Lithuania

Although the Financial Crime Investigation Service is the core institution for reporting suspicous monetary operations and transactions and other reporting activities, the Lithuanian Bar Association is the central authority for reporting by attorneys and assistant attorneys, which further communicates information to the Financial Crime Investigation Service.

In accordance with the Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania, money laundering shall mean:

1. the conversion or transfer of property, in the knowledge that such property is derived from a criminal act or from involvement in such an act, for the purpose of concealing or disguising the illicit origin of the property or of assisting any person who is involved in the commission of such a criminal act to evade the legal consequences of this act;
2. the concealment or disguise of the true nature, origin, source, location, disposition, movement, rights with respect to, or ownership of property, in the knowledge that such property is derived from a criminal act or from involvement in such an act;
3. the acquisition, possession or use of property, in the knowledge, at the time of acquisition/transfer, that such property was derived from a criminal act or from involvement in such an act;
4. preparation, attempts to commit and association to commit any of the acts referred to in items 1, 2 and 3 above.

See our answer in question 2 above. Please also note that laundering of crime-related property falls within the scope of money laundering as it is understood under criminal law. In accordance with the Criminal Code of the Republic of Lithuania, laundering of crime-related property is defined as an act of a person who, with a view to concealing or legitimising his own or another person’s property, while being aware that it has been derived from crime, acquires, manages, uses, transfers the property to other persons, performs financial operations related to this property, enters into transactions, uses it in economic and commercial activities, otherwise transforms it or falsely indicates that it has been obtained from lawful activities, also a person who conceals the actual nature of his own or another person’s property, its source, location, disposal and movement thereof or ownership or other rights related to the property, while being aware that the property has been derived from crime.

The following institutions are responsible for the prevention of money laundering and/or terrorist financing: the Government of the Republic of Lithuania, the Financial Crime Investigation Service under the Ministry of the Interior of the Republic of Lithuania, the State Security Department of the Republic of Lithuania, the Bank of Lithuania, the Customs Department under the Ministry of Finance of the Republic of Lithuania, the Department of Cultural Heritage Protection under the Ministry of Culture of the Republic of Lithuania, the Gaming Control Authority under the Ministry of Finance of the Republic of Lithuania, the Lithuanian Chamber of Notaries, the Lithuanian Chamber of Auditors, the Chamber of Judicial Officers of Lithuania, the Lithuanian Assay Office and the Lithuanian Bar Association. Obliged entities from different sectors are assigned to the supervision of the aforementioned institutions (e.g. Lithuanian Bar Association is responsible for supervision of activities of the attorneys and assistant attorneys).

Yes

If not, when is it expected to be implemented?

N/A

Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania
in Lithuanian:
https://www.e-tar.lt/portal/lt/legalAct/TAR.C44837068B55/asr;
in English (not the final version though):
https://e-seimas.lrs.lt/portal/legalAct/lt/TAD/26a9f270fb6511e796a2c6c63add27e9?jfwid=2r1m4zwg)

Rules for Attorneys and Assistant Attorneys for Prevention of Money Laundering and Terrorist Financing and other template forms (in Lithuanian:
https://www.advokatura.lt/lt/apie-advokatura/pinigu-plovimo-ir-834e.html)

Other legal acts adopted by the Financial Crime Investigation Service (in Lithuanian:
http://www.fntt.lt/lt/pinigu-plovimo-prevencija/teises-aktai/isakymai/285)

The Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania does not provide a clear answer whether visiting lawyers to the country subject to local laws regarding Anti-Money Laundering. To our understanding, lawyers should be subject to their home Member State laws on prevention of money laundering and terrorist financing, unless they practice in Lithuania.

Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania, and thus reporting obligations, applies to attorneys and assistant attorneys, whether by acting on behalf of and for their client or by assisting in the planning or execution of transactions for their client concerning the purchase or sale of immovable property or undertakings, management of client money, securities or other assets, opening or management of bank or securities accounts, organisation of contributions necessary for the establishment, operation or management of legal persons and other organisations, emergence or creation and operation or management of trust or company incorporation and administration service providers and/or related transactions.

