Zurnalas_1(8)

ISSN 2029-4239

ISSN 2029-4239

9772029423009

STRAIPSNIAI – ARTICLES

Piktnaudţiavimas taikytinos teisės kolizinėmis normomis Jurgita Grigienė, Edita Laurišaitė

Does the use of predator drones to carry out targeted killings in a foreign

state‘s territory in response to armed attacks by non-state actors violate

international law? Julius Čiegis

Civil liability of internet service providers for transmitted information:

problems and perspectives of legal regulation Karolis Vinciūnas

Impact of the EU financial regulatory and supervision reform to the

development of the fundamental principles of Lithuanian financial markets

regulation Nerijus Strikulys

INFORMACIJA – INFORMATION

Ţurnalo Teisės apžvalga straipsnių rengimo taisyklės

TT EEIISSĖĖSS AAPPŽŽVVAALLGGAA

LLAAWW RREEVVIIEEWW VYTAUTAS MAGNUS UNIVERSITY

2012 VASARIS NUMERIS 1(8) FEBRUARY 2012 NUMBER 1(8)

VYTAUTO DIDŽIOJO UNIVERSITETAS

Teis

ės a

pžvalg

a N

r. 1

(8)/

Law

Revie

w N

o.

1 (8)

STRAIPSNIAI – ARTICLES

Redakcijos žodis 4

Jurgita Grigienė,

Edita Laurišaitė Piktnaudžiavimas taikytinos teisės kolizinėmis normomis

5

Misuse of conflict of law rules 23

Julius Čiegis Does the use of predator drones to carry out targeted

killings in a foreign state‘s territory in response to armed

attacks by non-state actors violate international law?

25

Ar nepilotuojamų lėktuvų naudojimas uţsienio šalių

teritorijoje, kaip atsakas į nevalstybinių subjektų ginkluotas

atakas, prieštarauja tarptautinei teisei?

55

Karolis Vinciūnas Civil liability of internet service providers for

transmitted information: problems and perspectives of

legal regulation

57

Interneto paslaugų tiekėjų civilinė atsakomybė uţ trečiųjų

asmenų perduotą informaciją: teisinio reglamentavimo

problemos ir perspektyvos

98

Nerijus Strikulys Impact of the EU financial regulatory and supervision

reform to the development of the fundamental principles

of Lithuanian financial markets regulation

100

ES finansų reguliavimo ir prieţiūros reformos įtaka

pagrindinių Lietuvos finansų rinkų reguliavimo principų

vystymuisi

133

INFORMACIJA – INFORMATION

Žurnalo Teisės apžvalga straipsnių rengimo taisyklės 136

Rules of Making Articles for Law Review Journal

EEIISSĖĖSS AAPPŽŽVVAALLGGAA TT LLAAWW RREEVVIIEEWW 1(8) Turinys Contents

Kaunas 2012 © VYTAUTO DIDŽIOJO UNIVERSITETAS, TEISĖS FAKULTETAS

VYTAUTAS MAGNUS UNIVERSITY, FACULTY OF LAW

Adresas/Address: E.OŢEŠKIENĖS 18, Kaunas 44254, Lietuva

Tel.: 370-37-751044 (uţsienyje/abroad)

8-37-751044 (Lietuvoje/in Lithuania)

Mokslinė redakcijos kolegija Academic Editorial Board

Dr. Aušra Kargaudienė Vyriausiasis redaktorius/Editor-in-Chief

Vytauto Didţiojo Universiteto Teisės Fakultetas, Kaunas Lietuva E-mail: [email protected]

Doc. Dr. Tomas Berkmanas Redaktorius/Editor


Doc. Dr. Linas Meškys Redaktorius/Editor


Doc. Dr. Agnė Tikniūtė Redaktorius/Editor

Mykolo Romerio Universiteto Teisės Fakultetas, Vilnius Lietuva E-mail: [email protected]

Doc. Dr. Edita Žiobienė Redaktorius/Editor

Vilnius Lietuva E-mail: [email protected]

Prof. Dr. Edita Gruodytė Redaktorius/Editor


Darbinė redakcijos kolegija Executive Editorial Board

Donatas Nėnius Vyriausiasis redaktorius/Editor–in–Chief Vytauto Didţiojo Universiteto Teisės Fakulteto magistrantas

E-mail: [email protected]

Jurgita Barauskaitė Vyriausiojo redaktoriaus pavaduotoja/Vice-Editor Vytauto Didţiojo Universiteto Teisės Fakulteto magistrantė


Rasa Lazaravičienė Redaktorius/Editor Vytauto Didţiojo Universiteto Teisės Fakulteto magistrantė


Darius Marčiulaitis Redaktorius/Editor Vytauto Didţiojo Universiteto Teisės Fakulteto magistrantas


Darius Butavičius Redaktorius/Editor Vytauto Didţiojo Universiteto Teisės Fakulteto magistrantas


Jomilė Juškaitė-Vizbarienė Redaktorius/Editor

Vytauto Didţiojo Universiteto Teisės Fakulteto magistrantė


Evelina Monstytė Redaktorius/Editor



Emilija Vabuolaitė Redaktorius/Editor



mailto:[email protected]


ISSN 2029-4239 (online)

Teisės apžvalga Law review

No. 1 (8), 2012, p. 4

REDAKCIJOS ŽODIS

Prasidėjus naujiems metams, malonu pristatyti pirmąjį šių metų „Teisės apžvalgos“

žurnalo numerį, kuriame, laikantis tradicijų, didžioji dalis straipsnių parengta VDU Teisės

fakulteto magistrantų vardu. Atsižvelgiant į šių dienų aktualijas ne tik teisinėje, bet ir

ekonominėje, socialinėje ir politinėje erdvėje, tikimės, kad skelbiama teisinė mintis bus

reikšminga ir įdomi ne tik teisę studijuojan-tiems asmenims. Visi šiame numeryje

publikuojami straipsniai yra pažymėti tarptautinių teisinių santykių elementu, be to,

kiekvienas jų konkuruoja dėl aktualumo šiandieninėje visuomeninio gyvenimo erdvėje –

pradedant finansų rinkų reguliavimo klausimu ir baigiant interneto plėtros neišvengiama

sąlyga – universalaus teisinio reguliavimo poreikiu ir svarba.

Nerijus Strikulys strapsnyje „ES finansų reguliavimo ir priežiūros reformos įtaka

pagrindi-nių Lietuvos finansų rinkų reguliavimo principų vystymuisi“ kelia klausimą kiek

Europos Sąjungos finansų reguliavimo ir priežiūros reforma turės esminės įtakos Lietuvos

finansų rinkos reguliavimo principams. Straipsnyje analizuojami naujai kuriamos Europos

Sąjungos finansų rinkos reguliavimo ir priežiūros sistemą reglamentuojantys teisės aktai bei

aiškinama galima įtaka valstybių narių, tame tarpe ir Lietuvos, finansų rinkos priežiūros

sistemai.

J.Čiegis straipsnyje „Ar nepilotuojamų lėktuvų naudojimas užsienio šalių teritorijoje,

kaip atsakas į nevalstybinių subjektų ginkluotas atakas, prieštarauja tarptautinei teisei?“

analizuoja išankstinio savigynos būdo institutą šiandieninėje tarptautinėje teisėje. Aptariami

proporcingumo ir būtinumo principų, kaip vertinimo kriterijų, taikymas įgyvendinant

savigynos teisę bei kiti esminiai klausimai, susiję su tarptautinės teisės principų taikymo

aktualijomis šiandieninėje visuomenėje tarptautinių konfliktų atveju.

Jurgitos Grigienės ir Egidijos Laurišaitės straipsnyje „Piktnaudžiavimas taikytinos

teisės kolizinėmis normomis“ pateikia esminius argumentus, sprendžiant klausimą byloje,

turinčioje tarptautinį elementą – kas yra ginčui taikytina teisė. Straipsnyje atskleidžiami

piktnaudžiavimo taikytina teise atvejai, analizuojamos pagrindinės ryšio formulės taikytinai

teisei nustatyti, išskiriami jų taikymo privalumai ir trūkumai.

Karolio Vinciūno straipsnio tema „Interneto paslaugų tiekėjų civilinė atsakomybė už

trečiųjų asmenų perduotą informaciją: teisinio reglamentavimo problemos ir perspektyvos“

yra sąlygota sparčios interneto plėtros įtakoje kintančių teisinių, socialinių ir ekonominių

santykių, kuriuose dalyviu yra interneto paslaugų teikėjai. Informacijos plitimo interneto

erdvėje kontrolė, bei šios kontrolės tinkamas universalus teisinis reglamentavimas, o kaip

autorius pabrėžia šiame straipsnyje, šių teisinių santykių reguliavimo stoka, gali tapti viena

iš asmens teisių pažeidimo sąlygų. Iš kitos pusės, kaip nurodo autorius, šis teisinis

neapibrėžtumas gali tapti pačios interneto paslaugų plėtros stabdžiu.

Linkime turiningo skaitymo!

Nuoširdžiai Jūsų žurnalas „Teisės apžvalga“



No. 1 (8), 2012, p. 5-24

5

PIKTNAUDŽIAVIMAS TAIKYTINOS TEISĖS

KOLIZINĖMIS NORMOMIS

Jurgita Grigienė1

Egidija Laurišaitė2

Vytauto Didţiojo universitetas

Pateikta 2011 m. geguţės 5 d.

SANTRAUKA

Straipsnyje nagrinėjami valstybių kolizinių normų skirtumai bei nepakankama

kolizinių normų harmonizacija, kuri sudaro prielaidas atsirasti teisės bei teismo pirkimui

(atitinkamai angl. law shopping bei angl. forum shopping), o pastarųjų egzistavimas -

piktnaudţiavimu teise, teisės apėjimu (pranc. froid à la loi). Viena vertus, laisvas taikytinos

teisės ir teismo pasirinkimas yra visuotinai pripaţįstamo šalių autonomijos principo išdava.

Kita vertus, kai viena ar abi ginčo šalys siekia kuo palankesnio teismo sprendimo,

piktnaudţiaudamos teise pasirinkti taikytiną teisę ar teismą kitos proceso šalies teisių

sąskaita, paţeidţiami visuotinai įtvirtinti sąţiningumo, protingumo bei teisingumo

principai. Piktnaudţiavimas taikytinos teisės kolizinėmis normomis sukelia teisinį

netikrumą, pasekmės gali būti visiškai nenuspėjamos. Pasaulyje yra daugiau nei du šimtai

teisės sistemų ir kiekviena iš jų tą patį teisinį santykį gali reglamentuoti savitai. Netgi

analogiškos teisinį santykį reglamentuojančios taisyklės gali būti aiškinamos, taikomos ar

vertinamos skirtingai. Ţinant skirtingų valstybių materialinės teisės skirtumus, nesunku

pastebėti, kad teisiniam santykiui taikyti palankesnes vienos šalies teisės normas gali būti

naudinga vienai ar abiem teisinio santykio dalyviams. Siekiant išvengti piknaudţiavimo,

teismui yra suteikta teisė įvertintinti, ar galima ginčui taikyti teisę, nustatomą pagal

kolizines taisykles. Autorės straispnyje analizuoja atvejus, kada teisės ir teismo pirkimas

šalims sukels neigiamas pasekmes, t.y. teismas atsisakys taikyti taikytiną teisę ar spręsti

ginčą jų pasirinktame teisme.

REIKŠMINIAI ŽODŽIAI

Taikytina teisė, teismo pirkimas, teisės pirkimas, tarptautinė privatinė teisė.

ĮVADAS

Vykstant laisvam asmenų judėjimui Europos Sąjungoje (toliau – ES) daugėja ir

teisinių ginčų, turinčių tarptautinį elementą. Vienas iš svarbiausių klausimų sprendţiant

1 Jurgita Grigienė, docentė dr., Vytauto Didţiojo universiteto Teisės fakultetas. Kontaktinė

informacija: adresas Oţeškienės g. 18, 44254 Kaunas, Lietuva, tel. (+370) 37 327873. El. paštas

[email protected]. 2 Egidija Laurišaitė, teisės magistrė, Vytauto Didţiojo universiteto Teisės fakultetas. Kontaktinė

informacija: adresas Oţeškienės g. 18, 44254 Kaunas, Lietuva, tel. (+370) 37 327873. El. paštas

[email protected]



Jurgita Grigienė, Edita Laurišaitė „Piktnaudžiavimas taikytinos teisės kolizinėmis normomis“


No. 1 (8), 2012, p. 5-24

6

bylą, turinčią tarptautinį elementą, yra nustatyti ginčui taikytiną teisę. Kiekviena valstybė

savo nacionaliniais teisės aktais įtvirtina ginčui taikytinos teisės nustatymo kolizines

normas3, susidedančias iš apimties

4 ir ryšio formulės

5. Viena iš aktualiausių problemų ES

teisinėje erdvėje6

- tai valstybėse narėse įtvirtintos įvairios ryšio formulės, kurios nurodo

savitą kolizijos sprendimo būdą - t.y. taikytiną teisę. Net kai kolizinės normos yra

unifikuotos, jos gali būti apibrėţiamos nevienareikšmiškai arba interpretuojamos pagal

valstybių nacionalinę teisę. ES valstybių narių materialios teisės bei kolizinių normų

skirtumai sudaro prielaidas atsirasti teisės pirkimui (angl. law shopping7) bei teismo

pirkimui (angl. forum shopping8), o pastarųjų egzistavimas - piktnaudţiavimu teise, teisės

apėjimui (pranc. froid à la loi 9

). Straipsnyje atskleidţiami piktnaudţiavimo taikytina teise

atvejai. Analizuojamos pagrindinės ryšio formulės taikytinai teisei nustatyti, išskiriami jų

taikymo privalumai bei trūkumai. Straipsnyje pabrėţiama ir teisės pirkimo teigiama pusė -

tai yra nagrinėjami atvejai, kai šalys sąmoningai ir teisėtai pasirenka ginčui taikytiną teisę.

Laisvas taikytinos teisės ir teismo pasirinkimas yra visuotinai pripaţįstamo šalių

autonomijos principo išdava. Tačiau kita vertus, kai viena ar abi ginčo šalys, siekia kuo

palankesnio teismo sprendimo bei pasirenka taikytiną teisę, ar teismą, kitos proceso šalies

teisių sąskaita, paţeidţiami visuotinai įtvirtinti sąţiningumo, protingumo bei teisingumo

principai. Teisės ir teismo pirkimo reiškiniai gali išsivystyti į modelius, į strateginių

sprendimų priėmimo varţybas ir sukelti rimtas teisines pasekmes vienam ar abiem teisino

santykio dalyviams. Piktnaudţiavimas taikytinos teisės kolizinėmis normomis sukelia

teisinį netikrumą, pasekmės gali būti visiškai nenuspėjamos, o teismo sprendimas tapti

formalumu, net ir konstatavus nesąţiningumą - gali nebūti teisinių priemonių, kuriomis

būtų galima jį atkurti. Todėl straipsnyje siekiama įvardinti kriterijus, kuriais remiantis

galima būtų nustatyti, kada teisės pirkimas (angl. law shopping), ar teismo pirkimas (angl.

forum shopping) perauga į teisės apėjimą (pranc. froid à la loi). Norint uţtikrinti

teisingumą, teisinį tikrumą bei tinkamai ginti piliečių teises ir interesus, būtinas teisės bei

teismo pirkimo, teisės apėjimo rizikos maţinimas. Straipsnyje nagrinėjami būdai, kaip būtų

galima uţkirsti kelią piktnaudţiavimui taikytina teise bei nesąţiningam asmenų elgesiui.

3 Kolizinė norma yra tam tikra taisyklė, kuria vadovaujantis nustatoma konkrečios valstybės teisė,

taikytina ginčui. 4 Apimtis įvardija teisinį santykį, kuriam bus taikoma konkrečios valstybės teisė (pavyzdţiui,

santuokos sudarymui taikytina teisė, testamento formai taikytina teisė, prievomėms taikytina teisė ir

t.t.). 5 Ryšio formulė nurodo, kurios valstybės teisė bus taikoma (taikoma sutarties sudarymo vietos teisė,

ţalos padarymo vietos teisė, sutuoktinio nuolatinės gyvenamosios vietos teisė). 6 Ţr. red. P. DE VAREILLES-SOMMIÉRES, Forum shopping in the European Judicial Area (Oxford: Hart

Publishing, 2007), p. v-vi. 7 Teisės pirkimas (angl. law shopping) - tarptautinėje privatinėje teisėje naudojama sąvoka,

apibūdinanti reiškinį, kai asmenys, turėdami galimybę pasirinkti jų teisiniam santykiui taikytiną teisę,

dėl subjektyvių prieţasčių renkasi palankesnę teisę. 8 Teismo pirkimas (angl. forum shopping) - proceso šalių procesiniai veiksmai, siekiant įgyti

palankesnio teismo jurisdikciją. 9 Teisės apėjimas – sąmoningi asmenų veiksmai, kuriais siekiama apeiti taikytinimos teisės

imperatyvias normas.



No. 1 (8), 2012, p. 5-24

7

1. PIKTNAUDŽIAVIMO TAIKYTINA TEISE

PRIEŽASTYS

Pasaulyje yra daugiau nei du šimtai teisės sistemų ir kiekviena iš jų tą patį teisinį

santykį gali reglamentuoti savitai. Netgi analogiškos teisinį santykį reglamentuojančios

taisyklės gali būti aiškinamos, taikomos ar vertinamos skirtingai. Ţinant valstybių

materialinės teisės skirtumus, nesunku pastebėti, kad teisiniam santykiui taikyti palankesnes

vienos šalies teisės normas gali būti naudinga vienai ar abiem teisinio santykio dalyviams.

Pavyzdţiui, vienose teisės sistemose sutinkami tam tikri institutai, kitose tokių institutų

nėra,10

vienos valstybės teisė gali numatyti ilgesnius ieškinio senaties terminus11

, skirtingas

teisines prezumpcijas, skirtingos materialinės teisės normos gali nustatyti skirtingas sąlygas

nustatant ieškovą ir atsakovą byloje, skirtingai reguliuoti teisę į palūkanas bei jų dydį,

numatyti skirtingas taisykles nustatant įrodinėjimo dalyką ar nuostolių sudėtį. Vienos

valstybės procesinės teisės normos gali numatyti palankesnes sąlygas paduoti ieškinį, kitą

ieškinio pareiškimo formą ir tvarką, civilinių teisių gynimo būdus, nuostolių skaičiavimo

normas, palankesnes įrodymų rinkimo, šaukimų išsiuntimo, liudytojų apklausos ir daugybę

kitų sąlygų. Skirtingose valstybėse vienos normos gali būti priskiriamos materialinei teisei,

kai tuo tarpu kitoje valstybėje tą patį teisinį santykį reglamentuojančios normos gali būti

procesinės teisės dalimi, vienoje valstybėje teisės normos gali būti priskiriamos viešajai,

kitoje privatinei teisei ir pan. Pavyzdţiui, Didţiosios Britanijos teismo išnagrinėtoje byloje

Maharanee of Baroda v. Wildnestein12

, Prancūzijos gyventoja, nusipirko iš meno prekeivio

- taip pat Prancūzijos gyventojo, besivertusio tarptautine prekyba, paveikslą, kuris pasirodė

yra ţymaus dailininko klastotė. Pirkimo-pardavimo sutartis buvo pasirašyta taip pat

Prancūzijoje. Ieškovė pareiškė ieškinį Didţiosios Britanijos teismui kol atsakovas buvo

trumpam atvykęs į šią šalį. Tokio ieškovės elgesio prieţastis - Prancūzijoje būtų kilę

problemų dėl ekspertų pateiktų įrodymų ir tai būtų uţvilkinę bylą. Taigi, šiuo atveju

ieškovė pasinaudojo Didţiosios Britanijos procesinėmis teisės normomis išvengdama jai

nepalankių Prancūzijos procesinių teisės normų, kurios šioje byloje neabejotinai turėjo

lemiamos reikšmės. Prieţastis piktnaudţiauti taikytina teise ar teismu labai daţnai - siekis

gauti finansinės naudos. Asmenys siekia tam tikros valstybės teisės taikymo ar bylinėjimosi

tam tikrame teisme vien dėl tos prieţasties, kad pastarosios teisės normos numato didesnę

kompensaciją uţ patirtą ţalą, ar egzistuoja galimybė prisiteisti didesnį nuostolių ar

palūkanų dydį. Antai Jungtinių Amerikos Valstijų (toliau - JAV) teismai, niekam ne

paslaptis, jau tapo savotiška Meka viso pasaulio bylininkams, siekiantiems kuo didesnės

kompensacijos uţ patirtą ţalą13

, geresnio teismo išlaidų, išlaidų teisininkams bei galimos

kompensacijos bylos sėkmės atveju balanso. JAV vystomos net ekonominės teismo

10 V. MIKELĖNAS, Tarptautinės privatinės teisės įvadas (Vilnius: Justitia, 2001), p. 22-23. 11 Plg. Lietuvoje bendras ieškinio senaties terminas yra 10 metų, Prancūzijoje 30 metų, Vokietijoje

bendras senaties terminas 3 metai. 12 Ţr. Didţiosios Britanijos bylą: Maharanee of Baroda v. Wildnestein [1972] 2 QB 283. 13 Ţr. G. CUNIBERTI, „Abusive forum shopping?“ // [ţiūrėta 2010 07 29]

<conflictoflaws.net/2010/abusive-forum-shopping>



No. 1 (8), 2012, p. 5-24

8

pirkimo teorijos, kurios teisės pirkimą sieja su galima ekonomine nauda.14

Antai tokia

Meka ES yra Didţiosios Britanijos teismai, dėl palyginus su kitom ES valstybėm, lanksčios

teisės sistemos bei teismo proceso greitumo15

. Asmenys gali pasinaudoti galimybe gauti

finansinės naudos, kreipdamiesi į palankesnį teismą (angl. forum convenience). Taikyti tam

tikros šalies teisę, ar bylinėtis tam tikros šalies teisme asmenys gali siekti ne tik dėl teisėtų

tikslų, tačiau ir dėl ekonominės naudos.

Dėl skirtingų materialinių bei procesinių teisių sistemų egzistavimo šalys gali siekti,

kad ginčui butų taikoma konkrečios valstybės teisė tiek dėl teisėtų prieţasčių, tiek dėl

ekonominės naudos ar kitų asmenių interesų.

2. TAIKYTINOS TEISĖS NUSTATYMO TEISINIS

REGLAMENTAVIMAS BEI UNIFIKAVIMAS

Tarptautinės privatinės teisės kolizinės normos yra reglamentuotos Lietuvos

Respublikos Civilinio kodekso (toliau - LR CK) II skyriuje, kituose įstatymuose16

,

dvišalėse ar daugiašalėse tarptautinėse sutartyse17

. Ilgą laiką tarptautinė privatinė teisė buvo

reglamentuota nacionaliniais teisės aktais, t.y. kiekviena valstybė savo vidaus teisės aktais

nustatydavo taikytinos teisės taisykles, naudodama įvarius kriterijus. Todėl šalys galėjo

naudotis tarptautinės privatinės teisės skritumais bei labai paprastastais būdais siekti sau

palankios teisės taikymo. Siekiant išvengti piktnaudţiavimo taikytina teise, pastebimas

tarptautinės privatinės teisės harmonizavimas. Lietuvai tapus ES nare, Lietuvoje įsigaliojo

ES teisės aktai. Vienos iš svarbiausių ES konvencijų tarptautinės privatinės teisės srityje,

siekiančių harmonizuoti kolizines normas, yra 1980 m. Romos konvencija (toliau - Romos

konvencija) dėl sutartinėms prievolėms taikytinos teisės. Lietuvoje Romos konvencija

įsigaliojo 2006 m. gruodţio 1 d.18

, nors šios konvencijos nuostatos jau buvo įtrauktos į 2001

m. liepos 18 d. įsigaliojusį naująjį LR CK. Nuo 2009 m. sausio 19 d. Romos konvenciją iš

dalies pakeitė (EB) reglamentas Nr. 593/2008 dėl sutartinėms prievolėms taikytinos teisės

(Roma I), bei (EB) reglamentas Nr.864/2007 dėl nesutartinėms prievolėms taikytinos teisės

(Roma II), kurie yra tiesiogiai taikomi visose ES narėse. Vienas iš pagrindinių Romos

14 Ţr. K. A. MOORE, „Rethinking forum shopping in cyber space” // [ţiūrėta 2009 03 10]

<www.ssrn.com/abstract_id=297100>. Taip pat ţr. A. O. SYKES, „Transnational forum shopping as a

trade and investment issue" // [ţiūrėta 2009 03 10] <www.law.virginia.edu/pdf/olin/0708/sykes.pdf> 15 Ţr. C. M. V. CLARKSON, JONATHAN HILL, The Conflict of Laws (Oxford: Oxford university press,

2006) p. 104. 16 Ţr. LR Įstatymas dėl uţsieniečių teisinės padėties, Ţin. (2004, Nr. 73-2539); LR Prekybinės

laivybos įstatymas, Ţin. (1996, Nr. 101-2300); LR Koncesijų įstatymas, Ţin. (1996, Nr. 92-2141). 17 Pvz., Trišalė Lietuvos Respublikos, Estijos Respublikos ir Latvijos Respublikos sutartis dėl teisinės

pagalbos ir teisinių santykių, Ţin. (1994, Nr. 28-492); Dvišalė Lietuvos Respublikos ir Lenkijos

Respublikos sutartis dėl teisinės pagalbos ir teisinių santykių civilinėse, šeimos, darbo ir

baudţiamosiose bylose, Ţin. (1994, Nr. 14-234). 18 Konvencija dėl Čekijos Respublikos, Estijos Respublikos, Kipro Respublikos, Latvijos

Respublikos, Lietuvos Respublikos, Vengrijos Respublikos, Maltos Respublikos, Lenkijos

Respublikos, Slovėnijos Respublikos ir Slovakijos Respublikos prisijungimo prie Konvencijos dėl

sutartinėms prievolėms taikytinos teisės, pateiktos pasirašyti 1980 m. birţelio 19 d. Romoje, ir prie

Pirmojo ir Antrojo protokolų dėl Europos Bendrijų Teisingumo Teismo įgaliojimų aiškinti šią

konvenciją, Ţin. (2006, Nr. 75-2849).

http://www.ssrn.com/abstract_id=297100



No. 1 (8), 2012, p. 5-24

9

konvencijos ir jį iš dalies pakeitusio19

(EB) reglamento Nr. 593/2008 tikslų yra apibrėţti

bendrus ES šalims taikytinos teisės nustatymo kriterijus. (EB) reglamento Nr. 593/2008 6

str. nustato:

…[T]am, kad būtų uţtikrintas geresnis ginčo baigties nuspėjamumas, teisinis tikrumas

ir laisvas teismo sprendimų judėjimas, tinkamas vidaus rinkos veikimas sukuria poreikį,

kad valstybių narių teisės kolizijos taisyklės nukreiptų į tą pačią nacionalinę teisę, nesvarbu

kurioje valstybėje yra teismas, kuriame iškelta byla.20

Taigi, nepriklausomai nuo to, kurios valstybės teisme bus sprendţiamas ginčas, visi

teismai taikys tas pačias unifikuotas tarptautines privatinės teisės normas ir taip bus

uţkertamas kelias piktnaudţiavimui. Pavyzdţiui, jei sutarties formai taikoma sutarties

pasirašymo vietos teisė, tai nesvarbu kurios valstybės teisme sprendţiamas ginčas, vis tiek

sutarties formai bus taikoma ta pati sutarties pasirašymo vietos teisė.

Nors sutartinėms bei nesutartinėms prievolėms taikytinos teisės vienodinimo srityje

pastebimas akivaizdus progresas, tačiau lieka sričių, kur kolizinių normų harmonizavimas

dar vyksta - vis dar neįsigaliojo reglamentai dėl šeimos santykiams, sutuoktinių teisiniam

reţimui bei paveldėjimui taikytinos teisės - svarstomas (EB) reglamento dėl jurisdikcijos ir

taikytinos teisės nustatymo bylose, susijusiose su santuoka, projektas „Roma III“ ( toliau -

Roma III), Europos Komisija pateikė ţaliąją knygą dėl sutuoktinių turtiniam reţimui

taikytinos teisės „Roma IV“. Taip pat tęsiasi reglamento dėl paveldėjimo ir testamentui

taikytinos teisės parengiamieji darbai „Roma V“, svarstomas EB reglamento dėl

jurisdikcijos, taikytinos teisės, teismo sprendimų pripaţinimo ir vykdymo bei

bendradarbiavimo išlaikymo prievolių srityje „Roma VI“ (toliau - Roma VI) projektas.

Pastaruoju metu ES priimami reglamentai, tiesiogiai taikomi visoje ES erdvėje,

nustato vienodas tarptautinės privatinės teisės kolizines normas. Europos Sąjungos lygiu

unifikuojant tarptautinės privatinės teisės kolizines normas uţtikrinamas geresnis ginčo

baigties nuspėjamumas, teisinis tikrumas, nes vienodos kolizijos taisyklės nukreipia į tą

pačią nacionalinę teisę, nesvarbu kurioje valstybėje sprendţiamas ginčas.

3. PAGRINDINĖS TAIKYTINOS TEISĖS RYŠIO

FORMULĖS

Vis dėlto nesant tarptautinės privatinės teisės unifikavimas visiškai neeliminuoja

piktnaudţiavimo taikytina teise. Skirtingiems teisiniams santykiamas yra naudojamos

skirtingos ryšio formulės, siejančios tam tikrą teisinį santykį su konkrečios valstybės teise.

Pavyzdţiui, turtas gali būti siejamas su turto buvimo vietos teise (lot. lex citus), asmuo - su

nuolatinės gyvenamosios vietos valstybės (lot. lex domicilii) arba šalies, kurios pilietis jis

yra teise (lot. lex patriae), santuoka su santuokos sudarymo vietos teise (lot. lex loci

celebretiones) ir pan. Ryšio formulių kriterijai nustatomi taip, kad būtų garantuotas

pakankamas teisinio santykio ir valstybės ryšys. Ryšio formulių kriterijai yra įvairūs. Vieni

yra labai lankstūs ir juos lengva pakeisti (tokie kaip sutarties sudarymo vieta, turto buvimo

19 Reglamentas (EB) Nr. 593/2008, įsigaliojo 2009 m. gruodţio 17 d. 20 Regulation (EC) No. 593/2008 of the European Parliament and of the Council of 17 June 2008 on

the law applicable to contractual obligations (Rome I), OJ L 177, 2008, 6 str. // [ţiūrėta 2009 05 19]

http://eur-lex.europa.eu/smartapi/cgi/sga_doc?smartapi!celexplus!prod!DocNumber&lg=en&type_doc=Regulation&an_doc=2008&nu_doc=593#_blank



No. 1 (8), 2012, p. 5-24

10

vieta, gyvenamoji vieta), kiti kriterijai yra stabilūs ir juos sunku pakeisti (tokie kaip

pilietybė, nuolatinė gyvenamoji vieta). Asmenys, iš anksto ţinodami tarptautinės privatinės

teisės kolizines normas, t.y. ţinodami, kad jų santykiui bus taikoma santuokos sudarymo

vietos teisė, gali sudaryti santuoką norimoje valstybėje arba siekdami, kad sutarties formai

būtų taikoma sutarties sudarymo vietos valstybės teisė, gali sudaryti sutartį norimoje

valstybėje. Teisinio santykio šalys taip pat gali siekti apeiti įstatymą manipuliuodami

taikytinai teisei ar teismo jurisdikcijai nustatyti skirtomis ryšio formulėmis - pavyzdţiui,

fizinis ar juridinis asmuo, ţinodamas, kad jo kreditorius turi teisę dėl skolos išieškojimo

paduoti ieškinį teismui, kuris yra nuolatinėje skolininko gyvenamojoje vietoje ir norėdamas

išvengti neigiamų tos valstybės teisės normų taikymo, gali pakeisti gyvenamąją vietą ir

išvykti į valstybę, kurios teisės normos ar teismai palankiau spręs susidariusią situaciją,

sutuoktiniai gali pakeisti nuolatinę gyvenamąją vietą dėl galimybės kreiptis į palankesnį jų

skyrybų klausimą išspręsiantį teismą, autorinių teisių paţeidėjas, numatęs galimybę, kad jis

taps potencialiu atsakovu gali sąmoningai vystyti veiklą ten, kur įstatymai numato maţesnę

atsakomybę uţ autorinių teisių paţeidimus.21

Tokiu būdu šalys tiek teisėtai, tiek

piktnaudţiaudami savo teisėmis gali pasirinkti ginčui taikytiną teisę.

Unifikuotuose teisės aktuose net ir numačius vienodus kriterijus, gali atsirasti

sunkumų juos nustatyti bei taikyti. Pavyzdţiui, Reglamente numatyta, kad sutartinėms

prievolėms taikoma “prievolės, kuri labiausiai būdinga sutarčiai įvykdymo vieta”.

“Sutartinė prievolė yra labiausiai susijusi su ta valstybe, kurios teritorijoje yra šalies,

turinčios įvykdyti pareigą, labiausiai būdingą tai sutarčiai, įprastinė gyvenamoji vieta”22

.

Tam tikrais atvejais gali būti sunku nustatyti, kuri pareiga yra labiausiai būdinga sutarčiai,

kai abi sutarties šalys įvykdo tos pačios rūšies prievoles23

arba jei tarp šalių pasirašytas

kompleksinis kontraktas, kur abiems šalims yra numatytos prievolės. Romos konvencijos 4

str. 2 d. įtvirtinta sąvoka, kad ginčui taikytina asmens, kuris turi įvykdyti labiausiai būdingą

sutarties prievolę, įprastinės gyvenamosios vietos arba pagrindinės verslo vietos teisė. Tais

atvejais, kai sutarties prievolė turi būti vykdoma ne pagrindinėje verslo vietoje - valstybės,

kurioje yra kita verslo vydymo vieta. Nesant aiškių kriterijų nustatyti, kur yra pagrindinė

verslo vieta, šios taisyklės skirtingas interpretavimas gali lemti skirtingus rezultatus.

Pavyzdţiui, kai sutarties dalykas yra banko sąskaita, taikytina teisė gali būti nustatoma

pagal valstybės, kurios teritorijoje yra banko padalinys, kuriame sąskaita atidaryta, teisę24

.

Byloje Bank Baroda v. Vysya Bank 25

atsakovas Indijos bankas išdavė dokumentą, kuriuo

suteikė paskolą Airijos kompanijai prekiavusiai geleţimi. Paskolą patvirtino ieškovo - kito

Indijos banko filialas Anglijoje. Teismas konstatavo, kad sutarčiai labiausiai būdinga

prievolė buvo ieškovo veiksmai patvirtinantys paskolą, o kadangi ieškovas šiuos veiksmus

atliko per filialą Anglijoje, ginčui taikytina kitos nei pagrindinė verslo vietos valstybės t. y.

Anglijos teisė.

21 Ţr. Italijos bylą: B.L. Macchine Automatiche v. Windmoller & Holscher KG [2004] EIPR N-155. 22 Romos konvencija dėl sutartinėms prievolėms taikytinos teisės, OJ C27/34, 1998 01 26. 23 Ţr. Jungtinės Karaystės bylą: Apple Corps Ltd. v. Apple Computer Inc. [2004]. 24 C. M. V. CLARKSON, JONATHAN HILL, The Conflict of Laws (Oxford: Oxford university press,

2006), p. 188. 25 Ţr. Jungtinės Karaystės byą: Bank Borada v. Vysya Bank [1994] 2 Lloyd's Rep 87.



No. 1 (8), 2012, p. 5-24

11

Nors tarptautiniai teisės aktai ir numato labai aiškius taikytinos teisės kriterijus, tokius

kaip nuolatinė gyvenamoji vieta (lot. domicilii), tačiau kiekvienas teismas taikydamas šį

kriterijų naudos savo valstybės nuolatinės gyvenamosios vietos sampratą. Ir antra, nors

kriterijus atrodo visiškai aiškus, tačiau faktiškai nustatyti, kur yra asmens nuolatinė

gyvenamoji vieta gali būti sunku. Lietuvos Respublikos civiliniame kodekse (toliau LR

CK) fizinio asmens nuolatinė gyvenamoji vieta įtvirtinta kaip vieta, “... reiškianti asmens

teisinį santykį su valstybe ar jos teritorijos dalimi, ir yra toje valstybėje ar jos teritorijos

dalyje, kurioje jis nuolat ar daugiausia gyvena, laikydamas tą valstybę ar jos teritorijos dalį

savo asmeninių, socialinių ir ekonominių interesų buvimo vieta”26

. Juridinių asmenų

civilinis teisinis statusas nustatomas pagal juridinio asmens buveinę, kuri LR CK

apibrėţiama kaip “.... vieta, kurioje yra nuolatinis” juridinio asmens “valdymo organas”.27

Nuolatinė gyvenamoji vieta nustatoma pagal teismo, kuris sprendţia bylą teisę, o pats

nuolatinės gyvenamosios vietos apibrėţimas skiriasi įvairiose valstybėse. Nuolatinės

gyvenamosios vietos principas yra daug stabilesnis uţ paprastos gyvenamosios vietos

principą. Kilus ginčui, kur yra asmens nuolatinė gyvenamoji vieta, asmuo, kuris siekia tam

tikros teisės taikymo privalo įrodyti, kad jo ekonominių bei socialinių interesų centras yra

būtent ta valstybė, kurios teisės taikymo siekiama. Kai pagal kelių skirtingų valstybių teisę

asmens nuolatinė gyvenamoji vieta yra keliose valstybėse, o socialiniai, ekonominiai ar

kitokie interesai tolygiai pasiskirsto, būtina atsiţvelgti į tai, kokie santykiai yra reikšmingi

nustatant taikytiną teisę. Byloje Plummer v. IRC28

buvo nuspręsta, kad nuolatinė

gyvenamoji vieta reiškia asmens pagrindinę nuolatinę gyvenamąją vietą, kur asmuo

gyvena, dirba ir mokosi, o ne tėvų namai, kuriuose pastarasis lankosi savaitgaliais ar

atostogų metų. Tam tikrais atvejais nuolatine gyvenamąją vieta gali būti pripaţinta ir ta

valstybė, kurioje asmuo dar tik ketina gyventi, arba valstybė, kurioje asmuo gyvena

pakankamai maţą laiko tarpą, tačiau kurioje jau spėjo uţmegzti tvirtus socialinius,

ekonominius ar kitokio pobūdţio santykius, adaptavosi ir jo veikla rodo ketinimus gyventi

vasltybėje nuolat. Koks laiko tarpas yra pakankamas, kad būtų įtvirtinta nauja nuolatinė

gyvenamoji vieta ir, ar asmuo praranda ankstesnę nuolatinę gyvenamąją vietą sprendţia

teismas, atsiţvelgdamas į faktines bylos aplinkybes. Paţymėtina, kad prarasti ankstenę

gyvenamąją vietą yra kur kas sunkiau nei įtvirtinti naują pasirinktą nuolatinę gyvenamąją

vietą.29

Įtvirtinti pasirinktą gyvenamąją vietą būtinos dvi sąlygos - gyvenamoji vieta bei

asmens intencija gyventi pasirinktoje valstybėje nuolat ar neapibrėţtam laikotarpiui.

