NEW MORTGAGE REGISTRATION MODEL IN LITHUANIA CENTRAL MORTGAGE OFFICE LITHUANIA 4 December 2012

A BRIEF OVERVIEW OF REGISTERS MANAGED BY CENTRAL MORTGAGE OFFICE

Register:Activity since: Mortgage Register of the Republic of Lithuania1 April 1998 Register of Wills1 July 2001 Register of Property Seizure Acts1 January 2002 Register of Marriage Settlements1 July 2002 Register of Contracts17 July 2002 Register of Legally Incapable Persons and Persons with Limited Legal Capacity 1 January 2011 Register of Notarially Certified Powers of Attorney1 January 2011 Central Mortgage Office was established on the 29 September 1997 Registers managed by the Office:

Objects of the Register: wills; facts of acceptance of inheritance. Data about the content of will and testator’s will are not stored and processed in the Register of Wills. REGISTER OF WILLS

12234ąččęėįšž STATISTICS OF THE REGISTER OF WILLS wills were registerd from 1 January 2012 till 1 October 2012.

12234ąččęėįšž STATISTICS OF THE REGISTER OF WILLS

The Register of Property Seizure Acts is a public state register where property seizure acts accepted by state institutions (officers) are registered in accordance with the order established by law. Objects of the Register are property seizure acts of: courts bailiffs prosecutors State Tax Inspectorate under the Ministry of Finance of the Republic of Lithuania State Social Insurance Fund Board under the Ministry of Social Security and Labour of the Republic of Lithuania other institutions and officers by which rights to the property located in the Republic of Lithuania are temporarily restricted by force by seizing the property in accordance with the grounds and order established by laws. REGISTER OF PROPERTY SEIZURE ACTS

Till 1 July 2012 Data might be transferred to the register: by fax by mail personally Refusal to register of property seizure act: Decision is made by mortgage judge There was no time limit in order to eliminate data inaccuracies and shortcomings PROPERTY SEIZURE ACTS REGISTRATION Since 1 July 2012 Data might be transferred to the register: electronically by fax (for unexpected problems to transfer data) Refusal to register of property seizure act: Decision is made by Central Mortgage Office There is a time limit of 10 workdays in order to eliminate data inaccuracies and shortcomings

REGISTER OF PROPERTY SEIZURE ACTS STATISTICS

Objects of the Register: marriage settlements; cohabitation settlements on the division of jointly acquired and used property at the end of co- habitation; facts of the division of property (settlements and court decisions on division of joint property of spouses). 2. REGISTER OF MARRIAGE SETTLEMENTS

STATISTICS OF THE REGISTER OF MARRIAGE SETTLEMENTS 536 marriage settlements were registered form 1 January 2012 till 1 October 2012

Objects of the Register: Contracts of Instalment Sale Contracts of Sale with Right of Redemption; Leasing (financial lease) agreements. The object of such contracts is a thing which has not/can not be registered (in appropriate property register), acquired for the business or services. 3. REGISTER OF CONTRACTS

STATISTICS OF THE REGISTER OF CONTRACTS

In accordance with Article 2(2) of the Law Amending Article 31 of the Law on the Notariat of the Republic of Lithuania and agreement between the Chamber of Notaries of Lithuania and the Central Mortgage Office of 22 December 2010, the Chamber of Notaries of Lithuania transferred data about persons acknowledged by the court as legally incapable or with limited legal capacity accumulated before the beginning of the Register’s activities. A list of 8,161 person was transferred to the Register. In 2011 the courts of Lithuania presented data to the Register about 835 incapable persons or persons with limited capacity. 6. REGISTER OF LEGALLY INCAPABLE PERSONS OR PERSONS WITH LIMITED LEGAL CAPACITY