Rules for Attorneys and Assistant Attorneys for Prevention of Money Laundering and Terrorist Financing and other template forms (in Lithuanian: www.advokatura.lt/lt/apie-advokatura/pinigu-plovimo-ir-834e.html)

Yes, Lithuanian Bar Association is responsible for approving instructions aimed at preventing money laundering and/or terrorist financing which are intended for attorneys and assistant attorneys, supervise the activities of attorneys and assistant attorneys related to the implementation of money laundering and/or terrorist financing prevention measures and give advice to the attorneys and assistant attorneys on the issues relating to the implementation of the instructions specified herein.

All attorneys and assistant attorneys are subject to the rules for prevention of money laundering and/or terrorist financing. However, law firms (both which have legal status and which do not have a legal status) are obliged to appoint a person (MLRO) responsible for organisation of implementation of measures for prevention of money laundering and/or terrorist financing and reporting thereof. Attorneys operating on an individual basis may individually organise implementation of measures for prevention of money laundering and/or terrorist financing and reporting thereof.

CDD requirements apply to attorneys and assistant attorneys, whether by acting on behalf of and for their client or by assisting in the planning or execution of transactions for their client concerning the purchase or sale of immovable property or undertakings, management of client money, securities or other assets, opening or management of bank or securities accounts, organisation of contributions necessary for the establishment, operation or management of legal persons and other organisations, emergence or creation and operation or management of trust or company incorporation and administration service providers and/or related transactions. CDD must be carried out before commencement of provision of services to the customer and in other cases established under Article 9 of the Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania. CDD inter alia comprises of:

• identifying the customer and verifying the identity of the customer and of the beneficial owner on the basis of documents, data or information obtained from a reliable and independent source;
• establishing whether the customer acts on his own behalf or is controlled and identifying the beneficial owner and, where the customer acts through a representative, also establishing the identity of that person;
• requiring to provide documents and other data on the basis of which it would be possible to understand the management structure and the nature of activities of the customer which is a legal person;
• obtaining information on the purpose and intended nature of the business relationship.

Yes.

If yes is there a set framework in place or guidelines to assist with this?

No, law firms or attorneys acting on individual basis should adopt internal AML policies specifying how the risk-based approach is applied.

Yes.

If yes, please supply further details

In accordance with the Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania, simplified CDD may be carried out where lower risk of money laundering and/or terrorist financing is identified based on the internal risk assessment and management procedures in the cases of:

1. companies whose securities are admitted to trading on a regulated market in one or more European Union Member States and other foreign companies whose securities are traded on regulated markets and which are subject to disclosure requirements consistent with the European Union legislation;
2. entities of public administration;
3. a customer, where the customer is a financial institution covered by the Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania, or a financial institution registered in another European Union Member State or in a third country which imposes requirements equivalent to those laid down in the Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania and is supervised by competent authorities for compliance with those requirements, also where international organisations have identified a low level of corruption in that country;
4. other cases prescribed by Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania (most of other cases applies in case of provision of financial services).

Yes.

If yes please provide details of these requirements and examples of the types of evidence required to demonstrate an enhanced level of CDD.

In accordance with the Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania, enhanced CDD shall be carried out applying additional measures of identification of the customer and of the beneficial owner:

1. where cross-border correspondent banking relationships are carried out with third-country financial institutions;
2. where transactions or business relationships are carried out with politically exposed natural persons;
3. where transactions or business relationships are carried out with natural persons residing or legal persons established in high-risk third countries included in lists of jurisdictions with strategic deficiencies in their frameworks to combat money laundering and/or the financing of terrorism published by the European Commission and FATF. Upon the assessment of risk, enhanced CDD measures shall not be obligatory in respect of branches or majority-owned subsidiaries of financial institutions or other obliged entities established in the European Union which are located in high-risk third countries identified by the European Commission, where those branches or majority-owned subsidiaries comply with the group-wide requirements equivalent to those established by the Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania;
4. where higher risk of money laundering and/or terrorist financing is identified based on the internal risk assessment and management procedures. When assessing the risks of money laundering and/or terrorist financing, the factors of potentially higher risk of money laundering and/or terrorist financing referred to in Article 14(10) of the Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania must be assessed;
5. in the cases indicated by the European supervisory authorities and the European Commission.