Trumpalaikiai vizitai ar gyvenimas kitoje šalyje be tikslo ten gyventi nuolat nėra pagrindas

pripaţinti, kad asmens nuolatinė gyvenamoji vieta buvo pakeista. Byloje IRC v. Duchess of

Portland30

buvo konstatuota, kad vien ta aplinkybė, jog asmuo praleidţia nuo dešimties iki

dvylikos mėnesių tam tikroje valstybėje su tikslu ten praleisti senatvę dar nėra pakankamas

pagrindas pripaţinti, kad buvo įtvirtinta nuolatinė gyvenamoji vieta. Ketinimas gyventi tam

tikroje šalyje turi būti nuolatinis bei ilgalaikis. Nuolatinei gyvenamąjai vietai įtvirtinti

26 LR CK, Ţin. (2000, Nr. 7422-62), 2.12 str. 27 Ţr. ten pat 2.49 str. 28 Ţr. Jungtinės Karaystės bylą: Plummer v. IRC [1988] I WLR 292. 29 C. M. V. CLARKSON, JONATHAN HILL, The Conflict of Laws(Oxford: Oxford university press, 2006),

p. 25. 30 Ţr. Jungtinės Karaystės bylą: IRC v. Duchess of Portland [1982] STC 149.



No. 1 (8), 2012, p. 5-24

12

reikšmės turintys faktoriai gali būti aklimatizacija, šeimos ryšiai naujoje visuomenėje,

socialinė integracija, pagarba vietiniams papročiams, asmens karjeros perspektyvos, amţius

ar nuolatinės gyvenamosios vietos įtvirtinimo valstybėje motyvai.31

Asmenys, siekdami išvengti nepalankios teisės taikymo ar palankesnių teisės normų

taikymo, gali manipuliuoti ryšio formulėmis ir taip apeiti įstatymą (pranc. froid à la loi).

Ryšio formulių svarba yra akivaizdi ypatingai tais atvejais, kai asmenys taikytinos teisės

negali pasirinkti, jų santykiams taikytina teisė nustatoma tik remiantis ryšio formulėmis.

Asmenys keisdami nuolatinę gyvenamąją vietą, pasirinkdami santuokos sudarymo valstybę,

siekdami sandorį sudaryti tam tikroje valstybėje vien tam, kad santykiui būtų taikytina

palankesnė teisė gali manipuliuoti ryšio formulėmis ir taip apeiti nepalankią teisę. Norint

išvengti piktnaudţiavimo taikytina teise, geriausia naudoti tvirtus principuus, kuriuos ne

taip lengva pakeisti. Tačiau labai stabilūs kriterijai (tokie kaip pilietybė) gali nebegarantuoti

pakankamo asmenų ryšio su pilietybės valstybe, ypač kai asmenys nuolat gyvena uţsienio

valstybėje.

4. SUTARTIES ŠALIŲ AUTONOMIJOS

PRINCIPAS PASIRENKANT TAIKYTINĄ TEISĘ

Šalys gali tikslingai pasirinkti ginčui taikytina teisę, kai tokia galimybė yra numatyta

teisės aktuose. Sutarties šalių autonomijos principas yra visuotinai pripaţįstamas principas,

kurio esmė yra sutarties šalių teisė sutarininiams santykiams pasirinkti taikytiną teisę, jei šie

santykiai turi tarptautinį elementą.32

Susitarimas dėl taikytinos teisės gali apimti visą sutartį,

ar tik tam tikrą jos dalį, susitarimas tarp šalių gali atsirasti tiek sutarties pasirašymo

momentu, tiek ir pasirašius sutartį. Sutarties šalys bet kuriuo momentu susitarimą dėl

taikytinos teisės gali pakeisti.33

Šalių autonomijos principas yra vienas iš esminių principų

siekiant uţtikrinti sutarties šalių interesų įgyvendinimą, suteikti lankstumo kolizinėms

teisės normoms.34

LR CK II skyriuje, skirtame tarptautinei privatinei teisei, teisinio

santykio dalyviams taip pat numatyta galimybė pasirinkti jų teisiniams santykiams taikytiną

teisę. Taikytina teisė gali būti pasirinkta šalių susitarimu savo nuoţiūra arba iš keleto

įstatyme nurodytų alternatyvių variantų. Įstatymu išimtinė teisė pasirinkti taikytiną teisę

gali būti suteikiama tik vienam teisinio santykio dalyviui. Pavyzdţiui, LR CK 1.49 str. 1 d.

tokia teisė suteikiama nukentėjusiajam, kuris savo nuoţiūra gali pasirinkti lex causae arba

lex loci delicti, taikytinas šalių teisėms bei pareigoms pagal prievoles, atsirandančias dėl

padarytos ţalos. Taikytiną teisę turtiniams santykiams pagal sutartis gali pasirinkti

sutuoktiniai35

, sutartinėms prievolėms taikytiną teisę gali pasirinkti prievolės šalys36

, (šiuo

31 Ţr. išnašą 29: C. M. V. CLARKSON, JONATHAN HILL, p. 37-38. 32 Plačiau apie teisinius santykius, turinčius tarptautinį elementą, ţr. „LR teismų praktikos taikant

tarptautinės privatinės teisės normas apibendrinimo apţvalga“, Teismų praktika (2001, Nr. 14), p. 2. 33 Lietuvos Respublikos Civilinis kodeksas, Ţin. (2000, Nr. 7422-62), 1. 37 str. 1 d. 34 „Green Paper on applicable law and jurisdiction in divorce matters“ (2005 03 14) // [ţiūrėta 2009

04 20]

<eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:52005DC0082:LT:HTML> 35 LR CK, Ţin. (2000, Nr. 7422-62), 1. 28 str. 2 d. 36 Ţr. ten pat, 1. 37 str. 1 d.

http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:52005DC0082:EN:NOT



No. 1 (8), 2012, p. 5-24

13

atveju šalių pasirinkta teisė bus taikoma ir sandorio formai37

), galimas susitarimas dėl

taikytinos teisės tarp vartotojo ir prekių bei paslaugų tiekėjo38

. Taikytiną teisę gali pasirinkti

ir su reikalavimo perleidimu bei skolos perkėlimu susijusių santykių dalyviai.39

Tam tikrais

atvejais sutarties šalys gali rinktis tik iš įstatyme įtvirtintų alternatyvų - sutuoktiniai

turtiniams santykiams gali pasirinkti vietos, kurioje nuolat gyvena arba ketina gyventi, arba

lex celebritiones, arba vietos, kurios pilietis yra vienas iš sutuoktinių, teisę.40

Nukentėjusysis, dėl ţalos atsirandančioms prievolėms gali pasirinkti arba lex causae, arba

vietos, kurioje buvo kitokių ţalą sukėlusių aplinkybių, arba lex delicti teisę.41

Taikytinos

teisės pasirinkimas, kai tai yra numatyta teisės aktuose, nelaikomas teisės apėjimu. Tačiau

nors šalių autonomijos principas asmenims suteikia teisę pasirinkti taikytiną teisę, ši teisė

yra neatsiejama nuo pareigos elgtis sąţiningai, teisingai bei protingai42

ir jei šalys nepaiso

šios pareigos ir savo teisę naudoja ne tiems tikslams, kuriems ji buvo sukurta, gali atsirasti

piktnaudţiavimas taikytina teise. Šalių autonomijos principas sukuria tik galimybę šalims

pasirinkti taikytiną teisę, ir tik tuo atveju, kai jos tinkamai naudosis suteikiama teise,

laikysis pareigos elgtis sąţiningai, protingai bei teisingai, nepaţeis viešosios tvarkos,

imperatyvių įstatymo normų, teisės pasirinkimas nebus laikomas piktnaudţiavimu.

5. TAIKYTINOS TEISĖS PIRKIMO IR TEISMO

PIRKIMO RYŠYS

„Teismas Anglijoje yra gera vieta apsipirkti dėl prekių kokybės ir aptarnavimo

greičio.“43

(Lord Alfred Thompson Denning)

Šalys gali pasirinkti taikytiną teisę ir netiesiogiai, t.y. pasirinkdamos tam tikros

valstybės teismą, kuris pagal tarptautinės privatinės teisės taisykles taikys bylą

nagrinėjančio teismo teisę (lex fori). „...[T]aikytinos teisės ir jurisdikcijos derinimas yra

racionalus tiek šalių, tiek bylą nagrinėjančio teismo poţiūriu, nes suteikia daugiau

galimybių teisingai išspręsti ginčą ...“44

. Tačiau vien ta aplinkybė, kad byla priskirtina tam

tikro teismo jurisdikcijai dar nereiškia, kad teismas taikys lex fori. Ar teismas taikys lex fori

priklauso nuo bylos ryšio su teismo vietos šalimi ir toks ryšys nustatomas pagal valstybėje

įtvirtintas ryšio formules (pvz. nuolatinės gyvenamosios vietos principas, pilietybės,

ekonominių interesų buvimo vieta, pagrindinių verslo ryšių buvimo vieta ir pan.).

Praktikoje pasitaiko situacijų, kai nustatyti su kuria valstybe ginčas labiau susijęs yra

labai sunku. Tais atvejais kai ginčas yra susijęs ir su bylą nagrinėjančio teismo valstybe ir

su uţsienio valstybe teismai labiau linkę taikyti lex fori, nes uţsienio šalies teisės taikymas

37 Ţr. ten pat, 1. 38 str. 1 d. 38 Ţr. ten pat, 1. 39 str. 2 d. 39 Ţr. ten pat, 1. 42 str. 1 d. 40 Ţr. ten pat, 1. 28 str. 2 d. 41 Ţr. ten pat, 1. 43 str. 1 d. 42 Ţr. ten pat, 1. 5 str. 1 d. 43 C. M. V. CLARKSON, JONATHAN HILL, The Conflict of Laws (Oxford: Oxford university press,

2006), p. 104. 44 V. MIKELĖNAS, Tarptautinės privatinės teisės įvadas (Vilnius: Justitia, 2001), p. 156.



No. 1 (8), 2012, p. 5-24

14

praktikoje yra neretai problematiškas. Šalys negali tikėtis, kad bus taikoma lex fori jei byla

ar jos dalis yra aiškiai nesusijusi su teismo buvimo vietos valstybe.

LR CK numatyta taisyklė, jeigu teismui ar ginčo šaliai, kuri remiasi uţsienio teise,

nepavyksta įrodyti uţsienio teisės turinio, taikoma Lietuvos Respublikos teisė lex fori.

Taigi, pasitaiko atvejų, kai sutarties šalis ar šalys, ţinodamos šią taisyklę ir turėdamos

galimybę kreiptis į kelių valstybių teismus, kreipsis į tos valstybės, kurios teisė palankiau

išspręs ginčą teismą, tikėdamosis, kad teismas taikys jiems palankesnę lex fori. Tačiau, nors

iš pirmo ţvilgsnio tokia galimybė yra įmanoma, visgi šalys negali išvengti taikytinai teisei

nustatyti skirtų ryšio formulių. Tais atvejais, kai sutarties šalys nepasirenka teisiniam

santykiui taikytinos teisės, teismas taikytiną teisę nustato ex officio atsiţvelgdamas į tai, su

kuria šalimi ginčas yra labiau susijęs. Teismas, nustatęs, kad teisinis santykis yra susijęs su

kita nei teismo buvimo vietos šalimi privalo taikyti tos šalies, o ne lex fori teisę. Problema

gali kilti tada, kai nustatyti teisinio santykio ryšį su valstybe yra sunku arba išvis

neįmanoma, taikytina teisė yra arba išvis neţinoma arba maţai ţinoma teismui, arba šalių

pasirinktos teisės taikymas gali sukelti neigiamas teisines pasekmes asmenims, arba lex fori

netaikymas gali sukelti esminės ţalos šalių teisėms bei interesams. Net ir esant aiškiam

susitarimui dėl taikytinos teisės, viena šalis gali ginčyti tokio susitarimo galiojimą ir jei

sunku nustatyti su kuria šalimi ginčas labiau susijęs, asmenys gali apeiti susitarimo išlygas

ir kreipdamiesi į palankesnį teismą tikėtis, kad bus taikoma teismo buvimo vietos teisė.

Pavyzdţiui, Jungtinės Karalystės teismų praktikoje šalims susitarus, kad jų ginčą nagrinės

Jungtinės Karalystės teismas, net ir tuo atveju, kai ginčas neturės jokio ryšio su šalimi,

teismas labiausia tikėtina konstatuos, kad susitardamos dėl jurisdikcijos šalys norėjo, jog

teismas taikytų lex fori ir ta aplinkybė, kad yra valstybių su kuria sutartis yra labiau susijusi

dar nereiškia, kad šalys nenorėjo, kad ginčo sprendimui būtų taikoma lex fori teisė.45

Pavyzdţiui, byloje Egon Oldendorff v. Libera Corpn46

kontraktas neturėjo jokio ryšio su

Jungtine Karalyste, išskyrus kontrakto išlygą, kad tarp šalių kilę ginčai bus sprendţiami

būtent šioje valstybėje. Teismas konstatavo, kad įrodymai, kuriais remiantis turėtų būti

taikoma Vokietijos ar Japonijos teisė buvo neįtikinantys ir, kadangi nebuvo įrodyta, kad

ginčas labiau susijęs su minėtom šalim, taikė lex fori.

Šalys gali pasirinkti ginčui taikytiną teisę ir netiesiogiai pasirinkdamos valstybę,

kurioje bus sprendţiamas ginčas t. y. kurios teismas pagal tarptautinės privatinės teisės

taisykles taikys bylą nagrinėjančio teismo teisę (lex fori). Taigi, pasitaiko atvejų, kai

sutarties šalis ar šalys, ţinodamos šią taisyklę ir turėdamos galimybę kreiptis į kelių

valstybių teismus, kreipsis į tos valstybės, kurios teisė palankiau išspręs ginčą teismą,

tikėdamosis, kad teismas taikys jiems palankesnę lex fori.

45 Plačiau ţr. C. M. V. CLARKSON, JONATHAN HILL, The Conflict of Laws (Oxford: Oxford university

press, 2006), p. 178. 46 Ţr. Didţiosios Britanijos bylą: Egon Oldendorff v. Libera Corpn [1995] 1 Loyd's Report 380 Q.B.



No. 1 (8), 2012, p. 5-24

15

6. PIKTNAUDŽIAVIMO TEISE SAMPRATA IR

SĄVOKOS ANALIZĖ

Ne visais atvejais, kai šalys vienokiu ar kitokiu būdu pasirenka taikytiną teisę, gali būti

konstatuojamas piktnaudţiavimas teise. Lietuvos Aukščiausiojo teismo (toliau - LAT) 2008

m. praktikos civilinėse bylose aktualijų apţvalgoje apibrėţiama piktnaudţiavimo teise

sąvoka - piktnaudţiaudamas savo teise asmuo nebūtinai turi turėti tiesioginį tikslą padaryti

ţalą kitų asmenų interesams, „...ţala kitiems asmenims gali atsirasti asmeniui nesąţiningai

siekiant savo interesų patenkinimo“47

. Piktnaudţiavimas atsiranda tuomet, kai

įgyvendindamas savo teises asmuo nesilaiko pareigos elgtis sąţiningai, protingai ir

rūpestingai (ar rūpestingas, protingas ir sąţiningas ţmogus tokioje situacijoje elgtųsi taip

pat) ir „nepaţeisti kito ţmogaus teisių ir teisėtų interesų“48

. LAT 2008 m. nutaryje byloje A.

N. p. N. N. paţymėjo, kad:

„...civilines teises draudţiama įgyvendinti tuo būdu ir priemonėmis, kad nesant

teisinio pagrindo būtų paţeistos ar varţomos kitų asmenų teisės ar įstatymo saugomi

interesai ar daroma ţala kitiems asmenims arba prieštaraujama subjektinės teises

paskirčiai. Asmuo iš savo neteisėto elgesio negali tikėtis naudos, o iš neteisėtų veiksmų

negali kilti teisėtos pasekmės, ...teisė negali ginti tokių teisių, kurios naudojamos priešingai

jos tikslams ir paskirčiai, o ...tais atvejais, kai asmuo paţeidţia šį įstatymo nustatytą

imperatyvą, laikoma, kad asmuo piktnaudţiauja teise ir …tai konstatavęs, teismas gali

atsisakyti ginti tokią subjektinę teisę...“.49

Civilinėje teisėje piktnaudţiavimo teise doktrina numato, kad asmuo gali būti

atsakingas uţ savo teisėtais veiksmais sukeltą ţalą, jei „...šios teisės įgyvendinimas

prieštarauja moralei, geros valios“ ar „...sąţiningumo principams arba yra naudojama

kitiems tikslams nei tiems, kuriems ji buvo skirta“50

. Įstatymo apėjimas, kaip ir

piktnaudţiavimas subjektine teise, turėtų būti pripaţintas prieštaraujančiu bendriesiems

teisės principams, draudţiantiems piktnaudţiauti teise.51

Kai konstatuojamas

piktnaudţiavimas pasirenkant taikytiną teisę ar teismą, teismas turėtų tokį proceso šalių

elgesį pripaţinti paţeidţiančiu neleistinumo piktnaudţiauti teise principą52

bei teisingumo,

proporcingumo ir sąţiningumo kriterijams53

ir, vadovaudamasis LR CK 1.11 str. gali

atsisakyti taikyti šalių pasirinktą teisę. Konstatavęs, kad šalių susitarimas dėl taikytinos

teisės negalioja, teismas taiko lex fori arba valstybės su kuria ginčas labiausiai susijęs teisę.

47 „Lietuvos Aukščiausiojo teismo 2008 m. praktikos civilinėse bylose aktualijos“, Lietuvos

Aukščiausiasis Teismas, p. 29 // [ţiūrėta 2009 03 17]

<www.lat.lt/IxSitesUpload/Upload_LAT.LT/File/Mensiniai%20civil%20praktikos%20aktualijos/200

8%20metine%20nuasmeninta.doc> 48 Ţr. ten pat. 49 Ţr. A. N. p. R. R., Lietuvos Aukščiausiasis Teismas, (2008, Nr. 3K-3-203); Taip pat ţr. UAB „Init“

v. UAB „Parabolė“ ir kt., Lietuvos Aukščiausiasis Teismas, (2000, Nr. 3K-3-905); 305-oji DNSB

„Bokštas“ p. Vilniaus miesto valdyba, Lietuvos Aukščiausiasis Teismas, (2002, Nr. 3K-3-512); M. Č.

p. E. M., I. D., Teisingumo ministerija, Lietuvos Aukščiausiasis Teismas, (2007, Nr.3K-7-4) ir kt. 50 Red. B. A. GARNER, Black's law dictionary 7th edition (St. Paul, Minn.: West Group, 1999), p. 10. 51 V. MIKELĖNAS, Tarptautinės privatinės teisės įvadas (Vilnius: Justitia, 2001), p. 126. 52 LR CK, Ţin. (2000, Nr. 7422-62), 1. 2 str. 53 Ţr. ten pat, 1. 5 str.



No. 1 (8), 2012, p. 5-24

16

Analogiškai teismas turėtų elgtis ir konstatavęs, kad proceso šalis piktnaudţiauja

procesinėmis teisėmis. Pavyzdţiui, ETT sprendime byloje G. P. Turner v. F. F. I. Grovit,

Harada Ltd, Changepoint LTd54

(toliau - Turner v. Grovit) Jungtinės Didţiosios Britanijos

ir Šiaurės Airijos Karalystės (toliau - Didţioji Britanija, Jungtinė Karalystė) apeliacinis

teismas konstatavo atsakovo piktnaudţiavimą procesine padėtimi, kai atsakovas kreipėsi į

Ispanijos teismą, vien tam, kad suţlugdytų procesą Jungtinėje Karalystėje pasinaudodamas

tuo, kad ES nacionalinių teismų diskrecija yra ribojama lis pendens doktrina. Jungtinės

Karalystės teismas kreipėsi į ETT prejudicinio sprendimo dėl nacionalinio teismo

jurisdikcijos ir galimybės pratęsti laikinąsias apsaugos priemones - t. y. apriboti atsakovo

galimybę (skiriant jam baudą uţ įpareigojimo netęsti proceso Ispanijoje nesilaikymą)

kreiptis į palankesnį teismą vien tam, kad suţlugdytų teismo procesą jam nepalankios ar

nepatogios valstybės teisme. ETT konstatavo, kad tokie veiksmai, kai proceso šalis elgiasi

iš blogos valios (angl. acting in bad faith) ir naudoja savo subjektinę teisę vien tam, kad

suţlugdytų teismo procesą kitoje šalyje, yra piktnaudţiavimas, tačiau net ir konstatavus tokį

piktnaudţiavimą nacionalinis teismas negali paţeisti lis pendens doktrinos ir imtis

priemonių paţeistoms teisėms atkurti.55

Ne visais atvejais, kai šalys pasirenka taikytiną teisę bus nustatomas piktnaudţiavimas.

Teismas kiekvienu atveju turi įvertinti, ar šalys siekė apeiti imperatyvias įstatymo

nuostatas, ar išskirtinės ekonominės naudos, ar paţeidė sąţiningumo bei protingumo

principus pasirinkdamos teisę.

7. TAIKYTINOS TEISĖS PIRKIMO RIZIKOS

RIBOJIMAS

Siekiant išvengti piktnaudţiavimo, šalių autonomiją pasirinkti taikytiną teisę ar teismą

riboja imperatyvios įstatymo normos56

, viešosios tvarkos išlyga bei bendrieji teisės

principai. LR CK 1.11 str. 1 d. įtvirtinta nuostata, kad pasirinkta teisė gali būti netaikoma,

jei ji prieštarauja valstybės, kurios teismas nagrinėja bylą, viešajai tvarkai (angl. public

policy)57

. Analogiškos nuostatos yra ir ES Romos konvencijoje. ETT bylose Krombach v.

Baberski58

bei Gambazzi v. Daimler Chrysler59

išaiškino, kad nacionalinis teismas,

remdamasis viešosios tvarkos išlyga negali atsisakyti taikyti kitos valstybės teisės normos

vien tuo pagrindu, kad ji skiriasi nuo lex fori teisės normos. ETT nuomone, teisės norma

turi būti akivaizdţiai priešinga lex fori teisės normai, kuri yra esminė ir būtina uţtikrinti

54 Europos Teisingumo Teismo byla: Case 159/02, Gregory Paul Turner v. Felix Fareed IsmailGrovit

Grovit, Harada Ltd, Changepoint LTd, [2003] ECR I-3565. 55 Ţr. ten pat, § 31. 56 1980 m. Rome convention on law applicable to contractual obligations, Roma, 1996 11 26,

publikuotas OJ C 027, 1998, 7 str., p. 34-46 // [ţiūrėta 2009 03 20] <eur-

lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:41998A0126%2802%29:EN:HTML> 57 Viešosios tvarkos doktrina reiškia, kad nacionalinės teisės normos, ginančios viešąjį interesą,

įgauna pirmumą prieš šiai valstybei nepriimtinas uţsienio valstybių normas. Plačiau ţr. V.

MIKELĖNAS, Tarptautinės privatinės teisės įvadas (Vilnius: Justitia, 2001), p. 128. 58 Europos Teisingumo Teismas: Case 7/98, Dieter Krombach v. André Bamberski [2000] ECR I-

1935.



No. 1 (8), 2012, p. 5-24

17

viešajai tvarkai, o viešosios tvarkos taikymo ribos nėra išplėstos tiek, kad akivaizdţiai

paţeistų pagrindines ţmogaus laisves įtvirtintas ES. Teismas taip pat išaiškino, kad

„…prieštaravimas viešajai tvarkai apima du aspektus - prieštaravimą gerai moralei bei

prieštaravimą imperatyvioms įstatymo normoms”60

. Pavyzdţiui, teismas turėtų atsisakyti

taikyti uţsienio teisės normą, jei taikytina teisė nenumato nepilnamečio vaiko teisės į

alimentus, jei taikytina teisė nenumato finansinio išlaikymo sutuoktinei ar įteisina

susitarimus sudarytus apgaulės būdu ar panaudojant prievartą.61

Teismas, nustatęs, kad teisiniam santykiui taikytinos teisės taikymas prieštarauja

viešajai tvarkai, turi atsisakyti taikyti šalių pasirinktą uţsienio teisę ir taiko lex fori.

Pabrėţtina, kad kiekvienu atveju yra svarbu nustatyti ar teisės norma yra imperatyvi

atsiţvelgiant į šios normos prigimtį bei tikslus, bei kokias teisines pasekmes imperatyvių

teisės normų taikymas ar netaikymas sukels teisinio santykio dalyviams. Nustatyti ar teisės

norma yra imperatyvi yra labai svarbu,62

nes nuo to kaip bus vertinama teisės norma gali

priklausyti ar teismas taikys uţsienio teisę, jei šalys nepasirinko taikytinos teisės, o tuo

atveju kai pasirinko - susitarimo dėl taikytinos teisės galiojimas.

Susitarimas dėl taikytinos teisės gali būti pripaţintas prieštaraujantis viešajai tvarkai,

jei uţsienio šalies normos prieštarauja lex fori imperatyvioms įstatymo normoms ar gerai

moralei t.y. paţeidţia pagrindines ţmogaus teises ir laisves, prieštarauja lex fori įtvirtintoms

teisingumo, padorumo, geros moralės principams. Paţymėtina, kad daugelio tarptautinės

privatinės teisės taisyklių paskirtis yra ginti asmenų interesus, o ne valstybės, taigi teismas

kiekvienu konkrečiu atveju turi įvertinti ar šalių pasirinktos teisės netaikymas iš esmės

nepaţeis pastarųjų teisėtų interesų. Pavyzdţiui, byloje Addison v. Brown susitarimas dėl

išlaikymo, kuriuo buvo apribota Kalifornijos teismo jurisdikcija buvo pripaţintas

galiojančiu Didţiojoje Britanijoje, nors pagal lex fori toks susitarimas būtų niekinis.63

Teismas netaiko šalių pasirinktos teisės ir tuo atveju, kai nei šalims, nei teismui

nepavyksta nustatyti taikytinos teisės turinio ar išimtinais atvejais, kai būtina imtis skubių

asmens ar turto apsaugos priemonių, kol bus nustatytas taikytinos teisės turinys64

bei tais

atvejais, kai asmenys galėtų išvengti imperatyviųjų lex fori ar šalies, su kuria teisinis

santykis yra glaudţiausiai susijęs, teisės normų.65

Šiais atvejais bus taikomas teismo

buvimo vietos teisė.

Teismas „...gali atsisakyti taikyti šalių pasirinktą teisę, jei pasirinkta teisė daro sutartį

... negaliojančią arba sukelia šalims ar vienai iš jų labai sunkių ir netikėtų, nenumatytų

59 Europos Teisingumo Teismas: Case 394/07, Marco Gambazzi v. Daimler Chrysler Canada Inc. ir

CIBC Mellon Trust Company, [2008] ECR I-1935. 60 V. MIKELĖNAS, Tarptautinės privatinės teisės įvadas (Vilnius: Justitia, 2001), p. 129. 61 Lemenda Trading Co Ltd. v. African Middle East Petroleum Co Ltd. [1988] Court of Queen's

Branch QB 448. 62 H. L. BUXBAUM, „Mandatory rules in civil litigation: status of the doctrine post-globalization“ //

[ţiūrėta 2009 04 05]

<papers.ssrn.com/sol3/papers.cfm?abstract_id=1281682> 63 C. M. V. CLARKSON, JONATHAN HILL, The Conflict of Laws (Oxford: Oxford university press,

2006), p. 486. 64 LR CK, Ţin. (2000, Nr. 7422-62), 1.12 str. 2 d. 65 V. MIKELĖNAS, Tarptautinės privatinės teisės įvadas (Vilnius: Justitia, 2001), p. 126.



No. 1 (8), 2012, p. 5-24

18

padarinių“66

. Pavyzdţiui, netikėta gali būti pripaţinta sutarties išlyga įrašyta į sutartį vienos

iš sutarties šalių iniciatyva tinkamai apie tai neinformavus kitos šalies.

Teisės apėjimas, siekiant išvengti imperatyviųjų įstatymo normų (pavyzdţiui

poligaminės santuokos draudimo arba draudimo tuoktis tos pačios lyties asmenims) taip pat

tam tikrais atvejais sukelia teisines pasekmes. Teismas, konstatavęs, kad asmenys bandė

išvengti imperatyviųjų įstatymo normų, remdamasis viešosios tvarkos išlyga atsiradusio

teisinio santykio, teisių ar pareigų nepripaţins toje valstybėje, kurios teisės imperatyvių

teisės normų buvo bandoma išvengti. Pavyzdţiui, santuoka tarp asmenų, kurių nuolatinė

gyvenamoji vieta yra Lietuvoje nebus pripaţįstama, jei asmenys santuoką sudarė uţsienio

valstybėje turėdami tikslą išvengti santuokos pripaţinimo negaliojančia. Lietuvos teismų

praktikoje taip pat yra atvejų, kai teismas atsisako taikyti uţsienio teisę. Lietuvos

Aukščiausias Teismas konstatavo:

…[P]agal Lietuvos Respublikos ir Baltarusijos Respublikos 1992-10-20 dvišalę

teisinės pagalbos sutartį, kai kurio nors iš tėvų ir vaikų gyvenamoji vieta yra kitos

Susitariančiosios Šalies teritorijoje, jų (tėvų ir vaikų) teisinius santykius reglamentuoja

šalies, kurios pilietis yra vaikas, įstatymai. Taigi, šioje byloje turėtų būti taikomi

Baltarusijos Respublikos įstatymai, kuriuose nenustatyta tėvų pareiga teikti paramą

pilnamečiam vaikui, kuriam tokia parama yra būtina, jeigu jis mokosi vidurinių, aukštųjų

ar profesinių mokyklų dieniniuose skyriuose ir yra ne vyresnis negu 24 m. Vis dėlto šioje

byloje yra pagrindas taikyti specialiąją normą, numatytą LR CK 1.11 str.,

reglamentuojančiame uţsienio teisės taikymo apribojimus, nes atsiţvelgus į byloje

nustatytas aplinkybes, konstatuotina, kad šis ginčas labiausiai susijęs su LR teise: 1) ginčas

teisėtai yra nagrinėjamas LR teismuose; 2) atsakovas yra LR pilietis, gyvenantis Lietuvoje;

3) LR CK 3.194 str. yra imperatyvi teisės norma, pagal kurią LR piliečiai privalo vykdyti

pareigą – teikti paramą iki 24 m. amţiaus paramos reikalingiems savo vaikams, kurie

mokosi vidurinių, aukštųjų ar profesinių mokyklų dieniniuose skyriuose; 4) minėtos LR

piliečio pareigos nevykdymas pripaţintinas prieštaraujančiu gerai moralei, teisingumo ir

sąţiningumo principams.67

Siekiant išvengti piktnaudţiavimo taikytina teise, uţsienio teisė gali būti netaikoma

remiantis viešosios tvarkos išlyga, jei jos taikymas paţeidţia ginčą nagrinėjančios valstybės

viešąją tvarką. Teismas tokius atvejus turėtų spręsti vadovaudamasis bendrąja viešosios

tvarkos išlyga, pripaţinti paţeidţiančius neleistinumo piktnaudţiauti teise principą, bei

teisingumo, proporcingumo ir sąţiningumo kriterijus ir, vadovaudamasis LR CK 1.11 str.

gali atsisakyti taikyti šalių pasirinktą uţsienio teisę. Konstatavęs, kad šalių susitarimas dėl

taikytinos teisės negalioja, teismas taiko lex fori arba valstybės, su kuria ginčas labiausiai

susijęs, teisę. Analogiškai teismas turėtų elgtis ir konstatavęs, kad proceso šalis

piktnaudţiauja procesinėmis teisėmis. Teisės aktai neapibrėţia viešosios tvarkos sąvokos -

tai kiekvienu konkrečiu atveju nustato teismas. Vien tik tai, jog uţsienio teisė skiriasi nuo

ginčą nagrinėjančio teismo teisės, negali būti pagrindas taikyti viešos tvarkos išlygą.

Piktnaudţiavimas gali būti konstatuotas tik tuo atveju, kai šalys siekė bylinėtis pasirinktame

teisme ar teisiniam santykiui taikyti tam tikrą teisę vien dėl tos prieţasties, kad gautų

66 Ţr. Ten pat, p. 239. 67 I. T. v. I. T., Lietuvos Aukščiausiasis teismas, (2007, Nr. 3K-7-130).



No. 1 (8), 2012, p. 5-24

19

finansinės naudos ir kai tokia finansinė nauda yra ţymiai didesnė uţ galimą naudą bylą

nagrinėjant kitame teisme bei kai tokia nauda neatitinka protingumo, sąţiningumo bei

teisingumo reikalavimų.

8. TEISMO VAIDMUO VERTINANT TEISĖS

PIRKIMO, TEISMO PIRKIMO IR

PIKTNAUDŽIAVIMO TEISE ATVEJUS

Teismo vaidmuo yra lemiamas vertinant, ar konkrečiu atveju asmenys, įgyvendindami

savo teisę teisiniam santykiui pasirinkti taikytiną teisę ar teismą, elgėsi sąţiningai. Teismas

spręsdamas ginčą turi atsiţvelgti ne tik į įstatymo raidę, tačiau turi aiškinti įstatymo normas

atsiţvelgdamas į jų tikslą bei paskirtį ir į proceso šalių interesus. Taikant kolizines teisės

normas teismui iškyla „viena iš tarptautinės privatinės teisės dilemų“68

- kaip pasiekti ne tik

kolizinio teisingumo69

(angl. conflict justice), bet ir esminio teisingumo70

(angl. material

justice). Pastaruoju metu vis labiau linkstama į esminio teisingumo pusę, nes civilinių

teisinių santykių esmė yra uţtikrinti asmenų teisių ir pareigų pusiausvyrą ir rasti geriausią

sprendimą, kuris labiausiai atitiktų šalių interesus. Taigi, teismui yra suteikiama diskrecija

spręsti, ar taikytina teisė arba šalių pasirinktas teismas atitinka pastarųjų teisėtus interesus

bei lūkesčius ir ar taikant tam tikros valstybės teisę bus pasiektas teisingas rezultatas.

Romos konvencijoje įtvirtinta išimtinė teismo teisė nuspręsti ar šalių pasirinkta teisė ar

teisė, į kurią nurodo kolizinės lex fori teisės normos neprieštarauja imperatyvioms įstatymo

normoms ir šiuo atveju teismas turi atsiţvelgti į imperatyvių teisės normų prigimtį bei

taikymo ar netaikymo teisines pasekmes asmenims.71

Paţymėtina, kad analogiška sąlyga

yra įtvirtinta ir LR CK 1.11 str. 2 dalyje. Teismas ex officio nustato taikytinos teisės turinį,

bei taiko šalių pasirinktą arba tą teisę į kurią nukreipia kolizinės normos, o tuo atveju kai

asmenys taikytinos teisės nepasirenka, vertina ryšio formulių svarbą ir pan. Pavyzdţiui,

Olandijos Aukščiausiojo teismo išnagrinėtoje byloje Société Nouvelle des Paperteries de

l'Aa SA v. BV Machinefabrike BOA72

, kur ieškovas Olandijos pilietis pardavė atsakovui,

Prancūzijos piliečiui popieriaus presą, ginčas labiau buvo susijęs su Prancūzija - kontrakto

sudarymo vieta, kontrakto kalba, prekės pristatymo vieta, kontrakto valiuta - visi šie

faktoriai rodė, kad ginčui turėtų būti taikoma Prancūzijos teisė. Ginčą su Olandija siejo tik

tai, kad ieškovo pagrindinė verslo vieta buvo Olandijoje. Teismas savo sprendimą ginčui

taikyti Olandijos teisę argumentavo tuo, kad visi kiti ryšio faktoriai turi lemiamos reikšmės

tik tada, kai šalies pagrindinės verslo vietos faktorius jokios reikšmės byloje neturi. Byloje

68 S. C. SYMEONIDES, „Result-Selectivism in Private International Law“ // [ţiūrėta 2009 05 20]

<papers.ssrn.com/sol3/ papers.cfm? abstract_id=1133630> 69 Taikoma tinkamos šalies pagal kolizines teisės normas teisė, nesvarstant ar tinkamos teisės

taikymas uţtikrins teisingumą konkrečiu atveju. 70 Teismas siekia, kad rezultatas būtų analogiškas tam rezultatui, kuris pagal nacionalines teisės

normas būtų iš esmės teisingas. 71 1980 m. Rome convention on law applicable to contractual obligations, Roma, 1996 11 26, OJ C

027, 1998, 7 str. 1 d., p. 34-46 // [ţiūrėta 2009 03 20] <eur-

lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:41998A0126%2802%29:EN:HTML> 72 C. M. V. CLARKSON, JONATHAN HILL, The Conflict of Laws (Oxford: Oxford university press,

2006), p. 190.



