe). “It is recommended that every company establish internal procedures governing the ‘write-off’ of vacation days, or that relevant provisions be included in the company’s work rules,” advises an AVOCAD lawyer.

Such a document should clearly specify how and when unused vacation days are "written off," the basis for accounting entries, and the circumstances under which employees are granted additional time to use them. It is also possible to stipulate employees’ obligation to take leave and provisions for cases of abuse (when an employee arbitrarily fails to take the mandatory uninterrupted annual leave). Such a procedure helps to effectively manage the vacation process, ensures transparency, and helps avoid disputes.

In conclusion, Sandra Mickienė once again points out that the misconception that compensation for unused vacation days is calculated for a maximum of three years often leads to incorrect calculations and disputes. In fact, the Labor Code does not impose such a limitation—compensation depends on the actual number of accrued and unused vacation days, with each year evaluated separately. The right is not lost if an employee was unable to take vacation for objective reasons. Therefore, it is important to clearly document processes, “write off” vacation time in a timely manner, and ensure that employees can actually take it.

 

Used agricultural machinery with hidden defects: does the farmer have the right to make a claim against the seller? 

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In Lithuania, it is common to sue used car dealers who have sold cars with hidden defects. However, sellers of used agricultural equipment receive significantly fewer complaints from farmers, even though such equipment is also prone to failure. Mantas Baigys, a lawyer at the AVOCAD law firm, explains the legal and practical factors that determine this difference.

According to him, farmers often encounter dishonest sellers, but few seek justice. "Agricultural equipment is often sold with hidden defects, but buyers do not take any action because they believe that they are buying used equipment and must assume all the risks associated with its defects," notes the lawyer.

The laws in force in Lithuania establish a general rule – the seller has a duty to guarantee to the buyer that the goods comply with the terms of the contract and that, at the time of conclusion of the contract, there are no hidden defects in the goods that would render them unfit for the purpose for which the buyer intended to use them, or which would reduce the usefulness of the item to such an extent that the buyer, had they been aware of these defects, would not have purchased the item at all or would not have paid as much for it.

According to the lawyer, the seller, having information about the condition or characteristics of the item being sold that is relevant to the conclusion of the contract, and performing the obligation to ensure the quality of the item, acting in good faith, must disclose this information to the buyer, regardless of whether the buyer requests such information. Failure to provide this information to the buyer shall be considered dishonesty on the part of the seller," emphasizes Mantas Baigys.

Therefore, agricultural machinery, like cars, is subject to the same legal regulations, and farmers have the same rights to defend their interests if agricultural machinery with hidden defects has been purchased and cannot be used for its intended purpose.

How long do I have to make a claim to the seller?

When the warranty period or suitability for use of an item is not specified, the buyer may submit claims regarding defects in the item within a reasonable period of time, but no later than two years from the date of transfer of the item, unless a longer period is provided for by law or contract. This position is also upheld in the practice of the Supreme Court of Lithuania.

What can you demand from the seller?

The farmer may demand that the seller: 1) remedy the defects in the item free of charge (repair the item); 2) to replace the item of inadequate quality with an item of adequate quality free of charge; 3) to reduce the price accordingly; 4) the buyer also has the right to unilaterally terminate the contract and demand a refund of the price paid.

Lawyer Mantas Baigys also notes that in each case, it is necessary to first assess the causes of the defect, the cost of repairing it, and other circumstances, and only then decide which method of legal redress is the most effective and fairest.

What does a farmer need to prove when purchasing substandard agricultural equipment?

The farmer must prove that the item sold is of inadequate quality, i.e. that it cannot be used for its intended purpose, that it does not meet the quality requirements for items of this type, and that at the time of purchase he was not aware and could not have been aware of the defects in the item sold.

"If you suspect hidden defects, it is advisable to immediately contact service providers or specialists who can assess the cause of the defect and record it in a written document," advises the lawyer.

Meanwhile, the seller may avoid liability if he proves that the defects in the item arose after the transfer of the items to the buyer due to the buyer's violation of the rules for use or storage of the item, due to the fault of third parties or due to force majeure.

Can a farmer recover other costs related to defective agricultural machinery?

Expenses incurred by the buyer—legal expenses, transportation costs, expert fees, etc.—are classified as losses and may be compensated in accordance with the general procedure, provided that all conditions of civil liability are proven.

"The general recommendation is to document all expenses incurred with written evidence (e.g., invoices) so that they can be proven in court in the event of a dispute," says M. Baigys.

Farmers have the same rights and opportunities to defend their violated rights when purchasing poor-quality agricultural machinery, but in many cases they become hostages to the situation when they rely solely on the assurances of the sellers themselves that the legislation does not provide farmers with any means of legal protection, so it is recommended in all cases to consult with professionals in this field.

 

The court clarified when an employee's silence in relations with the employer becomes consent 

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When an employee agrees on a salary but receives less for several months and does not say anything to the employer, thinking that these are temporary difficulties or that the company is going through a difficult period, serious problems may arise later when a claim is made.

According to Viktorija Dubovskienė, a lawyer at the AVOCAD law firm, the latest court practice sends a very important and clear message: silence in labor relations can be understood as consent, and an arbitrary decision to no longer perform one's duties can be understood as a gross violation.

Lower pay: when does an employee's expectation become consent?

The case examined a situation where an employee had agreed on a specific salary, but the amounts actually paid were subsequently reduced. The employee claimed that this was an unpaid portion of his salary and that he therefore had the right to terminate the contract and claim the outstanding amount. The employer took the opposite view, arguing that the reduction in remuneration had been agreed and that the employee had not made any claims for a long time.

