CEDH · CASELAW;JUDGMENTS;CHAMBER;ENG — 29 janvier 2019

.s800EAC49 { font-size:12pt } .sFE10DC93 { margin-top:0pt; margin-bottom:0pt; text-align:center } .sBB9EE52A { font-family:Arial } .s29100277 { font-family:Arial; font-weight:bold } .sA36B60A1 { font-family:Arial; font-style:italic } .s598389FB { margin-top:0pt; margin-bottom:0pt; text-align:center; font-size:14pt } .sF5E1C6CF { font-family:Arial; font-weight:bold; text-decoration:underline; color:#ff0000 } .sE208486F { font-family:Arial; color:#ff0000 } .s598389F8 { margin-top:0pt; margin-bottom:0pt; text-align:center; font-size:11pt } .s4ACA9207 { page-break-before:always; clear:both; mso-break-type:section-break } .s9793A85B { margin-top:0pt; margin-bottom:0pt; text-indent:14.2pt } .sCB9E0544 { margin-top:0pt; margin-bottom:0pt; text-align:left } .sB9D5CABB { width:28.35pt; display:inline-block } .sD3B63DAD { margin-top:36pt; margin-bottom:12pt; page-break-inside:avoid; page-break-after:avoid; font-size:14pt } .s79DE5897 { margin-top:18pt; margin-left:17.85pt; margin-bottom:12pt; text-indent:-17.85pt; page-break-inside:avoid; page-break-after:avoid } .sF7A86111 { margin-top:6pt; margin-left:21.25pt; margin-bottom:6pt; text-indent:7.1pt; font-size:10pt } .s8EB5F569 { font-family:Arial; font-size:6.67pt; vertical-align:super } .sA8776625 { margin-top:18pt; margin-left:29.2pt; margin-bottom:12pt; text-indent:-17.6pt; page-break-inside:avoid; page-break-after:avoid } .s72C8F48C { margin-top:12pt; margin-left:36.6pt; margin-bottom:6pt; text-indent:-15.05pt; page-break-inside:avoid; page-break-after:avoid } .sA20670C4 { margin-top:12pt; margin-left:48.75pt; margin-bottom:6pt; text-indent:-17pt; page-break-inside:avoid; page-break-after:avoid; font-size:10pt } .s59DEA84 { margin-top:12pt; margin-left:59.5pt; margin-bottom:6pt; text-indent:-17.85pt; page-break-inside:avoid; page-break-after:avoid; font-size:10pt } .s583D00FA { margin-top:0pt; margin-left:17pt; margin-bottom:0pt; text-indent:-17pt } .s4B243ECC { margin-top:12pt; margin-bottom:0pt; text-indent:14.2pt; page-break-inside:avoid; page-break-after:avoid } .sF7A4323 { margin-top:36pt; margin-bottom:0pt; text-align:left } .sBAD0D18F { width:1.87pt; display:inline-block } .s165BD465 { width:190.1pt; display:inline-block } .s7602FED2 { width:18.21pt; display:inline-block } .sC1AC44A4 { width:228.11pt; display:inline-block }       FOURTH SECTION             CASE OF ORLEN LIETUVA LTD. v. LITHUANIA   (Application no. 45849/13)               JUDGMENT         STRASBOURG   29 January 2019     FINAL   29/04/2019   This judgment has become final under Article 44 § 2 of the Convention. It may be subject to editorial revision. In the case of Orlen Lietuva Ltd. v. Lithuania, The European Court of Human Rights (Fourth Section), sitting as a Chamber composed of:   Ganna Yudkivska, President,   Egidijus Kūris,   Iulia Antoanella Motoc,   Carlo Ranzoni,   Georges Ravarani,   Marko Bošnjak,   Péter Paczolay, judges, and Marialena Tsirli, Section Registrar, Having deliberated in private on 4 December 2018, Delivers the following judgment, which was adopted on that date: PROCEDURE 1.     The case originated in an application (no. 45849/13) against the Republic of Lithuania lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) by a legal entity registered under Lithuanian law, Orlen Lietuva Ltd. (“the applicant company”), on 11 July 2013. 2.     The applicant was represented by Mr M. Juonys and Mr   K.   Kačerauskas, lawyers practising in Vilnius. The Lithuanian Government (“the Government”) were represented by their Agent, Ms   K.   Bubnytė-Širmenė. 3.     The applicant company alleged a breach of legal certainty under Article 6 § 1 in view of the imposition of a fine after the expiry of the applicable limitation period and the different interpretation of the limitation period that had been taken in two allegedly similar cases. It also alleged a breach of Article 7, given the high level of the fine imposed. 4.     On 21 June 2017 the application was communicated to the Government. THE FACTS I.     THE CIRCUMSTANCES OF THE CASE 5.     The applicant company is a legal entity registered in Mažeikiai. 6.     In 2004 the Competition Council ( Konkurencijos taryba ) opened an investigation into the applicant company’s alleged abuse of its dominant position on the fuel market. The investigation covered the applicant company’s activities between 2002 and 2004. According to the applicant company, the last action that fell within the scope of the investigation was undertaken on 31   December 2004. 7.     On 7 March 2005 the Competition Council decided to broaden the scope of the investigation and to find out whether the applicant company’s activities had affected trade between the European Union member States, as defined in Article 82 of the Treaty establishing the European Community (“the TEC”) – now Article 102 of the Treaty on the Functioning of the European Union (“the TFEU” – see paragraph 43 below). 8 .     On 22 December 2005 the Competition Council found that the applicant company had abused its dominant position on the fuel market, and fined it 32,000,000 Lithuanian litai (LTL – approximately 9,267,841 euros (EUR)). 9.     The applicant company appealed against the decision of the Competition Council of 22 December 2005 (see paragraph 8 above). It argued that the Competition Council had committed procedural violations and that it had also made mistakes in defining the scope of the market and the scope of the geographical market, and that its ruling that the applicant company had abused its dominant position on the fuel market had thus been unjustified. The applicant company also described as unjustified the Competition Council’s ruling that its pricing had been discriminatory and that the applicant company had obliged other economic entities to sign loyalty and non-competition agreements (see paragraph 16 below), and that it had discriminated against other economic entities. The applicant company also described as unfounded the Competition Council’s ruling that it had sold diesel fuel for differing prices to different economic entities and had thus discriminated against them and that it had sold arctic diesel fuel to one economic entity for a better price than that which it had offered to others. The applicant company was also dissatisfied with the level of the fine and was of the view that that it had been disproportionate. 