No. 1 (8), 2012, p. 5-24

20

Definitely Maybe (Touring) Ltd v. Marek Lieberberg Konzertagentur GmbH73

ieškovas,

renginių organizavimo kompanija, kuri atstovavo britų grupę Oasis, padavė ieškinį

Didţiosios Britanijos teismui prieš atsakovą Vokietijos kompaniją, organizuojančią

muzikinius festivalius, teigdamas, kad kontraktui turėtų būti taikytina Didţiosios Britanijos

teisė pagal piniginės prievolės įvykdymo vietą. Atsakovas teigė, kad kontraktui turėtų būti

taikytina Vokietijos teisė pagal pagrindinės prievolės įvykdymo vietą. Teismas konstatavo,

kad nesant daugiau faktorių, kurie nurodo kurią teisę taikyti, dar nereiškia, kad teismas

privalo taikyti kontrakto įvykdymo vietos teisę, nors kontrakto valiuta buvo Vokietijos

valiuta, kontrakto sąlygos reikalavo, kad abiejų šalių prievolės būtų vykdomos Vokietijoje

ir išskyrus vienos šalies teritorinius ryšius su Didţiaja Britanija, daugiau niekas nerodė, kad

ginčas yra susijęs su šia valstybe. Taigi, šie pavyzdţiai parodo, kad teismo vaidmuo

vertinant ir taikant kolizines normas, vertinant ryšio formules yra labai reikšmingi. Kadangi

teismo vaidmuo bylose turinčiose tarptautinį elementą yra aktyvus ir reikšmingas, darytina

išvada, kad teismas turėtų siekti balanso tarp kolizinio ir esminio teisingumo.

IŠVADOS

Atlikus teisės aktų, teisinės literatūros, teismų praktikos sisteminę analizę pateikiamos

tokios išvados:

Dėl skirtingų materialinių bei procesinių teisių sistemų egzistavimo šalys gali siekti,

kad ginčui būtų taikoma konkrečios valstybės teisė tiek dėl teisėtų prieţasčių, tiek dėl

ekonominės naudos ar kitų asmeninių interesų.

Vienas iš būdų siekiant išvengti manipuliavimo tarptautinės privatinės teisės kriterijais

yra jos unifikavimas, pasirašant tarptautinius dokumentus. Pastaruoju metu pastebimas

akivaizdus tarptautinės privatinės teisės harmonizavimas ES, priimant reglamentus.

Kolizinių normų vienodinimas bei harmonizavimas nustato viendodas kolizines normas ir

nepriklausomai nuo to, kurios valstybės teisme bus sprendţiamas ginčas, visi teismai taikys

tas pačias unifikuotas tarptautines privatinės teisės normas ir taip bus uţkertamas kelias

piktnaudţiavimui.

Asmenys, siekdami išvengti nepalankios teisės taikymo ar siekdami palankiau jų

teisinį santykį reglamentuojančios teisės normų taikymo, gali manipuliuoti ryšio

formulėmis ir taip apeiti įstatymą (pranc. froid à la loi). Asmenys, keisdami nuolatinę

gyvenamąją vietą, pasirinkdami santuokos sudarymo valstybę, siekdami sandorį sudaryti

tam tikroje valstybėje vien tam, kad tam santykiui būtų taikytina palankesnė teisė, gali

manipuliuoti ryšio formulėmis ir taip apeiti nepalankią teisę. Siekiant išvengti

piktnauţiavimo taikytina teise, teisės aktai turi numatyti stabilias ryšio formules, kurias yra

sunku pakeisti.

Šalys gali teisėtu būdu siekti, kad jų ginčui būtų taikoma tam tikros valstybės teisė.

Sutarties šalys gali sutarčiai pasirinkti taikytiną teisę ir tai nebus laikoma teisės apėjimu.

Šalių autonomijos principas sukuria tik galimybę šalims pasirinkti, ar jie tinkamai naudosis

73 Ţr. Didţiosios Britanijos bylą: Definitely Maybe (Touring) Ltd v. Marek Lieberberg

Konzertagentur GmbH (No 2) [2001] 4 All ER 283. 849.



No. 1 (8), 2012, p. 5-24

21

suteikiama teise pasirinkti taikytiną teisę ir ar laikysis pareigos elgtis sąţiningai, protingai

bei teisingai.

Šalys gali pasirinkti ginčui taikytiną teisę ir netiesiogiai pasirinkdamos valstybę,

kurioje bus sprendţiamas ginčas bei kuris pagal tarptautinės privatinės teisės taisykles

taikys bylą nagrinėjančio teismo teisę (lex fori). Taigi, pasitaiko atvejų, kai sutarties šalis ar

šalys, ţinodamos šią taisyklę ir turėdamos galimybę kreiptis į kelių valstybių teismus,

kreipsis į tos valstybės, kurios teisė palankiau išspręs ginčą teismą, tikėdamosis, kad

teismas taikys jiems palankesnę lex fori.

Ne visais atvejais, kai šalys pasirenka taikytiną teisę bus nustatomas piktnaudţiavimas.

Teismas kiekvienu atveju turi įvertinti, ar šalys siekė apeiti imperatyvias įstatymo

nuostatas, ar siekė išskirtinės ekonominės naudos, ar paţeidė sąţiningumo bei protingumo

principus pasirinkdamos teisę.

Siekiant išvengti piktnaudţiavimo taikytina teise, uţsienio teisė gali būti atmesta

remiantis viešosios tvarkos išlyga, jei jos taikymas paţeidţia ginčą nagrinėjančios valstybės

viešąją tvarką. Teisės aktai neapribėţia viešosios tvarkos sąvokos, tai kiekvienu konkrečiu

atveju nustato teismas. Vien tik tai, kad uţsienio teisė skiriasi nuo ginčą nagrinėjančio

teismo teisės, negali būti pagrindas taikyti viešos tvarkos išlygą.

Teismui turi būti suteikiama diskrecija spręsti, ar taikytina teisė arba šalių pasirinktas

teismas atitinka pastarųjų teisėtus interesus bei lūkesčius ir ar taikant tam tikros valstybės

teisę bus pasiektas teisingas rezultatas.

LITERATŪROS SĄRAŠAS

KNYGOS

CLARKSON, C. M. V., JONATHAN HILL. The Conflict of Laws. Oxford: Oxford university

press, 2006.

DE VAREILLES-SOMMIÉRES, P. Forum shopping in the European Judicial Area. Oxford:

Hart Publishing, 2007.

GARNER, B. A. Black's law dictionary 7th edition. St. Paul, Minn.: West Group, 1999.

MIKELĖNAS, V. Tarptautinės privatinės teisės įvadas. Vilnius: Justitia, 2001.

PERIODINIAI LEIDINIAI

„LR teismų praktikos taikant tarptautinės privatinės teisės normas apibendrinimo

apţvalga“. Teismų praktika. Nr. 14 (2001).

TEISINIAI DOKUMENTAI

Lietuvos Respublikos Civilinis kodeksas. Valstybės ţinios. 2000, Nr. 7422-62.

LR Įstatymas dėl uţsieniečių teisinės padėties. Valstybės ţinios. 2004, Nr. 73-2539.

LR Prekybinės laivybos įstatymas. Valstybės ţinios. 1996, Nr. 101-2300.

LR Koncesijų įstatymas. Valstybės ţinios. 1996, Nr. 92-2141.

Reglamentas (EB) Nr. 593/2008 dėl sutartinėms prievolėms taikytinos teisės (Roma I).

(Įsigaliojo 2009 m. gruodţio 17 d.).

Romos konvencija dėl sutartinėms prievolėms taikytinos teisės. OJ C27/34. 1998 01 26.



No. 1 (8), 2012, p. 5-24

22

Trišalė Lietuvos Respublikos, Estijos Respublikos ir Latvijos Respublikos sutartis dėl

teisinės pagalbos ir teisinių santykių. Valstybės ţinios. 1994, Nr. 28-492.

Dvišalė Lietuvos Respublikos ir Lenkijos Respublikos sutartis dėl teisinės pagalbos ir

teisinių santykių civilinėse, šeimos, darbo ir baudţiamosiose bylose. Valstybės ţinios.

1994, Nr. 14-234.

Konvencija dėl Čekijos Respublikos, Estijos Respublikos, Kipro Respublikos, Latvijos

Respublikos, Lietuvos Respublikos, Vengrijos Respublikos, Maltos Respublikos,

Lenkijos Respublikos, Slovėnijos Respublikos ir Slovakijos Respublikos prisijungimo

prie Konvencijos dėl sutartinėms prievolėms taikytinos teisės, pateiktos pasirašyti

1980 m. birţelio 19 d. Romoje, ir prie Pirmojo ir Antrojo protokolų dėl Europos

Bendrijų Teisingumo Teismo įgaliojimų aiškinti šią konvenciją. Valstybės ţinios.

2006, Nr. 75-2849.

A. N. p. R. R. Lietuvos Aukščiausiasis Teismas. (2008, Nr. 3K-3-203).

UAB „Init“ v. UAB „Parabolė“ ir kt. Lietuvos Aukščiausiasis Teismas. (2000, Nr. 3K-3-

905).

305-oji DNSB „Bokštas“ p. Vilniaus miesto valdyba, LR Aukščiausiasis Teismas. (2002,

Nr. 3K-3-512).

M. Č. p. E. M., I. D. Teisingumo ministerija, Lietuvos Aukščiausiasis Teismas. (2007,

Nr.3K-7-4).

I. T. v. I. T. Lietuvos Aukščiausiasis teismas. (2007, Nr. 3K-7-130).

Europos Teisingumo Teismo byla: Case 159/02, Gregory Paul Turner v. Felix Fareed

IsmailGrovit Grovit, Harada Ltd, Changepoint LTd. [2003] ECR I-3565.

Europos Teisingumo Teismo byla: Case 7/98, Dieter Krombach v. André Bamberski [2000]

ECR I-1935.

Europos Teisingumo Teismo byla: Case 394/07, Marco Gambazzi v. Daimler Chrysler

Canada Inc. ir CIBC Mellon Trust Company. [2008] ECR I-1935.

Didţiosios Britanijos byla: Maharanee of Baroda v. Wildnestein. [1972] 2 QB 283.

Didţiosios Britanijos byla: Egon Oldendorff v. Libera Corpn. [1995] 1 Loyd's Report 380

Q.B.

Didţiosios Britanijos byla: Definitely Maybe (Touring) Ltd v. Marek Lieberberg

Konzertagentur GmbH (No 2) [2001] 4 All ER 283. 849.

Jungtinės Karaystės byla: Apple Corps Ltd v. Apple Computer Inc. [2004].

Jungtinės Karaystės byla: Bank Borada v. Vysya Bank [1994] 2 Lloyd's Rep 87.

Jungtinės Karaystės byla: Plummer v. IRC [1988] I WLR 292.

Jungtinės Karaystės byla: IRC v. Duchess of Portland [1982] STC 149.

Italijos byla: B.L. Macchine Automatiche v. Windmoller & Holscher KG. [2004] EIPR N-

155.

Lemenda Trading Co Ltd v. African Middle East Petroleum Co Ltd. [1988] Court of

Queen's Branch QB 448.

INTERNETINIAI ŠALTINIAI



No. 1 (8), 2012, p. 5-24

23

BUXBAUM, H. L. „Mandatory rules in civil litigation: status of the doctrine post-

globalization“. // [ţiūrėta 2009 04 05]

<papers.ssrn.com/sol3/papers.cfm?abstract_id=1281682>

CUNIBERTI, G. „Abusive forum shopping?“ // [ţiūrėta 2010 07 29]

<conflictoflaws.net/2010/abusive-forum-shopping>

MOORE, K. A. „Rethinking forum shopping in cyber space”. // [ţiūrėta 2009 03 10]

<www.ssrn.com/abstract_id=297100>

SYKES, A. O. „Transnational forum shopping as a trade and investment issue". // [ţiūrėta

2009 03 10] <www.law.virginia.edu/pdf/olin/0708/sykes.pdf>

SYMEONIDES, S. C. „Result-Selectivism in Private International Law“. // [ţiūrėta 2009 05

20] <papers.ssrn.com/sol3/ papers.cfm? abstract_id=1133630>

“Green Paper on applicable law and jurisdiction in divorce matters”. 2005 03 14. // [ţiūrėta

2009 04 20] <eur-

lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:52005DC0082:LT:HTML>

„Lietuvos Aukščiausiojo teismo 2008 m. praktikos civilinėse bylose aktualijos“. Lietuvos

Aukščiausiasis Teismas. // [ţiūrėta 2009 03 17]

<www.lat.lt/IxSitesUpload/Upload_LAT.LT/File/Mensiniai%20civil%20praktikos%2

0aktualijos/2008%20metine%20nuasmeninta.doc>

1980 m. Rome convention on law applicable to contractual obligations. Roma. 1996 11 26.

OJ C 027, 1998. // [ţiūrėta 2009 03 20] <eur-

lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:41998A0126%2802%29:EN:H

TML>

Regulation (EC) No. 593/2008 of the European Parliament and of the Council of 17 June

2008 on the law applicable to contractual obligations (Rome I). OJ L 177, 2008. //

[ţiūrėta 2009 05 19] <eur-

lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2008:177:0006:0016:LT:PDF>

SUMMARY

MISUSE OF CONFLICT OF LAW RULES

Conflict of law rules differ from state to state and therefore can encourage persons to

evade those conflict norms to achieve the better law or better court. The main purpose of

European Community legal tools for private international law is to ensure the same rules

for all the member states in order to achieve proper functioning of judicial area. But the

unification of law in European Community doesn’t cover all fields and therefore exists

possibilities for law shopping. Law shopping and forum shopping can develop into evasion

of conflict norms and in such a case it's against the basic principle of law - that no law can

arise from illegal action. Article analyses legal consequences for persons who evade

conflict of law norms. Authors analyses the concept of law shopping, forum shopping and

evasion of law. The definition of law shopping and forum shopping are ambiguous. On the

one hand, person can choose more appropriate law for legal purposes and for legal

reasons. On the other hand, when person is trying to choose the law or the forum only for

not legal reasons (to achieve economic benefit, to frustrate proceedings, to evade general

http://www.ssrn.com/abstract_id=297100

http://www.law.virginia.edu/pdf/olin/0708/sykes.pdf

http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:52005DC0082:EN:NOT

http://eur-lex.europa.eu/smartapi/cgi/sga_doc?smartapi!celexplus!prod!DocNumber&lg=en&type_doc=Regulation&an_doc=2008&nu_doc=593#_blank



No. 1 (8), 2012, p. 5-24

24

rules of law, to evade legal outcomes), then forum shopping and law shopping is

unacceptable and it develops into evasion of law, which can't be the compatible with law.

Article analyses cases when persons has right to chose applicable law and forum and

emphases situations when choice is not acceptable. If the person or legal relationship has

subjective connection with more than one country, person can choose conflict of law rules.

The definition of connecting factor and criterions in the conflict of law rule can differ,

because different states understands and applies such principle as domicile, habitual

residence and interpreters such definitions as main contract obligation different. This

creates an opportunity for person to choose a better law and if a person meets all the

conditions set by lex fori there is no evasion of law. The role of the courts in determining

what is more appropriate law is significant. On those cases when person has no subjective

right to choose, only the court applies conflict rules, determines what law or forum is more

connected with person and evaluates the benefit or fraud. The conflict norms are the

reasons why the court may seek collision justice and not substantial justice. The balance

between those purposes should be sought in order to evaluate law shopping. Authors

analyses how negative consequences of forum shopping could be avoided and suggests

legal tools such as harmonization of law, application of ordre public exception.

KEYWORDS

Applicable law, law shopping, forum shopping, conflicts of laws.



No. 1 (8), 2012, p. 25-56

DOES THE USE OF PREDATOR DRONES TO

CARRY OUT TARGETED KILLINGS IN A FOREIGN

STATE‘S TERRITORY IN RESPONSE TO ARMED

ATTACKS BY NON-STATE ACTORS VIOLATE

INTERNATIONAL LAW?

Julius Čiegis1

Pateikta 2011 m. rugpjūčio 23 d.

SUMMARY

In developing the idea of the just war Hugo Grotius, develops certain natural rights, of

which the most important is that it be lawful to kill him who is preparing to kill. Hugo

Grotius formulation of self-defense understandable as a broad right of preemption which

justifies the use of force against states that are preparing to kill. More than a century later,

Emmerich de Vattel expands Grotius concept of self-defense allowing preemptive force to

prevent evil. However, the Grotius and de Vattel’s statements and arguments were made

before Westphalia peace (1648) when there was no sovereignty concept. Nevertheless, in a

recent past there are numerous historical examples were anticipatory self-defense has been

used and it’s usage recognized by international community. The lack of treaties and

protocols governing the use of unmanned robots on the battlefield presents debates among

international legal scholars. Therefore, it is necessary to assess whether the use of force in

response against attacks promulgated by non-state actors is compatible with the principles

of Ius ad bellum, such as proportionality, necessity sovereignty and liability of the entity. In

recent years, the United Nations Security Council characterized international terrorism in

general as one of the most serious threats to international peace and security. However,

charter's language suggests that it only regulates the use of force between states therefore

an armed response to a terrorist attack will almost never meet parameters for the lawful

exercise of self-defense. Instead terrorist attacks are generally treated as criminal acts

because they have all the hallmarks of crimes. The drone attacks involve significant

firepower—this is not the force of the police, but of the military. It is also necessary to

define and to examine what actions are legal and what actions are illegal during use of

force with consistency of principles of Ius in bello. Proportionality constitutes a limit to the

power to choose the means and methods of warfare. The rule of distinction requires that

attacks may only be directed against combatants. The Hague Conventions of 1907 and the

Geneva Conventions of 1949 outline some of the rights held by illegal belligerents, such as

a right to trial upon capture. Even the sophisticated cameras of a drone cannot reveal with

certainty that a suspect being targeted is not a civilian. Therefore, usage of large capacity

1Julius Čiegis – Vytautas Magnus University Faculty of Law, master's degree.

Julius Čiegis – Vytauto Didžiojo universitete įgytas vientisųjų teisės studijų magistro laipsnis.

Julius Čiegis, „Does the use of predator drones to carry out targeted killings in a foreign state‘s territory in response to armed attacks by non-state actors violate international law?”


No. 1 (8), 2012, p. 25-56

26

firearms in densely populated areas where such operations take place clearly violates

principles of necessity and distinction under international law. Right to life guaranteed by

the article 6(1) of the International Covenant on Civil and Political Rights is applicable

even in the case of the conflict between state and non-state actors. Moreover, the duty to

respect right to life is a peremptory norm of customary international law. Therefore,

targeted killings should never be based solely on suspicious conduct or unverified – or

unverifiable – information. Otherwise, the strike would constitute a clear case of

extrajudicial (arbitrary) killing.

KEYWORDS

International public law, sovereignty, anticipatory self-defense, Ius ad bellum, Ius in

bello, predator drones, unmanned aerial vehicles, arbitrary killings, non-state actors.

INTRODUCTION

Self-defense in response to armed attacks promulgated by non-state actors is

undoubtedly one of the controversial and complex issues in modern international law.

Highly economically and technologically developed countries for instance The United

States has increasingly relied upon unmanned aerial vehicles (UAVs), or drones, to target

and kill enemies in its current armed conflicts. It is of great practical relevance, as for

instance, with the ongoing use of drones for the targeted killings of suspected terrorists, and

has attracted a great deal of scholarly attention.

Events such as intervention into a sovereign state, targeted killings and destruction of

civilian property causing enormous resonance, interest and discussions among the world's

most famous scholars in the field of international law. Moreover, the usage of unmanned

aerial vehicles because of its robotic nature, which is not covered by any legal written

source of International law and specific entity of non-state actors causing even more

controversy.

In recent years, the UN Security Council authorized significant amount of military

sanctions and interventions by approving ―Global war on terror‖ and declaring that

terrorism is the most serious threat to international peace and security. Does the respect of

intervention onto states territory and states sovereignty is still fundamental in international

law? Does the legal interpretation of International law sources require consent of the state

where the targeted killings occurs? Hugo Grotius develops an idea of anticipatory self-

defense ―it be lawful to kill him who is preparing to kill‖2, there is also numerous historical

examples where anticipatory self-defense has been used and its usage recognized by

international community, however Caroline case3 sets a test for legitimate self-defense, it

has to be imminent treat for states survival. Is the anticipatory self-defense is inevitable

considering sophisticated military technology or it‘s just a niche for state leaders in order to

achieve their goals by manipulating and artificially creating right of self-defense? Does the

2H. GROTIUS, The Law of War and Peace, Book II, Chapter I, ed. William Whewel (Clark, New

jersey: The Lawbook Excange LTD., 2009), p. 64 [hereinafter GROTIUS]. 3United states v. Great Britain (also known as Caroline case), (1837) [hereinafter CAROLINE].



No. 1 (8), 2012, p. 25-56

27

anticipatory self-defense considering the usage of predator drones permitted under

customary law and jus ad bello? Executing member of violent non-state organization, who

is not acting as a hostile on the battlefield, but having a dinner or playing with kids in a

foreign sovereign state territory is legal even if the anticipatory self-defense exists or its

extrajudicial killing under Geneva Convention4? The lack of treaties and protocols

governing the use of unmanned robots on the battlefield presents debates among

international legal scholars. Unmanned weapons are used usually in places and in

circumstances that do not specify as a battlefield considering international law. Does the

location of the strike has to be only within recognized battlefield? Usually UAVs are

operated via satellite from another corner of the world. Does it matter in the legal sense

where the operator of the drone is located? Most often these robotic weapons are controlled

not by military, but by civilians (i.e. Central Intelligence Agency personnel). If under UAV

attack an error occurred and innocent persons were killed, who are to blame? Is it the

commander, the operator, the programmer, the victims, or perhaps the machine? Predator

drones has the ability to find and identify targeted persons that it seems that it should easily

comply with the principle of distinction, does importance or rank in organization of targeted

person has sufficient impact of justifying acceptable collateral damage? Under international

law, the line between combatant and civilian is often blurry and undefined. Does the

terrorist who intentionally fails to distinguish himself as a combatant obtains a protected

status of a legal combatant?

Non-state actors are not new entity considering international law, in history we find

many examples of international violent non-governmental organizations, or persons

associated with those organizations engaged in terrorist attacks internationally such as Red

brigades, Yakuza or Cosa Nostra. Nevertheless, these organizations and individuals have

been treated as criminals rather than combatants or illegal belligerents, what has been

changed in legal interpretation of the actions delivered by non-state actors? Or was it at all?

Is it criminal acts or armed attacks?

And finally what are the rights of non-state actors if a state unlawfully uses force

against them? According to Professors Paust and Printer the state has right to use force

against non-state actors as legitimate self-defense and even targeted killings, because ―an

entity that elects to use force on the international plane should be treated as an international

actor and should be bound by accepted international norms‖5, therefore does a non-state

actors has right to legitimate self-defense against states attacking them?

Many of these legal questions are still not answered, moreover, even more questions

concerning drones and terrorists are so far unrevealed.

The main aim of my article - to identify the legal framework and sources of law

applicable to the current conflicts in which drones are employed; examine whether, and if

so in what circumstances state can use legitimate right of self-defense by using force

4 Geneva Convention for the Amelioration of the Condition of the Wounded and Sick in Armed

Forces in the Field (First Geneva Convention), 75 UNTS 31, 12 August 1949 (entered into force 21

October1950). 5 J. J. PAUST, „Self-defense targetings of non-state actors and permissibility of U.S. use of drones in

pakistan― Journal of Transnational Law & Policy, (2010, vol. 19, No. 2, 237, U of Houston Law

Center No. 2009-A-36). p. 25 [hereinafter PAUST].



No. 1 (8), 2012, p. 25-56

28

against other international entities. Moreover, does the usage of drones for targeting

operations violates the jus in bello principles of proportionality, military necessity,

distinction, and humanity; determine what legal limitations apply to the limitless

capabilities of drone warfare; evaluate whether the law of armed conflict is adequate for

dealing with the use of drones to target belligerents and terrorists in this non-traditional

armed conflict and ascertain whether new rules or laws are needed to govern their use.

To achieve the aim, I‗ll begin whit (1) short introduction of the roots and development

of international law. In determining existence of anticipatory self-defense and thus the

legality of Predator drone strikes, it is necessary to (2) reveal the new legal challenges in

relation to new technological sophisticated and modern warfare permissibility to use force.

Further it will (3) examine laws such as United Nations Charter and other international

treaties which address how and when states can initiate armed conflict, whether or not to

engage in a war is permissible and (4) define what actions are legal and what actions are

illegal during war by examining the Hague Convention and the Geneva Convention which

regulates conduct during war. One of the crucial questions conclude by (5) proposing legal

and policy guidelines for the lawful use of drones in armed conflict. Therefore it has to be

(6) extinguished contradictions between UN Charters articles 2 (4) and 51, between the

right of self-defense and principle of sovereignty, between civilians and illegal belligerents,

and finally between criminal act and armed attack.

BACKGROUND

i. HISTORICAL RETRO PERSPECTIVE AND

PHILOSOPHICAL APPROACH OF ANTICIPATORY SELF-

DEFENSE

International law begins with its sources, of which state practice and opinio juris

(belief of states that a practice is lawful) are the most important. In determining existence of

anticipatory self-defense and thus the legality of Predator drone strikes, it is necessary to

consider the origins of international law, and in particular the law of war.

The Law of War developed through five periods. The first period is the Just War

Period (335 BC to 1800 AD). Hugo Grotius develops an idea of anticipatory self-defense.

The second period is The War as Fact Period (1800 to 1918). War as Fact developed

concepts to avoid war in the first place by implementing legal guidelines, such as treaties

and policies. The third is Jus Contra Bellum (1918 to 1945), the main goal of this period

prohibiting aggression and admitting self-defense. The fourth period is the Post World War

II Period (1945 to 1946). It focused the legal situations that may occur with the use of

nuclear weapons. This period also focused on the concept of ―war crimes.‖ The last period

is the United Nations Charter Period (1946 to present). 6

In developing the idea of the just war in his 1625 work The Law of War and Peace,

Hugo Grotius, considered as the father of international law, develops certain natural rights,

6 The Internet Encyclopedia of Philosophy, Just war theory, (2008); [accessed 2010 11 15],

<http://www.utm.edu/research/iep/j/justwar.htm>.



No. 1 (8), 2012, p. 25-56

29

of which the most important is that ―it be lawful to kill him who is preparing to kill.‖7 Hugo

Grotius formulation of self-defense understandable as a broad right of preemption, witch

justifies the use of force against states that are preparing to kill. Grotius does not limit this

by a test of imminent threat, necessity or proportionality as it was developed in famous

Caroline case, considering Hugo Grotius statement the act of preparing to kill is sufficient

to justify the use of force in self-defense.

More than a century later, Emmerich de Vattel in his Law of Nations explained, the

safest plan is to prevent evil where that is possible. ―A Nation has the right to resist the

injury another seeks to inflict upon it, and to use force against the aggressor‖.8 De Vattel

expands Grotius concept of self-defense allowing preemptive force to prevent evil. The

model of self-defense favored by these two highly recognized and first international

lawyers is much wider than that developed Caroline case international lawyers. The Grotius

and de Vattel‘s statements and arguments are no longer relevant to twenty first century

international law debates, either because they were made during a time when the use of

force did not have any legal constraints or because relations of the society and in particular

military conflicts strategy, tactics and military measures have so developed. But the most

crucial concern about Grotius and de Vattel‘s statements is at the time these states were

made there was no sovereignty concept, it was found and came into power only after

Westphalia peace in 1648 and thus the arguments of these two scholars of international law

are no longer relevant. The Caroline case correspondence, were limiting the broad right of

self-defense that Grotius and de Vattel articulated. Nevertheless, the UN Charter is clear in

its unwillingness to restrict the right of self-defense: Article 51 of the Charter reassure that

nothing in the present shall impair the inherent right of individual or collective self-defense.

Grotius and de Vattel confirmed a natural right of preemptive self-defense, and it is still by

de jure protected by Article 51 of the UN Charter. But UN charter and in particular Article

51 regulates relations only among the states, and this situation rises a serious questions

when it comes to a right of self-defense against non-state actors.

There are numerous historical examples were anticipatory self-defense has been used

and its usage recognized by international community.

During the 1800s, Napoleon‘s armies were conquering the European continent, Great

Britain learned of secret protocols to treaties signed between France and Russia under

which Russia would not object to France seizing Denmark‘s naval fleet. These agreements

were essential to Great Britain national security. Great Britain sent British soldiers to

Copenhagen and in that way maintained its control of the seas and prevented an attack from

France.

A century later, after France capitulation to the Nazi Germany, British government

feared that the British Royal Navy might lose control of the seas if Frances naval fleet fell

under Nazi control. Prime Minister Churchill ordered the destruction of Frances naval fleet.

The Cuban Missile Crisis, began with satellite photographs showing the Soviet Union

arming Cuba with nuclear missiles capable of hitting American territory, The US President

7 See supra note 2 [GROTIUS], p. 64. 8 E. DE VATTEL, The Law of Nations, or, the Principles of the Law of Nature, Applied to the Conduct

and Affairs of Nations and Sovereigns (1758, vol. IV, 3, 1758), trans. Jospeh Chitty,7th ed. (1849).



No. 1 (8), 2012, p. 25-56

30

Kennedy ordered a blockade of the Cuban island. Even though Cuba had its missiles

pointed at U.S. territory. President Kennedy ordered ―Bay of pigs‖ invasion.

Nevertheless, when it comes to non-state actors there are numerous historical

examples when the state leaders in order to achieve their goals manipulates and artificially

creates right of self-defense.

During the night of July 18, 64 AD, fire broke out in the merchant area of the city of

Rome. It is uncertain who or what actually caused the fire. According to Tacitus, some in

the population held Nero responsible. To diffuse blame, Nero targeted the Christians. There

were Christians who confessed to the crime, but it became known that Christians were

forced to confess by means of torture. After this major event, in whole Roman Empire

Christian persecution began.

In 1933 Adolf Hitler had been sworn in as Chancellor and head of the coalition

government. Hitler's aim was first to acquire a National Socialist majority to secure his

position and eliminate the communist opposition. On 27 February, 1933, the Reichstag

caught fire. Hitler announced that it was the start of a Communist plot to take over

Germany. This sent the Germans into a panic and isolated the Communists further among

the civilians; additionally, thousands of Communists were imprisoned and Communist party

has been banned.

Even though these examples do not have international element, we can certainly find

some parallels of the events that are occurring in our days.

ii. NEW TECHNOLOGY OF MODERN WARFARE

(UNMANNED AERIAL VEHICLES)

The development of the crossbow and spear, gunpowder and missile, dynamite and

atomic bomb are some of the innovations that have significantly changed the concepts of

war. The use of firebombs against the Japanese during World War II and the use of napalm

during the Vietnam War today is considered to violate the principle of proportionality

according to the current interpretation of Humanitarian law. The lack of treaties and

protocols governing the use of unmanned robots on the battlefield presents debates among

international legal scholars. Unmanned weapons are used usually in places and in

circumstances that do not specify as a battlefield considering international law, even more,

most often these robotic weapons are controlled not by military, but by civilians (i.e.

Central Intelligence Agency personnel).

Unmanned aerial vehicles (UAV) or drones, aerial vehicles piloted remotely, can carry

lethal ammunition. Predator MQ-1, armed with AGM-114 Hellfire missiles and the MQ-9

Reaper, can carry Hellfire bombs.9 Their primary purpose of UAV‗s was surveillance and

target acquisition, guaranteeing systematic and real time observation of the area of

operations. But recently this high-tech machinery has been found a new niche. Equipped

with precision ammunition, these platforms, lingering over targets for hours and then

executing them if necessary. The UAV is operated by remote control and is capable of

projecting vivid imagery to the operator as the system searches for its assigned target. Once

9 Predator RQ-1 / MQ-1 / MQ-9 Reaper - Unmanned Aerial Vehicle (UAV), USA:, [accessed 2011 01

20], http://www.airforce-technology.com/Projects/predator-uav/.



No. 1 (8), 2012, p. 25-56

31

the target is acquired, the operator may launch one of the UAV‗s onboard Hellfire missiles

in order to destroy the target. In the legal sense one of the difference between a normal

military jet aircraft and UAV is because of unclear attribution. If under UAV attack an error

occurred and innocent persons were killed, who are to blame? Blame could be placed on

the commander, the operator, the programmer, the victims, or perhaps the machine.

Usually UAVs are operated via satellite from another corner of the world. Considering

this it‘s easier to drop a bomb on a town, it becomes easier to control drone by remote that

shoots at suspected terrorist while sitting in comfort at an air force base somewhere

thousand miles away. UAV‗s that fire precision bombs and guided missiles allows to reduce

war to a video game. How is it ethical or even legal to employ unmanned weapons that in

general only makes easier to kill people? New technological development usually brings

positive changes, in this case UAV‗s makes military tasks easier and more effective, in most

circumstances UAV‗s eliminates involvement of the soldier on the battlefield and therefore

retain soldiers life. But it is still unfair to state that UAV saves human life.

PERMISSIBILITY OF USE OF FORCE IN

SELF-DEFENSE AGAINST NON-STATE

ACTORS AND ITS COMPLIENCE WITH

INTERNATIONAL LAW

Ius ad Bellum examines whether or not to engage in a war is permissible. Laws such as

United Nations Charter and bilateral and multilateral international treaties address how and

when states can initiate armed conflict. Additionally, these laws also determine under what

circumstances the use of force is legally and morally justified.

i. (ANTICIPATORY) SELF-DEFENSE AGAINST

TERRORISM

Under the UN Charter10

states are permitted to use force only in self-defense against

an armed attack or if the Security Council authorizes a use of force as a necessary measure

to restore international peace and security. „A state can only exercise its right to use force in

self-defense under article 51 if an ―armed attack occurs‖ against it. There is highly

recognized opinion that an actual armed attack has to be carried out and that the right to

attack another state on the basis of anticipatory or preemptive self-defense is not available

under the UN Charter―.11

In the Opinion on the Legality of the Threat or Use of Nuclear

Weapons the ICJ stated: ―The Court cannot lose sight of the fundamental right of every

State to survival, and thus its right to resort to self-defense, in accordance with Article 51 of

the UN Charter, when its survival is at stake‖.12

Moreover the ―use of force in self-defense

10 Charter of the United Nations, Article 51; [hereinafter UN CHARTER]. 11 UN Charter, Article. 51. Also see A. S. SIKANDER, ―War on Terrorism: Self Defence, Operation

Enduring Freedom, And the Legality of U.S. Drone Attacks in Pakistan‖, Washington University

Global Studies law Review (2010, No. 77), p. 7-8. 12 Legality of the Threat or Use of Nuclear Weapons, Advisory Opinion (1996), ICJ 226, (July 8)

[hereinafter NUCLEAR]. Also see [MAOGOTO] infra note 13, p. 24.



No. 1 (8), 2012, p. 25-56

32

is permissible for the purpose of protecting the security of the state and its essential rights,

in particular the rights of territorial integrity and political independence, upon which that

security depends‖.13

However in an era of mass destruction weapons, retaliation may become impossible

after the first strike, and therefore some form of anticipatory or preemptive defense is

necessary and therefore legal. Its continuing permissibility under the Charter on the

interpretation of article 51 permitted "interventionary" or "anticipatory" self-defense, which

takes place when an armed attack is imminent and inevitable. There has been a dispute

between highly recognized legal scholars, is there a right to employ anticipatory self-

defense as a measure against armed attacks that did not occur yet, or even if an armed

attack was executed is there a significant timing of self-defense response? ―In manifesting

the desire to regulate collectively and centrally the use of force between States, the

members of the United Nations have delegated to the Security Council, the primary and

authoritative role in the maintenance of international peace and security. The Council is

fully empowered by the Charter to deal with every kind of threat that States may confront,

even with military force, if necessary, for the maintenance or restoration of international

peace and security.‖14

By provision of Article 3915

, the Security Council is entrusted with

the exclusive authority to ‗determine the existence of any threat to peace, breach of the

peace or act of aggression‘ and upon such determination to make recommendations or to

decide what enforcement measures shall be taken in accordance with Article 41 16

and

Article 4217

that provides for the undertaking of military action. The Council enjoys very

broad discretionary powers when determining whether a particular situation or issue is a

threat to international peace and security. Read together, Articles 39 and 42 allow the

Security Council to authorize the use of force against threats to the peace: the concept of

pre-emptive war‖. 18

Furthermore, ―The UN resolution declared under Chapter VII that the "acts, methods,

and practices of terrorism are contrary to the purposes and principles of the United

Nations.‘19

United Nations Security Council passed a resolution condemning the attacks,

calling upon states to combat terrorism.20

Therefore, it is clear, that in the light of global

treat of terrorism paradigm of anticipatory self-defense develops to the next level and finds

more and more supporters who are claiming than nothing in the UN Charter. article 51

forbids the use of pre-emptive self-defense measures. Nevertheless the self-defense is

13J. N. MAOGOTO„Rushing to Break the Law? „The Bush Doctrine' of Pre-Emptive Strikes and the

UN Charter Regime on the Use of Force―, University of Western Sydney Law Review (2003, vol. 7),

p. 26. 14 Security Council Res. 1373, UN SCOR, 56th Sess., 95 (UN Doc. S/RES/1373 2001). 15 UN CHARTER, Article 39. 16 UN CHARTER, Article 41. 17 UN CHARTER, Article 42. 18 D. ŠVARC, ―Military Response to Terrorism and the Jus ad Bellum, Defense Against Terrorism

Review‖ (2008, vol. 1, No. 1, Spring, ISSN: 1307-9190), p. 29-48 [hereinafter ŠVARC]. 19 Supra note 15. 20 Security Council Res. 1368, U.N. SCOR, 56th Sess. (4370, U.N. Doc. S/RES/1368, 2001). See N.

G. PRINTER, „The Use of Force Against Non-State Actors under International Law: An Analysis of

the U.S. Predator Strike in Yemen―, UCLA Journal of International Law and Foreign Affairs (2003,

vol. 8, No. 331), p. 354 [hereinafter PRINTER].



No. 1 (8), 2012, p. 25-56

33

consistent with International law only when a nation is under attack, only the immediate

action is allowed and even necessary.‖21

Therefore even if anticipatory self-defense allows for reaction when an attack is

imminent22

and even if we assume that anticipatory self-defense is consistent whit

international law considering Predator drones strikes it is hard to imagine UAV which is

located in one state, controlled in second and attacking in third state thousand miles away

responding to imminent threat. Moreover considering targeting killings which is the main

purpose for the usage of UAV‘s, executing member of violent non-state organization, who

is not acting as a hostile on the battlefield, but having a dinner or playing with kids in a

foreign sovereign state territory. Considering the Naulila Case (Portugal vs. Germany)23

and

UN Reports Of International Arbitral Awards 1012 such action should be defined as an

illegal reprisal - "A reprisal is an act of self-help … by the injured state, responding—after

an unsatisfied demand—to an act contrary to international law committed by the offending

state….Its object is to effect reparation from the offending state for the offense or a return

to legality by the avoidance of further offenses."24

In a case concerning military and

paramilitary activities in and against Nicaragua, the Court held that even shipments of

weapons did not amount to an armed attack and could not be invoked as a basis for self-

defense.25

„When an armed attack has come to an end, an attacked state cannot retaliate by

using armed force because such a response would then qualify as an unlawful reprisal under

international law‖, as evinced by General Assembly (G.A.) resolutions26

, S.C. resolutions27

,

and ICJ judgments.28

The UN General Assembly in its 1970 Declaration on Principles of International Law

declared, "States have a duty to refrain from acts of reprisal involving the use of force."29

Therefore the use of force is legal if and only a threat is imminent or unavoidable

considering the concept of anticipatory self-defense, thus in circumstances when solely

attack occur and there is no explicit danger, the use of force cannot be veiled as self-defense

and should be considered as illegal reprisal under international law.