True risk based approach is applied. However, with respect to enhanced CDD, additional measures as established under Article 14 of the Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania have to be applied.

Yes. However, enhanced CDD has to be applied.

Yes.

If yes, please describe.

In accordance with the Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania, financial institutions and other obliged entities (including attorneys and assistant attorneys) may establish the identity of the customer or of the beneficial owner without his direct presence by making use of the information about the customer or the beneficial owner obtained third parties which are financial institutions supervised by competent authorities, another obliged entities or financials institutions or any other obliged entities registered in another European Union Member State or a state that is not a Member State of the European Union meeting the following requirements:

1. they are subject to mandatory professional registration prescribed by law;
2. they are registered in the European Union Member State or a third country which imposes requirements equivalent to those established by the European Union for the identification of the customer and of the beneficial owner and storage of information and they are supervised by competent authorities for compliance with those requirements.

Yes.

If yes, please provide further details

In general, attorneys and assistant attorneys are subject to the same rules as applied to financial institutions under the Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania, except for the fact that the rules established by the said law apply only to attorneys and assistant attorneys, whether by acting on behalf of and for their client or by assisting in the planning or execution of transactions for their client concerning the purchase or sale of immovable property or undertakings, management of client money, securities or other assets, opening or management of bank or securities accounts, organisation of contributions necessary for the establishment, operation or management of legal persons and other organisations, emergence or creation and operation or management of trust or company incorporation and administration service providers and/or related transactions.

In accordance with the Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania, upon establishing that their customer is carrying out a suspicious monetary operation or transaction, attorneys and assistant attorneys must suspend the operation or transaction disregarding the amount of the monetary operation or transaction (except for the cases where this is objectively impossible due to the nature of the monetary operation or transaction, the manner of execution thereof or other circumstances) and, not later than within three working hours from the suspension of the monetary operation or transaction, report this operation or transaction to the Lithuanian Bar Association (where the monetary operation or transaction has not been suspended due to the nature of the monetary operation or transaction, the manner of execution thereof or other circumstances – within three working hours from establishing the suspicious monetary operation or transaction).

Yes.

If yes, please give details

Suspicious transactions reporting requirements shall not apply to attorneys and assistant attorneys in the course of ascertaining the legal position of their client or defending or representing the client in, or concerning judicial proceedings, including advice on instituting or avoiding proceedings, irrespective of whether such information is received or acquired prior to, in the course of or upon termination of such proceedings.

No specific exemptions with respect to suspicious transaction reporting are established. However, general indemnities and guarantees on attorneys’ activities apply.

No, except for the cases where this is objectively impossible due to the nature of the monetary operation or transaction, the manner of execution thereof or other circumstances.

If yes, must consent from authorities be obtained first?

N/A

Yes.

If yes, please describe

Attorneys and assistant attorneys must in all cases carry out the ongoing monitoring of the customer’s business relationships, including scrutiny of transactions undertaken throughout the course of such relationships, to ensure that the transactions being conducted are consistent with the financial institutions’ or other obliged entities’ knowledge of the customer, its business and risk profile as well as the source of funds. The ongoing monitoring procedures have to be provided in the internal AML policy. Furthermore, the data, documents and information of the customer must be updated (at least every 24 months; the periods depend on the internal policies and customer risk profile).

KYC questionnaire, extracts from databases and contractual documentation, etc.

KYC questionnaire, extracts from databases, annual financial statements, annual tax declarations, employment documentation, etc.

National identification document, passport, permanent residence permit in Lithuania.

Certificate/exctract from Companies Register.

No information available.

No information available.

No.

Lithuania is a member of MONEYVAL. For more information regarding mutual evaluation of Lithuania by MONEYVAL, please follow the MONEYVAL website (www.coe.int/t/dghl/monitoring/moneyval).

Yes.

http://fntt.lt/data/public/uploads/2016/10/d2_nrv2015.pdf

No information available.

Please note that this information should not be used as a substitute for your own legal research or be construed as offering legal advice. The contributors accept no duty, liability or responsibility in respect of the accuracy of the information provided in this section.