10.     On 28 June 2008 the Vilnius Regional Administrative Court stated the following. The court held that the Competition Council had a right to investigate whether actions of economic entities had been in accordance with Article 82 of the TEC. The court emphasised that the Law on Competition enabled the Competition Council to initiate an investigation upon its own initiative if it gave sufficient reasons for doing so. In the present case, the Competition Council had given sufficient reasons for broadening the investigation to cover Article 82 of the TEC. The court found that the Competition Council had committed some procedural violations and decided to annul parts of its decision. The court also examined the case on the merits. It held that the Competition Council had defined the scope of the market and the geographical market incorrectly, and that that had had a major impact on its decision. It followed that further conclusions reached by the Competition Council regarding the applicant company’s dominant position, its abuse of that dominant position and compliance with Article 82 of the TEC could not have been just because they had been based on incorrect data. 11 .     The Competition Council appealed. On 8 December 2008 the Supreme Administrative Court delivered its decision, stating that it disagreed with the first-instance court regarding a number of procedural violations but holding that the Competition Council had not extensively explained why it had ignored the applicant company’s arguments regarding the scope of the market. In order to establish the scope of the market, it was necessary to investigate further. The court thus decided to return the case to the Competition Council for additional investigation ( grąžinti bylą Konkurencijos tarybai atlikti papildomą tyrimą ). 12 .     On 15 January 2009 the Competition Council decided that the Supreme Administrative Court’s decision (see paragraph 11 above) obliged it to undertake additional investigative measures into the applicant company’s activities and decided to reopen the investigation ( atnaujinti tyrimą ) with regard to the applicant company. 13.     On an unspecified date, the applicant company appealed against the decision of the Competition Council to recommence the investigation. It submitted that the investigation of the applicant company’s activities had covered the period between 2002 and 2004. Although the initial investigation had not mentioned the end date of the actions examined, it could be presumed that the last investigated action had been undertaken on 31   December 2004. Domestic law provided that economic entities could only be held liable for breaches of the Law on Competition up to three years after the date of the violation in question or, if the violation was continuous, three years after the date of the last action that had been contrary to the Law on Competition (see paragraph 27 below). The applicant company stated that the last such action had been undertaken by it on 31   December 2004 and that the limitation period had ended on 31   December   2007; it could thus not be held responsible for breaches of the Law on Competition. 14.     On 25 May 2009 the Vilnius Regional Administrative Court dismissed the applicant company’s complaint. The court held that final court decisions had to be executed, and that in view of the fact that the decision of the Supreme Administrative Court of 8 December 2008 had become final (see paragraph 11 above), the Competition Council had an obligation to reopen the investigation into the applicant company’s activities. 15 .     The applicant company lodged an appeal, which was dismissed by the Supreme Administrative Court on 13 May 2010. The court provided its reasoning in five short paragraphs, holding that by its impugned decision the Competition Council had merely restarted the previous investigation (rather than opening a new one) ( skundžiamu nutarimu yra tik atnaujinamas anksčiau vykdytas tyrimas vykdant Lietuvos vyriausiojo administracinio teismo įpareigojimą, o ne pradedamas naujas tyrimas ), and that the provision of the domestic law regarding the limitation period was only applicable in respect of new investigations. 16 .     In order to comply with the decision of the Supreme Administrative Court of 8   December 2008 (see paragraph 11 above), on 16 December 2010 the Competition Council carried out an additional investigation into the applicant company’s activities. The Competition Council clarified the definition of the geographical scope of the market, narrowing it to the territory of Lithuania. The Competition Council found that the applicant company had undertaken actions that had restricted competition – namely, it had abused its dominant position by applying discriminatory pricing, by imposing yearly loyalty requirements on other economic entities (that is to say by requiring them to agree to purchase a certain amount of fuel per year from the applicant company) and by restricting parallel imports and the onward sale by its clients of cheap fuel. The applicant company raised an issue regarding the limitation period, claiming that it had expired and that the Competition Council therefore had to terminate the investigation. The Competition Council was of the view that a limitation period had to be calculated from the time at which the economic entity in question had ceased engaging in unlawful activity. One of the breaches committed by the applicant company had started in 2002; one had started in 2003; and the rest had started in 2004. There was no information that the applicant company had ended its unlawful activities (except for one of them). Thus, the three ‑ year limitation period had not even started to run. Moreover, there was no information that the applicant company had changed its behaviour on