21 A. N. GUIORA, „Anticipatory Self-Defence and International Law - A Re-Evaluation; Journal of

Conflict and Security Law―, U of Utah Legal Studies Paper (2008, No. 057-08-10), p. 8 [hereinafter

GUIORA]. 22 UN doc. A/59/565, Report of the High-Level Panel on Threats, Challenges and Changes (2004).

Also see [GUIORA] supra note 2022, p. 3. 23 Portugal vs. Germany (Naulila case) Portuguese-German Arbitral Tribunal (1928). 24 UN office of legal affairs. Reports of international arbitral awards. Recueil des sentences arbitrales

vol. 1-22 (New York, 1948-2001), p. 16. 25 Nicaragua v United States of America (Military and Paramilitary Activities in and Against

Nicaragua), ICJ (1986), p. 14, 195, 230 [hereinafter NICARAGUA]. 26 Declaration on Principles of International Law Concerning Friendly Relations and Cooperation

Among States in Accordance with the Charter of the United Nations, G.A. Res. 2625 (XXV), P122,

U.N. Doc. A/8028 (Dec. 17, 1970). 27Security Council Resolution 188 (XIX), P1, U.N. Doc. S/5650 (Apr. 9, 1964). 28 Supra note 25 [NICARAGUA]. See also A. S. SIKANDER, „War on Terrorism: Self Defence,

Operation Enduring Freedom, And The Legality of U.S―, Washington University Global Studies law

Review (No. 77, 201), p. 7-8. 29 See Supra note 26.



No. 1 (8), 2012, p. 25-56

34

ii. THE PRINCIPLES OF NECESSITY AND

PROPORTIONALITY

The right of self-defense is subject to conditions of necessity and proportionality.30

Necessity in the jus ad bellum and refers to the decision to resort to force as a last resort

and that the use of major force can accomplish the purpose of defense―.31

Proportionality

requires the response to be proportional in relation to both the wrong suffered and ―the

nature and the amount of force employed to achieve the objective or goal‖.32

The ICJ held

in the Nuclear Weapons33

case ―there is a specific rule whereby self-defense would

warrant only measures which are proportional to the armed attack and necessary to respond

to it, a rule well established in customary international law. ―This dual condition applies

equally to Article 51 of the Charter, whatever the means of force employed.‖

According to UN Charter article 25: 1. Necessity may not be invoked by a State as a

ground for precluding the wrongfulness of an act not in conformity with an international

obligation of that State unless the act: (a) Is the only way for the State to safeguard an

essential interest against a grave and imminent peril; and (b) Does not seriously impair an

essential interest of the State or States towards which the obligation exists, or of the

international community as a whole. 2. In any case, necessity may not be invoked by a State

as a ground for precluding wrongfulness if: (a) The international obligation in question

excludes the possibility of invoking necessity; or (b) The State has contributed to the

situation of necessity.

In General Assembly resolution A/RES/56/83 it is stated34

that countermeasures must

be commensurate with the injury suffered, taking into account the gravity of the

internationally wrongful act and the rights in question. Following what was written above it

must be emphasized that there is a breach of an international obligation by a State when an

act of that State is not in conformity with what is required of it by that obligation,

regardless of its origin or character35

. Thus as we can see the customary international law

requirements of immediacy and necessity are inextricably linked.36

According to Caroline case necessity of that self-defense must be instant,

overwhelming, and leaving no choice of means, and no moment for deliberation. The test

has two distinct requirements: (a) The use of force must be necessary because the threat is

imminent (necessity); (b) The response must be proportionate to the threat

30 See supra note 12 [NUCLEAR]. 31 M. E. O‗CONNELL, „Unlawful Killing with Combat Drones: A Case Study of Pakistan, 2004-2009,

Shooting to kill: the law governing lethal force in context―, Simon Bronitt, ed., Forthcoming,; Notre

Dame Legal Studies Paper (6 Nov 2009, No. 09-43), p. 19 [hereinafter O‗CONNELL]. 32 A. S. SIKANDER, „War on Terrorism: Self Defense, Operation Enduring Freedom, and the Legality

of U.S. Drone Attacks in Pakistan―, Washington University Global Studies Law Review, (2010, vol. 9,

Nr. 1), p. 77-129. 33 See supra note 12 [NUCLEAR]. 34 United Nations General Assembly Resolution A/RES/56/83, 12 December 2001. Responsibility of

States for Internationally Wrongful Acts. 35 N. LUBELL, „Extraterritorial Use of Force against Non-state Actors―, Oxford University Press

(2010) [hereinafter LUBELL]. 36 A. S. SIKANDER, „The U.S. Attacks on Afghanistan: An Act of Self-Defense Under Article 51―,

Seattle J. Soc. Just. (2007), p. 160.



No. 1 (8), 2012, p. 25-56

35

(proportionality). The principle of necessity inseparable from the imminent threat, thus as it

was mentioned previously, it is hard to imagine drone, which is located in one state,

controlled in second and attacking in third state thousand miles away responding to

imminent threat. Considering the Caroline test it is highly doubtful that Predator drone

attacks even if it under specific circumstances meets the requirement of proportionality are

consistent with necessity requirement which was developed in Caroline case and highly

recognized by states. Necessity can only be met when alternative peaceful means of

resolving the dispute have been exhausted, given the time constraints involved.37

Numerous

ICJ judgments, as in Military and Paramilitary Activities (Nicaragua v. United States)38

, Oil

Platforms39

, and the advisory opinion on the Legality of the Threat or Use of Nuclear

Weapons40

, have recognized the requirements of necessity and proportionality as limits on

the right of self-defense.

The International Law Association‘s Committee on the Use of Force issued a report in

2008 confirming the basic characteristics of all armed conflict: 1) the presence of organized

armed groups that are 2) engaged in intense inter-group fighting.41

The fighting or

hostilities of an armed conflict occurs within limited zones, referred to as combat or conflict

zones. It is only in such zones that killing enemy combatants or those taking a direct part in

hostilities is permissible. Moreover, armed conflict requires certain intensity of fighting42

,

bearing in mind that in this paper, we analyze the states response to the attacks by non-state

actors, in view of what has been presented above, there is a reasonable doubt that in most of

the circumstances non-state actors actions in general can be defined as an armed attacks

under international law. Moreover, even if the responding state would fight against non-

state actors within a defined territory, it is clear that under international law when armed

attack has come to an end, an attacked state cannot retaliate by using armed force. To

continue, target killing might be lawful only if the lethal force is: a) proportionate and b)

necessary43

. R. Higgins observes that in International Human Rights Law proportionality

only ―…operates where a restriction upon a right is permitted, to control that restriction‖44

.

As regards necessity, it ―…means necessity, and not convenience or desirability‖45

. Thus,

the mere convenience of firing the missiles form a secure place instead of fighting in a

battlefield cannot be treated as necessary.

37 CH. GRAY, International Law and the Use of Force, 3rd ed. (2008), p. 230. 38 See supra note 3 [CAROLINE]. 39 See supra note 25 [NICARAGUA]. 40 Iran v. U.S., (Oil Platforms), ICJ (Nov. 6, 2003) [hereinafter OIL PLATFORMS]. 41 International Law Association, Initial Report of the Use of Force Committee, The Meaning of

Armed Conflict in International Law (Rio de Janeiro, Aug. 2008, Rio de Janeiro). 42 See supra note 31 [O‗CONNELL], p. 4. 43 UNHRC Report of the Special Rapporteur on extrajudicial, summary or arbitrary executions (28

May 2010) para. 32. 44 R. HIGGINS, Problems and Process: International Law and How We Use It (New York: Oxford

University Press, 2006), p. 234 [hereinafter HIGGINS]. 45 Sunday Times v. United Kingdom, ser. A, no. 30, para. 59 (1979).



No. 1 (8), 2012, p. 25-56

36

iii. SOVEREIGNTY OF THE STATE

In 1648 after thirty years war Westphalia peace (treaty) was signed in which the major

European countries agreed to respect the principle of territorial integrity. Even though

sovereignty doctrine is slowly melting by facing phenomenon of globalization, so far

territorial integrity principle is followed by most of the states. Today sovereignty of the

state is protected by the United Nations Charter and customary law46

. The rule requiring a

State‘s consent47

in respect of any intervention onto its territory is fundamental in

international law.

Nevertheless, recently some states do not avoid infringement of sovereignty of other

states. For instance in 1985 the Security Cauncil defined Israel‘s acts against Tunisia as an

act of aggression.48

The attacks on Angola performed by South Africa were labeled as an

act of aggression by the SC.49

Moreover, ―… the attack by Iraq on Kuwait in 1990 was … a

breach of Article 2(4) of the UN Charter, … and thus amounted to an aggression‖50

. It is

widely believed that violation of sovereign state territorial integrity is criminalized under

international law. Recently the House of Lords unanimously decided that aggression is

criminalized under international law51

. A. Cassese emphasizes ―…that it would be

fallacious to hold the view that, since no general agreement has been reached in the world

community on a treaty definition of aggression, perpetrators of this crime may not be

prosecuted and punished‖52

. Lord Brigham of Cornhill referred to Nuremberg tribunal by

stating that ―…it is unhistorical to suppose that the elements of the crime were clear in 1945

but have since become in any way obscure.‖53

Therefore, the responding State cannot

simply breach foreign states sovereignty and to intervene into its territorial integrity and

political independency.

However, according to United Nations Declaration on Principles of International Law,

concerning Friendly Relations and Co-operation among States in accordance with the

Charter of the United Nations all states ha as duty ―to refrain from organizing, instigating,

assisting or participating in ... terrorist acts in another State.‖ 54

That means that sovereignty

of the state is not absolute under international law.55

The ICJ has expressly reserved its position on whether Article 51 requires attribution

of the armed attack to a state, nevertheless in Congo v. Uganda case, in descent opinions

―Judges Kooijmans and Simma recognized that self-defense can be permissible against

46 UN Charter, Article 2, para 4. 47 Declaration on Principles of International Law Concerning Friendly Relations and Cooperation

Among States in Accordance with the Charter of the United Nations, G.A. Res. 2625 (XXV), (P122,

U.N. Doc. A/8028 Dec. 17,1970), p.121. 48 UNSC Res 573 (4 October 1985) para. 1 [Res 573]. 49 UNSC Res 577 (6 December 1985) [Res 577]. 50 A. CASSESE, International Criminal Law, (2nd ed. OUP, 2008), p. 157 [hereinafter CASSESE]. 51 R. v Jones, House of Lords (29 March 2006) at [CASESSE], supra note 50, p. 153 [hereinafter

JONES]. 52 Supra note 50, p. 155 [CASSESE]. 53 Supra note 51 [JONES], at [CASSESE], supra note 50, p. 153. 54 1979 Declaration on Principles of International Law Concerning Friendly Relations and

Cooperation among States, GA Res. 2625 (UN GAOR, 25th Sess., UN Doc A/8028, 1970), p.123. 55 United Kingdom v. Albania, (The Corfu Channel Case), ICJ (1949) [hereinafter CORFU].



No. 1 (8), 2012, p. 25-56

37

non-state actor armed attacks whether or not the state from whose territory an attack

emanates is involved.‖56

In Corfu Channel case, ICJ stated general principle that every

State has an ―obligation not to allow knowingly its territory to be used for acts contrary to

the rights of other States‖.57

Some of the legal scholars go even further ―Nothing in the

language of Article 51 of the United Nations Charter or in customary international law

reflected therein requires consent of the state from which a non-state actor armed attack is

emanating and on whose territory a self-defense action takes place against the non-state

actor. With respect to permissible measures of self-defense under Article 51, a form of

consent of each member of the United Nations already exists in advance by treaty.‖58

In recent years, the UN Security Council characterized international terrorism in

general as one of the most serious threats to international peace and security. In 1992, the

Council has frequently condemned acts of terrorism as well as specific cases of state

support for terrorism or state failure to prevent terrorist activities as a threat to international

peace and security. The Council has often authorized military and non-military sanctions

under Chapter VII, inter alia against Libya, Sudan, and Afghanistan. After the 11

September 2001 attacks, the Council members unanimously determined in their resolution

1373 (2001) that these attacks, like all acts of international terrorism, constitute a threat to

international peace and security59

. However, the UN Security Council authorizes the use of

force to often and mainly in questionable circumstances, it has to be developed strict

scrutiny principle as a high standard of judicial review before authorizing the use of force.

In most of the cases, the attacks developed by non-state actors were planned, prepared

and sometimes even executed from the territory of foreign sovereign state, or even several

states, most often members of violent non-state organizations who are directly participating

in a process of an armed attacks traverse in and out of one state to another, therefore the

state that suffered such attacks, by taking measures of self-defense are executing military

operations directed against members of non-state organizations on the territory of such

foreign sovereign state where the attackers are domiciled or even just temporary visiting.

The issue of the described situation is the rights of such foreign sovereign state where the

members of non-state organization operate. This situation have raised a question, whether

the response of the attacked state by using military measures in the territory of foreign state

without consent of that state against the attacks developed by non-state actors, violating the

sovereignty of the state where the responsible members of non-state organization take

place? By explaining the particular legal issue I will take US actions in response to events

of 9/11. First the prohibition on the use of force in international law, as set out in Article

2(4) of the UN Charter, operates exclusively between states. If, instead of from

Afghanistan, Al-Qaeda operated from and launched the 9/11 attacks against the United

56 Congo v. Uganda (Armed Activities on the Territory of the Congo) ICJ (Dec. 19, 2005), See

(Kooijmans, J., separate opinion), paras. 26-30; id. (Simma, J., separate opinion), para. 7-12, Also see

PAUST supra note 5, p. 5. 57 J. J. PAUST, „Permissible Self-Defense Targeting― (November 11, 2010). ), Denver Journal of

International Law and Policy (11 November 2010, vol. 40, 2011; U of Houston Law Center No.

2010-A-35), p. 41. 58 See supra note 5, p. 14 [PAUST] . 59 See supra note 18, p. 29 [ŠVARC].



No. 1 (8), 2012, p. 25-56

38

States from high seas or Antarctica the jus ad bellum would not in any way limit the US

response to the armed attack. It is only if in responding to the attack the US has to encroach

on the sovereignty of some other state that Article 2(4) is engaged. Article 51 requires that

the ‗armed attack‘ be attributable to a state, thereby engaging its responsibility. Therefore,

the 9/11 attacks must have been attributable to the state of Afghanistan. However, the

general rules of attribution of acts of non-state actors to states, as articulated by the

International law commission in its Articles on State Responsibility60

and by the ICJ in the

Nicaragua and Congo cases, do not allow for a reasonable interpretation that would

attribute the 9/11 attacks to Afghanistan, because they require proof that Afghanistan either

(a) had complete control over Al-Qaeda, rendering it a de facto state organ; or (b) that

Afghanistan had effective control over Al-Qaeda‘s conduct in question, i.e. the 9/11 attacks.

Since there is no proof the 9/11 attacks cannot be attributed to Afghanistan under the

general rules.

Considering all that was stated previously the attacks invoked by self-defense in

foreign sovereign state territory can be permissible under International law if a state

engages in legitimate self-defense against non-state actors that are preparing, directing or

executing ongoing armed attacks, such responsive targeting are not an attack on the state in

which the non-state actors are located, such a defensive use of force will not create a state

of war or an armed conflict of any duration between the state engaged in self-defense and

the state on whose territory the self-defense targeting take place.

However, legitimate self-defense against non-state actors in a sovereign state territory

without a particular state consent, only if: (a) the territorial state was actively supporting the

non-state actor in its armed attack; (b) the territorial state did not do all that it could

reasonably have done to prevent the non-state actor from using its territory to exercise an

armed attack against another state, or is not doing all it can to prevent further attacks; (c)

the territorial state may have exercised due diligence, but it was nonetheless unable to

prevent the attack, or to prevent further attacks.

iv. NON-STATE ACTORS – TARGETED KILLINGS V.

CRIMINAL LIABILITY

According to the Professor Printer opinion ―[t]he language of Article 51 does not

restrict against whom the inherent right of self-defense may be exercised‖.61

Moreover,

Printer has stated that ―[a]n entity that elects to use force on the international plane should

be treated as an international actor and should be bound by accepted international norms. It

would be inconsistent with the purpose of the Charter which is the maintenance of

international peace and security-to allow terrorist groups that engage in transnational armed

conflict against a state to fall outside the Charter.‖62

Furthermore if terrorists ―intentionally

obfuscates the identity and status of its members, it should bear the responsibility for any

60 32nd session of the International Law Commission (1980) - State responsibility for internationally

wrongful acts (part 1). 61 UN Charter art. 51, Also see [PAUST] supra note 5, p. 351. 62 UN Charter art. 1, para. 1. Also see [PAUST] supra note 5, p. 346.



No. 1 (8), 2012, p. 25-56

39

errors in identification.‖63

Moreover, according to the opinion of Professor Paust - Targeted

Killings and Captures during Self-Defense engaged in during self-defense, measures of

legitimate self-defense can include the targeting of what would be lawful military targets

during war, like the head of a non-state entity or the head of a state directly participating in

on-going processes of armed attack.

However, there is an opposing opinion „Charter's [c]harter's language suggests that it

only regulates the use of force between states―64

, the use of armed force against terrorists is

impermissible in that any use of force not sanctioned by the Charter is unauthorized. An

armed response to a terrorist attack will almost never meet parameters for the lawful

exercise of self-defense. Insted „[t]Terrorist attacks are generally treated as criminal acts

because they have all the hallmarks of crimes, not armed attacks that can give rise to the

right of self-defense. Terrorist attacks are usually sporadic and are rarely the responsibility

of the state where the perpetrators are located―.65

Additionally targeting particular members

of suspected terrorists is assassination and violation of the laws of war.66

There is no reason

to believe that the ordinary criminal justice system of foreign sovereign state cannot handle

crimes that are of a terrorist nature. However, any person of any status who violates the

laws of war is subject to prosecution in any country as a war criminal.

Moreover, if according to Professors Paust and Printer the state has right to use force

against non-state actors as legitimate self-defense and even targeted killings, because ―an

entity that elects to use force on the international plane should be treated as an international

actor and should be bound by accepted international norms‖67

, therefore, it seems that a

non-state actors has right to legitimate self-defense against states attacking them. In a

hypothetical scenario, if a tribe would be severely attacked by U.S. armed forces using

drones, then according to the principle that there is no rights without obligations and vice

versa and considering the arguments of Professors Paust and Printer, a non-state actor has a

right to execute targeted killing of the President of the United States.

Members of al Qaeda or other terrorist groups are active in Canada, France, Germany,

Indonesia, Morocco, Saudi Arabia, Spain, the United Kingdom, Yemen and elsewhere. Still,

these countries do not consider themselves in a war with al Qaeda.― 68

Moreover, the British

Judge on the International Court of Justice, Sir Christopher Greenwood stated: „In the

language of international law there is no basis for speaking of a war on Al-Qaeda or any

other terrorist group, for such a group cannot be a belligerent, it is merely a band of

63 See [PAUST] supra note 5, p. 25. 64 M. E. O‗CONNELL, „Unlawful Killing with Combat Drones: A Case Study of Pakistan, 2004-2009.

Shooting to kill: The law governing lethal force in context―, Simon Bronitt, ed., Forthcoming, Notre

Dame Legal Studies Paper (2009, No. 09-43,), At p. 14. 65 See supra note 64, p 14. 66 Geneva Convention (I) for the Amelioration of the Condition of the Wounded and Sick in Armed

Forces in the Field (First Geneva Convention), 75 UNTS 31, Geneva Convention (II) for the

Amelioration of the Condition of Wounded, Sick and Shipwrecked Members of Armed Forces at Sea, 75 UNTS 85, Geneva Convention (III) Relative to the Treatment of Prisoners of War, 75 UNTS 135,

Geneva Convention (IV) Relative to the Protection of Civilian Persons in Time of War, 75 UNTS

287. 67 See [PRINTER] supra note 20, p. 25. 68 See [O'CONNELL] supra note 64, p. 4.



No. 1 (8), 2012, p. 25-56

40

criminals, and to treat it as anything else risks distorting the law while giving that group a

status which to some implies a degree of legitimacy―.69

In history we find many examples of international non-governmental organizations, or

persons associated with those organizations engaged in terrorist attacks internationally.

Nevertheless, these organizations and individuals have been treated as criminals rather than

combatants or illegal belligerents.

After the Civil War, on December 24, 1865, Confederate veterans created the Ku Klux

Klan (KKK). 70

The KKK used violence, lynching, murder and acts of intimidation such as

cross burning to terrorize African Americans.71

The KKK has at times been politically

powerful, and at various times controlled the governments of several U.S. states. Ilich

Ramirez Sanchez, better known as Carlos the Jackal, in 1970, become a member of the

Popular Front for the Liberation of Palestine (PFLP), which was known for notorious

airline hijackings. After several bungled bombings in 1975 he organized a raid on the

OPEC headquarters in Vienna, which killed three people. For many years he was among the

most wanted international fugitives.72

Carlos the Jackal was captured and was found guilty

and sentenced to life imprisonment. Red Brigades or Brigade Rose was a Marxist-Leninist

terrorist group based in Italy and committed a number of political assassinations. In

September 1974, Red Brigades founders Renato Curcio and Alberto Franceschini were

arrested and sentenced to 18 years in prison, nevertheless the organization is still active and

widely held as a terrorist organization.73

ETA is an armed Basque nationalist and separatist

organization. The group was founded in 1959 and has since considered as paramilitary

group with the goal of gaining independence for the Greater Basque Country. Since 1968,

ETA has been blamed for killing 829 individuals, injured thousands. The European Union

and the United States list ETA as a terrorist organization in their relevant watch lists. 74

And

there is plenty of more, not to mention criminal organizations which are active on

international ground such as Cosa Nostra, Yacuza, Somali Pirates, Medellin Drug Cartel

etc. The law enforcement structures were used to capture these international terrorists and

bring them to face a fair trial, instead of using armed force or targeted killings executed by

predator drones. The drone attacks involve significant firepower—this is not the force of

the police, but of the military. Moreover, the police use lethal force only in situations of

necessity. Terrorism is crime, actions of most of the states are generally consistent with its

long-term policies of separating acts of terrorism from armed conflict. Therefore, targeted

killings without a trial are assassination. And because these persons were killed, by

69 See supra note 64, p. 4, also see CH. GREENWOOD, War, Terrorism and International Law, (56

CURR. LEG. PROBS. 505, 529, 2004). 70 M. NEWTON, „The Invisible Empire: The Ku Klux Klan in Florida―, University Press of Florida

(2001), p. 1–30. 71 J. F. RHODES, History of the United States from the Compromise of 1850 to the McKinley-Bryan

Campaign of 1896 (New York: Macmillan Company, 1920), p. 157-158. 72 J. FOLLAIN, Jackal: The Complete Story of the Legendary Terrorist, Carlos the Jackal (Arcade

Publishing, 1998), p. 1. 73 A. JAMIESON, Identity and morality in the Italian Red Brigades, Terrorism and Political Violence,

vol. 2 no 4 (Routledge, 1990), p. 508-15. 74 E. MARTINEZ - HERRERA, „National Extremism and Outcomes of State Policies in the Basque

Country, 1979–200―1―, International Journal on Multicultural Studies (2002, vol. 4, No. 1).



No. 1 (8), 2012, p. 25-56

41

significant firepower disposed by UAV‗s, it is impossible to verify their identity and to

definitively ascertain their status under the Ius in bello.

THE USE OF PREDATOR DRONES IN

ACCORDANCE WITH THE FUNDAMENTAL

PRINCIPLES OF ARMED CONFLICT.

Jus in Bello regulates conduct during war. It defines what actions are legal and what

actions are illegal during war. The Hague Convention and the Geneva Convention are

international protocols that regulate conduct during war. The Hague Convention defines

belligerents, methods of engaging the enemy with proportionate force.

i. THE PRINCIPLE OF PROPORTIONALITY

In State practice the requirement of proportionality is widely admitted. Proportionality

constitutes a limit ―…to the power to choose the means and methods of warfare‖.75

Moreover, humanitarian law insists ―…that attacks be directed only at military objectives

and even then that they should not cause disproportionate civilian casualties‖. 76

Higgins

claims that ―the substantive law of jus in bello is largely based on the concept of

proportionality‖.77

To continue, ―…the rules on armed conflict fully subsume the doctrine of

proportionality‖.78

As a result, if one fails to act in conformity with a particular rule of jus

in bello such an act cannot be justified as still proportionate.79

Proportionality demands that

force is used in a manner to minimize the collateral damage to civilian persons and

property. „A state by using predator drones must take all feasible precautions in the choice

of means and methods of attack with a view to avoiding, and in any event to minimizing,

incidental loss of civilian life, injury to civilians and damage to civilian objects―.80

„According to the Israeli human rights organization B‘Tselem, since November 2000,

the Israel Defense Forces (IDF) killed more than 300 Palestinians in targeted operations,

more than 130 of whom were bystanders. In 2004, Sheikh Ahmed Yassin, the leader of

Hamas, was killed in Gaza by a missile fired from an Israeli helicopter, together with seven

other persons. In the air strike against Salah Shehadeh, the leader of Hamas‘ military wing

Iz Adin al-Kassam, sixteen civilians died―.81

UN Additional Protocol I prohibits ―an attack

which may be expected to cause incidental loss of civilian life, injury to civilians, damage

to civilian objects, or a combination thereof, which would be excessive in relation to the

75 E. CANNIZZARO, ―Contextualizing proportionality: jus ad bellum and jus in bello in the Lebanese

war International Review of the Red Cross‖ International Review of the Red Cross (December 2006,

vol. 88, No 864), p. 781. 76 D. FLECK, The Handbook of International Humanitarian Law, 2nd ed. OUP (Oxford: 2008), p. 13. 77 See supra note 44 [HIGGINS]. 78 Ibid., p. 234. 79 Ibid., p. 232. 80 Ibid., p. 233. 81 Protocol Additional to the Geneva Conventions of 12 August 1949, and relating to the Protection of

Victims of International Armed Conflicts (Protocol I, 8 June 1977), [hereinafter AP I], Art. 57.



No. 1 (8), 2012, p. 25-56

42

concrete and direct military advantage anticipated‖.82

However, none of UN Additional

Protocols nor other international treaties does not require parties to fight with equal strength

or ability it does not by itself violate the principle of proportionality it requires only equal

compliance with rules set in these international protocols and treaties.

In theory UAV‗s is consistent proportionality principle, but planers and executers of

operations usually do not avoid attacks near bystanders or highly populated areas by

civilians. „Several reports have revealed a 1:50 casualties rate (for each targeted individual,

there are 50 collateral casualties, not to speak of loss of property)―.83

That significant

amount of collateral damage cannot be justified as proportional.

ii. PRINCIPLE OF DISTINCTION AND MILITARY

NECESSITY.

The rule of distinction requires that attacks may only be directed against combatants,

where ―combatant‖ indicates ―persons who do not enjoy the protection against attack

accorded to civilians‖.84

In addition the UN Report states: ―targeted killing is only lawful

when the target is a ―combatant‖ or ―fighter‖ or, in the case of a civilian, only for such time

as the person ―directly participates in hostilities.‖85

As affirmed by the International Court

of Justice in 1986 in case Nicaragua v. United States of America86

, the provisions of

common Article 3 reflect customary international law and represent a minimum standard

from which the parties to any type of armed conflict must not depart. The basic rule in

Article 48 of the additional Protocol I87

states, that in order to ensure respect for and

protection of the civilian population and civilian objects, the parties to the conflict shall at

all times distinguish between the civilian population and combatants and between civilian

objects and military objectives and accordingly shall direct their operations only against

military objectives.

Article 51 (4) expressly states, that ―Indiscriminate attacks are prohibited‖88

and 51 (5)

(b) details that ―...an attack which may be expected to cause incidental loss of civilian

life‖89

should be ―...considered as indiscriminate‖90

. These provisions refer to principle of

distinction, which is a customary rule. Principle requires: ―…to distinguish between

combatants and military objectives on one hand, and non-combatants and civilian objects

on the other, and to direct their attacks only against the former‖.91

. Moreover, Article 57 of

Additional Protocol I sets forth the requirements: ―2. With respect to attacks, the following

82 F. SPEROTTO, „Illegal and ineffective? Drone strikes and targetted killing in 'the war on terror'―,

(2010), [accessed 2011 01 20] <http://www.opendemocracy.net/opensecurity/federico-

sperotto/illegal-and-ineffective-drone-strikes-and-targetted-killing-in-war-on>. 83 See supra note 82. 84 See supra note 64, p. 10 [O‘CONNELL]. 85 J. HENCKAERTS, .,Customary International Humanitarian Law, vol. 1: Rules & vol II: Practice,

CUP (Cambridge: 2005) [hereinafter HENCKAERTS]. 86 See supra note 23. 87 See supra note 25 [NICARAGUA]. 88 See supra note 81 [AP I]. 89 AP I, art 51 (4). 90 AP I, art 51 (5) (b). 91 AP I, art 51 (5).

http://www.opendemocracy.net/opensecurity/federico-sperotto/illegal-and-ineffective-drone-strikes-and-targetted-killing-in-war-on




No. 1 (8), 2012, p. 25-56

43

precautions shall be taken: (a) those who plan or decide upon an attack shall: (i) do

everything feasible to verify that the objectives to be attacked are neither civilians nor

civilian objects and are not subject to special protection but are military objectives within

the meaning of paragraph 2 of Article 52 and that it is not prohibited by the provisions of

this Protocol to attack them; (ii) take all feasible precautions in the choice of means and

methods of attack with a view to avoiding, and in any event to minimizing, incidental loss

of civilian life, injury to civilians and damage to civilian objects; (iii) refrain from deciding

to launch any attack which may be expected to cause incidental loss of civilian life, injury

to civilians, damage to civilian objects, or a combination thereof, which would be excessive

in relation to the concrete and direct military advantage anticipated; 3. When a choice is

possible between several military objectives for obtaining a similar military advantage, the

objective to be selected shall be that the attack on which may be expected to cause the least

danger to civilian lies and to civilian objects‖.92

Article 5793

sets out a list of precautionary rules which include an obligation to verify

that targets are military objectives give effective advance warnings of attacks to the civilian

population ―unless circumstances do not permit‖, take all feasible precautions in the choice

of means and methods of attack and refrain from launching or cancel attacks which may be

expected to cause harm excessive to the military advantage anticipated94

. In relation to

feasibility, the rule sets that ―[t]he technology available to an attacker determines whether

an action is feasible [...] as well as when choice is possible‖.95

Military necessity requires that force may only be used against persons or objects

contributing to an opponent's war effort, whose total or partial destruction is expected to

contribute to the successful conclusion of hostilities. Moreover, ―necessity in International

humanitarian law requires it to evaluate whether an operation will achieve the goals of the

military operation and is consistent with the other rules of IHL‖.96

The damage caused to

civilians and civilian objects in attacks must be proportionate to the direct and concrete

military advantage anticipated.97

Furthermore, in assessing collateral damage a military

commander is "entitled to take account of factors such as stocks of different weapons and

likely future demands, the timelines of attack and risks to his owns forces".98

To continue, ―…the killing must be militarily necessary; the use of force must be

proportionate.‖99

In addition to a lawful basis in the Charter, states using force must show

that force is necessary to achieve a defensive purpose. „If a state can make the necessity

showing, it must also show that the method of force used will not result in disproportionate

loss of life and destruction compared to the value of the objective. Therefore fail to protect

92 See supra note 76, p. 36. 93 See supra note 81 [AP I]. 94 Ibid. 95 M. N. SCHMITT, „Precision attack and international humanitarian law―, International Review of the

Red Cross (September 2005, vol. 87, No. 859), p. 16. 96 UNHRC Report of the Special Rapporteur on extrajudicial, summary or arbitrary executions (28

May 2010) para 32 [hereinafter UNHRC REPORT] para. 43. 97 AP I Articles 51(5)(b) 57(2)(a)(iii). 98 A. P. V. ROGERS, „Law on the battlefield―, Manchester University Press (1996), [hereinafter

ROGERS] p.178. 99 See UNHRC Report, supra note 96, p. 10.



No. 1 (8), 2012, p. 25-56

44

civilians in most of the cases constitutes violation of international law. In particular it would

be violation under articles 51 (1), 51 (4), 51 (5) (b) and 57 (2) of the Additional Protocol I

(AP I)100

which are customary rules.

According to article 51 (1): ―The civilian population and individual civilians shall

enjoy general protection against dangers arising from military operations.‖101

Article 51 (4)

expressly states, that ―[i]ndiscriminate attacks are prohibited‖102

and 51 (5) (b) details that

―...an attack which may be expected to cause incidental loss of civilian life‖103

should be

―...considered as indiscriminate‖.104

However, attacks causing civilian deaths can still be

proportionate, e.g., according to the Prosecutor‘s comments on NATO bombing of the

Serbian Radio and TV station with estimated 10 to 17 civilian casualties105

: ―assuming the

station was a legitimate objective, the civilian casualties were unfortunately high but do not

appear to be clearly disproportionate.".106

Moreover, according to the International

Committee of the Red Cross (ICRC), ―members of organized armed groups belonging to a

non-state party to the conflict cease to be civilians for as long as they remain members by

virtue of the fulfillment of their continuous combat function‖.107

ICRC explains, that

individuals, ―whose continuous function involves the preparation, execution, or command

of acts or operations amounting to direct participation in hostilities are assuming a

continuous combat function‖.108

. The view that such a category exists is supported by

commentators.109

Therefore civilians are legitimate targets of attacks as long as they are

taking a direct or active part in hostilities.110

„Direct participation in hostilities implies a

direct causal relationship between the activity engaged in and the harm done to the enemy

at the time and place where the activity occurs.‖.111

Taking a direct part in hostilities

extends the temporal scope of the loss of immunity from attacks for the whole duration of

the hostilities. In this case civilians become illegal belligerents. This position has support

from commentators112

and has been upheld by the Israeli Supreme Court in the Targeted

Killings case.113

. Moreover, such interpretation of the doctrine would provide a solution to

100 See supra note 81 [AP I]. 101 AP I, art 51 (1). 102 AP I, art 51 (4). 103 AP I, art 51 (5) (b). 104 AP I, art 51 (5). 105 Final Report to the Prosecutor by the Committee Established to Review the NATO Bombing

Campaign Against the Federal Republic of Yugoslavia para 71, 75. 106 Id. para 77. 107 N. MEZLER, „Interpretive Guidance on the Notion of Direct Participation in Hostilities under

International Humanitarian Law―, International Committee of the Red Cross (2009), [hereinafter

MELZER]. 108 Ibid. 109 See supra note 35, p. 147 [LUBELL]. 110 AP I, art 51(3), AP II, art 13. 111 ICRC, Commentary on the Additional Protocols on 8 June 1977 to the Geneva Conventions on 12

August 1949, (Kluwer Academic Publishers, The Hague, 1984), para 1679. 112 Y. DINSTEIN, „The Conduct of Hostilities under the Law of International armed conflict―,

Cambridge University Press (2004); Also see supra note 107, p. 510 [MELZER]. 113 The Public Committee Against Torture in Israel v. The Government of Israel (2006, HCJ 769/02

769/02 ).



No. 1 (8), 2012, p. 25-56

45

the ―revolving doors‖ problem.114

Participation in a terrorist group and especially assuming

the leadership therefore does have a direct causal relationship between the activity engaged

in and the harm done by the terrorists. Thus it would seem that the terrorists are legal

targets despite of what they do at the moment of attack of responding state, if they were

active in their actions contributed to the attacks directed against a particular state.

However, the Hague Conventions of 1907 and the Geneva Conventions of 1949

outline some of the rights held by illegal belligerents, such as a right to trial upon capture. 115

In the ICRC study of customary international humanitarian law, distinction is the first

rule: Rule 1. The parties to the conflict must at all times distinguish between civilians and

combatants. Attacks may only be directed against combatants. Attacks must not be directed

against civilians. Additional Protocol I of 1977 to the 1949 Geneva Conventions: Article

51(3) Civilians shall enjoy the protection afforded by this section, unless and for such time

as they take a direct part in hostilities.116

Suspected terrorist leaders wear civilian clothes.

Even the sophisticated cameras of a drone cannot reveal with certainty that a suspect being

targeted is not a civilian. The ICRC Interpretative Guidance on Direct Participation in

Hostilities points out that in just such a situation, international humanitarian law gives a

presumption to civilian status: in case of doubt as to whether a specific civilian conduct

qualifies as direct participation in hostilities, it must be presumed that the general rule of

civilian protection applies and that this conduct does not amount to direct participation in

hostilities. The presumption of civilian protection applies, a fortiori, in case of doubt as to

whether a person has become a member of an organized armed group belonging to a party

to the conflict. Obviously, the standard of doubt applicable to targeting decisions cannot be

compared to the strict standard of doubt applicable in criminal proceedings but rather must

reflect the level of certainty that can reasonably be achieved in the circumstances.117

In the legal sense it is also important to determine who is considered to be a lawful

combatant considering deploy of UAV‘s — the Air Force pilot operating predator drone and

―pushing the trigger‖ by launching hellfire missile and executing target from thousands of

miles away of the battlefield, or the civilian contractor servicing it in Afghanistan?

Furthermore, only members of armed forces have the combatant‘s privilege to use lethal

force and they must be the subject to the military chain of command. Considering that in

most of the operations where UAV‘s were used to locate and to kill terrorists, the planers,

organizers and executers were the personnel of CIA.118

The CIA agents are non-combatants.

Only members of armed forces have the combatant‘s privilege to use lethal force, they are

not subject to the military chain of command.

114 See supra note 35, p. 142 [LUBELL]. 115 Convention Respecting the Laws and Customs of War on Land, with Annex of Regulations (Oct.