The Supreme Court of Lithuania emphasized a fundamental rule: if an employee believes that the terms of their employment contract have been changed unlawfully, they must take active steps. The law sets a time limit within which potentially violated rights can be challenged. If no dispute is initiated within this period, the employee is deemed to have agreed to work under the changed terms and conditions.

According to the lawyer, in this case, the employee could have noticed the reduction in remuneration when he received the first smaller payments. However, he continued to work, accepted his salary, and did not initiate a formal dispute for a long time. Only later, when the conflict escalated, was a significant amount claimed for the entire period. The court found that there was no basis for such an "accumulated" claim because the employee had not exercised his right to dispute the situation in a timely manner.

Discussing the latest ruling by the Supreme Court, Viktorija Dobovskienė points out that labor law protects employees, but it is also based on the principle of legal certainty. "If a person accepts a lower salary for months and does not react, the court may consider that they have agreed to this situation. Waiting in good faith can become a legal risk," she warns.

Absence from work – a serious violation

An equally important part of the case concerns dismissal for absence from work. The employee, believing that his request to terminate the contract had already taken effect, did not go to work for almost two months. Meanwhile, the employer clearly stated that it did not agree with such termination and considered the employment contract to be valid.

The court assessed this behavior as a continuous and deliberate failure to perform duties. It was emphasized that if the basis for termination of an employment contract is disputed, an employee cannot unilaterally decide that they no longer need to perform their duties. Until there is legal clarity, the obligation to work remains.

"Long-term absence from work without a valid reason was recognized as a gross violation, and dismissal was considered a proportionate measure, especially given the employer's loss of trust. The court also noted that even if there is debate about certain procedural details, this does not in itself negate the fact that a gross violation may have been committed," notes Viktorija Dubovskienė.

The AVOCAD lawyer also points out that if the employer clearly states that the contract is valid, the decision to simply not come to work is extremely risky. "In such a case, the safest course of action is to resolve the dispute through legal means, rather than arbitrarily terminating the performance of duties," says the lawyer.

According to her, this ruling highlights two clear rules. First, if you believe that your salary or other essential terms have been changed unlawfully, react immediately. In labor law, "later" often means "too late." Second, if there is a dispute over the termination of an employment contract, a unilateral decision to stop performing your duties can have serious consequences.

In labor relations, inaction also has a price. The court has once again demonstrated that it is not those who suffer in silence who prevail, but those who defend their rights in a timely and appropriate manner.

When contract termination becomes a dispute: what do you need to know before making a decision?

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Unilateral termination of a contract may seem like a quick way to stop a loss-making project, get rid of an unreliable partner, or renegotiate more favorable terms. However, in practice, this action is one of the most common reasons why business partners end up in court.

According to Karolina Briliūtė, a lawyer at the AVOCAD law firm, even when the possibility of termination is clearly stipulated in the contract, it becomes a complex legal issue in the event of a dispute. Often, one party is convinced that it had both factual and legal grounds to terminate the contract, while the other party believes that such grounds did not exist or were only formal. That is why, according to the lawyer, unilateral termination often turns into a financial and reputational risk.

Court practice follows a clear line – first and foremost, the contract must be preserved, rather than looking for ways to terminate it. Termination is considered an extreme measure, applied only when there is essentially no possibility of preserving the contractual relationship. As Karolina Briliūtė points out, unilateral termination of a contract is not a free exit from an inconvenient business decision. Even if the contract provides for the right of termination, the court will take a strict view – the most important thing is whether there were real and sufficient grounds for such a decision. This means that the terminating party will in all cases have to prove that its decision was based on facts and not merely on a desire to withdraw from its obligations.

The fewest disputes arise when the termination conditions are formulated clearly, specifically, and objectively in the contract. For example, a specific deadline is set, after which the right to terminate the contract arises, the unpaid amount is clearly specified, or the scope of work is defined, and if it is not performed, the possibility of termination arises. The more abstract the terms are, the more room there is for interpretation and for figuring out what the parties really meant. "Clarity in a contract acts as a preventive measure. The more specific the terms are, the lower the risk that, in the event of a dispute, the terms will be interpreted differently than the parties had intended," emphasizes K. Briliūtė.

It is important to understand that even the possibility of termination provided for in the contract is not absolute. The court will assess not only whether the conditions for termination have been formally met, but also whether such a decision is fair and proportionate to the interests of the other party. Termination should not cause disproportionate damage to the other party compared to the interests of the terminating party. If termination substantially distorts the balance of interests between the parties, it may be deemed unjustified.

When it comes to termination due to a material breach of contract, a mere formal breach of the provisions is usually not sufficient. The difference between what was promised and what was actually delivered is assessed, whether the breach caused real and significant negative consequences, whether the breach was intentional or due to gross negligence, and whether it can reasonably be expected that the contract will be properly performed in the future. "What matters to the court is not the formal error, but the actual consequences. If the damage is insignificant or non-existent, the likelihood that the breach will be considered material is significantly reduced," emphasizes K. Briliūtė.

Therefore, before initiating unilateral termination of a contract, it is necessary to assess whether each element of the decision can be justified in the event of a dispute. Unjustified termination may result in an obligation to compensate the other party for losses, cover litigation costs, and cause additional business risks.

"It is possible to terminate a contract, but the most important thing is to not only have the right to do so, but also to have sufficient arguments based on real facts," emphasizes the AVOCAD lawyer.