the relevant markets in such a way that it no longer undertook actions contrary to the Law on Competition and the TFEU; therefore, the violation had been continuous, and it could not be held that the limitation period had expired. Even if the limitation period had started running before the Competition Council’s issuance of its decision of 22 December 2005, the calculation of it would nevertheless have ceased to run on the day that the Competition Council adopted its decision. The time ‑ limit for holding the applicant company liable should have started running on 8 December 2008 – the date of the Supreme Administrative Court’s partial annulment of the decision of the Competition Council. Otherwise, it would have been impossible for the Competition Council to rectify the shortcomings in its decision owing to the length of the court proceedings. Such a situation would have been contrary to the principles of justice and reasonableness because the harmful actions in question could have continued and there would have been no opportunities to require the applicant company to terminate them. Moreover, it would have been impossible to enforce the execution of the court’s decisions. The calculation of the limitation period provided by the applicant company was favourable to other economic entities that had breached the Law on Competition. Such economic entities would only have to behave in such a manner as to ensure that the court proceedings in respect of their own behaviour lasted for a long time. The Competition Council also drew attention to the provisions of the Code of Administrative Offences, wherein it was stated that if a court annulled a decision to impose a sanction on an economic entity or to terminate the procedure regarding the imposition of a sanction (or if that first ‑ instance decision was annulled by an appellate court), the time-limits would start to run again from the date on which the court’s or appellate court’s decision became final (see paragraph 31 below). The Supreme Administrative Court held that responsibility for violations of the Law on Competition was an administrative responsibility in the broad sense and that the principles of administrative responsibility could also be applied to violations of the Law on Competition (see paragraph 38 below). The Competition Council decided that the provisions of the Code of Administrative Offences had to be applied in the applicant company’s case and that – irrespective of the rules of the Law on Competition – the time-limit had to be calculated from the day on which the Supreme Administrative Court had adopted its decision. The provisions of European Union law also provided that the limitation period for imposing fines had to be suspended when the European Commission’s decision was reviewed by the European Union Court of Justice (see paragraph 47 below). The Competition Council was of the view that the national competition authority could not be more limited than the European Commission in its ability to suspend the limitation period. The Competition Council also relied on the decision of the Supreme Administrative Court of 13 May 2010, whereby the court held that the Competition Council had been obliged to reopen the investigation and not to start a new one (see paragraph 15 above). The Competition Council found that the applicant company had breached the Law on Competition and the TFEU and fined it LTL   8,231,000 (approximately EUR 2,383,862). 17.     The applicant company lodged a complaint with the Vilnius Regional Administrative Court and asked it to annul the order of the Competition Council of 16 December 2010 (see paragraph 16 above). The applicant company’s arguments were based, inter alia , on the fact that the limitation period for imposing the fine had been missed and that the applicant company could not be held responsible for violations of the Law on Competition and of the TFEU. The applicant company argued, inter alia , that the Law on Competition set the most serious economic sanctions of all those provided under the Lithuanian legal system and that such high fines threatened the continuity of the activities of economic entities and that because of that it was logical that the law provided that the limitation period could not be suspended or renewed. 18 .     On 15 April 2011 the Vilnius Regional Administrative Court dismissed the applicant company’s complaint. As regards the limitation period and its calculation, the court held that the investigation into the applicant company’s activities had been started on 15 July 2004. The Competition Council was of the view that the limitation period had not started running before 22 December 2005 and that even if it had, it must have stopped when the Competition Council had adopted its decision (see paragraph 8 above). When the Supreme Administrative Court had annulled part of the Competition Council’s decision (see paragraph 11 above), the time-limit for responsibility for violations of competition law had had to be reset. The Vilnius Regional Administrative Court decided that the investigation had merely been reopened and that no new investigation had been initiated ( nagrinėjamu atveju tyrimas tiesiog buvo atnaujintas, o ne pradėtas naujas ) and that the applicant company’s arguments regarding the limitation period had been unfounded. 19 .     