18, 1907, 1910, 36 Stat. 2277, T.S. No. 539, Jan. 26. 1910) [hereinafter "HAGUE IV"].; also see

Geneva Convention, supra note 94, art. 99-108. 116 See supra note 81 [AP I]; Also see Protocol Additional to the Geneva Conventions of 12 August

1949, and relating to the Protections of Victims of Non-International Armed Conflicts (Protocol II) of

8 June 1977 (1125 U.N.T.S. 609, 1979). 117 ICRC Guidance on DPH. 118 J. MAYER, ―The Predator War, What are the Risks of the C.I.A.‘s Covert Drone Program?‖, The

New Yorker (Oct. 26, 2009).



No. 1 (8), 2012, p. 25-56

46

UAV‗s are extremely sophisticated war machines equipped with precision surveillance

which include electromagnetic spectrum sensors, biological sensors, and chemical sensors.

With that kind of technology UAV‗s can identify even the face of the target, therefore it

seems that UAV‗s should easily meet the distinction requirement set in Geneva

convention.119

. However collateral damage in the use of such sophisticated machines is one

of their main constraints. Moreover, even though in theory targeted killings of an high

ranked organization members are consistent with military necessity principle, considering

reports above and usage of large capacity firearms in densely populated areas where such

operations take place clearly violates principles of necessity and distinction under

international law.

iii. THE PRINCIPLE OF HUMANITY

According to Geneva Convention: (1) attackers must be capable of distinguishing from

the civilian population and combatants. Neither the civilian population as whole nor

individual civilians will be attacked. (2) Attacks are to be made solely on military targets.

Individuals who can no longer take part in hostilities are entitled to respect from their

attackers. (3) It is strictly forbidden to kill or wound an adversary who surrenders. (4)

Weapons or methods of warfare that inflict unnecessary suffering or destruction are

forbidden. (5) Wounded combatants and the sick combatants must be cared for as soon as

possible. (6) Combatants must be able to distinguish the universal Red Cross or Red

Crescent on a white background. All combatants are forbidden to engage objects thus

marked. (7) Captured combatants and civilians must be protected against all acts of

violence. Article 2 of Fourth Geneva Convention120

states that signatories are bound by the

convention both in war, armed conflicts where war has not been declared and in an

occupation of another country's territory. Article 3121

states that even where there is not a

conflict of international character the parties must as a minimum adhere to minimal

protections described as: noncombatants, members of armed forces who have laid down

their arms, and combatants who are hors de combat (out of the fight) due to wounds,

detention, or any other cause shall in all circumstances be treated humanely, with the

prohibition of ―the passing of sentences and the carrying out of executions without previous

judgment pronounced by a regularly constituted court, affording all the judicial guarantees

which are recognized as indispensable by civilized peoples‖.

Right to life guaranteed by the article 6(1) of the ICCPR is applicable even in the case

of the conflict between state and non-state actors. ICJ plainly rejected the theory that the

ICCPR ceases to apply only in the times of war: ―…the protection of the (ICCPR) does not

cease in times of war, except by operation of Article 4 of the Covenant whereby certain

provisions may be derogated from in a time of national emergency. Respect for the right to

life is not, however, such a provision‖.122

. Thus, the idea that in the battlefield the

119See supra note 81 [AP I]. 120 Geneva Convention Relative to the Protection of Civilian Persons in Time of War (Fourth Geneva

Convention), (75 UNTS 287, 12 August 1949). 121 Ibid. 122 See supra note 12 [NUCLEAR].



No. 1 (8), 2012, p. 25-56

47

prevailing law is law of war was abandoned123

. Nowadays such an approach is upheld by

many scholars124

. Moreover, the UNGA emphasized that non-derogable human rights

―…continue to apply fully in situations of armed conflict‖.125

. To sum up, even if the

responding state considers themselves at war with non-state actors, it has to act in

conformity with its obligations under article 6(1).126

.

Moreover, the duty to respect right to life is a peremptory norm of customary

international law127

, therefore ―…right to life is (…) binding upon all states, regardless of

whether they are party to any particular treaty‖.128

. The right is established in international

treaties129

as well as in the Article 6(1) of the ICCPR: ―…No one shall be arbitrarily

deprived of his life‖. 130

. The UN Human Rights Committee stated that ―arbitrary‖ includes

inappropriateness, injustice and lack of predictability.131

. The test for an arbitrary

deprivation of life in the context of an armed conflict ―falls to be determined by the

applicable lex specialis, namely, the law applicable in armed conflict‖.132

„An armed

conflict exists whenever there is a resort to armed force between States or protracted armed

violence between governmental authorities and organized armed groups or between such

groups within a State.133

. Therefore, there are two criteria to be met for a conflict to be

organized as an armed conflict: (i) the intensity of the conflict and (ii) the organization of

the parties to the conflict.134

. An armed group is considered organized if it has ―some

hierarchical structure‖135

and its leadership requires ―the capacity to exert authority of its

members‖136

and ―the ability to exercise some control over its members so that basic

obligations of Common Article 3 of the Geneva Conventions may be implemented‖.137

This

approach can also be read from Human Rights instruments138

and has been upheld by

123 D. KRETZMER, ―Targeted Killing of Suspected Terrorists: Extra-Judicial Execution or Legitimate

Means of Defense?‖ (2005, EJIL, vol. 16 no. 2), p. 185 [hereinafter KRETZMER]. 124 Ibid. 125 UNGA Res 2675 (XXV), Basic Principles for the Protection of Civilian Populations in Armed

Conflicts (9 December 1970), [Res 2675]. 126 International Covenant on Civil and Political Rights, adopted 16 December 1966, entered into

force 23 March 1976 (999 UNTS 171, art 6(1)) [hereinafter ICCPR]. 127 See supra note 123, p. 185 [KRETZMER]. 128 See supra note 35, p. 170 [LUBELL]. 129 The 1948 Universal Declaration of Human Rights [UDHR]. 130 See supra note 126, art 6(1) [ICCPR]. 131 See supra note 35, p. 171 [LUBELL]. 132 See supra note 12 [NUCLEAR]; Also see Legal Consequences of the Construction of a Wall in the

Occupied Palestinian Territory, Advisory Opinion (2004 para 106) [hereinafter WALL]. 133 Prosecutor v. Dusko Tadic, Decision on the Defense Motion for Interlocutory Appeal on

Jurisdiction (ICTY, 2 October 1995). 134 Prosecutor v. Boskoski and Tarculovski, Appeal Judgment, ICTY (19 May 2010, IT-04-82-A)

[hereinafter BOSKOSKI]. 135 Ibid. 136 Ibid. 137 Ibid. 138UNHCR, ICCPR/C/21/Rev.1/Add. 13 (26 may 2004) para 11; Convention for the Protection of

Human Rights and Fundamental Freedoms (European Convention on Human Rights, as amended)

(ECHR) 15(2).



No. 1 (8), 2012, p. 25-56

48

Human Rights bodies.139

Therefore, intelligence gathering and sharing arrangements must

include procedures for reliably vetting targets, and adequately verifying information.

Targeted killings should never be based solely on ―suspicious‖ conduct or unverified – or

unverifiable – information‖.140

Otherwise the strike would constitute a clear case of

extrajudicial (arbitrary) killing.141

Thus terrorists are suspects, therefore they are illegal

targets. Moreover, when it comes to targeting killing it is clear that the purpose of operation

(eliminate), highly ranked terrorist leader (if we presume that terrorist is a combatant),

leaves him no option of surrendering when he is under attack by UAV firing Hellfire

missiles in his direction.

CONCLUSIONS AND PROPOSALS

1. Under the UN Charter, states are permitted to use force only in self-defense

against an armed attack or if the Security Council authorizes a use of force as a necessary

measure to restore international peace and security. The UN declared that the acts, methods,

and practices of terrorism are contrary to the purposes and principles of the United Nations

and thus these actions are treats to international peace and security. It is widely admitted

that the state has right to resort to self-defense, in accordance with Article 51 of the Charter,

when its survival is at stake. Moreover, in an era of mass destruction weapons, retaliation

may become impossible after the first strike, and therefore it is clear that some form of

anticipatory or preemptive defense is necessary and therefore legal. However, according to

Caroline test in order to use anticipatory self-defense, an armed attack must be imminent

and inevitable. Moreover, considering Predator drones strikes in most of the circumstances

UAV located in one state, controlled in second and attacking in third state would not qualify

as a response to imminent threat. When an armed attack has come to an end, an attacked

state cannot retaliate by using armed force because such a response would then qualify as

an unlawful reprisal under international law.

2. The ICJ held that proportionality requires the response to be proportional in

relation to both the wrong suffered and the nature and the amount of force employed to

achieve the objective or goal. The other crucial principle of Ius ad bello is necessity, it can

only be met when alternative peaceful means of resolving the dispute have been exhausted,

given the time constraints involved. Under these general principles, self-defense must be

instant, overwhelming, and leaving no choice of means, and no moment for deliberation.

Even though the UN Security Council recognized that terrorist attacks, can be defined as an

armed attack, however, by systematically analyzing international law sources it is unlikely

that non-state actors actions in general can be defined as an armed attacks under

international law. Moreover, even if the responding state would fight against non-state

actors within a defined territory, the use of force would be legal if and only a threat is

139 Juan Carlos Abella v. Argentina, Report Nº 55/97, Inter-Am. C.H.R., OEA/Ser.L/V/II.95 Doc. 7

rev. at 271 (1997, Case 11.137 ) [ABELLA]. 140 P. ALSTON, Report of the Special Rapporteur on extrajudicial, summary or arbitrary executions‖,

UNGA (A/HRC/14/24/Add.6), p. 28. 141 UN Doc. E/CN.4/003/3, paras. 37 – 39. also see, M. J. DENNIS, ―Human Rights in 2002: The

Annual Sessions of the UN Commission on Human Rights and the Economics and Social Council‖,

97 AM. J. INT‗L L. 364, 367, n.17 (2003).



No. 1 (8), 2012, p. 25-56

49

imminent or unavoidable considering the concept of anticipatory self-defense, thus in

circumstances when solely attack occur and there is no explicit danger, the use of force

cannot be veiled as self-defense and yet again should be considered as illegal reprisal under

international law.

3. Sovereignty of the state is protected by the United Nations Charter and customary

law. The rule requiring a State‘s consent in respect of any intervention onto its territory is

fundamental in international law. United Nations declared that all states has duty to refrain

from organizing, instigating, assisting or participating in terrorist acts in another State. That

means that sovereignty of the state is not absolute under international law. If a state engages

in self-defense against non-state actors that are preparing, directing or executing on going

„armed attacks―, such responsive targeting are not an attack on the state in which the non-

state actors are located. Such a defensive use of force will not create a state of war or an

armed conflict of any duration between the state engaged in self-defense and the state on

whose territory the self-defense targeting take place until both states has an agreement.

However, the attacks invoked by self-defense in foreign sovereign state territory can be

permissible under International law even without consent if the territorial state did not do

all that it could reasonably have done to prevent the non-state actor from using its territory

to exercise an armed attack against another state, or is not doing all it can to prevent further

attacks or the territorial state may have exercised due diligence, but it was nonetheless

unable to prevent the attack, or to prevent further attacks.

4. UN Charter's language suggests that it only regulates the use of force between

states, the use of armed force against terrorists is impermissible in that any use of force not

sanctioned by the Charter is unauthorized. Terrorist attacks are generally treated as criminal

acts because they have all the hallmarks of crimes. Targeted killings without a trial are

assassination. Moreover, in most of the operations where UAV‘s were used to locate and to

kill terrorists, the planers, organizers and executers were the personnel of CIA. Under

international law only members of armed forces have the combatant‘s privilege to use lethal

force in the armed conflict. However it does not matter from where is pulled the trigger

until the attack is consistent with laws of war.

5. In State practice the requirement of proportionality of military actions is widely

admitted. Necessity in International humanitarian law requires it to evaluate whether an

operation will achieve the goals of the military operation and is consistent with the other

rules of IHL. Proportionality constitutes a limit to the power to choose the means and

methods of warfare. However, UN Additional Protocols nor other international treaties does

not require parties to fight with equal strength or ability, it does not by itself violate the

principle of proportionality it requires only equal compliance with rules set in these

international protocols and treaties. In theory UAV‗s is consistent with international

humanitarian law, but planers and executers of operations usually do not avoid attacks near

bystanders or highly populated areas by civilians and because of high capacity weapons

deployed by UAV‗s collateral damage is unproportional and unnecessary.

6. The principle of distinction under Ius in bellum requires that attacks may only be

directed against combatants, where combatant indicates persons who do not enjoy the

protection against attack accorded to civilians. Targeted killing is only lawful when the

target is a ―combatant‖ or ―fighter‖ or, in the case of a civilian, only for such time as the



No. 1 (8), 2012, p. 25-56

50

person who directly participates in hostilities. The killing must be militarily necessary the

use of force must be proportionate. Therefore fail to protect civilians in most of the cases

constitutes violation of international law. Taking a direct part in hostilities extends the

temporal scope of the loss of immunity from attacks for the whole duration of the

hostilities. In this case civilians become illegal belligerents. Furthermore, even though in

theory targeted killings of a high ranked organization members are consistent with military

necessity principle, considering usage of large capacity firearms in densely populated areas

where such operations take place clearly violates principles of distinction under

international law. Moreover, even the sophisticated cameras of a drone cannot reveal with

certainty that a suspect being targeted is not a civilian. In such a situation, international

humanitarian law gives a presumption to civilian status.

7. Terrorists in most of the cases defined as criminals, but even if in specific

circumstances they become belligerents, Hague Conventions and Geneva Conventions

outline the rights held by illegal belligerents, such as a right to trial upon capture, hore de

combat, surrendering. In all circumstances they should be treated humanely, with the

prohibition of executions without judgment pronounced by a regularly constituted court,

affording all the judicial guarantees which are recognized as indispensable by civilized

peoples. Right to life guaranteed under international law and applicable even in the case of

the conflict between state and non-state actors. There is no evidence that drones cause more

injury or suffering then traditional bombs or highly explosive firearms, but nevertheless,

drones are unable to except surrender or call back strikes not to mention the trial. Therefore,

targeted killings carried out by predator drones are a clear violation of the principle of

humanity.

There are several international legal instruments that are able to remove the

contradictions considering non-state actors and the usage of predator drones against them:

1. Decision of International Court of Justice - however the decision of the ICJ is

binding only for the parties of the dispute, moreover there is no stare decisis principle, thus

there is no obligation to respect the precedents established by the previous decisions,

therefore there is no consistency.

2. Ius Congens (opinio juris + state practice) – It is already clear that there is some

existence of state practice considering the usage of predator drones against non-state actors,

however, it is likely that such practice is influenced by the economically and politically

powerful states which are the main users of predator drones, moreover, Ius Cogens also

requires a second element which is belief by significant number of states that such practice

is legal, it is hardly believable that such consent could be developed.

3. Supplement of the existing international norms and the creation of new

regulations – In my opinion this is most realistic and fastest way to resolve contradictions

in international law, my proposals are following:

3.1. Present international law and norms governing the use of force has been primarily

written in the context of the state, therefore there always will be disputes and

different interpretations considering non-state actor, in order to eliminate

uncertainty further amendments of conventions and resolutions should be in the

context of ―entity‖ instead of ―nation-state‖.



No. 1 (8), 2012, p. 25-56

51

3.2. Under current international law the line between combatant and civilian is often

blurry and undefined, to avoid controversy between principle of humanity,

distinction and permissibility of collateral damage international humanitarian law

considering non-state actor should give the protection of civilians and the rights of

combatant.

3.3. The modern warfare is one of the fastest developing area, thus international law is

left behind, for instance Geneva convention is 60 years old, there is no specific

treaty or regulation considering the usage of predator drones. Therefore, in order

to eliminate contradictions it is necessary to pass resolution considering the usage

of robotic weaponry.

LITERATURE

BOOKS

CASSESE, A., International Criminal Law, 2nd

OUP (2008). DE VATTEL, E., The Law of Nations, or, the Principles of the Law of Nature, Applied to the

Conduct and Affairs of Nations and Sovereigns, vol. IV, 3, trans., Jospeh Chitty, 7th

ed.

(1849). FOLLAIN, J., Jackal: The Complete Story of the Legendary Terrorist, Carlos the Jackal

(Arcade Publishing, 1998). FLECK, D., The Handbook of International Humanitarian Law, 2nd ed. OUP (Oxford:

2008). GRAY, CH., International Law and the Use of Force, 3

rd ed. (2008).

GREENWOOD, CH., War, Terrorism and International Law (56 CURR. LEG. PROBS. 505,

529, 2004).

GROTIUS, H., The Law of War and Peace, Book II, Chapter I, ed. William Whewell,

(Clark, New Jersey: The Lawbook Excange LTD., 2009). HENCKAERTS, J., Customary International Humanitarian Law, vol. 1: Rules &vol II:

Practice, CUP (Cambridge: 2005). HIGGINS, R., Problems and Process: International Law and How We Use It (New York:

Oxford University Press, 2006). RHODES, J. F., History of the United States from the Compromise of 1850 to the McKinley-

Bryan Campaign of 1896 (New York: Macmillan Company, 1920).

JOURNALS

CANNIZZRO, E., ―Contextualizing proportionality: jus ad bellum and jus in bello in the

Lebanese war‖, International Review of the Red Cross (December 2006, vol. 88, No

864). DENNIS, M. J., ―Human Rights in 2002: The Annual Sessions of the UN Commission on

Human Rights and the Economics and Social Council‖ (2003, 97 AM. J. INT‗L L.

364, 367, n.17). DINSTEIN, Y., ―The Conduct of Hostilities under the Law of International armed conflict‖,

Cambridge University Press (2004).



No. 1 (8), 2012, p. 25-56

52

GUIORA, A. N., ―Anticipatory Self-Defence and International Law - A Re-Evaluation‖,

Journal of Conflict and Security Law (2008, U of Utah Legal Studies Paper No. 057-

08-10). JAMIESON, A., ―Identity and morality in the Italian Red Brigades, Terrorism and Political

Violence‖ (1990, Routledge, vol. 2 no. 4). KRETZMER, D., ―Targeted Killing of Suspected Terrorists: Extra-Judicial Execution or

Legitimate Means of Defense?‖ (2005, EJIL, vol. 16 no. 2). LUBELL, N., ―Extraterritorial Use of Force against Non-state Actors‖, Oxford University

Press (2010). MAOGOTO, J. N., ―Rushing to Break the Law? 'The Bush Doctrine' of Pre-Emptive Strikes

and the UN Charter Regime on the Use of Force‖, University of Western Sydney Law

Review (2003, vol. 7). MARTINEZ - HERRERA, E., ―National Extremism and Outcomes of State Policies in the

Basque Country, 1979–2001‖, International Journal on Multicultural Studies (2002,

vol. 4, No. 1). MAYER, J., ―The Predator War, What are the Risks of the C.I.A.‘s Covert Drone Program?‖,

The New Yorker (Oct. 26, 2009). MCMANUS, D., A U.S. ―License to Kill, a New Policy Permits the C.I.A. to Assassinate

Terrorists, and Officials Say a Yemen Hit Went Perfectly. Others Worry About Next

Time‖, L.A.Times (Jan. 11, 2003). MEZLER, N., Interpretive Guidance on the Notion of Direct Participation in Hostilities

under International Humanitarian Law, International Committee of the Red Cross,

(2009).

NEWTON, M., ―The Invisible Empire: The Ku Klux Klan in Florida‖, University Press of

Florida (Gainesville: 2001). O‘CONNELL, M. E., ―Unlawful Killing with Combat Drones: A Case Study of Pakistan,

2004-2009, Shooting to kill: the law governing lethal force in context‖, Notre Dame

Legal Studies Paper (6 Nov 2009, No. 09-43). PAUST, J. J., ―Permissible Self-Defense Targeting‖, Denver Journal of International Law

and Policy (11 November 2010, vol. 40, 2011; U of Houston Law Center No. 2010-A-

35). PAUST, J. J., ―Self-Defense Targetings of Non-State Actors and Permissibility of U.S. Use

of Drones in Pakistan‖, Journal of Transnational Law & Policy (December 8, 2009,

vol. 19, No. 2, p. 237, 2010; U of Houston Law Center No. 2009-A-36). PRINTER, N. G., ―The Use of Force Against Non-State Actors under International Law: An

Analysis of the U.S. Predator Strike in Yemen‖, UCLA Journal of International Law

and Foreign Affairs (2003, vol. 8, No. 331). ROGERS, A. P. V., ―Law on the battlefield‖, Manchester University Press ND (1996). SCHMITT, M. N., ―Precision attack and international humanitarian law‖, International

Review of the Red Cross (September 2005, vol. 87, Number 859). SIKANDER, A. S., ―The U.S. Attacks on Afghanistan: An Act of Self-Defense Under Article

51?‖, Seattle J. Soc. Just. (2007).



No. 1 (8), 2012, p. 25-56

53

SIKANDER, A. S., ―War on Terrorism: Self Defense, Operation Enduring Freedom, and the

Legality of U.S. Drone Attacks in Pakistan‖, Washington University Global Studies

Law Review (2010, vol. 9, Nr. 1). ŠVARC, D., ―Military Response to Terrorism and the Jus ad Bellum, Defense Against

Terrorism Review‖ (2008, vol. 1, No. 1, Spring, ISSN: 1307-9190).

LEGAL DOCUMENTS

32nd session of the International Law Commission (1980) - State responsibility for

internationally wrongful acts.

ALATON, P., Report of the Special Rapporteur on extrajudicial, summary or arbitrary

executions, UNGA A/HRC/14/24/Add.6.

Charter of the United Nations (adopted 26 June 1945, entered into force 24 October 1945).

Convention Respecting the Laws and Customs of War on Land, with Annex of Regulations,

Oct. 18, 1907, 1910, 36 Stat. 2277, T.S. No. 539 (Jan. 26. 1910).

Declaration on Principles of International Law Concerning Friendly Relations and

Cooperation Among States in Accordance with the Charter of the United Nations, G.A.

Resolution 2625 (XXV), P122, UN Doc. A/8028 (Dec. 17, 1970).

Final Report to the Prosecutor by the Committee Established to Review the NATO

Bombing Campaign Against the Federal Republic of Yugoslavia para 71, 75.

Geneva Convention (I) for the Amelioration of the Condition of the Wounded and Sick in

Armed Forces in the Field, 75 UNTS 31, 12 August 1949 (entered into force 21

October 1950).

Geneva Convention (II) for the Amelioration of the Condition of Wounded, Sick and

Shipwrecked Members of Armed Forces at Sea, 75 UNTS 85, 12 August 1949 (entered

into force 21 October 1950).

Geneva Convention (III) Relative to the Treatment of Prisoners of War, 75 UNTS 135, 12

August 1949 (entered into force 21 October 1950).

Geneva Convention (IV) Relative to the Protection of Civilian Persons in Time of War, 75

UNTS 287, 12 August 1949 (entered into force 21 October 1950).

International Covenant on Civil and Political Rights (adopted 16 December 1966, entered

into force 23 March 1976) 999 UNTS 171.

International Committee of the Red Cross, Commentary on the Additional Protocols on 8

June 1977 to the Geneva Conventions on 12 August 1949, (Kluwer Academic

Publishers, The Hague, 1984).

International Law Association, Initial Report of the Use of Force Committee, The Meaning

of Armed Conflict in International Law (Aug. 2008, Rio de Janeiro).

Legal Consequences of the Construction of a Wall in the Occupied Palestinian Territory,

Advisory Opinion, (2004).

Legality of the Threat or Use of Nuclear Weapons, Advisory Opinion, International Court

of Justice 226, (8 July 1996).

National Human Rights Commission, Report of the Special Rapporteur on extrajudicial,

summary or arbitrary executions (28 May 2010).

PROVOST, R., International Human Rights and Humanitarian Law (2002).



No. 1 (8), 2012, p. 25-56

54

Security Council Resolution 1368, UN SCOR, 56th Sess., 4370, UN Doc. S/RES/1368,

(2001).

Security Council Resolution 1373, UN SCOR, 56th Sess., 95, UN Doc. S/RES/1373

(2001).

Security Council Resolution 188 (XIX), P1, United Nations document. S/5650 (Apr. 9,

1964).

The 1948 Universal Declaration of Human rights.

United Nations document A/59/565, Report of the High-Level Panel on Threats, Challenges

and Changes, (2004).

United Nations document E/CN.4/003/3.

United Nations office of legal affairs. Reports of international arbitral awards. Recueil des

sentences arbitrales. vol. 1-22. New York, (1948-2001).

United Nations General Assembly Resolution 2675 (XXV), Basic Principles for the

Protection of Civilian Populations in Armed Conflicts (9 December 1970).

United Nations High Commissioner for Refugees, CCPR/C/21/Rev.1/Add. 13 (26 may

2004) para 11; Convention for the Protection of Human Rights and Fundamental

Freedoms (European Convention on Human Rights, as amended) (ECHR) 15(2).

United Nations High Commissioner for Refugees Report of the Special Rapporteur on

extrajudicial, summary or arbitrary executions (28 May 2010).

United Nations General Assembly Resolution A/RES/56/83, Responsibility of States for

Internationally Wrongful Acts (12 December 2001).

United Nations Security Council Resoliution 573 (4 October 1985).

United Nations Security Council Resoliution 577 (6 December 1985).

Congo v. Uganda (Armed Activities on the Territory of the Congo) I.L.M. 271 2005

International Court of Justice (Dec. 19), (Kooijmans, J., separate opinion), paras. 26-

30; id. (Simma, J., separate opinion).

Iran v. U.S (Oil Platforms.,) International Court of Justice 161, 191 (6 Nov 2003).

Juan Carlos Abella v. Argentina, Case 11.137, Report Nº 55/97, Inter-Am. C.H.R.,

OEA/Ser.L/V/II.95 Doc. 7 (1997).

Nicaragua v United States of America (Nicaragua case: Military and Paramilitary

Activities in and Against Nicaragua ), International Court of Justice (1986).

Portugal vs. Germany (Naulila Case), Portuguese-German Arbitral Tribunal, (1928).

Prosecutor v. Boskoski and Tarculovski (Appeal Judgment), IT-04-82-A, The International

Criminal Tribunal for the former Yugoslavia , (19 May 2010).

Prosecutor v. Dusko Tadic, Decision on the Defense Motion for Interlocutory Appeal on

Jurisdiction, The International Criminal Tribunal for the former Yugoslavia , (2

October 1995).

R. v Jones, House of Lords (29 March 2006). Sunday Times v. United Kingdom (1979, Ser A, no 30). The Public Committee Against Torture in Israel v. The Government of Israel, High Court of

Justice 769/02 (2006). United states v. Great Britain, The Caroline afair (also known as Caroline case),

(1837).



No. 1 (8), 2012, p. 25-56

55

United Kingdom v. Albania, ( The Corfu Channel Case), International Court of Justice

(1949).

INTERNET SOURCES

Predator RQ-1 / MQ-1 / MQ-9 Reaper - Unmanned Aerial Vehicle (UAV), USA,

<http://www.airforce-technology.com/projects/predator/> [accessed 2011 01 20]. SPEROTTO, F., „Illegal and ineffective? Drone strikes and targetted killing in 'the war on

terror―; <http://www.opendemocracy.net/opensecurity/federico-sperotto/illegal-and-

ineffective-drone-strikes-and-targetted-killing-in-war-on>. [accessed 2011 01 20]. The Internet Encyclopedia of Philosophy, Just war theory;

<http://www.utm.edu/research/iep/j/justwar.htm> [accessed 2010 11 15].

SANTRAUKA

AR NEPILOTUOJAMŲ LĖKTUVŲ NAUDOJIMAS

UŽSIENIO ŠALIŲ TERITORIJOJE, KAIP ATSAKAS

Į NEVALSTYBINIŲ SUBJEKTŲ GINKLUOTAS

ATAKAS, PRIEŠTARAUJA TARPTAUTINEI TEISEI?

Išankstinės savigynos būdas yra pripažintas ir plačiai naudojamas tarptautinės

bendruomenės. Jungtinių Tautų Chartija, valstybėms leidžia naudoti ginkluotą jėgą tik

ginkluoto užpuolimo atveju arba jei JT saugumo taryba duoda sutikimą jėgos naudojimui

tam tikromis aplinkybėmis, kaip būtiną priemonę. Vis dėlto, atsižvelgiant į Tarptautinio

tribunolo išaiškinimą Naulila byloje, jei išpuoliai pasibaigė, ta valstybė, kuri juos patyrė

negali naudoti karinės jėgos, nes tai traktuojama, kaip neteisėtas baudimas. Be to,

naudojant savigynos teisę, negalima pažeisti būtinumo ir proporcingumo principų. Jėgos

naudojimas turi būti paskutinė išeitis ir naudojama tik gynybos tikslais. Atsižvelgiant į

Caroline byloje suformuotą testą, savigynos būtinumas turi pasireikšti didele grėsme

valstybės saugumui ir nepalikti jokių pasirinkimo galimybių. 1648 m. buvo pasirašyta

Vestfalijos taika, kuria didžiausios Europos šalys susitarė dėl šalių teritorinio vientisumo ir

suvereniteto principų. Laikui bėgant šie principai tapo tarptautinės paprotinės teisės

dalimi. Nepaisant to, ir dabar didelę ekonominę ir politinę įtaką turinčios valstybės

nevengia pažeidinėti kitų šalių suvereniteto. Tačiau, valstybės suverenitetas nėra absoliutus.

Jei įrodoma, kad valstybė veikimu ar neveikimu prisidėjo prie teroristinių išpuolių

organizavimo, intervencija į šios valstybės teritoriją gali būti pateisinama. Chartijos

kontekstas reguliuoja jėgos panaudojimą tik tarp valstybių. Be to, teroristų veiksmai turi

visus nusikalstamos veikos požymius, todėl teroristiniai išpuoliai, atsižvelgiant į šalių

praktiką, laikomi nusikaltimais. Karinės jėgos naudojimas tokiu atveju yra neteisėtas. Be

to, teroristai neatitinka kovotojo kriterijų, o vadovaujantis Raudonojo kryžiaus tarptautinio

komiteto išvadomis, civiliai yra teisėti taikiniai, tik tokiomis aplinkybėmis, kai jie tiesiogiai

ir aktyviai dalyvauja kariniuose veiksmuose. Net pažangias stebėjimo technologijas turintys

nepilotuojami lėktuvai, negali atskirti ar civilis asmuo konflikto metu dalyvauja kariniuose

http://www.airforce-technology.com/projects/predator/





No. 1 (8), 2012, p. 25-56

56

veiksmuose. Tokiais atvejais, tai yra, kai kyla abejonių dėl subjekto statuso tarptautinė teisė

vadovaujasi prezumpcija, kad asmuo yra civilis. Taip pat, pareiga gerbti teisę į gyvybę yra

imperatyvi norma kylanti iš paprotinės tarptautinės teisės, todėl tiksliniai kovotojų

nužudymai niekada neturėtų būti grindžiami vien įtarimais ar nepatvirtinta informacija.


Tarptautinė viešoji teisė, suverenitetas, prevencinė savigyna, Ius ad bellum, Ius in

bello, nepilotuojami lėktuvai, savavališki nužudymai, nevalstybiniai subjektai.



No. 1 (8), 2012, p. 57-99

CIVIL LIABILITY OF INTERNET SERVICE

PROVIDERS FOR TRANSMITTED INFORMATION:

PROBLEMS AND PERSPECTIVES OF LEGAL

REGULATION

Karolis Vinciūnas1

Vytautas Magnus university

Pateikta 2011 m. lapkričio 5 d.

SUMMARY

With the unprecedented development of the Internet the role of Internet intermediaries

that give access to, host, transmit and index content originated by third parties or provide

Internet-based services to third parties have grown over the recent years. These entities

provide services through both wired and mobile technologies. Internet access

intermediaries, hosting and data processing providers create a platform for new, faster and

cheaper communication technologies. They also contribute to innovation and productivity

gains, provision of new products and services. Furthermore, Internet Service Providers

(ISPs) create circumstances for expanding global freedom of expression. However, such a

broad proliferation of Internet possesses major threats to privacy protection, copyrights

and also helps to spread various sorts of illegal information.

The evaluation of the necessity and scope of the legal responsibility of ISPs for the

information transmitted through their networks by third parties and introduction of the

conceptual model of mechanisms and principles which could form a background for global

unified system of civil liability ascription is the main aim of this article.

In order to achieve this aim, several tasks were formulated and accomplished: firstly,

main theories and theoretical approaches of the ISPs civil liability for the information

transmitted by third parties were analyzed (Theoretical part of the article, Part I);

secondly, factual situation in ISPs civil liability area of EU as a whole, of USA and of

Lithuania was presented, the main legal acts were pointed out and the most important

cases of this type were examined (Analytical part of the article, Part II); thirdly, main

aspects of various legal regimes on which background of the ISPs civil liability system can

be built including economic and social implications were singled out; and finally, basic

principles for conceptual model of global regime of the ISPs civil liability were introduced

(Conceptual part of the article, Part III).

The following methods of theoretical and empirical research were used: 1)

comparative research approach; 2) analysis of scientific literature; 3) method of

generalization; 4) qualitative analysis.

1 Karolis Vinciūnas is a first year PhD student at the Faculty of Law at Vytautas Magnus University.

Author‟s main area of interest is Internet law and relative judicial processes and jurisprudence around

the world. E-mail: [email protected]

Karolis Vinciūnas, „Civil liability of internet service providers for transmitted information: problems and perspectives of legal regulation”


No. 1 (8), 2012, p. 57-99

58

Based on the analysis conducted in the three different parts of this article, several

important conclusions can be drawn and proposals suggested:

1) Theoretical background of the ISPs civil liability, consisting of various liability

theories and approaches, is an important part of the new emerging Internet law.

Furthermore, its analysis can contribute not only to the better understanding of underlying

processes of legal interaction between main actors in cyberspace but also can help to

construct an analytic framework. This framework would be useful in determining the

appropriate scope and under what circumstances and rationale legal responsibility can be

ascribed to the ISPs for the actions of third parties. Ascription of legal responsibility to the

ISPs for third parties’ actions can be shown as a system of opposing direction of civil

liability and regulation processes where regulation and civil liability streams are directed

through ISPs accordingly towards end users and initiators of infringements.

2) “The European Community’s Electronic Commerce Directive” (ECD) is one of the

main legal acts among other things regulating civil liability of the ISPs in EU. This

legislative act uses a mix of contributory and vicarious liability theories and external

approach as a background for ascribing legal responsibility to ISPs. Different EU member

states interpret provisions of the ECD differently. Such divergent approach determines that

courts, who are trying to fill this gap in law system with their decisions, are failing to go

along with a pace of Internet technology innovations. This situation reveals an evident lack

of unified legislative position in the area discussed. In USA “Digital Millennium Copyright

Act” is the main law governing the ISPs civil liability issue and its main difference from

ECD is broader rules of exclusion from legal responsibility. This aspect is clearly seen in

recent case law of this country.

3) Negligence (notice based) legal regime of the ISPs civil liability is the most popular

regime used today. It could become an important part of a possible new global unified

system of responsibility ascription, if its main drawbacks – lack of the clear rules of

engagement and social-economic inefficiency – are eliminated. Versatile incorporation of

Internet freedom, online privacy, internal (technology-friendly) approach, cyber-territorial

jurisdiction, consideration of different functioning of various Internet service providers and

other principles and their corresponding alignment with the mix of the mentioned legal

regimes is probably the best possible solution to sustainable and sound development of the

global unified ISPs civil liability system.

KEYWORDS

Internet, Internet law, Internet Service Providers, civil liability.

INTRODUCTION

In recent years as Internet has grown to permanate all aspects of economy and society

as well has the role of Internet intermediaries that give access to, host, transmit and index

content originated by third parties or provide Internet-based services to third parties

increased. They enable to host activities through both wired and increasingly, mobile

(wireless) technologies. Internet access intermediaries, hosting and data processing



No. 1 (8), 2012, p. 57-99

59

providers render a platform for new, faster, and cheaper communication technologies, for

innovation and productivity gains, and for the provision of new products and services. They

also contribute to expanding global freedom of expression.

However, such broad proliferation of Internet poses major threats to privacy

protection, copyrights and also helps to spread various sorts of illegal information.

Managing responsibility for such actions is one of the major problems which must be dealt

with in upcoming years. Also it is one of the corner stones of still emerging Internet law

doctrine. Therefore that suppliers and receivers of information are usually hard to trace and

prosecute, various Internet Service Providers (ISPs) are the ones who are generally cough

up in the center of litigation processes for copyright, privacy or other law infringements

taking place in cyber space.

But on the other hand, if ISPs are able to prevent subscribers‟ illegal acts cheaply does

it mean that they should be ascribed with the costs of preventing the spread of information

(or data) infringing various law and if unsuccessful, pay damages and have civil liability

imposed on them? These and similar questions must be dealt with and explicit system of

ISPs civil liability for third parties‟ actions must be created in near future. It is needed in

order to ensure the sustainable development not only of Internet law but also of Internet as

a whole.

The aim of this article is to evaluate the necessity and scope of the legal

responsibility of ISP for the information transmitted through their network by third parties

and to introduce conceptual model of mechanisms and principles which could form

background for global unified system of civil liability ascription to various actors of online

intermediation process.

Main tasks of the article are the following: 1) to analyze theoretical background of

the legal responsibility of ISPs and various types of approaches used to apply these

theories; 2) to present main legal acts on which civil liability to ISPs for the information

transmitted by third parties is ascribed in different parts of the world and to analyze main

cases in this area; 3) to present conceptual background for the global model of the ISPs

civil liability ascription.

In the first part of the article main theories of the ISPs civil liability for the

information transmitted by third parties constitutive, “speech-act”, “respondeat superior”,

contributory and vicarious liability are presented and their main aspects are analyzed.

Furthermore, prevailing approaches to ISPs responsibility, such as “ex-ante/ex-post”,

internal/external or exceptional, are introduced and their impact on ISPs civil liability

ascription process is examined. At the end of this part, structural scheme of civil

liability/regulation of ISPs is brought and main aspects of overall process are pointed out.