Persons acknowledged as legally incapable by court judgement; Persons whose legal capacity was limited by court judgement ; Fourteen to eighteen-year-old minors whose rights to independently use their income and property were restricted or withdrawn by court judgement. OBJECTS OF THE REGISTER OF LEGALLY INCAPABLE PERSONS OR PERSONS WITH LIMITED LEGAL CAPACITY

Objects of the Register: 1) The powers of attorney certified by a notary or a consular officer: that entitle to make agreements requiring a notarial form; that entitle an individual to carry out the matter related to the entities, except the cases defined by the provisions of law that permit to provide any other form of power; by which an individual provide a right of management, using and disposal of his/her real estate; other powers of attorney certified by a notary. 2) the powers of attorney certified by the authority equal to a notary: the military powers of attorney, certified by a commander (head) of military subunit, formation, military institution and school; prisoners’ powers of attorney certified by the head of an imprisonment place; powers of attorney certified by a captain of long voyage ships navigating with the flag of the Republic of Lithuania for the persons that navigate such ships. 4. REGISTER OF NOTARIALLY CERTIFIED POWERS OF ATTORNEY

MORTGAGE REGISTER OF THE REPUBLIC OF LITHUANIA AFTER 1 JULY 2012

contractual mortgages (pledges) legal mortgages (pledges) mortgage (pledge) transactions Data about these objects is stored and processed in the Mortgage Register as well as data about the marks of notary executive records. OBJECTS OF THE MORTGAGE REGISTER

refused excess functions of a mortgage judge in mortgage (pledge) registration process, also, refused mortgage divisions upon district courts people applying for a loan can cope mortgage related affairs in a “one-stop shop” way simpler mortgage (pledge) registration process established a possibility to pledge assets of enterprise DURING THE MORTGAGE REFORM (1)

There is no standardized form of the bond anymore Contractual mortgage (pledge) comes into force after it is signed by the parties of transaction (if there is no other conditions) The registration of contractual mortgages is not obligatory anymore Mortgage (pledge) registration has been made administrative, not judicial process DURING THE MORTGAGE REFORM (2)

Faster forced recovery process Forced recovery process starts after the notary makes an executive record. Executive record is considered to be executive document which can be presented to a bailiff DURING THE MORTGAGE REFORM (3)

CONTRACTUAL MORTGAGES (PLEDGES) REGISTRATION PROCEDURE

LEGAL MORTGAGES (PLEDGES) REGISTRATION Administrators of taxes, Administration institutions of the State Social Insurance Fund Board, notaries Mortgage Register CreditorCourt Mortgage judge Before 1 July 2012 If the legal mortgage (pledge) had been established by a court decision, creditor had to submit the original of the legal mortgage (pledge) bond to the mortgage division After 1 July 2012 Electronically transferred data Mortgage Register Creditor Court Mortgage judge Electronically transferred data Bond Creditor

FORCED RECOVERY PROCEDURE Creditor Mortgage judge Creditor Bailiff Before 1 July 2012 Mortgage judge Creditor Creditor and owner Request for a forced recovery Decision to seize property Request for a sale by auction Receiving-order Presentation of receiving-order Mortgage judge Recovered fund Allocation of recovered fund Creditor Notary Creditor Bailiff Creditor and owner After 1 July 2012

Residents’ Register of the Republic of Lithuania; Register of Legal Persons Register of Real Estate; Register of Sea-Going Ships Registers of Inland Waterway Vessels Register of Railway Rolling Stock and Containers Register of Trademarks Register of Patents Register of Designs Register of Tractors, Self-Propelled and Agricultural Machines and their Trailers; Register of Civil Aircrafts Register of Road Vehicles; Register of Weapons; Register of Addresses; Register of Foreigners. INTERACTION WITH RELATED REGISTERS

Registration fee has been paid for the mortgage (pledge) registration, for its data change recording or for the mortgage (pledge) deregistration: registration – 108 LTL (31 EUR) data change recording – 31 LTL (9 EUR) deregistration – 10 LTL (3 EUR) REGISTRATION FEE

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