The applicant company appealed, raising the issue of the limitation period. On 21 January 2013 the Supreme Administrative Court upheld the arguments of the Vilnius Regional Administrative Court (see paragraph 18 above). It added that there was disagreement between the parties about the dates on which the applicant company had committed violations. Because the Competition Council had investigated the applicant company’s activities between 2002 and 2004, the court held that the last violation had been committed by the applicant company on 31 December 2004. The court also observed that the Competition Council had not proved that the violation had continued after 31 December 2004, and did not accept its arguments that the applicant company’s violation had been continuous or that the limitation period had not started running at all. The court then emphasised the importance of the principle of res judicata – that is to say the factual and legal aspects had been examined in another decision of the court and had to be accepted, and that a party to the proceedings or another person who had participated in the case (where the parties to the proceedings were the same) could rely on that court’s decision without having to prove the same circumstances again. In addition, one of the most important elements of the principle of the rule of law was the principle of legal certainty, which required that the principle of res judicata be respected. Accordingly, when the courts resolved a case, their decisions should not be questioned or left unexecuted, because courts’ decisions (together with legal norms) were a guarantee of the stability of public life and the certainty of social relations. Having regard to that, the Supreme Administrative Court was of the view that on 13 May 2010 it had already examined the Competition Council’s right to reopen the investigation into the applicant company’s activities (see paragraph 15 above). As a result, the legality of the reopening of the investigation had the power of res judicata and could not be questioned again. The Supreme Administrative Court also referred to another one of its cases, decided by different composition with an exception of one judge, on 21   June 2012, which had concerned the sale of dairy products (“the dairy products case”). In that case it had examined the relevant provisions of the Law on Competition – namely their application when a case concerning a violation of competition law was transferred for examination to a court, which then annulled the decision of the Competition Council and returned the case to it for further investigation (see paragraph 40 below). However, the court held: “In the opinion of the extended composition of the court, the reasoning provided in the dairy products case is not applicable to the present case firstly, because of the abovementioned arguments regarding the influence of the decision of 13 May 2010 and the principle of res judicata . Moreover, the circumstances of the instant case and the one in which the decision of 21 June 2012 has been adopted, are not the same or so similar that they could be examined similarly. In the administrative case no.   A 520 ‑ 2136/2012 the court has examined the legality of the decision of the Competition Council whereby the economic entity was suspected of a breach of the provisions of the Law on Competition and in the instant case the applicant company is suspected of breaching both the Law on Competition and the TFEU. In the opinion of the extended composition of the court, this circumstance also determined the conclusion that the two cases are substantively different and the decision, taken in one of them, cannot be a precedent in determining the other one.” The court thus decided that the Competition Council’s ruling that (i) the limitation period had not expired and (ii) the applicant company could be held liable for the breaches of the Law on Competition had been lawful. The court did however lower the fine to LTL 7,819,450 (approximately EUR   2,264,669). II.     RELEVANT DOMESTIC LAW AND PRACTICE A.     Constitutional provisions 20.     Article 46 of the Constitution provides that the economy of Lithuania shall be based on the right of private ownership, freedom of individual economic activity, and economic initiative. The State shall support economic efforts and initiative that are useful to society. The State shall regulate economic activity so that it serves the general welfare of the Nation. The law shall prohibit the monopolisation of production and the market, and shall protect freedom of fair competition. The State shall defend the interests of the consumer. 21 .     Article 138 of the Constitution provides that international treaties ratified by the Seimas shall form a constituent part of the legal system of the Republic of Lithuania. 22 .     The Law Supplementing the Constitution of the Republic of Lithuania with the Constitutional Act “On Membership of the Republic of Lithuania in the European Union” and Supplementing Article 150 of the Constitution of the Republic of Lithuania (No. IX-2343) of 13 July 2004 provides that the Republic of Lithuania, as a member State of the European Union, shall share with the European Union (or confer with the European Union regarding) the responsibilities of its State institutions in those areas specified in the founding Treaties of the European Union to the extent that by doing so it would, together with the other member States of the European Union, meet its membership commitments in those areas (as well as enjoying membership rights). The norms of European Union law shall constitute a constituent part of the legal system of the Republic of Lithuania. Where they concern the founding Treaties of the European Union, the norms of European Union law shall be applied directly, while in the event of the collision of legal norms, they shall have supremacy over the laws and other legal acts of the Republic of Lithuania (see also paragraph 32 below). B.     Law on Competition 23 .     At the material time, Article 9 provided that it was prohibited to abuse a dominant position within a relevant market by undertaking any acts that restricted or could restrict competition or limited without a justified reason the possibilities of other economic entities to operate in a market or breached the interests of consumers, including by: (1) the direct or indirect imposition of unfair prices or other conditions in respect of purchase or sale; (2)   the imposition of restrictions on trade, production or technical development, to the detriment of consumers; (3) the application of different (that is to say discriminatory) conditions to different economic entities in similar contracts and creating different competitive conditions in respect of those economic entities; (4) the conclusion of an agreement whereby additional obligations were imposed on another party to that agreement and those obligations (as regards their commercial nature or purpose) had no direct connection with the object of the contract. 