The second part of the article is devoted to presenting factual situation in ISPs civil

liability area of EU as a whole, of USA and of Lithuania. The “European Community‟s

Electronic Commerce Directive” and European Parliament‟s resolution “On Cultural

Industries in Europe” are examined and their main provisions concerning ISPs

responsibility are pointed out. Also implementation of these legal acts in local level is

introduced, including case law analysis of France, UK, Belgium courts and European Court

of Justice. “Digital Millennium Copyright Act” and “Communication Decency Act” are

presented as the main legal acts of USA in the area. Additionally, most important cases



No. 1 (8), 2012, p. 57-99

60

which are forming present stare decisis of ISPs civil liability are analyzed. At the end of

this part situation of legal ISPs civil liability ascription process in Lithuania is examined

and main legislative instruments (including law of electronic communication and decision

of government of ISPs responsibility for prohibited information transmission) are presented

and relevant ongoing cases in this field are analyzed.

The third part of the article is dedicated to presenting the main legal regimes of the

ISPs civil liability – negligence (or notice based), strict and non-liability – on which various

global legal liability systems can be constructed. Therefore, their main aspects including

economic and social implications are pointed out. Finally, basic principles (including

Internet freedom and privacy, cyber territorial jurisdiction, etc.) for conceptual model of

global regime of ISPs civil liability are introduced.

At the end of the article main conclusions will be drawn and proposals for conceptual

background of the legal responsibility of ISPs will be delivered.

In order to achieve the aim of this article, several methods of theoretical and empirical

research are used. Comparative research approach is used to analyze various legal systems,

their main laws and principles, theoretical backgrounds and also their methods to ascribe

civil liability to ISPs and to compare different cases of EU, USA and Lithuania in the area

discussed. Analysis of scientific literature is used to examine main theories and principles

of ISP civil liability in order to outline main problems of their practical implementation.

Method of generalization is used to summarize main findings of analyzed legal framework

and cases and to reveal general common principles of ISPs civil liability ascription.

Qualitative analysis method of case law of European Court of Justice, various EU countries

(Belgium, France, UK, Lithuania) and USA is used to assess main principles of certain

jurisprudence and outline main patterns in the ISPs civil liability case.

I. THEORETICAL BACKGROUND OF THE ISPs’

CIVIL LIABILITY

Theoretical background of the ISPs‟ civil liability is an important part of the new

emerging Internet (cyber) law; its analysis can be useful in constructing various

mechanisms for online regulation. Furthermore, it can contribute not only to a better

understanding of underlying processes of legal interaction between main actors in

cyberspace but also to evaluate certain decisions in various cases in this area around the

world. It can be also stated that such analysis can help to structure a conceptual background

for the global unified system of civil liability ascription to various ISPs for the third parties

action.

The “theoretical basis for ascribing legal responsibility to third parties can be based on

that party's constitutive role in enabling illegal acts of others to produce social harm”2. It is

also stated “that the provision by an ISP of access to the enabling technical infrastructure –

the network medium – in itself creates a responsibility base for mitigating social harm

2 Theoretically, civil liability to ISPs can be ascribed because intermediation process on the Internet

cannot be sustained without certain role of ISPs. See: K. A. TAIPALE, “Secondary Liability on the

Internet: Towards a Performative Standard for Constitutive Responsibility”, Center for Advanced

Studies Working Paper No. 04-2003 (2003), p. 3.



No. 1 (8), 2012, p. 57-99

61

arising from the use of that infrastructure based on the effects of the mediation in furthering

or contributing to the harm”3. Such social harm involves illegal dissemination of

copyrighted or forbidden material (child pornography and other obscene data, promotion of

racial despite or terroristic ideas, etc.), Internet gambling, privacy violations, illegal trade

and so forth.

In order to fully understand theoretical background of the ISPs civil liability, firstly

ISPs, intermediation process and third parties must be described and their main legal

aspects should be pointed out.

1. DEFINITIONS OF ISPS, INTERMEDIATION PROCESS

AND THIRD PARTIES

For the purpose of this article ISPs, as mentioned in the introduction, are understood

as an entity “that give access to, host, transmit and index content originated by third parties

or provide Internet-based services to third parties”4. ISPs can also be grouped according to

functions they execute; that is: 1) Internet access and service providers, 2) data processing

and web hosting providers, 3) Internet search engines and portals, 4) e-commerce

intermediaries, 5) Internet payment systems, 6) participative networked platforms, etc.5 It is

commonly stated that main functions of these ISPs are the following: “1) to provide

infrastructure; 2) to collect, organize and evaluate dispersed information; 3) to facilitate

social communication and information exchange; 4) to aggregate supply and demand; 5) to

facilitate market processes; 6) to provide trust; and 7) to take into account the needs of both

buyers/users and sellers/advertisers”6. All the before mentioned ISPs differ in their

activities, the scope of connection with third parties and information they transmit.

Although it is important to assess all of them, because of the limitation of this article only

common aspects of their activities and legal nature will be analyzed. It must be stressed that

more comprehensive analysis of each kind of ISPs responsibility must be done in other

legal research articles in order to fully understand the complexity of the ISPs civil liability.

Intermediation for the purpose of this article can be regarded as “the process by

which a firm, acting as the agent of an individual or another firm, leverages its middleman

position to foster communication with other agents in the marketplace (Internet space) that

will lead to transactions and exchanges that create economic and/or social value”7. In order

to fulfill these functions ISPs have enacted various technical measures which help them to

manage intermediation processes; usually under external approach to ISP‟s responsibility

3 See id. 4 OECD„s Committee for Information, Computer and Communications Policy (ICCP) and its working

papers provide up to date, comprehensive, systematic and globally accepted assessment of ISPs, their

economic and social function, development and prospects, benefits and costs, and responsibilities. For

more on economic and social role of ISPs see: K. PERSET, “The Economic and Social Role of Internet

Intermediaries”, OECD Digital Economy Papers, No. 171 (2010), p. 4. 5 See id. 6 See id. 7 Essential part of intermediation is the creation of certain additional value. See supra note 4: K.

PERSET, p. 15.



No. 1 (8), 2012, p. 57-99

62

these technical measures are being analyzed as a primary source for ascribing civil liability

to ISPs for the information transmitted by third parties8.

Third party (-ies) in the purpose of this article can be regarded as a term for any

individual who does not have a direct connection with a legal transaction between ISPs and

owners (or beneficiaries) of information but who might be affected by it. Third party

concept includes any legal or physical person who is using any services provided by

different ISPs and while using them deliberately or not engages in some sort of legal

transaction.

After the main terms and concepts used in this article have been introduced, in the next

section the theoretical background of the ISPs civil liability for the information transmitted

by third parties will be analyzed.

2. THEORETICAL PRECONDITIONS FOR THE

ASCRIPTION OF RESPONSIBILITY TO ISPS

It is stated that “the global reach of the Internet, the ease and low marginal cost of

replication and transmission of digital data, and the relative anonymity of users have

changed the balance of forces that have previously served to keep in check certain

undesirable behavior in the physical world”9. Thus principles and rules according to which

legal responsibility (or liability) to the main actors in cyberspace is ascribed have also

changed. In this section of the article main theories of civil liability will be presented and

their basic principles will be examined. These theories not only help to better understand

the background of the ISPs civil liability but also can be regarded as cornerstones of the

global Internet (cyber) law. It must be also pointed out that theoretical basis of the ISPs

civil liability for the information transmitted by third parties can contribute to the formation

of analytic framework that would be useful in determining the appropriate scope, and under

what circumstances and rationale, legal responsibility can be ascribed to ISPs for the

actions of third parties.

According to various legal scholars10

, the following main theories of the ISPs legal

responsibility can be singled out – constitutive, “speech-act”, “respondeat superior“,

contributory and vicarious liability.

In the next subsections each of the above mentioned theories will be analyzed and

their main aspects will be pointed out.

2.1. THEORY OF CONSTITUTIVE (DIRECT) LEGAL

RESPONSIBILITY

Meir Dan-Cohen in his book “Harmful Thoughts: Essays on Law, Self and Morality”11

sets out a theory of responsibility based on what can be called the “constitutive paradigm”.

8 Internal and external approaches to ISPs„ civil liability are discussed in chapter 3 of this part of the

article. Also see: J. W. PENNEY, “Technology and Judicial Reason: Digital Copyright, Secondary

Liability, and the Problem of Perspective”, 22 I.P.J. 251 (2010). 9 See supra note 2: K. A. TAIPALE, p. 4. 10 See supra note 2, 4 and 8.



No. 1 (8), 2012, p. 57-99

63

Usually legal responsibility is based on blame “that is, ascribing moral responsibility for the

consequences of one's actions – are premised on what is generally known as the “free will

paradigm” 12

. Following this paradigm responsibility is ascribed to a party according to its

capacity to decide freely what actions and when can be performed. “Whereas the free will

paradigm treats responsibility as a matter of what we choose to do, the constitutive

paradigm treats responsibility as a matter of what and who we are.”13

Considering the

previous statements, it can be noted that “constitutive responsibility is a function of one‟s

social “role” in relation to a given action or conduct”14

.

In the scope of this article it is very important to analyze the dual structure of

constitutive responsibility – that is “object-responsibility” and “subject-responsibility”.

“Object-responsibility” relates to direct authorship of an event or behavior while “subject-

responsibility” relates to the responsibility base for which object-responsibility may be

assigned”15

. An example of these two different notions can be an accident brought on by

drunk driving: the driver can be ascribed object-responsibility for the accident and/or

subject-responsibility for the condition that resulted in the accident, i.e., drunk driving and

the responsibility base for attributing object responsibility for the accident is drunk driving.

According to the presented notions of constitutive theory, ISPs can be held liable for

their subscribers‟ behavior when the former commit infringement (of copyright, etc.)

providing basic Internet service to an infringing subscriber; this outcome can seem

plausible because ISPs automatically and routinely reproduce and distribute protected

(copyrighted, etc.) material in response to subscribers‟ requests16

. When subscribers upload

material to the web pages by instructing the computers of ISPs to make and store a copy of

the uploaded material, these “computers make copies of the material every time a person

views the subscriber‟s web page and send those copies through the Internet to the viewing

party”17

.

The above mentioned theory was used in USA in early cases18

of copyright

infringements on the Internet where liability to ISPs for third parties actions was ascribed

because of a mere ability of ISPs to make infringement possible. Such a narrow approach

can be regarded as the main drawback of the constitutive theory because “irrelevance of

intent or knowledge means that any ISP who reproduces or distributes an article commits

11 More on the nature of the self and its response to legal commands see: M. DAN-COHEN, Harmful

Thoughts: Essays on Law, Self and Morality (Princeton: Princeton University Press, 2002). 12 See supra note 2: K. A. TAIPALE, p. 5. 13 Responsibility together with ownership is regarded as fundamental concept in interpreting the

constitutive role that social practices – particularly law and morality – play in the formation of the

self. See supra note 11: M. DAN COHEN, p. 199 – 200. 14 See supra note 2: K. A. TAIPALE, p. 5. 15 See id. 16 See: A. C. YEN, “Internet Service Provider Liability for Subscriber Copyright Infringement,

Enterprise Liability and the First Amendment”, Boston College Law School Research Paper No.

2000-03 (2000), p. 8. 17 See id., p. 9. 18 Whenever a subscriber downloads information from the Internet his ISP receives copies of

copyrighted material and sends that material on to the subscriber. All of this activity arguably

infringes the copyright holder‟s exclusive rights of reproduction and distribution. See USA case:

Playboy Enterprises, Inc. v. Frena, 839 F. Supp. 1552 (M.D. Fla. 1993).



No. 1 (8), 2012, p. 57-99

64

copyright infringement, even when that copying results from the passive execution of

subscriber instructions, a practically unlimited scope of liability can soon follow”19

.

Therefore this theory is not very popular today and is used only as supplementary mean of

civil liability ascription to the ISPs.

2.2. “SPEECH-ACT” THEORY

“Speech-act” theory is the analysis of language by what it does through social process

rather than what it represents through formal structure20

. This theory examines the power

of language (spoken as well as written) and how it can be used not only to say something

but also to make someone do something. John L. Austin in his book distinguishes language

with the primary function of doing something (so called “performative” speech acts) and

language used primarily for saying something (so called “constative” speech acts)21

. This

can be transformed to “the context of cyberspace [where] the information is available on

my web site is constative but the statement “<A

HREF="http://www.taipale.com/info_here/">Click Here for Information</A>” is

performative.”22

It must be noted that the biggest part of legal language is performative because, for

example, the phrase “you are negligent” assigns responsibility and has social consequence.

Naturally, this aspect of performative speech is very contextual and the above mentioned

phrase has a different meaning and understanding weather it is told by someone in the

supermarket or by a lawyer in a court. The hyperlink described above “is performative only

in context, that is, when embedded in an HTML document”23

.

For the purpose of this article the analyzed theory can be enacted when ascribing legal

responsibility to the ISPs according to “the relationship of the service provided to the actual

harm resulting from the conduct of their users“24

. The example of the application of this

theory can be the Napster case25

where liability to the ISPs was ascribed because it enabled

individual user to behave in a way that created or gave effect to the emergence of legal

violation.

As previously presented theory of constitutive responsibility, “speech-act” theory also

has a pretty narrow approach, especially in the light of recent breakthroughs in online

technologies (live video and audio streaming, global social networks, etc.). Almost all ISPs

performatively (by helping to transfer information (data) or allowing access to it using

19 See supra note 16: A. C. YEN (2000), p. 9. 20 Under presented theory, words by themselves can create certain acts and this performative ability is

very important in analyzing various legal relations on the Internet. For more on performative theory

see: J. L. AUSTIN, How to Do Things with Words (Cambridge: Harvard University Press, 1962), p. 6. 21 See id. 22 See supra note 2: K. A. TAIPALE, p. 20. 23 See id. 24 See id., p. 21. 25 So called Napster case is a landmark intellectual property case in which the United States Court of

Appeals for the Ninth Circuit affirmed the ruling of the United States District Court for the Northern

District of California, holding that defendant, peer-to-peer file-sharing service Napster, could be held

liable for contributory infringement and vicarious infringement of the plaintiffs' copyrights. This was

the first major case to address the application of copyright laws to peer-to-peer file-sharing. See USA

case: A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004 (9th Cir. 2001).

http://en.wikipedia.org/wiki/Intellectual_property

http://en.wikipedia.org/wiki/United_States_Court_of_Appeals_for_the_Ninth_Circuit



http://en.wikipedia.org/wiki/United_States_District_Court_for_the_Northern_District_of_California



http://en.wikipedia.org/wiki/Defendant

http://en.wikipedia.org/wiki/Peer-to-peer

http://en.wikipedia.org/wiki/File-sharing

http://en.wikipedia.org/wiki/Napster

http://en.wikipedia.org/wiki/Contributory_copyright_infringement

http://en.wikipedia.org/wiki/Perfect_10,_Inc._v._Visa_Int%27l_Serv._Ass%27n#Vicarious_copyright_infringement

http://en.wikipedia.org/wiki/Plaintiffs

http://en.wikipedia.org/wiki/Copyrights



No. 1 (8), 2012, p. 57-99

65

mentioned performative language) can be held liable for actions of third parties. Following

this it must be stated that it would reasonable to apply this theory in judging the ISPs civil

liability only in “mitigating ongoing harm ... either [lack of] actual control or perhaps

reckless disregard“26

.

2.3. DOCTRINE OF “RESPONDEAT SUPERIOR”

Commonly the doctrine of “respondeat superior” is used to ascribe liability to an

employer and it is required to show that the conduct in question was within the scope of

employment. This theory enacts so called strict liability. Usually it is limited in application

because only direct employee/employer (“servant/master”) relationship is needed.

Despite its limitations sometimes the application of this theory can be extended using

the so called “abnormally dangerous activity” exclusion. Under this exclusion „strict

liability [can be imposed] on abnormally dangerous activities because the risk of harm is

great and cannot be eliminated by the exercise of due care“27

. As argued earlier, most of

activities enabled by ISPs can also be used to make various sorts of violations.

Theoretically almost every online activity can be regarded as abnormally dangerous in this

sense. On the other hand, technology does not by itself cause an infringement – it is always

a physical person who with the help of that technology makes a violation. This can be

regarded as the main drawback of the presented theoretical approach.

The other exclusion under which “respondeat superior” theory can be used in the ISPs

civil liability cases is that defectively designed products can be held liable for injuries

proximately caused by those defects. In this case the factual situation must be analyzed „by

comparing the risks and benefits of the product‟s actual, allegedly defective design with the

risks and benefits associated with an alternate, allegedly non-defective design“28

. As it was

mentioned earlier, almost all services and products provided by ISPs can be used illegally

but it does not mean that all of them have defected design. In order to apply this exclusion,

firstly, the actual and potential non-infringing use must be weighted and, secondary,

alternate design options must be analyzed29

. After combining those results, the overall

social value of an actual service or product must be evaluated. If this value is lower than

potential harm caused by a service or product, then it can be concluded that it has defective

design and ISPs can be held liable for the action of third parties by using this service or

product.

This theory in practice is used in those cases30

when specific technological design of

certain ISPs services can be treated as directly injuring interests of some third party and the

infringing third party is using those services or products specifically only to implement

such actions.

26 See supra note 2: K. A. TAIPALE, p. 21. 27 Internet technology may be comparable to some sort of abnormal dangerous activity because it

creates a significant risk of mass copyright infringement. See: A. C. YEN, “Sony, Tort Doctrines, and

the Puzzle of Peer-to-Peer”, Boston College Law School Faculty Papers, No. 31 (2005), p. 40. 28 See id. 29 See id, p. 41. 30 See supra note 25. See also USA case: In re: Aimster Copyright Litigation, 334 F.3d 643, 654 (7th

Cir. 2003).



No. 1 (8), 2012, p. 57-99

66

2.4. THEORY OF CONTRIBUTORY LIABILITY

The theory of contributory liability is best described in USA case Gershwin Publishing

v. Columbia Artists Management31

where it was stated that “one who, with knowledge of

the infringing activity, induces, causes or materially contributes to infringing conduct of

another may be held liable as a “contributory” infringer”32

. The main aspect of this theory

is that it “requires a finding that the defendant‟s knowledge and contribution are sufficiently

unreasonable to support a particular level of culpability”33

. In the ISPs civil responsibility

for the actions of third parties case, the level of such knowledge and technological

implementation is extremely important when deciding whether to apply contributory

theory. On the other hand, the establishment that certain ISPs service or product has the

requisites, sufficient to provide knowledge of the infringing activities of its users, usually is

complicated because almost every service or product today can be treated as providing

enough knowledge to ISPs about its illegal use.

Having in mind this limitation, the new form of contributory liability has emerged. It

is called “inducement liability”. In USA case MGM Studios, Inc. v. Grokster, Ltd34

Supreme Court stated that “one who distributes a device with the object of promoting its

use to infringe copyright, as shown by clear expression or other affirmative steps taken to

foster infringement, is liable for the resulting acts of infringement”35

. It must be noted that

in order to use this kind of liability several points must be proved. Firstly, the aim to satisfy

the need of non-legal activity must be shown; secondly, no attempts to develop any filtering

tools to monitor or prevent non-legal activity must be made; and thirdly, financial benefit of

providing these services or selling products must be proved36

. If all these aspects can be

proved then contributory (or inducement) liability can be ascribed to certain ISPs for the

actions of third parties.

This theory is one of the main used in certain ways in almost all cases of the ISPs civil

liability ascription because the nature of ISPs themselves makes ISPs contributory liable

theoretically in any legal relationship in which they take any even merely intermediary part.

2.5. THEORY OF VICARIOUS LIABILITY

Vicarious liability is a liability that arises where a defendant has the right and ability to

control third party‟s infringing activities and where the defendant also receives a direct

31 See USA case: Gershwin Publishing Corp. v. Columbia Artists Management, Inc., 443 F.2d1159,

1161 (2d Cir. 1971). 32 See id. 33 See supra note 27: A. C. YEN (2005), p. 11. 34 Mere knowledge of infringing potential or of actual infringing uses or ordinary acts incident to

product distribution, such as offering customers technical support or product updates, support liability

are not enough to subject a distributor to liability. The inducement rule premises liability on

purposeful, culpable expression and conduct that does nothing to compromise legitimate commerce.

See USA case: MGM Studios, Inc. v. Grokster, Ltd. 545 U.S. 913 (2005). 35 See id. 36 The proving of financial benefit is most complicated issue under contributory liability theory. See:

J. D. LIPTON, “Secondary Liability and the Fragmentation of Digital Copyright Law”, 3 Akron Intell.

Prop. J. 105 (2009), p. 110.



No. 1 (8), 2012, p. 57-99

67

financial benefit from the infringement37

. The concept of vicarious liability can also be

explained through the “dance hall” and the “landlord” cases38

. According to those two

groups of cases the main factor for applying vicarious liability is scope of control.

“Landlords exercise far less control over rented premises than dance hall proprietors do

over their halls”39

and that is why landlords are not being held liable for violations

performed by the tenants. Accordingly, it can be summarized that “vicarious liability can be

established where the third party has the right and ability to control, and a direct financial

interest in the use” 40

. It must be noted that knowledge of the law violating actions is not

needed under this theory, so it has a broad application for ISPs civil liability for the services

and products provided. Of course, the scope of application depends on the factual situation

and today usually ISPs tend to take preventative measures in order to go around this type of

liability.

It must be also noted that vicarious liability is sometimes called enterprise liability

because under this theory enterprises should internalize losses caused by their existence as a

cost of doing business41

. In our case, ISPs should be ready to accept some part of the

damages incurred because of the actions of third parties but it there is a lack of common

standard what size of this part must be accepted.

As in previously discussed contributory liability occasion this theory is also broadly

used by courts because again the very nature of ISPs can lead to vicarious civil liability for

the third parties‟ actions using products or services provided by those ISPs.

All the above presented theories form a certain legal background on which different

legal systems base their mechanisms of the ISPs civil liability for the actions (information

transmitted, etc.) by third parties. In recent years several main approaches of civil liability

ascription to ISPs based on the theories described above have emerged. The most important

of them will be analyzed in the next section of this part of the article.

3. DIFFERENT APPROACHES OF THE CIVIL LIABILITY

ASCRIPTION TO ISPS

Different “competing approaches to technology [and thus to liability of ISPs] have

deeply influenced judicial reasoning and outcomes in … liability cases”42

, so it is very

important to discuss each of the approaches (“ex-ante” (active-preventative) and “ex-post”

(passive-reactive), external and internal, exceptionalistic and non-exceptionalistic) and

to point out their main aspects in order to understand their implications in actual legal

situations.

37 See id., p. 110-111. 38 Dance hall operators are held liable for infringement by bands performing copyrighted articles in

their establishments and no liability is imposed on landlords who merely lease space at fixed rates and

who have no knowledge or control over the lessee‟s infringing activity. These examples can be as

well used in analyzing ISPs‟ civil liability cases. See supra note 2: K. A. TAIPALE, p. 15. 39 See supra note 16: A. C. YEN (2000), p. 12. 40 See supra note 2: K. A. TAIPALE, p. 15. 41 Under enterprise liability theory, ISPs should deter copyright infringement, raise compensation for

copyright infringements that occur, and spread costs throughout the Internet-user community. See

supra note 16: A. C. YEN (2000), p. 11. 42 See supra note 8: J. W. PENNEY, p. 2.



No. 1 (8), 2012, p. 57-99

68

3.1. “EX-ANTE” (ACTIVE-PREVENTATIVE) AND “EX-

POST” (PASSIVE-REACTIVE) APPROACH

During recent developments of the Internet (and various online activities) different

ISPs did not pay enough attention to the fact that much of the third parties‟ information

(data) was hosted or transmitted by violating certain laws or regulations. “By remaining

passive hosts or service providers, ISPs could take advantage of the safe harbor provisions

in many jurisdictions‟ copyright laws … [which] require intermediaries only to react ex

post to notices of infringement.”43

Such actions grant ISPs immunity from liability for their

customers‟ (third parties) actions which violate different laws. This so called “ex-post”

approach was not only enacted in different laws regulating online activities but was also a

favorite approach of the most courts. Under this approach, ISPs are free to provide any

services and to sell any products as long as they do not have constructive knowledge that

someone is using them to violate existing laws. In this case ISPs are required to “react (in

various ways) when they are made aware of the existence of allegedly copyright-infringing

material within their system”44

.

However, in recent years the situation is changing and “entertainment industries,

government legislators, and regulatory agencies are increasingly pressuring online

intermediaries to take a more active role in preventing copyright infringement with “ex-

ante” approach”45

. Sometimes ISPs are “voluntarily shifting their role from passive

providers to active enforcers because they share with some copyright holders a common

objective: to become better at proactively managing information transmitted through

networks, especially peer-to-peer traffic”46

.

The result of the collision of these two approaches is changing perspectives to the

overall legal liability of ISPs for any actions that take place under their supervision or in

cyberspace managed by them. This leads to certain ISPs actions, such as actively policing

their networks, filtering content, shaping traffic and otherwise cooperating in cyber-law

enforcement efforts.

3.2. EXTERNAL AND INTERNAL APPROACHES

External perspective “approaches the Internet and related technologies from the

outside, in technical real terms. The Internet is seen simply as a global information network

with users and programmers external to the network and connecting to it with their

computers”47

. External perspective focuses on physical side of the Internet and understands

it as a global network “transmitting bits of binary data and other information among end-

43 See: J. DE BEER and C. D. CLEMMBER, “Global Trends in Online Copyright Enforcement: A Non-

Neutral Role for Network Intermediaries?”, 49 Jurimetrics J. (2009), p. 376. 44 See id., p. 377. 45 See id., p. 376. 46 While ISPs worry about transmission efficiencies, content owners care more about copyright

enforcement. The end result is that both have reasons to support content filtering or traffic-shaping

practices. Consequently, many ISPs worldwide began to more actively police their networks, filter

content, shape traffic, and otherwise cooperate in copyright enforcement efforts. See id., p. 377. 47 See supra note 8: J. W. PENNEY, p. 2.



No. 1 (8), 2012, p. 57-99

69

users connected by computers”48

. This approach was a very important factor in already

mentioned USA case A&M Records v. Napster49

where external perspective prevailed. The

courts in this case agreed that despite Napster peer-to-peer file exchange system could also

be used in legal way its application in non-legal ways had to be stopped because its

operators technically (though practically it was literally impossible) had theoretical

possibility to prevent copyright infringements.

“An internal perspective approaches things more from the inside, that is, the way a

program or technology defines, affects and limits the experience of users.”50

This approach

stresses that “actual technical operations or structure of the Internet has little importance”51

to its legal implications on ISPs. It can be argued that if this approach was used in deciding

before mentioned Napster case the outcome could have been completely different because

under internal approach civil liability of ISPs for the actions (information transmitted) of

third parties is limited. It is so because in internal approach users (third parties) are the ones

who make actual illegal operations and the mere theoretical technological ability of ISPs to

prevent it is not an important factor in deciding liability ascription.

Summarizing it can be stated that most probably in the nearest future due to extensive

breakthrough in Internet associated technologies internal approach will prevail because

only comprehensive treatment of ISPs and their provided services and products can lead to

equitable decisions in civil liability cases.

3.3. Approach to the ISPs‟ civil liability by Internet exceptionalists and non-

exceptionalists

The “fundamental insight [of Internet exceptionalists] is that reliance on local

governments to set rules for the new online world would not scale well“52

. The alternative

they present “is the notion of cyberspace as a separate place which should be ruled by the

norms developed by self-governing communities of users”53

. On the other hand, Internet

non-exceptionalists state that “cyberspace is not a separate place; it is simply a

communications network that links real people in real jurisdictions with other people who

might be in different jurisdictions“54

.

Despite that this approach is more theoretical in its application than the “ex-ante” or

“ex-post” approaches analyzed earlier, its implications in today‟s legal debates about the

ISPs civil liability are very important. It must be particularly stressed that this approach is

very important in formation of new laws or regulations concerning ISPs activities and their

legal responsibilities. If the approach of Internet exceptionalists prevails then the laws or

regulations are not so strict and most of the regulating activities are prescribed to ISPs and

other actors of cyberspace. However, if the perspective of non-exceptionalists is treated

48 See id., p. 3. 49 See supra note 25, USA case: A&M Records v. Napster. 50 See supra note 8: J. W. PENNEY, p. 2. 51 See supra note 8: J. W. PENNEY, p. 4. 52 See: M. MACCARTHY, What Internet intermediaries are doing about liability and why it matters?

(2009); <http://articles.bepress.com/mark_maccarthy/1> [visited December 17, 2010], p. 2. 53 See id., p. 2. 54 See id., p. 3.



No. 1 (8), 2012, p. 57-99

70

more importantly then the laws or regulations tend to be more rigorous and usually policing

powers are prescribed to some governmental institution or organization.

It must be also noted that these different approaches spark debates about a choice55

whether government should be active or passive in regulating online activities.

The global outcome of this discussion will have huge implications on the ISPs civil

liability ascription in the future56

. All the above mentioned theories and approaches of ISPs

responsibility ascription interact with each other and create certain system of civil liability

which can be presented in certain schematic way.

4. STRUCTURE OF THE ISPS’ CIVIL LIABILITY

ASCRIPTION

As it was mentioned in the previous section of this part of the article, there are several

main theories and approaches used to ascribe civil liability to ISPs for the information

transmitted by third parties. In order to better understand how the overall process of civil

liability ascription is functioning, certain schematic structure can be drawn (see Figure 1).

Figure 1. Structure of the ISPs’ civil liability ascription for the actions by third parties.

As it is illustrated in the figure above, there are opposing directions of civil liability

and regulation processes. Civil liability arises from the creators of information (authors,

copyright holders, private persons protecting their rights to privacy, other users of ISPs

services and products) who are trying to protect their interests by imposing liability first on

the consumers of information, then on ISPs and finally on the party who is directly liable

for the certain infringement. For example, software development companies tend more

usually to sue users who download illegal content than hackers who made that software

55 See id., p. 4. 56 OECD„s ICCP organizes various annual events related between all to the ISPs‟ civil liability topics.

See: Workshop summary The Role of Internet Intermediaries in Advancing Public Policy Objectives

(2010 06 16); <http://www.oecd.org/dataoecd/8/59/45997042.pdf> [visited December 17, 2010].



No. 1 (8), 2012, p. 57-99

71

available online for free. Therefore that third parties and receivers of information usually

are physical persons who are hard to find and prosecute, creators of information also tend to

sue (or at least include in lawsuits) ISPs for their role in information transmission process57

.

This litigation model is complicated for both – creators of information and ISPs – therefore

above mentioned theories and approaches are used to facilitate the desired outcome of the

process.

Though, there is process of regulation initiated by supervising institutions (which can

be established by certain laws or by private initiatives). Because third parties usually are

professional hackers and other advanced users of Internet, supervising bodies focus their

actions on receivers of information and on ISPs which can be easily found and sued.

Despite the direction of mentioned processes, ISPs are always in the middle of the

structure and therefore usually become first to receive claims of civil liability. To assess

how this process is functioning in practice, in the next part of the article situation in the

ISPs civil liability area for the information transmitted by third parties in EU and USA will

be analyzed and main aspects of its legal implementation will be pointed out.

II. DIFFERENT APPROACH TO THE

RESPONSIBILITY OF ISPs IN LEGAL SYSTEMS

AROUND THE WORLD

The lack of uniform approach, mentioned in the theoretical part of this article, can be

clearly seen when analyzing differences in legal acts and jurisprudence in various parts of

the world. Legal scholars58

single out EU and USA as major actors in forming Internet law

and concept of ISPs liability as integral part of it. Therefore, in the next sections situation in

these two different legal systems will be analyzed more broadly and the main cases in the

area will be presented. At the end of this part, Lithuania’s situation will be presented to

get a better sense of Internet law perception in newly formed legal systems.

1. EU SITUATION ANALYSIS

1.1. MAIN ASPECTS OF EU E-COMMERCE

DIRECTIVE

The main legislative act which is used in EU area to regulate central issues regarding

electronic commerce, commercial communications, and formation of online contracts and

also liability of Internet intermediaries is “The European Community‟s Electronic

57 Mere intermediation is still regarded as sufficient background to start litigation processes against

ISPs. See: E. D. VENTOSE and J. J. FORRESTER, “Authorization and Infringement of Copyright on the

Internet”, 14 No. 6 J. Internet L. 3 (2000). 58 See: M. S. GARCIA, “The Right to Privacy and the Right to Intellectual Property in Internet: The

Promusicae Case, a Significant Judgment of the European Court of Justice”, Bulletin of the

Transylvania University of Brasov, Vol. 2/51 (2009); B.KLEINSCHMIDT, „An International

Comparison of ISP's Liabilities for Unlawful Third Party Content“, 4 Int J Law Info Tech 18 (2010)

and supra note 52: M. MACCARTHY.



No. 1 (8), 2012, p. 57-99

72

Commerce Directive” (ECD)59

. Several main aspects of this directive concerning liability

of ISPs for the information transmitted can be pointed out.

Firstly, according to the article 12 of ECD60

, the horizontal exemption from liability

for ISPs is established when they play “mere conduit” role in intermediation process of

“caching” and hosting information“61

. Term “mere conduit” is the cornerstone of this

proposition and can be explained through the prism of initiative of ISPs. According to

Arno R. Lodder “[ISP] is not liable for the transmitted information only if three conditions

are fulfilled; first, the transmission may not be initiated by the provider; second, the

provider may not decide to whom the information is sent; third, the provider may not select

the information or modify it“62

. It must be also noted that horizontal exemption approach is

completely different from US law (analyzed in the next section of the article) “under which

Internet intermediaries‟ liability for third-party content is subject to completely different

criteria, depending on whether the liability at issue arises from copyright infringement or

from other types of unlawful content“63

.

Secondly, according to various scholars64

this act can be treated as an ex-post (passive-

reactive) model for dealing with the ISPs civil liability. The ECD “does not impose liability

on the ISPs if it does not modify information transmitted by third parties, unless the ISPs

acquires actual or constructive notice of illegal content and fails to take prompt remedial

steps”65

. ISPs “have to remove the information as soon as they know that the initial source

of the information is removed, access to it has been disabled, or court administrative

authority have ordered such removal or disablement”66

. On the one hand, erection of such

safe harbors helps ISPs arrange their activities and avoid unnecessary problems concerning

liability for the information transmitted. On the other hand, it does not preclude possibility

of injunctive relief against a qualifying service provider67

.

Article 45 of the ECD provides the possibility of injunctions of different kinds in case

termination of certain illegal activity is expeditiously necessary68

.

59 See: Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on

certain legal aspects of information society services, in particular electronic commerce, in the Internal

Market, OJ L 178, 2000. 60 The Directive establishes a horizontal exemption from liability for ISP when they play a technical

role as a “mere conduit” of third party information and limits service providers‟ liability for the other

intermediary activities of “caching” and hosting information. See supra note 59: ECD, art. 12. 61 See supra note 4: K. PERSET, p. 11. 62 See: A. R. LODDER, European Union E-Commerce Directive - Article by Article Comments, Guide

to European Union Law on E-Commerce, Vol. 4 (2007), p. 87. 63 See: M. PEGUERA, “The DMCA Safe Harbors and Their European Counterparts: A Comparative

Analysis of Some Common Problems”, 32 Columbia J Law Arts 4 (2009), p. 483. 64 See supra note 16: A. C. YEN (2000) and supra note 52: M. MACCARTHY and 58: M. S. GARCIA. 65 Almost absolute immunity enjoyed by American ISPs (this topic is present in the next chapter of

this part) has the virtue of drawing a clear line that eliminates any exposure to liability for third party

content and contrary the imposition of even a limited duty for ISPs creates legal uncertainties and new

financial burdens. See: M. L. RUSTAD and Th. KOENIG, “Rebooting Cybertort Law”, 80 Wash. L. Rev.

2 (2005), p. 393. See also supra note 59: ECD, Art. 13 and 14. 66 See supra note 62: A. R. LODDER, p. 88. 67 See supra note 59: ECD, Art. 14, s. 3. 68 The limitations of the liability of intermediary service providers established in this Directive do not

affect the possibility of injunctions of different kinds; such injunctions can in particular consist of



No. 1 (8), 2012, p. 57-99

73

It must be also pointed out that such possibility “creates legal uncertainties and new

financial burdens for ISPs – [a need] to bear the expenditures of investigating complaints,

tracking down wrongdoers, and making nuanced takedown and put-back decisions under

European law“69

. Finally it can be noted that already mentioned lack of uniform approach

to this problem by the courts of different EU member states creates hardships to global

operations of ISPs who have to adjust their services and products in each EU country

according to the legal approach adopted in domestic courts.

Thirdly, ECD points out that there is no general obligation to engage in monitoring

activity70

. It is stated “that no general obligation exists for service providers to monitor

information they transmit or store; a general obligation to actively seek facts or situations

indicating illegal activity does not exist either“71

. This is a very important rule as it does not

impose a “cyber police” functions on ISPs and leaves this field to various governmental

agents. Nonetheless two exceptions exist to this general rule: first, EU member states may

establish obligations on ISPs to inform the authorities of alleged illegal activities or illegal

information provided by recipients as soon as the provider becomes aware of it; second, EU

member states may also establish obligations on providers to disclose the identity of

recipients with whom they have storage agreements72

.

Fourthly, “the ECD‟s recitals note that the free development and circulation of

information services throughout the European Community is guaranteed by the basic

principle of freedom of expression, as set forth in the Article 10(1) of the “European

Convention for the Protection of Human Rights and Fundamental Freedoms”73

. This

approach sometimes is challenged as it is noted that “[ECD] is being criticized for

promoting self-censorship, the loss of privacy, and a decline in the free flow of

information“74

. It is hard to find correct answer whether ECD is a sufficient tool to regulate

civil liability of ISPs and often approaches (or perspectives) presented earlier in this article

must be taken as the main factor for decision making.

orders by courts or administrative authorities requiring the termination or prevention of any

infringement, including the removal of illegal information or the disabling of access to it. See id., Art.

45. 69 It is stated that all and any obligations for ISPs to perform a role of cyber-patrol in order to evade

possibility of injunctions come at certain costs which are passed on to computer users and other

consumers in Internet access charges. See supra note 65: M. L. RUSTAD and Th. KOENIG, p. 394. 70 See supra note 59: ECD, Art. 15. 71 See supra note 62: A. R. LODDER, p. 89. 72 Such exceptions provide a possibility for any member state impose certain obligations on ISPs.