24 .     Article 17 § 1 provides that the Competition Council is an independent State authority, which reports to Parliament. It implements national competition policy and oversees observance of the Law on Competition. The Competition Council is independent and autonomous in issuing its decisions. 25 .     Article 36 § 1 provides that a fine of up to 10% of the gross annual income realised in the preceding business year can be imposed on economic entities in respect of prohibited agreements, abuse of a dominant position, the implementation of a notifiable concentration without the permission of the Competition Council, the continuation of a concentration during the period of its suspension or an infringement of concentration conditions or mandatory obligations established by the Competition Council. 26 .     At the material time, Article 39 (2) provided that after examining a case concerning a decision delivered by the Competition Council, a court could decide to annul that decision (or parts thereof) and to return the case to the Competition Council for additional investigation. 27 .     Article 40 § 3 of the Law on Competition, as in force at the material time, provided that legal entities could be held responsible for a violation of the Law on Competition within three years of the date of that violation or, if the violation was continuous, within three years of the date on which the violation had occurred. 28 .     On 3 May 2011 an amended Law on Competition entered into force. Legal entities could be held responsible for a violation within three years of the date of that violation or, if the violation was continuous, within five years of the date on which the last such violation had been committed (Article 40 § 3). The limitation period was to be suspended (i) while the Competition Council performed an investigation, (ii) when a court had suspended an investigation being undertaken by the Competition Council, or (iii) when there was a dispute in the domestic courts about a decision taken by the Competition Council to impose sanctions. C.     Other legislative provisions 29 .     Article 15 § 1 of the Law on Administrative Proceedings provided that the Supreme Administrative Court should ensure uniform practice among the administrative courts as regards the interpretation and application of laws and other legal acts. 30 .     Article 153 § 2 (12) of the Law on Administrative Proceedings provided that proceedings could be reopened when it was necessary to ensure the uniform development of the case-law of the administrative courts. 31 .     Article 35 § 4 of the Code of Administrative Offences provides that when (i) a decision to impose a sanction on an economic entity (or to terminate the procedure to be followed when imposing such a sanction) is annulled by a court or (ii) a first-instance decision is annulled by the appellate court, the relevant time-limit shall be reset and shall start to run again from the date on which the court’s or appellate court’s decision became final. D.     Domestic case-law 1.     Case-law of the Constitutional Court (a)     As to the place of the European Union law   in the Lithuanian legal system 32 .     The Constitutional Court held that the Constitution consolidated the principle that in cases when national legal acts established a legal regulation that competed with that established by an international treaty, then the international treaty should be applied. The Constitutional Court also, with regard to European Union law, established expressis verbis the “collision rule”, which consolidated the principle that European Union legal acts were to take priority in cases where the provisions of the European Union arising out of the founding Treaties of the European Union competed with the legal regulations established by Lithuanian national legal acts (regardless of their legal force). The only exception to this rule was the Constitution itself (decisions of the Constitutional Court of 14 March 2006, 21   December 2006, 8 May 2007 and 4 December 2008). (b)     As to court precedents and continuity of jurisprudence 33 .     The Constitutional Court has emphasised the importance of the continuity of jurisprudence (rulings of 12 July 2001, 10 May 2003, 13   February 2004, 13 December 2004, 14 March 2006, 28 March 2006, 24   October 2007, and 3 February 2014). 34 .     On 28 March 2006 the Constitutional Court examined, among other issues, the power of court precedents, possibilities to deviate from them. It held: “It was mentioned that the principle of a State under the rule of law enshrined in the Constitution implies continuity of jurisprudence, as well as that creation of new court precedents and arguing (grounding) the court precedents may not be rationally legally unreasoned volitional acts. Since courts of general jurisdiction, inter alia, the Supreme Court of Lithuania and the Court of Appeal of Lithuania, must, under their competence, ensure the continuity of the corresponding jurisprudence (inter alia, the fact that the practice of courts of general jurisdiction would be corrected (it would be deviated from the precedents that had been binding on courts by then and new precedents would be created) only when it is unavoidably and objectively necessary, constitutionally grounded and reasoned, and that such correction of the practice of courts of general jurisdiction (deviation from the previous precedents that had been binding on courts by then and creation of new precedents) would in all cases be properly (clearly and rationally) argued (first of all, in the decisions of the corresponding courts of general jurisdiction themselves)), as the courts of the highest instances of the systems of specialised courts established under Paragraph 2 of Article 111 of the Constitution (in the system of administrative courts—the Supreme Administrative Court) are under analogous obligation, so must the Constitutional Court, referring to its already formed constitutional doctrine and precedents, ensure the continuity of the constitutional jurisprudence (its consecution, consistency) and the predictability of its decisions.” 35 .     On 24 October 2007 the Constitutional Court further elaborated on the doctrine on court precedents. It stated: “The principle of a state under the rule of law entrenched in the Constitution implies continuity of jurisprudence... Disregarding the maxim that the same (analogous) cases have to be decided in the same way, which arises from the Constitution, would also mean disregarding the provisions of the Constitution on administration of justice, that of the constitutional principles of a state under the rule of law, justice, equality of people before the court and other constitutional principles... The practice of courts of general jurisdiction in cases of corresponding categories has to be corrected and new court precedents in these categories may be created only when it is unavoidably and objectively necessary, when it is constitutionally grounded and justified... No creation or reasoning of a new court precedent may be determined by accidental (in the aspect of law) factors. The imperatives of the activity of the courts of general jurisdiction and legal regulation of this activity arising from the Constitution... should also be applied mutatis mutandis to the activity of the specialised courts established under Paragraph 2 of Article 111 of the Constitution and its legal regulation. ... Court precedents are sources of law – auctoritate rationis; the reference to the precedents is a condition for the uniform (regular, consistent) court practice as well as that of implementation of the principle of equity entrenched in the Constitution. Therefore, it is not permitted to unreasonably ignore court precedents. In order to perform this function properly, the precedents themselves should be clear. Court precedents may not be in conflict with the official constitutional doctrine, either. On the other hand, it is not permitted to overestimate, let alone make absolute, the significance of court precedents as sources of law. Court precedents must be invoked with particular care. It needs to be emphasised that in the course of consideration of cases by courts, only those previous decisions of courts have the power of a precedent, which were created in analogous cases, i.e. the precedent is applied only in those cases whose factual circumstances are identical or very similar to the factual circumstances of the case in which the precedent was created, and with regard to which the same law should be applied as in the case in which the precedent was created. In a situation where there is competition of precedents (i.e. when there are several differing court decisions adopted in analogous cases) one must follow the precedent that was created by the court of higher instance (a higher court). Also, account should be taken of the time of the creation of the precedent and of other factors of significance, as, for instance: of the fact whether the corresponding precedent reflects the established court practice, or whether it is a single occurrence; of whether the reasoning of the decision is convincing; of the composition of the court that adopted the decision (whether the corresponding decision was adopted by a single judge, or by a college of judges, or whether by the enlarged college of judges, or whether by the entire composition of the court (its chamber)); whether there were any dissenting opinions of judges expressed because of the previous court decision; of possible significant (social, economic etc.) changes which took place after the adoption of the corresponding court decision, which has the significance of a precedent, etc. As mentioned before, in cases when the correction of court practice is unavoidably and objectively necessary, the courts may deviate from the previous precedents, which had been binding on the courts until then, and create new precedents, however, it must be done by properly (clearly and rationally) arguing it. It needs to be specially emphasised that, when deviating from its previous precedents, the court must not only properly argue the adopted decision itself (i.e. the created precedent itself), but also clearly set forth the reasoning and the arguments substantiating the necessity to deviate from the previous precedent.” (c)     As to economic sanctions 36 .     On 3 November 2005 the Constitutional Court examined the case on whether provisions of the Law on the Control of Tobacco, which had not provided that the administrative courts could not lower fines even if there had been circumstances mitigating responsibility, and the fine had obviously been disproportionate, were in accordance with the Constitution and the principles of equity and the rule of law. The Constitutional Court held: “[A]ll the sanctions – monetary fines – established in the provisions...of the Law on the Control of Tobacco... are called “economic sanctions” in this law, by their legal content and other features are close to administrative sanctions   ‑   administrative penalties for corresponding violations of law – established in some other laws (inter alia, in the Code of Administrative Offences) and virtually they are not different from the former; although the so-called economic sanctions... especially when one has in mind the fact that such individual type of legal liability or an individual legal institute as “economic liability” does not exist at all, the so-called economic sanctions... should be categorised as belonging to the same legal institute, i.e. to the institution of administrative legal liability. ... The constitutional principles of justice and of a state under the rule of law do not permit establishing such penalties for violations of law, as well as such sizes of the fines, which would evidently be disproportionate (inadequate) to the violation of law and the objective sought (the Constitutional Court’s rulings of 6 December 2000, 2   October 2001, and 26 January 2004). The penalties established for violations of the laws must be of