Sometimes these obligations can be regarded as infringing notions of “safe harbor” provided in other

cited articles of ECD. See supra note 59: ECD, Art. 15, s. 2. 73 See: H. TRAVIS, “Opting Out of the Internet in the United States and the European Union:

Copyright, Safe Harbors, and International Law”, 84 Notre Dame L. Rev. 331 (2008), p. 364. 74 The absence of comprehensive and universal methods of evaluation of the scope necessary to

ensure desired level of online regulation is one of the main obstacles preventing from creating sound

and clear system of possible injunctions and thus explicit mechanism of ISPs‟ responsibilities. See

supra note 65: M. L. RUSTAD and Th. KOENIG, p. 394.



No. 1 (8), 2012, p. 57-99

74

1.2. MAIN ASPECTS OF THE EUROPEAN PARLIAMENT

RESOLUTION75CONCERNING THE ISPS’ CIVIL LIABILITY

As it will be shown later in the article, different states within the EU have adopted

different approaches to ISPs civil liability for third parties action. Because of such a broad

interpretation of ECD European Parliament (EP) in 2008 adopted resolution “On Cultural

Industries in Europe”. In this resolution EP called against policies that would terminate

Internet service to repeat infringers and urged European nations to reject France‟s example

which will be analyzed later in this article. The resolution requires member states to avoid

adopting measures conflicting with civil liberties and human rights and with the principles

of proportionality, effectiveness and dissuasiveness, such as the interruption of Internet

access76

. In resolution it is as well noted that “in the interest of a balance between the

opportunities for access to cultural events and content and intellectual property that

guarantee fair, effective remuneration to all categories of right holders, real choice for

consumers, and cultural diversity”77

.

It must be also mentioned that the resolution includes a notion which emphasizes the

importance of online access to various cultural material and that “the security of unimpeded

access to online cultural content and to the diversity of cultural expressions (must be) over

and above that which is driven by industrial and commercial logic, ensuring moreover, fair

remuneration for all categories of right holders”78

.

All the above outlined statements of the EP‟s resolution “On Cultural Industries in

Europe” mean that for the moment EU member states do not have a single approach to the

problem of the ISPs civil liability. The lack of rules in this area is becoming an increasing

problem not only for ISPs but also for the users and all other parties (governments, courts,

protectors of intellectual property, etc.) involved in various legal online activities and its

regulations.

1.3. ANALYSIS OF THE MAIN CASES OF THE ISPS

CIVIL LIABILITY IN DIFFERENT EU MEMBER STATES AND

IN ECJ JURISPRUDENCE

Diverse understanding of ISPs civil liability leads to different judicial decisions in the

EU on the subject matter. Various cases in which different types of ISPs are being sued for

actions of third parties show a broad and unequal application of ECD provisions in almost

identical situations.

75 The need to modernize ECD and create new comprehensive on-line regulation can be regarded as

an important trend in various recent EU legislative actions in the field. See: European Parliament

resolution of 10 April 2008 on cultural industries in Europe, 2007/2153 (INI), 2008. 76 The importance of sustainable Internet development and need to assure its universal and unimpeded

accessibility is usually presented as one of the main arguments to reduce the level of ISPs‟ civil

liability. See supra note 43: J. DE BEER and CH. D. CLEMMER, p. 390. 77 See supra note 75: European Parliament resolution, p. 8. 78 See id, p. 8.



No. 1 (8), 2012, p. 57-99

75

1.3.1. FRENCH, BELGIUM AND UK APPROACH TO THE

ISPS CIVIL LIABILITY

In the case Lafesse v. MySpace (2006)79

, French humorist Lafesse filed a suit against

MySpace80

, claiming infringement of his author‟s rights and personality rights after several

videos of his skits appeared on MySpace web site. France‟s “Digital Economy Law”81

(adopted in accordance with Article 14 of ECD) provides that hosts may not be held civilly

liable for the activities or information stored at the request of a recipient of these services

“if they did not have actual knowledge of their unlawful nature or of facts and

circumstances making this nature apparent, or if, as soon as they obtained such knowledge,

they acted expeditiously to remove or to disable access to these data”82

. It also stipulates

that providers are under no general obligation to monitor the information that they transmit

or store. MySpace, having complied with the legislation, should have been protected from

such a suit but the Paris Tribunal de Grande Instance (TGI) held MySpace to be the

publisher rather than the host of the content. The Paris TGI justified its decision by citing

the fact that MySpace allows users to upload content through a specific frame structure. It

was also noted that every time the video was viewed an advertisement was displayed and

that resulted in advertising revenue for MySpace. Because the court was convinced that

MySpace was the publisher it was not permitted to rely on the French hosting exemption (as

noted earlier)83

.

In the light of the before presented theories and approaches to the ISPs civil liability, it

can be stressed that despite actual law being more “ex-post” (passive-reactive) character,

the court basically relied on an external approach. By stating that MySpace theoretically

could be viewed as a publisher the court focused on the technological side of the case

where the mere possibility of MySpace to contribute to copyright violation done by third

party was seen as its fault. However, this case can be seen as an example of practice of the

vicarious liability theory because MySpace had possibility to control third parties‟ actions

(by removing infringing content) and also had direct financial interest from infringing

activity (advertising revenues).

In another case (Nord-Ouest Production v. Dailymotion (2007)84

) Nord-Ouest

Production sued the hosting site Dailymotion85

after a copy of its film Joyeux Noel

79 See France case: Lafesse v. Myspace, Tribunal de Grande Instance (T.G.I.) Paris, Ordonnance de

référé (June 22, 2007). 80 MySpace is a social networking website, offering its users variety of services, including exchange

of messages, pictures, videos and other user modified private information. 81 See: Digital Economy Law of the Republic of France (Loi sur la confiance dans l'Economie

Numérique), No. 2004-575, June 6, 2004. 82 See: N. JONDET, “The Silver Lining in Dailymotion's Copyright Cloud” (2008), Juriscom.net;

<http://ssrn.com/abstract=1134807> [visited November 16, 2010]. 83 MySpace was ordered to remove the infringing content or face a daily EUR 1,000 fine and to pay

EUR 61,000 for commercial prejudice, infringement of moral and personal rights, and the plaintiff‟s

legal fees. See supra note 79. 84 See France case: Nord Ouest Production v. Dailymotion, UGC Images, Tribunal de Grande

Instance (T.G.I.) Paris, 3e ch., 2e sec. (July 13, 2007). 85 DailyMotion.com is a video sharing service website, allowing its users to share online free of cost

various types of video data.



No. 1 (8), 2012, p. 57-99

76

appeared on Dailymotion’s web site without authorization. Dailymotion argued that under

France‟s “Digital Economy Law” and provisions of Article 15 of the ECD they had no

general obligation to monitor the information which they transmit or store, nor a general

obligation actively to seek facts or circumstances indicating unlawful activity. The plaintiff

argued that Dailymotion was a publisher and as was held in before mentioned case of

MySpace and thus must prevent all acts of infringement from occurring. The court held that

Dailymotion had deliberately enabled mass-scale piracy because its web site infrastructure

was built in first place for sharing not homemade videos but copyright protected data86

. In

contradiction to the MySpace decision, the court held that because Dailymotion did not

control the content of the postings they were not a publisher despite the presence of paid

advertisements. This can be seen as an example of internal approach to the ISPs civil

liability for the information transmitted by third party. If court used external approach to

base its decision, the outcome of this part of the case would have been completely different

and Dailymotion would be held liable. At the end court held that Dailymotion was

nonetheless liable, as the exemption from a general duty to monitor their network did not

apply when the unlawful activities were generated or induced by the service provider

itself87

.

Dailymotion was a hosting service provider, and because it must have been aware that

its platform was being used for copyright infringement (in fact, it “enabled, induced and

thrived on” the induced infringements), it had an obligation to implement technical

solutions to prevent all unlawful activities. This approach of the court was based on

secondary liability (contributory and vicarious) theories and also showed that courts were

not ready to fully accept internal approach to the ISPs civil liability. The Dailymotion

ruling expanded the circumstances under which hosting service providers in France could

be held liable for infringement. Following the decision, hosting service providers could see

their safe harbor protection in France disappear if a court decides they must have been

aware of the infringing content, they induced the infringement in an effort to increase traffic

to their site, or they profited from the infringement by posting advertisements alongside

videos on their Web site88

.

In Belgium, courts came up even with the stricter standard for ISPs behavior on the

subject matter. In the case SABAM v. Scarlet (2007)89

the collective society representing

composers and music publishers in Belgium, SABAM, filed a lawsuit against an

intermediary to compel the intermediary to adopt technological measures to stop its

subscribers from downloading illegal music. The court ruled that ISPs have both a legal

responsibility and the technical ability to stop copyright infringement, and ordered Scarlet

to use one of methods suggested in an expert report to either block or filter “p2p”

infringements on its network. If Scarlet failed to do this within six months, it was to face a

daily penalty. This decision is controversial for at least two reasons. “First, it represents the

86 See supra note 82: N. JONDET, p. 5. 87 Dailymotion was fined EUR 23,000 in damages and a further EUR 1,500 for each day the

infringing video stayed online. See supra note 84. 88 See supra note 43: J. DE BEER AND CH. D. CLEMMER, p. 399. 89 See Belgium case: SABAM v. S.A. Tiscali (Scarlet), Tribunal de Première Instance de Bruxelles

(June 29, 2007; No. 04/8975/A).



No. 1 (8), 2012, p. 57-99

77

first time in Europe that such an obligation has been imposed on carriers; second, the

judgment appears to contradict a prohibition on monitoring obligations contained in the

ECD.”90

Again it can be noted that courts used a completely external approach to the ISPs

civil liability and despite that law regulating this area is “ex-post” (passive-reactive) in

nature they still held that mere possibility to contribute to infringement can be enough to

prove ISPs‟ guilt.

Different approach in similar situation was taken by judicial system of UK. In the

case91

against TV-Links92

it was stated that if ISPs acts only as an indiscriminate conduit to

content searched by users, it cannot be held liable for the information transmitted through

its network by third parties. On one side, this holding can be viewed as based on an internal

approach to the ISPs civil liability. On the other side, it must be indicated that TV-Links

engaged in linking activity and thus its exemption due to mere conduit clause in the ECD

and its implementation in UK law93

can seem doubtful. It will probably have no global

impact on the topic of the ISPs civil liability, having in mind the Pirate Bay case in

Sweden94

where both lower and appellate courts found ISPs (in this case website‟s

www.piratebay.org redactors and owners, physical persons) guilty for allowing its

customers to share copyrighted content using their website‟s infrastructure.

In the other UK case Godfrey v. Demon95

the plaintiff was a physics lecturer falsely

identified as the author of an allegedly defamatory Internet posting. The plaintiff notified

the ISP of the postings and requested that they be removed. Demon declined to remove the

posting until it expired two weeks and plaintiff sued Demon for spreading defamatory

content. The court ruled that “since the plaintiff had notified Demon of the allegedly

90 This decision can be regarded as representing a significant departure from the principle that

connectivity providers are “mere conduits”. It also shows that current legislation under ECD is not

comprehensive and major gaps are left allowing national courts to interpret certain provisions in a

way contravening overall attitude of the ECD. See supra note 43: J. DE BEER AND CH. D. CLEMMER, p.

401. 91 The actual knowledge must be proved in order to obtain injunction and block certain Internet site

accused of copyright infringements. Otherwise the provisions of “safe harbor” provided in ECD are

employed and ISP is considered as “mere conduit”. See UK case: Rock, Overton v. F.A.C.T., [2010] 4

All Er 121. 92 TV - Links was a UK-based site which linked to movies and TV shows hosted on the other sites as

YouTube, MySpace Video or DailyMotion. 93 Despite mentioned TV – Links case ruling present legislation in UK allows copyright holders or

other injured third parties seek injunctions and blocking of certain Internet sites. ISPs can be ordered

to engage in filtering and blocking activities and bear some of costs related to such activities. See:

Digital Economy Act of UK 2010 (c. 24, April 8, 2010). 94 The Pirate Bay case was criminal proceedings against four owners of Internet site

www.piratebay.org which was (and in fact still remains) one of the main on-line resource for p2p file

sharing links (most of the links are related to copyright protected content). The purpose of the trial

was to determine if the mentioned site and its owners promoted copyright infringement with its

actions as a torrent tracking website. In the first instance the owners were found guilty of assistance to

copyright infringement and sentenced to one year in prison and payment of a fine of $ 3,620,000.

Appellate court withheld the decision. The main arguments used by courts were that site owners have

the constructive knowledge of continuous copyright infringements and that they did not take any steps

to stop such actions and in some instances induced them. See Sweden case: Holding of Appellate

Court of Sweden (November 26, 2010; No. B 4041-09). 95 See UK case: Godfrey v. Demon Internet Ltd, QBD, [1999] 4 All ER 342, [2000] 3 WLR 1020,

[2001] QB 201.



No. 1 (8), 2012, p. 57-99

78

defamatory content, Demon could not raise the innocent dissemination defense”96

. Despite

the negative outcome for ISP because of the lack of timely response in this case, court again

used an internal approach to the ISPs civil liability and completely relied on safe harbor

provisions, stated in the ECD and its “ex-post” nature regulations.

1.3.2 DECISIONS OF ECJ IN THE ISPS’ CIVIL

LIABILITY CASES

One of the main cases of the ISPs responsibility in European Court of Justice (ECJ)

jurisprudence is a case Promusicae97

v. Telefonica Spain98

. In this case Promusicae asked

for Telefonica to be ordered to disclose the identities and physical addresses of certain

persons whom it provided with Internet access services, whose IP address and date and

time of connection were known. Telefonica refused to do it and Promusicae sued it. ECJ

held that the ECD “does not require the member states to lay down, in a situation such as

that in the main proceedings, an obligation to communicate personal data in order to ensure

effective protection of copyright in the context of civil proceedings”99

. This judgment

“confirms the relevance to Community law of the fundamental rights, whose balancing

becomes a singular principle of interpreting European and national law“100

. It must be also

stressed that such argumentation of the court confirmed main approach used in the ECD –

ISPs are not liable for third parties‟ actions if they act as mere intermediaries (and that is

why in Promusicae case Telefonica was not obliged to provide personal data of its users).

In another ECJ case Vuitton v. Google101

Vuitton102

sued Google for its users‟ actions.

Vuitton stated that search results in Google were presented in such manner that ordinary

user was unwillingly directed to Internet site that sold unauthorized copies of Vuitton

production and so its copyrights were infringed. ECJ held that “[ISP] cannot be held liable

for the data which it has stored at the request of an advertiser, unless, having obtained

knowledge of the unlawful nature of those data or of that advertiser‟s activities, it failed to

act expeditiously to remove or to disable access to the data concerned“103

. With this holding

ECJ followed the main theme of the ECD and its ISPs safe harbors rules when no direct

control over the data transmitted through their networks exists.

In summary, in different EU countries the interpretations of the provisions of the ECD

are different. Such a divergent approach remains a big problem not only for ISPs but also

for various governmental institutions responsible for the supervision of cyber space. On one

96 See: M. SCHRUERS, “The History and Economics of ISP Liability for Third Party Content”, 88 VA L

Rev 205 (2002), p. 227. 97 Promusicae is a Spanish non-profit-making organization of producers and publishers of musical

and audiovisual recordings. 98 See case C-275/06, Productores de Música de España (Promusicae) v. Telefónica de España SAU

[2006] ECR I-00271. 99 See id. 100 See supra note 58, M. S. GARCÍA, p. 191. 101 See case C-236/08 joined with C-237/08 and C-238/08, Google France SARL, Google Inc. v Louis

Vuitton Malletier SA and others [2010] ECR I-00000. 102 Vuitton, which markets, in particular, luxury bags and other leather goods, is the proprietor of the

Community trade mark „Vuitton‟ and of the French national trade marks „Louis Vuitton‟ and „LV‟. 103 See supra note 101: Case C-236/08 and others.



No. 1 (8), 2012, p. 57-99

79

side, ISPs are having difficulties in adapting to diverse legal approaches in the EU area; on

the other, courts are trying to fill this gap in law system with their decisions but the pace of

technological innovations makes these tasks very complicated. In the next section of the

article another legal regime of the ISPs civil responsibility in USA will be presented and

main cases in the area will be pointed out.

2. USA SITUATION ANALYSIS

2.1. ANALYSIS OF THE “DIGITAL MILLENNIUM

COPYRIGHT ACT”104

Main legislative document which is used to ascribe civil liability to ISPs in USA is the

“Digital Millennium Copyright Act” (DMCA). It must be noted that its primary function is

to deal with copyright infringements, therefore in the next subsection of this article the

“Communications Decency Act” (CDA) will be analyzed in the scope of the ISPs civil

liability for unlawful data other than intellectual transmission by third parties. Title II of the

DMCA (now codified at Section 512 of the Copyright Act), specifically addresses the issue

of the ISPs civil liability for subscriber‟s infringement. The DMCA “affects ISPs liability

by insulating ISPs from liability as long as they comply with certain statutory requirements

designed to facilitate content providers‟ efforts to protect their copyrighted material”105

.

The statute clearly states that these safe harbors do not affect the viability of any other legal

grounds on which ISPs might claim non liability. According to DMCA ISPs cannot be held

liable when it does not have actual knowledge of the infringement, does not receive

financial benefit and acts as requested when the fact of infringement is duly presented and

proved106

.

It must be stated that “all three requirements must be satisfied for the safe harbor to

apply”107

. If the ISP gains knowledge or awareness of infringing activity no liability

attaches as long as the ISP removes or disables access to the alleged infringement. All

mentioned provisions are basically similar to provisions of then ECD and the biggest

difference of these two legal acts is the possibility of injunctive reliefs. As it was mentioned

before, the European safe harbors do not limit possibility of injunctive relief against a

qualifying service provider. Contrary, the DMCA allows such measure of litigation only

104 See: Digital Millennium Copyright Act (DMCA) of 1998, Pub. L. No. 105 – 304, 112 Stat. 105 See supra note 16: A. C. YEN, p. 45. 106 It is stated that ISPs cannot be ascribed with the responsibility if: „(A) (i) does not have actual

knowledge that the material or an activity ... is infringing; (ii) in the absence of such actual

knowledge, is not aware of facts or circumstances from which infringing activity is apparent; or (iii)

upon obtaining such knowledge or awareness, acts expeditiously to remove, or disable access to, the

material; (B) does not receive a financial benefit directly attributable to the infringing activity, ...

[where] the service provider has the right and ability to control such activity; and (C) upon

notification of claimed infringement … responds expeditiously to remove, or disable access to, the

material that is claimed to be infringing or to be the subject of infringing activity”. See supra note

104: DMCA, s. 512. 107 See supra note 16: A. C. YEN, p. 45.



No. 1 (8), 2012, p. 57-99

80

after carefully considering the need, costs and expected results (benefits) of such

measure108

.

The existence of such limitation is a very important factor of the DMCA because it

shows the unwillingness of the government to engage into detailed regulation of cyber

space and thus it can be noted that such approach is an example of exceptionalistic

approach, mentioned in this article previously.

The other important distinction between usual perception of the ECD in different

states and the DMCA application in USA can be made when analyzing the so called

constructive knowledge rule. “The constructive knowledge rule assumes that a reasonable

ISPs should have known about objectionable content and in effect, dictates the monitoring

of all content on its services.“109

In Europe courts usually tend to apply constructive

knowledge rule to actions of ISPs and hold them liable just for mere knowledge of possible

law infringement in their networks. In USA such rule is not recognized not only because of

the language of the DMCA but also because “this inflexible standard would have a chilling

effect on free expression by causing some ISP to shut down their services and by increasing

the cost of Internet communications“110

.

Finally, it must be also noted that in USA the ISPs civil liability for the information

transmitted by third parties is broadly affected by the First Amendment111

notions. As it is

stated, application of the First Amendment rules in the ISPs civil liability cases must

„recognize as protected each of the steps involved in the communicative relationship

between speaker and listener ... the right to speak and the right to hear, but also the right to

reach an audience free from the influence of extraneous criteria”112

. The application of the

First Amendment rules in courts of USA are very broad and, as it will be shown later in this

article, usually this overwhelms basic global principles and approaches of cyber law

presented earlier.

108 Injunctions are not allowed in case “it [would] significantly burden either the provider or the

operation of the provider‟s system or network; the magnitude of the harm likely to be suffered by the

copyright owner in the digital network environment if steps are not taken to prevent or restrain the

infringement; whether implementation of such an injunction would be technically feasible and

effective, and would not interfere with access to non-infringing material at other online locations; and

whether other less burdensome and comparably effective means of preventing or restraining access to

the infringing material are available”. See supra note 104: DMCA, s. 512. 109 See supra note 65: M. L. RUSTAD AND TH. KOENIG, p. 389 110 See id. 111 The First Amendment to the United States Constitution is part of the Bill of Rights. The

amendment prohibits the making of any law respecting an establishment of religion, impeding the

free exercise of religion, infringing on the freedom of speech and press, interfering with the right to

peaceably assemble or prohibiting government critic. 112 The First Amendment and its case law can be regarded as certain set of methodology used to

distinguish between necessary and allowed on-line regulation and a free and unimpeded flow of

information. See: F. A. PASQUALE, “Beyond Innovation and Competition: The Need for Qualified

Transparency in Internet Intermediaries”, 104 Nw. U. L. Rev. 105 (2010), p. 108.

http://en.wikipedia.org/wiki/United_States_Constitution

http://en.wikipedia.org/wiki/United_States_Bill_of_Rights

http://en.wikipedia.org/wiki/Establishment_Clause_of_the_First_Amendment

http://en.wikipedia.org/wiki/Free_Exercise_Clause_of_the_First_Amendment

http://en.wikipedia.org/wiki/Freedom_of_speech_in_the_United_States

http://en.wikipedia.org/wiki/Freedom_of_assembly





No. 1 (8), 2012, p. 57-99

81

2.2. ANALYSIS OF THE “COMMUNICATIONS DECENCY

ACT”

Another important USA legislation act that regulates liability of ISP for the

information transmitted is the CDA113

which was enacted few years ago before the DMCA.

The CDA established “a single bright-line rule [that] no provider or user of an interactive

computer service shall be treated as the publisher or speaker of any information provided

by another information content provider”114

. Such immunity covers almost all the content

excluding from its scope only some criminal law aspects and privacy regulations. On the

one hand, this safe harbor helps ISPs avoid unnecessary litigations but, on the other hand, it

“limits incentives for intermediaries to take initiatives to censor material passing through

their facilities”115

. It must be also noted that such almost absolute immunity in certain cases

is not consistent with today‟s “explosive” usage of Internet and in the near future it should

pass extensive review.

In the next subsection of this article main cases in USA related to the civil liability of

ISPs will be analyzed and basic notions that courts adopted in these litigations will be

presented.

2.3. ANALYSIS OF THE MAIN CASES OF THE ISPS

CIVIL LIABILITY IN USA

The first and most notorious case was A&M Records, Inc. v. Napster, Inc.116

and it

involved Napster117

whose business model involved possibility to circumvent the copyright

laws. In this case court held that Napster was contributory and vicariously liable for the

information transmitted by third parties. Court stated that Napster had both actual and

constructive knowledge of its users‟ infringing activities. The defendants had given Napster

plenty of knowledge of the actual infringing files. Further the court also held that vicarious

liability was applicable because a sufficient financial benefit related to the infringement

occurred where the availability of infringing material acted as bait for customers.

Additionally, Napster was found to have the ability to supervise the infringing activities of

its customers because it was able to monitor the titles of files traded through its services,

even though it did not maintain copies of those files on its own servers118

. It can be stated

that one of the main aspects of this case is the departure of the court from Sony119

case

rules. Because of its online peculiarity “the court distinguished Sony because the ongoing

central indexing function gave Napster unlike Sony actual, specific knowledge of direct

113 See: Communications Decency Act (CDA) of 1996, Pub. L. No. 104-104, title V, 110 Stat. 114 See supra note 63: M. PEGUERA, p. 484. 115 See supra note 112: F. A. PASQUALE, p. 191. 116 See supra note 25: USA case: A&M Records. v. Napster. 117 Napster was the first globally known peer-to-peer file sharing Internet service which allowed its

users to share audio files that were typically digitally encoded music as MP3 format files. 118 See supra note 36: J. D. LIPTON, p.119. 119 It was ruled that making of individual copies of television shows for purposes of time-shifting does

not constitute copyright infringement and that the manufacturers of such video recording devices are

not held liable for infringement. See USA case: Sony Corp. of America v. Universal City Studios,

Inc., 464 U.S. 417 (1984).



No. 1 (8), 2012, p. 57-99

82

infringement by users of its system”120

. This was a very important finding which showed

that courts are eager to use exceptionalistic approach to the ISPs civil liability issues. In this

case court also „did find “real world” precedent for the proposition that financial benefit

may be made out where the availability of infringing material in a physical venue acts as a

draw for customers, and thus enhances the profits the venue operator may make from

charging rents to vendors“121

. This type of approach is also very beneficial because courts

treat cyber space more as an extension of physical reality rather as the independent area of

different law principles. Finally, it can be noted that Napster case was a first and major

litigation based on the ISPs civil liability ascription and all later similar litigations in one

way or another referred to the findings of this case.

Another very important case is Tiffany (NJ), Inc. v. eBay, Inc.122

in which eBay123

was

sued for secondary trademark infringement when it refused to extensively monitor its

online auctions and removed only those items which can be proved with certainty being

counterfeit. In this case court took a different approach (internal rather than external) than

in Napster case and decided that eBay was not liable for the infringements made by third

parties. Court indicated that eBay according to previously analyzed DMCA and CDA

legislation was acting as a mere intermediary and thus was not liable for the violations

committed by the actors it did not control124

. eBay also obeyed notice and takedown rule

and after sufficient proves were presented acted expeditiously to remove illegal goods from

its auctions. Furthermore, court in this legislation adopted the rule of least cost enforcer.

Under this rule, the party who can prevent infringement with the least costs is the one who

must do it and if it does not conform it can be held liable for it. Rephrasing the court, it can

be stated that “if Tiffany is a rational actor, willing to pay up to the amount that it would

cost them to take its own enforcement actions, this suggests that eBay was not the least cost

enforcer after all“125

. The adoption of cost/benefit analysis in this case can be considered as

a new phase of the ISPs civil liability litigation process because in the age of extensive

Internet usage such analysis can be considered as one of the backgrounds of prescribing

responsibility to ISPs.

Finally, the Perfect 10, Inc. v. Amazon.com, Inc., Google, Inc. and others126

case must

be mentioned. In this case Perfect 10127

sued a number of third-party web site publishers

(including Google as the major one) that placed images obtained from Perfect 10’s

subscription-only area on their own websites, violating Perfect 10’s terms of service and

copyright. Perfect 10 believed the linking to the images, caching and thumbnails

constituted direct infringement of its intellectual property. According to the DMCA and

120 See supra note 112: F. A. PASQUALE, p. 192. 121 The notion of indirect financial benefit is very important in Napster type litigation processes. See

id. 122 See USA case: Tiffany (NJ), Inc. v. eBay, Inc., 576F. Supp. 2d 463 (S.D.N.Y. July 14, 2008). 123 eBay is a company that manages eBay.com - an online auction and shopping website in which its

users can buy and sell various goods and services worldwide. 124 See supra note 122: USA case: Tiffany (NJ), Inc. v. eBay, Inc. 125 See supra note 52: M. MACCARTHY, p. 26. 126 See USA case: Perfect 10, Inc. v. Amazon.com, Inc., 508 F.3d 1146 (9th Cir. 2007). 127 Perfect10.com was online photo gallery featuring high resolution photographs of women who have

not had cosmetic surgery.

http://www1.nysd.uscourts.gov/cases/show.php?db=special&id=83

http://en.wikipedia.org/wiki/Terms_of_service

http://en.wikipedia.org/wiki/Copyright



No. 1 (8), 2012, p. 57-99

83

previous cases, the court stated that Google could be liable for contributory infringement if

it: “(a) had knowledge that infringing images were available using its search engine; (b)

could take simple measures to prevent further damage to the copyrighted articles; and, (c)

failed to take such steps“128

. Because Google passed this test and proved that it was simply

making the web search faster and complex, the court found it not guilty for displaying links

to copyright protected images. In reaching this result, “the court relied largely on the

transformative nature of the thumbnails Google created, which, by facilitating the public‟s

ability to search the web for images, serve a different purpose than the original images,

which are designed to entertain”129

. This aspect of the decision is also very important

because it showed that not only the legal approach to the civil liability of ISPs matters but

also valuable public benefit which is acquired through new cyber technologies must be

considered in deciding this type of cases.

In general, USA has a different approach to the ISPs civil liability than some EU

countries. The biggest differences are the considerations in the decisions of courts of free

speech policy, cost/benefit analysis and public value of technologies. It must be also noted

that USA courts apply a more internal approach to this problem and usually treat ISPs with

less scrutiny than other actors in similar situations.

In the next section of this part of the article the situation in this area in Lithuania will

be presented and the main aspects of a relatively young law system related to cyber law and

the ISPs civil liability will be analyzed.

3. LITHUANIAN APPROACH TO THE CIVIL LIABILITY

OF ISPS

3.1. MAIN ASPECTS OF THE “LAW ON ELECTRONIC

COMMUNICATION” AND ADDITIONAL DECISION BY THE

GOVERNMENT

Certain activities of the ISPs (including provision of Internet access to natural and

legal entities and its technological implementation) and its liability in Lithuania are

regulated by the “Law on Electronic Communication of the Republic of Lithuania”130

and

by the Decision No. 290 by the Government of the Republic of Lithuania as of March 5,

2003131

.

The mentioned law centers on regulation of technological implementation of ISPs

services and it does not legislate the relationships among ISPs and other parties, including

128 See supra note 36: J. D. LIPTON, p. 112. 129 Internal approach to ISPs‟ civil liability is important in analyzing the main notions of Perfect 10

case See: Internet Library of Law and Court Decisions. Perfect 10, Inc. v. Amazon.com, Inc., et al.

case analysis; <http://www.Internetlibrary.com/cases/lib_case476.cfm> [visited December 16, 2010]. 130 See: Law on Electronic Communication of the Republic of Lithuania (April 15, 2004, No. IX-

2135). 131 See: Regarding the approval of the control of information not to be published on public computer

networks and the procedure of distributing restricted public information, Decision by the

Government of the Republic of Lithuania (March 5, 2003, No. 290).



No. 1 (8), 2012, p. 57-99

84

between all the content transmitted through its networks132

. Because no other laws regulate

general or certain activities of ISPs in Lithuania, such a lack of legislation can be

considered as a biggest drawback of the Lithuanian legal system in the area analyzed.

Theoretically this lacuna of law can be filled by courts‟ decisions but, having in mind

presented hardships faced by the courts of other countries which have full legislation of the

ISPs civil liability for the information transmitted, such recourse cannot be relied on.

The main legislative act by which civil liability to ISPs can be ascribed is the

previously mentioned Decision by the Government of the Republic of Lithuania. As the

restriction to distribute and/or publicly disclose information off-the-record (as defined by

the “Law on Protection of Youths from Negative Public Information of the Republic of

Lithuania”133

, the “Law on State Secrets and Official Secrets of the Republic of

Lithuania”134

and other laws) in public computer networks is established in the mentioned

decision135

, ISPs shall take all possible measures to restrict unlawful online activity. This

decision also establishes that the approved by it procedures are applicable to the wide range

of ISPs136

.

Several main aspects of this legal act can be pointed out. Firstly it can be noted that

this decision adopts external approach to the ISPs civil liability therefore that it does not

mention any safe harbor provisions for ISPs. On the one hand, it can seem that courts can

use it in their own discretion and hold any ISPs liable for any illegal information

transmitted through its network. On the other hand, it is obvious that such a broad

application is impossible in today‟s situation when Internet has become one of the main

parts of social and economic life of the country and more clear regulation must be

established. Secondly, because of such broad scope of its regulation (and also because of

the provisions which are outdated and completely inapplicable in certain situation) this

decision practically is not enforced at all because no governmental institution is able to

cope with policing whole cyber space of Lithuania. While the direct application of the ECD

without local legislative acts is impossible, situation in the area remains uncertain. It is

clearly seen when analyzing jurisprudence of the courts in Lithuania where only few cases

of civil liability of ISPs can be found.

132 The mentioned law relates exclusively to technological side of the intermediation process. See

supra note 130: Law on Electronic Communication, Art. 1 and 2. 133 See: Law on Protection of Youths from Negative Public Information of the Republic of Lithuania

(September 10, 2002, No. IX-1067). 134 See: Law on State Secrets and Official Secrets of the Republic of Lithuania (November 25, 1999,

No. VIII-1443). 135 See supra note 131: Decision by the Government, Art. 5. 136 It is stated that provisions of the procedure are “applied to legal subjects of the Republic of

Lithuania, also legal subjects of foreign states, which, despite the fact that they do not live (are not

established) in the Republic of Lithuania, yet they concentrate their entire activity (related to the

distribution of public information in public computer networks) or its part within the territory of the

Republic of Lithuania and use the services of a public communications network provider registered in

the Republic of Lithuania and/or the services of information hosting providers operating in Lithuania,

to distribute public information”. See id., Art. 3.



No. 1 (8), 2012, p. 57-99

85

3.2. ANALYSIS OF THE MAIN CASES OF THE CIVIL

LIABILITY OF ISPS IN LITHUANIA

Because of the lack of certain legislation of the ISPs civil liability, most of the cases in

the area are based more on privacy protection, copyright enforcement and gambling

regulation laws than on the Decision by the Government of the Republic of Lithuania.

One of the main cases of the ISPs civil liability is the recent ongoing case Microsoft

Lithuania v. Linkomanija.net137

. Microsoft sued owners of Linkomanija.net138

site for

copyright infringements made by it while offering to share torrents with links to illegal

Microsoft production downloads. Despite that this case is not yet decided, several main

aspects of this litigation can be pointed out. Firstly, this case, despite being a clear ISPs

civil liability case, because of the mentioned lack of legislation is based on violations of

copyright and intellectual property laws. Secondly, because of such legal background,

plaintiff cannot use earlier presented theories or approaches to the ISPs civil liability and

thus its legal arsenal is very weak. This weakness was proved in intervening decision of the

Appellate Court of Lithuania which refused to grant injunction (suspension of all services

related to torrent sharing) against Linkomanija.net site. The court mainly based its decision

on the lack of prima facie prove that this site was involved on illegal activity139

. Plaintiff

could not collect enough facts to establish that Linkomanija.net was involved in illegal

distribution of Microsoft production and one of the main reasons for this was an absence of

procedure according to which civil liability to ISPs for content transmitted could be

ascribed. Notwithstanding the final outcome of this litigation, it must be stated that current

situation in Lithuania in the area concerned is not favorable for both ISPs (who cannot

predict how certain cases will be decided) and for plaintiffs seeking to safeguard their

interest (because of the unclear procedures of its implementation).

Another case that is still ongoing but its findings can have a significant impact on the

development of the ISPs civil liability system in Lithuania is Lithuanian Gambling

Organizers Association v. Unibet, bwin, Triobet and others140

. In this case gamblers‟

association sues various online gambling organizers and various Internet connection

providers for providing access to online gambling sites, which do not have official licenses

needed to engage in gambling activities in Lithuania. This case is still in its primary phase

but first interim decisions by various courts can be already treated as trending direction in

these types of cases. For example, in this case applicants filed a preventive action – they

asked to prohibit the defendants to take certain actions (allowing to participate in online

gambling activities without having required licenses) in the future and thus to prevent

possible damages. Applicants stated that without applying the provisional protection

137 See Lithuania case: ongoing case Microsoft Lithuania v. Linkomanija.net in District Court of

Vilnius. 138 Linkomanija.net is Lithuanian website offering its users possibility to download various content

(most often copyrighted video, audio or software files) using specific “torrent” download system. 139 See Lithuania case: Microsoft Lithuania v. Linkomanija.net, Appellate Court of Lithuania (May

13, 2010; No. 2-652/2010). 140 See Lithuania case: ongoing case Lithuanian Gambling Organizers Association v. Unibet, bwin,

Triobet and others in District Court of Vilnius.



No. 1 (8), 2012, p. 57-99

86

measures the damage suffered by them would only increase and the enforcement of the

final court decision (if it is in favor for applicants – that is the provision of online gambling

services without certain licenses would be ruled unlawful) would become more difficult. In

the view of such circumstances, the application of the applicants was satisfied and the

provisional protection measures were applied: a ban on the defendants to take actions

related to the provision of betting organization services, and advertising for persons located

in the Republic of Lithuania, and the prohibition of all possible accesses via the a public

computer network operating in the Republic of Lithuania to the Internet portals bwin.com,

triobet.com and others.141

The higher (appellate) court of Lithuania, to whom complaint for

this decision by respondents was brought, withheld the primary decision by stating that

ISPs that provide certain online gambling services as well as ISPs which provide possibility

to access those Internet pages are the ones who have to take certain actions to suspend such

services until the final decision whether the provision of online gambling services without

acquiring license is lawful is made142

. This interim decision clearly shows that courts

adapted external approach and did not analyze whether ISPs who merely provide Internet

connection to general users can be ordered to factually filter all data stream in order to

prohibit access to certain online gambling sites. Notwithstanding final decision in this case,

these interim findings demonstrate that without a clear regulation in the area and lack of

basic laws, courts are trying to fill this gap and can come up with decisions that can be hard

to implement. They can also have a negative economic and social effect on Internet and its

law development.

In the next part of the article possible conceptual background for creating a unified

global ISPs civil liability regulation will be presented and its basic potential principles will

be outlined.

III. CONCEPTUAL BACKGROUND FOR UNIFIED

CIVIL LIABILITY REGIME OF ISPS

As it was shown in previous parts of this article, various legal systems enact different

legal theories and approaches to the ISPs civil liability and therefore usually different

results of similar type of litigations are possible. In order to better deal with the ISPs civil

liability problem in global scope, three main liability regimes which could be used as a

background for enacting further legislation mechanism can be pointed out. These are the

following: 1) negligence (which encompasses notice-based liability), 2) strict liability, and

3) non-liability legal regimes. All of them correspond to different approaches to the ISPs

liability, although it is obvious that for unified global approach to the ISPs civil liability

problem certain mix of these regimes will most probably be used. In the next subsection of

this article all these regimes are presented, their main aspects (including economic and

social implications) are pointed; at the end, basic principles for conceptual model of global

regime of the ISPs civil liability are introduced.

141 See Lithuania case: Lithuanian Gambling Organizers Association v. Unibet, bwin, Triobet and

others, District Court of Vilnius (July 2, 2010; No. 2-6458-578/2010). 142 See Lithuania case: Lithuanian Gambling Organizers Association v. Unibet, bwin, Triobet and

others, Appellate Court of Lithuania (December 30, 2010; No. 2-1585/2010).