such size which is necessary for the sought legitimate and generally important objective––to ensure the observance of the laws, the fulfilment of the established duties (the Constitutional Court’s ruling of 26 January 2004). The constitutional principle of justice demands to differentiate the established penalties for violations of law (thus, also the imposed administrative penalties and monetary fines) so that the nature of the violation of law, circumstances mitigating and aggravating the responsibility could be taken into account, that, while taking account of that, a milder punishment could be imposed than the minimum one provided for in the sanction (the Constitutional Court’s ruling of 26 January 2004). ... In the context of the constitutional justice case at issue, it needs to be noted that provided certain sanctions established in laws by their size (strictness) amount to criminal punishments, no matter whether these sanctions may be categorised as belonging to a certain type of legal liability (criminal, administrative, disciplinary or other legal liability), and no matter how respective sanctions are named in laws, the laws must necessarily establish procedural guarantees (which stem from the Constitution, inter alia, from its Article 31) for persons who are held legally liable under corresponding laws. In this context, it needs to be emphasised that the provisions of Article 31 of the Constitution cannot be construed as being designed only to the persons who are held criminally liable. Neither is it permitted to disregard this imperative also in the cases where laws establish certain sanctions which, although are referred to as “economic sanctions” in the laws, by their content and other features should be categorised as belonging to the institute of administrative legal liability, however, by their size (strictness) amount to criminal punishments.” 37 .     On 21 January 2008 the Constitutional Court examined the case on whether the rules on the Law on the Control of Alcohol were in accordance with the Constitution and the constitutional principles of equity, rule of law and legitimate expectation. The Constitutional Court referred to its ruling of 3   November 2005 and also held: “... [I]n the courts’ practice, the “economic sanctions” for violations of the Law on the Control of Alcohol (as well as the “economic sanctions” for violations of the Law on the Control of Tobacco) are treated namely as administrative sanctions ...” 2.     Other relevant domestic case-law 38 .     In its decision of 3 June 2004, the Supreme Administrative Court held that responsibility for violations of the Law on Competition was an administrative responsibility in a broad sense and that the principles of administrative responsibility could be applied to violations of the Law on Competition as well. 39 .     In its decision of 8 December 2008, the Supreme Administrative Court ruled that the procedural norms of the European Union member States in the field of the enforcement of competition law rules were not harmonised. Legal acts adopted in Lithuania had legal force in Lithuania, including those which prescribed the investigation by the Competition Council of Lithuania of violations of the Law on Competition and the TEC. However, in order to harmonise the national and the European Union rules on competition, as defined in Article 1 § 3 on the Law on Competition, and to ensure the proper application of these rules in Lithuania, it was necessary to take into account the procedural rules on competition, as valid under European Communities’ competition law. Under Article 10 of the TEC, it was not allowed to apply such national procedural norms that would render virtually impossible or excessively difficult the exercise of rights conferred by Articles 81 and 82 of the TEC (the principle of effectiveness) or to apply such rules that were less favourable than those governing similar domestic actions (the principle of equivalence) (decision no. A-248-715-08). 40 .     On 26 January 2012 the Vilnius Regional Administrative Court examined the dairy products case (see paragraph 19 above). It explained that analogy of law could be applied (in accordance with both general legal theory and Article 4   § 6 of the Code on Administrative Proceedings), but only when: 1) there was a legal gap; 2) there was a law regulating similar relationships; and 3) there were similarities between relationships governed by legal norms and those not governed by them, which allowed the conclusion to be drawn that the application of analogy of law would not be contrary to the essence and type of legal relationship in question. The court furthermore held that at the material time, the relevant provision of the Law on Competition had not provided that limitation periods had to be suspended once a case had been transferred to a court and renewed once the relevant investigation had been reopened by the Competition Council. The current provisions of the Law on Competition providing that the limitation period for imposing fines is five years (but that it is possible to suspend it if the case is examined before a court) came into force on 3   May 2011 (see paragraph 28 above). The court held that the provisions that had been in force at the material time were a conscious decision of the legislature. Even the explanatory report on the amendments to the Law on Competition stated that the three-year limitation period had not provided for any cases when the time-limit for imposing sanctions could be suspended. The court furthermore stated that general limitation periods, which were listed in the Code of Administrative Offences, were not applicable in the field of competition law because Article 40 of the Law on Competition provided a specific time-limit for the imposition of fines, and that analogy of law could thus not be applied. Moreover, the possibility (as stipulated in the Law on Competition) to suspend that time-limit was not provided in the case-law of the Supreme Administrative Court. The court refused to follow the decision of the Supreme Administrative Court of 13 May 2010 (see paragraph 15 above), stating that the factual circumstances of two cases were different. The court held that the Competition Council had applied the new provisions of the Law on Competition retroactively because it had held that the limitation period had been suspended when the case had been examined before the Supreme Administrative Court. However, provisions of competition law could not have a retroactive effect. The only exception to this rule in the field of administrative law was that the law could have a retroactive effect if it mitigated liability for violations of administrative law ( lex benignior retro agit ); however, in the present case the amendments to the Law on Competition did not mitigate such liability. The court had to follow the law; it could not assume the functions of the legislature by, in the absence of legal regulation, creating new legal norms and applying them to any specific case. Article 4 § 6 of the Law on Administrative Proceedings obliged the court to apply a law regulating a similar relationship in the absence of any law regulating the issue in question, and, if there was no such law – to apply the principles of fairness and reasonableness. Having regard to that, the court concluded that the limitation period had been provided in the Law on Competition, as worded at the material time and that no analogy of law could be applied. The court thus decided that the decision of the Competition Council had been unlawful because it had been issued after the expiry of the limitation period. 41 .     On 21 June 2012 the Supreme Administrative Court examined an appeal in the dairy products case concerning a decision of the Competition Council of 9 June 2011 to impose a fine on two economic entities for breaches of the Law on Competition. The economic entities were of the view that the Competition Council had imposed the fines after the expiry of the limitation period, because the investigated actions had ended in December 2007 and the fines had been imposed in June 2011. The Supreme Administrative Court found that in February 2008 the Competition Council had issued a decision to impose fines on the two economic entities that had participated in the dairy products market. In June 2009 the Supreme Administrative Court had obliged the Competition Council to additionally investigate the activities of the two economic entities. In July 2009 the Competition Council had reopened the investigation. In 2011 the Competition Council had found that the economic entities had breached the Law on Competition; accordingly, it had imposed fines on them. The Supreme Administrative Court held that Article 40 § 3 of the Law on Competition, valid at the material time, had provided that economic entities could be held responsible for a breach of the Law on Competition within three years of the day on which such a breach had been committed or, in the case of a continuous breach – within three years of the day on which the last of the actions constituting a breach of the law had been undertaken. There was no dispute that the last such action had occurred in December 2007. Article 40 § 3 of the Law on Competition did not provide that the limitation period could be suspended or restarted when a case regarding a violation of competition law was transferred to a court or when then a decision of the Competition Council was annulled and the case returned to it for additional investigation. The Supreme Administrative Court emphasised that Article 40 § 3 of the Law on Competition was clear and unequivocal. The fact that no exceptions to the calculation of the limitation period had been provided meant that the legislature had not meant to provide them. In other words, the aforementioned provision meant that the limitation period had to be calculated in a similar manner in all cases and that it did not depend on the circumstances of the examination of the case by the Competition Council or before the courts. The court also held that fines provided in the Law on Competition fell within the category of economic sanctions. Similar sanctions were provided by the Law on the Control of Tobacco, the Law on the Control of Alcohol, and the Law on Advertising, and they came close to constituting penalties for administrative offences and could even come close to constituting criminal sanctions. The domestic case-law provided that legal norms pertaining to responsibility and sanctions could not be interpreted in a broader sense. The analogy of law in both criminal and administrative law was an exception, and could only be justified if it narrowed the scope of responsibility. If analogy of law was applied in calculating the limitation period to the detriment of an applicant, it would mean that an economic entity could be held responsible otherwise than in accordance with the rules provided explicitly by law. This would be contrary to the principles of legal certainty and the rule of law. A person could only be held responsible if the grounds of responsibility were clearly defined, and all doubts had to be interpreted in his or her favour. These were the general principles, and the court could not negate them. The Supreme Administrative Court also examined whether the relevant provisions of the Code of Administrative Offences regulating the calculation of the limitation period could be applied in the case at issue. The court held that they could not, because the Code of Administrative Offences was not the act that had determined the scope of investigation of the Competition Council. Even though there was some case-law indicating that responsibility for violations of the Law on Competition was an administrative responsibility in a broad sense, the general calculation of the limitation period set in the Code of Administrative Offences could not be applied in the area of competition law. The Supreme Administrative Court also held that a speedy reaction after a violation had a greater preventive effect. Moreover, the essence of the limitation period was to ensure that the persons responsible were held liable for certain violations within a specific t