No. 1 (8), 2012, p. 57-99

87

1. NEGLIGENCE LEGAL REGIME OF THE CIVIL

LIABILITY OF ISPS

„Imbedded in the … law as “distributor liability,” … regime [of negligence] turns on

notice to the defendant, since knowledge of the allegedly injurious content gives rise to a

duty on the part of the ISPs.“143

Negligence in this regime can be traditionally referred as a

“conduct that fails to adhere to the legally prescribed standard for protecting others against

an unreasonable risk of harm“144

. As it was mentioned earlier this legal regime employs

notice – based approach therefore it can be stated that it corresponds to passive-reactive

(“ex-post”) approach that was presented in previous parts of the article.

Today this is the most popular regime in major jurisdictions around the world145

and it

can be stated that it is a “global norm ... to establish passive-reactive schemes that require

or permit intervention in third-party communications upon receiving allegations of

copyright infringement“146

. As it was pointed out previously in the article, according to this

approach ISPs may be not held liable if it acts according to certain criteria and removes

infringing information (data) after notice of its existence was presented to them. In

consideration of this main aspect of the legal regime of negligence, primary functions of

legal mechanisms based on it would be to establish rules according to which mentioned

notice to ISPs for infringing content is provided, time and scope of ISPs reaction to this

notice is defined, scope of civil liability if failing to act is incurred, etc.

Despite mentioned broad perception of this regime, several main drawbacks of it must

be pointed out. Firstly, certain discrepancy exists between so called safe harbor provisions

of ISPs if it reacts to notice and scope and intensity of this reaction. „Under the existing

laws ... intermediaries must remain passive-reactive in order to obtain immunity from

liability for copyright infringements occurring on their networks. The more active

intermediaries are in the hosting or transmission process, the less likely they are to be

protected by safe harbors.“147

This inconsistence is partly caused by the lack of clear rules

according to which ISPs must exercise due care of the actions taken by third parties while

using certain ISPs provided services. As it was mentioned earlier, establishment of the set

of such rules is one of the main goals that must be achieved in order to implement legal

regulation of the ISPs civil liability based on negligence legal regime. On the other hand,

because of the all-embracing role of Internet it cannot be reached so easily.

Second drawback of this legal regime is its social-economic inefficiency. It is stated

that “negligence regime creates a common-law sanctioned externality by permitting a

certain level of expected costs to be imposed on the public. Therefore, imposing a

negligence or distributor regime is economically inefficient“148

. This can be also explained

143 See supra note 95: M. SCHRUERS, p. 235. 144 See id., p. 233 – 234. 145 Such approach exists in the laws of Australia, Canada and China, the most of European Union

(including France and Germany), Japan, New Zealand, Singapore, South Korea, the United Kingdom

and the United States. See supra note 43: J. DE BEER AND CH. D. CLEMMER, p. 378. 146 See supra note 43: J. DE BEER AND CH. D. CLEMMER, p. 377. 147 See id., p. 405. 148 See supra note 95: M. SCHRUERS, p. 240.



No. 1 (8), 2012, p. 57-99

88

through the scope of usage of ISPs services. Because a negligence rule is not ascribing civil

liability for those injuries that could not efficiently be prevented, the scope of ISPs service

providing activity will not take into account the social cost of injuries incurred by some

users. This happens because of the infringing content is being spread so broadly.

Consequently, the market price of Internet access will not reflect the true social cost of the

industry – it will be too low and ISPs will sell too many accounts to users who in turn will

create too much possibly harmful third party content.149

And finally third drawback of this legal regime is that when “[ISPs] ... remove[s] only

as much content as it receives notice of, the ISPs forfeits any independent determination of

how much content to remove“150

. Consequently ISPs are becoming less interested in

content regulation and all policing activity is left to certain governmental or private

supervising authorities or even users themselves.

To conclude, because of the mentioned deficiency of negligence legal regime in some

instances strict liability legal regime of the ISPs civil liability is enacted as a background

for the regulation system of this issue.

2. STRICT LIABILITY LEGAL REGIME OF THE CIVIL

LIABILITY OF ISPS

“In a strict liability regime, an injurer is liable to all victims regardless of the care with

which he or she conducts activities, even if the exercise of due care would not have

prevented the damage.“151

It can be noted that this regime enacts previously mentioned “ex-

ante” or active-preventative approach to the ISPs civil liability. As it was stated earlier in

this article, “entertainment industries, government legislators, and regulatory agencies

increasingly are pressuring online intermediaries to play a more active role in preventing

copyright infringement ex-ante“152

. It is obvious that this regime is mostly beneficial to

parties interested in protecting their interests in cyber space (copyright holders, privacy

activists, opposing parties of online gambling, etc.).

In order to implement this legal regime‟s mechanism or structure of the scope of the

ISPs civil liability, clear rules of online operation and supervision by enacting certain set of

laws must be established. One example of this can be found in recent opinion of Advocate

General of ECJ in which it was stated that “hosting providers can be deemed to have

“actual knowledge” (or awareness) when there is an infringement of a trademark, and that

infringement is likely to continue regarding the same or similar goods by the same user”153

.

Such interpretation of ECD could mean that in the future at least in the EU area some sort

of strict liability regime can be introduced at least when referred to repeated or common

infringements made by using certain services provided by various ISPs. As it was

149 See id. 150 See id., p. 245. 151 See id. 152 See supra note 43: J. DE BEER AND CH. D. CLEMMER, p. 376. 153 Notwithstanding that opinion of Advocate General of ECJ is not binding upon ECJ such trend

shows that some changes in the legislation related to the civil liability of ISPs may be under way. See:

P. VAN EECKE AND M. TRUYENS, “Advocate General Clarifies the Status of Hosting Providers under

EU Law”, 14 NO. 8 J. Internet L. 29 (2011).



No. 1 (8), 2012, p. 57-99

89

mentioned earlier, explicit rules to implement this regime should be created. As Advocate

General also pointed out in his opinion “the crucial condition [in implementation of this

regime] is that the hosting provider can know with certainty what is required from him, and

that the injunction [of infringing actions] does not impose impossible, disproportionate, or

illegal duties like a general obligation of monitoring”154

.

Due to its stringent approach to the ISPs civil liability it is certain that this legal

regime will not prevail in its pure form in the global perspective. Also, most probably it

will be used as a part of some type of mixed approach. This proposition can be also

grounded by analyzing the main drawbacks of this legal regime.

The first and main problem is “reductive effect of speech”. Because of the strict

liability ISPs respond to any notice of infringing information (data) on their network and

therefore immediately remove it rather than investigating and mitigating the liability scope

with potential victim. Such ISPs actions, when content which does not actually infringe any

law is removed because of mere danger of potential litigation costs, have implications on

free speech spread on Internet. Socially and economically this effect can be explained as

“there is merely “too much” Internet use ... [therefore] the corresponding “accident” costs

(from alleged defamation, etc.) exceed the social benefits“155

.

The second drawback of strict liability legal regime is that it undermines the “network

effect” of the Internet. “A “network effect” … occurs when the utility that a user derives

from consumption of the good increases with the number of other agents consuming the

good.” 156

This effect also can be treated as one of the most important function of the

Internet. If strict liability regime is introduced in full scope, some of the users would reduce

their usage of certain ISPs services and this would affect other users. It can be stated that

the efficiency of imposing strict liability would be negative because benefits achieved by it

would be much smaller then losses incurred by global ISPs users‟ community due to

mentioned “network effect”.

It can be summarized that because of the problems mentioned above “imposing strict

liability on ISPs would decrease the amount of Internet use without assuring a

corresponding reduction in injuries“157

and therefore usage of pure strict liability regime is

not acceptable and most probably only some principles of it will be used in development of

the global and universal ISPs civil liability scheme.

3. NON-LIABILITY LEGAL REGIME OF THE CIVIL

LIABILITY OF ISPS

Non-liability legal regime can be defined as a conditional immunity regime – „upon

meeting the conditions of the law ISPs are afforded statutory immunity from suit“158

. This

regime can also be regarded as self-regulatory regime there ISPs can be held non-liable for

154 See id. 155 The socio-economic analysis of the influence that certain models of ISPs‟ civil liability ascription

have on the provision of intermediation services must be taken into consideration when analyzing

possible legislative mechanisms in the field. See supra note 95: M. SCHRUERS, p. 249. 156 See id., p. 250. 157 See id., p. 253. 158 See id., p. 231.



No. 1 (8), 2012, p. 57-99

90

the information transmitted by third parties when they engage in good faith monitoring. The

application of this regime is a clear example of earlier mentioned external approach where

ISPs can only be held liable for negligent actions performed directly and willfully by ISPs

themselves. One of the best examples of application of this regime is the already discussed

CDA159

in USA. Legal scholars point out several advantages of this regime.

First and most important point of non-liability civil regime is the principle of network

neutrality160

. If we would apply negligence or strict liability legal regimes, some ISPs

would have to engage in sorting content floating through them in order to avoid civil

liability and thus would contravene principle of network neutrality.

Second advantage of this regime is that “[a] “competitive” or “open” communications

policy sacrifices the order, predictability and stability of a planned policy for greater

allowance of market entry and (backers believe) faster technological development”161

. This

means that despite possibility to allow some parties of analyzed transactions to escape

responsibility completely, non-liability legal regime institutes suitable environment in

which social and economic development of both Internet and cyber law is most potential.

Thirdly, application of this regime minimizes economic inefficiency when ISPs, as

least cost avoiders, engage in full-scale content monitoring and marginal costs of Internet

usage rise unproportionally. It is stated that “just because ISPs are able to prevent

subscriber misconduct cheaply does not mean that they should be burdened with the cost of

preventing spread of [illegal content] and if unsuccessful, pay damages and have criminal

liability imposed on them”162

.

Finally, the opinion of one of the biggest associations of ISPs in the world – The

United States Internet Service Provider Association – can be mentioned as an authoritative

source to assess practical implementation of the mechanism of civil liability ascription to

ISPs. “As a general rule, liability for Internet content should rest with the creator or

initiator of the illegal content and not with an entity that retransmits, hosts, stores,

republishes, or receives such content.” 163

It must be also noted that ISPs under non-

liability regime should retain the right to block or filter traffic of data and to obtain

immunity from liability for such action, if no direct negligent actions of ISPs are taking

place.

On the other hand, as one of the main drawbacks of non-liability regime possible

negative social effect can be mentioned. It occurs when ISPs, as least cost avoiders, do not

take any certain actions to restrain access to illegal content. In such situations the end users

or injured parties would have to play a more active role in preventing or stopping

159 See supra note 113: CDA. 160 According to this principle, “network neutrality mandate would prohibit network owners from

discriminating against particular applications and content providers”. See: T. WU and CH. S. YOO,

“Keeping the Internet Neutral?: Tim Wu and Christopher Yoo Debate”, 59 Fed. Comm. L.J. 575

(2007), p. 575. 161 See: T. WU, “Copyright's Communications Policy”, 103 Mich. L. Rev. 278 (2005), p. 331. 162 See: A. ANCHAYIL AND A. MATTAMANA, “Intermediary Liability and Child Pornography: A

Comparative Analysis”, 1 JICLT 5 (2010), p. 55. 163 See: J. BAYER, “Liability of Internet service providers for third party content”, Victoria University

of Wellington Law Review Working Paper Series, Vol. 1 (2007), p. 15.



No. 1 (8), 2012, p. 57-99

91

infringements. Such behaviour would be more costly and economically inefficient

compared to actions which can be taken by ISPs.

Having presented three different legal regimes of the ISPs civil liability, it can be

summarized that certain choice which will be made in near future will not include pure

form of one of the regimes and most certainly would encompass mix of several regimes.

Possible conceptual background for the mechanism of civil liability ascription to ISPs is

presented in the last section of this part of the article.

4. POSSIBLE CONCEPTUAL BACKGROUND FOR THE

UNIFIED ISPS’ CIVIL LIABILITY REGIME

As it was presented in previous sections of this article, there are several types of legal

regimes on which background of possible global unified model of the ISPs civil liability

ascription can be constructed. Such common background and its novel approach to the

issue discussed is a mandatory part of future global Internet law. It is stated that “however,

in the end, the impact of these issues on the future economic development in the online

world is not to be underestimated [l]aw needs to keep up with the pace of changes in the

online world that have become an important economic factor”164

. As it was shown in the

article, currently the lack of legislation or clear rules of its implementation puts courts in

primary positions in dealing with this problem. Because ISPs are an essential component of

the normal functioning of the Internet and its various subsidiary services associated with it,

courts have begun to develop the case law governing the ISPs civil liability for subscriber

infringement along sensible lines. Unfortunately, there is no guarantee that those results

will be followed in the future165

. It can be also mentioned that “from the [ISPs] point of

view, a clear and harmonized approach is needed more than a victory in one country's

courtroom”166

.

Having made extensive analysis of theoretical base for the ISPs civil liability and

having examined practical legal regimes in the area, it can be proposed that most probable

outcome in the near future will be the usage of mixed (negligence, strict and non-liability)

legal regime to ascribe responsibility for third parties actions. Several main aspects

(principles) of such new regime which will most likely be applied in its establishing can be

pointed out.

Firstly, principle of Internet freedom will have to prevail in order to secure highest

efficiency of Internet communication. “The freedom of Internet communication, which is

firmly rooted in international human rights law, is at the core of Internet freedom.”167

Since

one of the main problems today is unclear function of ISPs in establishing illegality of the

content, “the administrative authority should be the only party competent to order the

removal (take-down measures) of “manifestly illegal” content to prevent the continuation of

164 See: A. RUHMKORF, “The Liability of Online Auction Portals: Toward a Uniform Approach?” 14

NO. 4 J. Internet L. 3 (2010). 165 See supra note 16: A. C. YEN (2000), p. 9. 166 See: R. UERPMANN-WITTZACK, Principles of International Internet Law, 11 German L.J. 1245

(2010). 167 See id.



No. 1 (8), 2012, p. 57-99

92

the alleged infringement“168

. “As long as the content is only “allegedly” illegal, there

should be no obligation for the host provider to act expeditiously to remove the content

since the illegal nature of the content has not been established.“169

It is also very important

that above mentioned principle would prevail over various theories and approaches used

today by courts. In order to achieve this, clear legislation with adequate notions must be

enacted.

Secondly, privacy aspect is very important in sustainable development of the future

ISPs civil liability system. This aspect in certain ways can be contrary to the principle of

Internet freedom, thus “whereas freedom of expression may be restricted in favor of the

rights of others and in particular the right to privacy, any restriction must be proportionate

to the aim pursued…states have to strike a fair balance between privacy on the one hand

and Internet freedom on the other hand”170

. It can be assumed that only clear and

unambiguous treatment of Internet privacy in legislation can lead to unimpeded functioning

of cyber space as a whole.

Thirdly, internal or technology-friendly approach should be in the center of the ISPs

civil liability ascription. “Technologies and business methods that have been widely

adopted [can] ... no longer be treated as suspect simply because they can be used for

infringement.“171

As it was argued before, internal approach to ISPs services and products

can be helpful in obtaining equitable solutions in the area discussed. It must be also

mentioned that enacting Internet filtering technologies is undesirable and “they should only

be used as a last resort, in cases where the removal of online content is impossible“172

. This

notion is very important because even if internal or technology-friendly approach is

adopted by legislation and courts, usage of various Internet filters can lead to violations of

formerly mentioned Internet freedom and privacy principles.

Fourthly, new principles of territorial jurisdiction of the ISPs civil liability must be

established. On one hand, “the effects doctrine giving jurisdiction over foreign acts

provided that they produce effects within the own territory must be adapted to the

ubiquitous nature of the Internet [must be enacted and on the other hand] jurisdiction [must]

expand to a state's country code Top Level Domain which becomes cyber territory“173

in

order to facilitate definite procedural mechanism of this type of legislation.

Finally, ISPs differences must be regarded as one of the main factors while deciding

on various cases of the civil liability for transmitted information by third parties. As it was

mentioned before, there are many different types of ISPs (from basic Internet service

providers to complex websites operators) and each of them must be treated correspondingly

168 Such administrative authority must not only have relative competence but also certain clear and

comprehensive set of rules must be created in order to achieve desired level of sustainable regulation.

See: J. ZIMMERMANN, P. AIGRAIN and others, Legal Liability of Internet Service Providers and the

Protection of Freedom of Expression Online (2010); <www.laquadrature.net/files/LQDN-20101105-

Response_e-Commerce.pdf> [visited April 07, 2011], p. 4. 169 See id., p. 6. 170 See supra note 166: J. ZIMMERMANN, P. AIGRAIN and others, p. 6. 171 See: R. I. REIS, The Sony Legacy: Secondary Liability Perspectives, 3 Akron Intell. Prop. J. 223

(2009), p. 262. 172 See supra note 168: J. ZIMMERMANN, P. AIGRAIN and others, p. 12. 173 See id.



No. 1 (8), 2012, p. 57-99

93

and adequately in the way they operate and technology they use. This is important in order

to justly ascribe legal responsibility. “A clear understanding of the pulse of new technology

innovation necessitates the incorporation of existing assessment framework to prevent

unwarranted inferences and “chilling affects” to the detriment of the [users] and public as a

whole.“174

In summary, it can be stated that only versatile incorporation of Internet freedom and

online privacy, cyber-territorial and other principles can guarantee not only sustainable and

sound development of the global unified ISPs civil liability system but must also be treated

as one of the cornerstones of the whole still evolving Internet law.

CONCLUSIONS AND PROPOSALS

Based on the analysis of theoretical background of the ISPs civil liability, examination

of the main cases in this area around the world, as well as having presented the main legal

regimes based on which global system of liability ascription to ISPs for third parties‟

actions can be constructed, the following conclusions are drawn and proposals are

suggested:

1. Theoretical background of the ISPs civil liability is an important part of the new

emerging Internet (cyber) law. Furthermore, its analysis can contribute not only to the

better understanding of underlying processes of legal interaction between main actors in

cyberspace but also helps to construct an analytic framework that would be useful in

determining the appropriate scope and under what circumstances and rationale legal

responsibility can be ascribed to the ISPs for the actions of third parties.

2. According to the basic notions of constitutive and “speech-act” theories, ISPs can be

held liable for their users‟ behavior when the former commit infringement providing basic

Internet services to an infringing user. This ascription of liability is possible because of the

mere nature of ISPs who automatically and routinely reproduce and distribute protected

material in response to users‟ requests.

3. Under the doctrine of “respondeat superior” strict liability can be imposed on

abnormally dangerous activities (among which almost all services of ISPs can be placed)

because the risk of harm is great and cannot be eliminated by the exercise of due care.

4. Secondary liability – contributory (with knowledge of the infringing activity,

induces, causes or materially contributes to the infringing conduct of another) and vicarious

(the right and ability to control a third party‟s infringing activities and receives of a direct

financial benefit from the infringement) – theories are the main used today in courts all over

the world to base legal responsibility of ISPs for third parties‟ actions.

5. Different approaches (“ex-ante” and “ex-post”, external and internal, exceptionalists

and non-exceptionalists, etc.) to civil liability of the ISPs are influencing judicial reasoning

and outcomes in related cases in various jurisdictions. Therefore, the lack of one prevailing

approach can be regarded as the biggest threat to sustainable development of international

Internet law.

174 See supra note 171: R. I. REIS, p. 267.



No. 1 (8), 2012, p. 57-99

94

6. Theoretically ascription of legal responsibility to the ISPs for third parties‟ actions

can be shown as a system of opposing direction of civil liability and regulation processes

where regulation and civil liability streams are directed through ISPs accordingly towards

end users and initiators of infringements.

7. “The European Community‟s Electronic Commerce Directive” (ECD) is one of the

main legal acts among other things regulating civil liability of the ISPs. Its basic principles

are the following: 1) establishment of a horizontal exemption from liability for ISPs when

they play only a technical role in transmitting third party information, 2) guarantee of

circulation of information services throughout the European Community in full compliment

with freedom of expression and 3) no general obligation for ISPs to engage in monitoring

activity.

8. Different EU member states interpret provisions of the ECD differently. Such

divergent approach determines not only that ISPs are having difficulties in adapting to

diverse legal treatment of civil liability, but also that courts, who are trying to fill this gap

in law system with their decisions, are failing to go along with a pace of Internet

technology innovations. Such situation reveals an evident lack of unified legislative

position in the area discussed.

9. Main legislative acts in USA regarding the ISPs civil liability are – “Digital

Millennium Copyright Act” and “Communications Decency Act”. Their biggest difference

compared to EU‟s ECD is much broader and more detailed provisions for ISPs “safe

harbors” (various rules of exceptions from civil liability) and more complex analysis for

requests of injunction against ISPs or their users.

10. A distinct approach to the ISPs civil liability from analyzed EU countries‟

jurisprudence can be found in US legislation. Among its biggest differences are

considerations in the decisions of courts of free speech policy, cost/benefit analysis and

public value of technologies. It must be also noted that US courts apply a more internal

(exceptionalistic) approach to this problem and usually in similar situations treat ISPs with

less scrutiny then courts in other mentioned countries.

11. There is no law which directly deals with the ISPs civil liability in Lithuania.

Furthermore, the main legislative act is an outdated decision by the Government concerning

the control of information. The direct application of the ECD without local legislative acts

is impossible and this lack of legislation can be considered as the main problem of

responsibility ascription system. That is because due to complex nature of various legal

cyber-relations, courts are not able to fill this lacuna of law with their decisions.

12. Only few examples of the ISPs civil liability can be found in case law of Lithuania.

Their analysis shows that without clear regulation in the area, courts come up with the

decisions that are hard to implement and also have negative economic and social effect.

This situation is as well becoming an obstacle to the development of the Internet law and

Internet as technology itself, therefore a clear and complex system of concerned laws is a

must in a near future.

13. Negligence (notice based) legal regime of the ISPs civil liability is the most

popular regime used today. It could become an important part of a possible new global

unified system of responsibility ascription, if its main drawbacks – lack of the clear rules of

engagement and social-economic inefficiency – are eliminated.



No. 1 (8), 2012, p. 57-99

95

14. Strict and non-liability legal regimes because of their marginal approaches to the

problem – from active-preventative (“ex-ante”) to completely voluntary (“the Good

Samarian”) –will more likely not be used as a background for possible legal regulation of

the ISPs responsibility. Rather they could become supplementary tools while dealing with

the issue discussed in certain legal situations.

15. Versatile incorporation of Internet freedom, online privacy, internal (technology-

friendly) approach, cyber-territorial jurisdiction, consideration of different functioning of

various Internet service providers and other principles and their corresponding alignment

with the mix of the mentioned legal regimes is probably the best possible solution to

sustainable and sound development of the global unified ISPs civil liability system.

Due to the scope and volume of this article, topics and problems of complex ascription

of civil liability for third parties‟ action to different types of ISPs, the influence and overall

relation with public and private international law as well as certain legislative procedures

were not encompassed and can be regarded as the new dimensions for expanding this

research in the area discussed in the future.

LITERATURE

BOOKS

AUSTIN, J. L. How to Do Things with Words (Cambridge: Harvard University Press, 1962),

p. 6.

DAN-COHEN, M. Harmful Thoughts: Essays on Law, Self and Morality (Princeton:

Princeton University Press, 2002), p. 199–241.

JOURNALS

ANCHAYIL, A. and MATTAMANA, A. Intermediary Liability and Child Pornography: A

Comparative Analysis. 1 JICLT 5 (2010), p. 55.

BAYER, J. Liability of Internet service providers for third party content. Victoria University

of Wellington Law Review Working Paper Series, Vol. 1 (2007), p. 15.

DE BEER, J. and CLEMMER, C. D. Global Trends in Online Copyright Enforcement: A Non-

Neutral Role for Network Intermediaries? 49 Jurimetrics J. (2009), p. 376 – 378, 390,

397, 401.

GARCIA, M. S. The Right to Privacy and the Right to Intellectual Property in Internet: The

Promusicae Case, a Significant Judgment of the European Court of Justice. Bulletin

of the Transylvania University of Brasov, Vol. 2/51 (2009).

Internet Library of Law and Court Decisions. Perfect 10, Inc. v. Amazon.com, Inc., et al.

case analysis (2008); <http://www.Internetlibrary.com/cases/lib_case476.cfm> [visited

December 16, 2010].

JONDET, N. The Silver Lining in Dailymotion's Copyright Cloud (2008), Juriscom.net;

<http://ssrn.com/abstract=1134807> [visited November 16, 2010].

KLEINSCHMIDT, B. An International Comparison of ISP's Liabilities for Unlawful Third

Party Content. 4 Int J Law Info Tech 18 (2010).



No. 1 (8), 2012, p. 57-99

96

LIPTON, J. D. Secondary Liability and the Fragmentation of Digital Copyright Law. 3

Akron Intell. Prop. J. 105 (2009), p 110 – 112, 119.

LODDER, A. R. European Union E-Commerce Directive - Article by Article Comments.

Guide to European Union Law on E-Commerce, Vol. 4 (2007), p. 87 - 89.

MACCARTHY, M. What Internet intermediaries are doing about liability and why it

matters? (2009); <http://articles.bepress.com/mark_maccarthy/1> [visited December

17, 2010], p. 2, 26.

PASQUALE, F. A. Beyond Innovation and Competition: The Need for Qualified

Transparency in Internet Intermediaries. 104 Nw. U. L. Rev. 105 (2010), p. 108, 191,

192.

PEGUERA, M. The DMCA Safe Harbors and Their European Counterparts: A Comparative

Analysis of Some Common Problems. 32 Columbia J Law Arts 4 (2009), p. 483.

PENNEY, J. W. Technology and Judicial Reason: Digital Copyright, Secondary Liability,

and the Problem of Perspective. 22 I.P.J. 251 (2010).

PERSET, K. The Economic and Social Role of Internet Intermediaries. OECD Digital

Economy Papers, No. 171 (2010), p. 4, 15.

REIS, I. R. The Sony Legacy: Secondary Liability Perspectives. 3 Akron Intell. Prop. J. 223

(2009), p. 262.

RÜHMKORF, A. The Liability of Online Auction Portals: Toward a Uniform Approach? 14

NO. 4 J. Internet L. 3 (2010).

RUSTAD, M. L. and KOENING, T.H. Rebooting Cybertort Law. 80 Wash. L. Rev. 2 (2005),

p. 389, 393, 394.

SCHRUERS, M. The History and Economics of ISP Liability for Third Party Content. 88 VA

L Rev 205 (2002), p. 227, 235, 240, 249.

TAIPALE, K. A. Secondary Liability on the Internet: Towards a Performative Standard for

Constitutive Responsibility. Center for Advanced Studies Working Paper No. 04-2003

(2003), p. 3 – 5, 15, 20, 21.

TRAVIS, H. Opting Out of the Internet in the United States and the European Union:

Copyright, Safe Harbors, and International Law. 84 Notre Dame L. Rev. 331 (2008),

p. 364.

UERPMANN-WITTZACK, R. Principles of International Internet Law. 11 German L.J. 1245

(2010).

VAN EECKE, P. and TRUYENS, M. Advocate General Clarifies the Status of Hosting

Providers under EU Law. 14 NO. 8 J. Internet L. 29 (2011).

VENTOSE, E. D. and FORRESTER, J. J. Authorization and Infringement of Copyright on the

Internet. 14 No. 6 J. Internet L. 3 (2000).

ZIMMERMANN, J., AIGRAIN, P. and others. Legal Liability of Internet Service Providers and

the Protection of Freedom of Expression Online (2010);

<www.laquadrature.net/files/LQDN-20101105-Response_e-Commerce.pdf> [visited

April 07, 2011], p. 4, 6, 12.

Workshop summary The Role of Internet Intermediaries in Advancing Public Policy

Objectives (2010 06 16); < http://www.oecd.org/dataoecd/8/59/45997042.pdf> [visited

December 17, 2010].



No. 1 (8), 2012, p. 57-99

97

WU, T. and YOO, C. S. Keeping the Internet Neutral?: Tim Wu and Christopher Yoo

Debate. 59 Fed. Comm. L.J. 575 (2007), p. 575.

WU, T. Copyright's Communications Policy. 103 Mich. L. Rev. 278 (2005), p. 331.

YEN, A. C. Internet Service Provider Liability for Subscriber Copyright Infringement,

Enterprise Liability and the First Amendment. Boston College Law School Research

Paper No. 2000-03 (2000), p. 8, 9, 11, 12, 45.

YEN, A. C. Sony, Tort Doctrines, and the Puzzle of Peer-to-Peer. Boston College Law

School Faculty Papers, No. 31 (2005), p. 11, 40.

LEGAL DOCUMENTS

Communications Decency Act (CDA) of 1996, Pub. L. No. 104-104, title V, 110 Stat.

Digital Economy Law of the Republic of France (Loi sur la confiance dans l'Economie

Numérique), No. 2004-575, June 6, 2004.

Digital Millennium Copyright Act (DMCA) of 1998, Pub. L. No. 105 – 304, 112 Stat.

Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on

certain legal aspects of information society services, in particular electronic

commerce, in the Internal Market. OJ L 178, 2000.

European Parliament resolution of 10 April 2008 on cultural industries in Europe.

2007/2153(INI), 2008, p. 8.

Law on Electronic Communication of the Republic of Lithuania (Official Gazette, April 15,

2004, No. IX-2135).

Law on Protection of Youths from Negative Public Information of the Republic of

Lithuania (Official Gazette, September 10, 2002, No. IX-1067).

Law on State Secrets and Official Secrets of the Republic of Lithuania (Official Gazette,

November 25, 1999, No. VIII-1443).

Regarding the approval of the control of information not to be published on public

computer networks and the procedure of distributing restricted public information,

Decision by the Government of the Republic of Lithuania (March 5, 2003, No. 290).

Digital Economy Act of UK 2010 (c. 24, April 8, 2010).

Belgium case: SABAM v. S.A. Tiscali (Scarlet). Tribunal de Première Instance de Bruxelles

(June 29, 2007 No. 04/8975/A).

Case C-236/08 joined with C-237/08 and C-238/08. Google France SARL, Google Inc. v

Louis Vuitton Malletier SA and others [2010] ECR I-00000.

Case C-275/06. Productores de Música de España (Promusicae) v. Telefónica de España

SAU [2006] ECR I-00271.

France case: Lafesse v. Myspace. Tribunal de Grande Instance (T.G.I.) Paris, Ordonnance

de référé (June 22, 2007).

France case: Nord Ouest Production v. Dailymotion, UGC Images. Tribunal de Grande

Instance (T.G.I.) Paris, 3e ch., 2e sec. (July 13, 2007).

UK case: Godfrey v. Demon Internet Ltd. QBD, [1999] 4 All ER 342, [2000] 3 WLR 1020,

[2001] QB 201.

UK case: Rock, Overton v. F.A.C.T. [2010] 4 All Er 121.

USA case: A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004 (9th

Cir. 2001).



No. 1 (8), 2012, p. 57-99

98

USA case: Gershwin Publishing Corp. v. Columbia Artists Management, Inc., 443

F.2d1159, 1161 (2d Cir. 1971).

USA case: In re: Aimster Copyright Litigation, 334 F.3d 643, 654 (7th Cir. 2003).

USA case: MGM Studios, Inc. v. Grokster, Ltd. 545 U.S. 913 (2005).

USA case: Perfect 10, Inc. v. Amazon.com, Inc., 508 F.3d 1146 (9th Cir. 2007).

USA case: Playboy Enterprises, Inc. v. Frena, 839 F. Supp. 1552 (M.D. Fla. 1993).

USA case: Sony Corp. of America v. Universal City Studios, Inc., 464 U.S. 417 (1984).

USA case: Tiffany (NJ), Inc. v. eBay, Inc, 576F. Supp. 2d 463 (S.D.N.Y. July 14, 2008).

Lithuania case: Microsoft Lithuania v. Linkomanija.net. Appellate Court of Lithuania (May

13, 2010; No. 2-652/2010).

Lithuania case: Lithuanian Gambling Organizers Association v. Unibet, bwin, Triobet and

others. District Court of Vilnius (July 2, 2010; No. 2-6458-578/2010).

Lithuania case: Lithuanian Gambling Organizers Association v. Unibet, bwin, Triobet and

others. Appellate Court of Lithuania (December 30, 2010; No. 2-1585/2010).

Sweden case: Appellate Court of Sweden (November 26, 2010; No. B 4041-09).

SANTRAUKA

INTERNETO PASLAUGŲ TIEKĖJŲ CIVILINĖ

ATSAKOMYBĖ UŽ TREČIŲJŲ ASMENŲ PERDUOTĄ

INFORMACIJĄ: TEISINIO REGLAMENTAVIMO

PROBLEMOS IR PERSPEKTYVOS

Spartus interneto augimas ir skverbimasis į visas socialinio ir ekonominio gyvenimo

sritis yra susijęs su interneto paslaugų tiekėjais (IPT), suteikiančiais prieigos prie duomenų

per viešo naudojimo kompiuterių tinklą ar jų prieglobos paslaugas. Suteikdami šias

paslaugas IPT kiekvienam vartotojui tuo pačiu leidžia naudotis neribota žodžio ir išraiškos

laisve, tuo prisidėdami prie liberalios ir demokratinės visuomenės plėtros. Tuo pačiu IPT

netiesiogiai daro įtaką ir neleistinos informacijos platinimui internetu. Jos kontrolė, esant

dideliam duomenų srautui, yra praktiškai neįmanoma. Vieningo teisinio reglamentavimo

(tiek įstatymų, tiek ir teismų praktikos) šioje srityje nebuvimas nulemia kovos su

internetiniais nusikaltimais, tokiais kaip autorių teisių ar privatumo pažeidimai, azartiniai

lošimai, vaikų pornografijos platinimas internete ir pan., problemas. Tai apriboja IPT

galimybes apsiginti nuo trečiųjų asmenų civilinių ieškinių, susijusių su minėtų nusikaltimų

sukelta materialine ir nematerialine žala. Toks teisinis neapibrėžtumas netolimoje ateityje

gali tapti ir interneto paslaugų plėtros stabdžiu, todėl vieningas sureguliavimas, siekiant

užtikrinti ir tolesnį darnų šios srities vystymąsi, yra būtinas.

Šio straipsnio tikslas yra įvertinti IPT civilinės atsakomybės už trečiųjų asmenų

perduotą informaciją nustatymo būtinybę ir galimą jos apimtį, taip pat pristatyti

pagrindinius principus, remiantis kuriais būtų kuriamas galimas bendras globalus

interneto tarpininkų civilinės atsakomybės mechanizmo pagrindas.



No. 1 (8), 2012, p. 57-99

99

Siekiant įgyvendinti šį tikslą, straipsnyje yra analizuojamos pagrindinės IPT civilinės

atsakomybės teorijos ir hipotetiniai atsakomybės priskyrimo metodai, aptariami

pagrindiniai šios srities ES, JAV ir Lietuvos teisės aktai bei svarbiausios išnagrinėtos ar

nagrinėjamos bylos. Paskutinėje straipsnio dalyje pristatomi esminiai teisiniai režimai ir

principai, remiantis kuriais būtų kuriama vieninga IPT civilinės atsakomybės sistema.

Įgyvendinus straipsnio pradžioje užsibrėžtą tikslą ir iškeltus uždavinius, pabaigoje

prieinama prie išvados, kad tik įvairių teisinių režimų (pilnos, įspėjamosios ir laisvos

atsakomybės) ir principų (interneto laisvės ir privatumo, kibernetinės jurisdikcijos ir kt.)

suderinimas gali užtikrinti tinkamą ir darnią interneto teisės nagrinėjamoje srityje raidą.

PAGRINDINĖS SĄVOKOS

Internetas, interneto teisė, interneto paslaugų tiekėjai, civilinė atsakomybė.


Teisės apžvalga

Law review No. 1 (8), 2012, p. 100-135

IMPACT OF THE EU FINANCIAL REGULATORY

AND SUPERVISION REFORM TO THE

DEVELOPMENT OF THE FUNDAMENTAL

PRINCIPLES OF LITHUANIAN FINANCIAL

MARKETS REGULATION

Nerijus Strikulys1

Vytautas Magnus University

Received 2011 m. lapkričio 25 d.

SUMMARY

Lithuania`s financial sector is the most important part of the country`s economy and

from it`s successful operation depends the rest market success. The main mission of the

financial sector is to serve the real economy by funding companies and their projects. The

last global financial crisies highlighted the fundamental problem of financial markets –

financial market participant rather than carry out its main function, they focus on short

term goal and short term profits. The consequenses of an crisis were felt around the whole

world and highlighted the need to take immediate action, thereby enhancing, the European

financial regulation and supervision. The core principles of ongoing reform is

transparency, accountability, supervision and crisis prevention and management. Taking

the fact, that EU law is directly applicable to the Member States,into account, there are no

questions that this reform will affect the Member States‟ financial sector, but there are also

natural questions, how they will impact the development of the fundamental principles of

the Lithuanian financial market regulations.

Objective regulation of each legal system, especially in finance, is associated with

clearancy, transparency and efficiency, what leads to the result that in order to achieve the

objectives, everyone has to be accountable to the responsible authorities. In the process of

the reform, there had been established two responsible supervision authorities, whose main

target was to ensure the macro and micro prudential regulation and supervision at the EU

level. Their recommendations and warnings will have binding power to the Lithuanian

responsible supervision authorities. This fact will have direct impact to the later

development of the conception of the fundamental principles of Lithuanian financial

regulation.

1 Nerijus Strikulys – Assistant; Vytautas Magnus University Faculty of Law, Department of Public

Law, Address: Ožeskienės 18, LT-44246, Kaunas, Lithuania, tel. (+370 685) 15338; e-mail:

[email protected];


Nerijus Strikulys, “Impact of the EU financial regulatory

and supervision reform to the development of the

fundamental principles of Lithuanian financial markets

regulation”


No. 1 (8), 2012, p. 100-135

101

KEYWORDS

Financial law, financial market regulation, systemic risk, financial regulatory and

supervision reform, fundamental principles.

INTRODUCTION

We will need to ensure „that our economy works for costumers, that it works for

investors, that it works for financial institutions – that it works for all of us“2. It is clear that

for the smooth operation of the system, its regulation and supervision must be based on

certain fundamental principles. This equally applies to financial systems. In the context of

globalization, the finance is not only a key factor for the State economy, but it also plays an

important role in the regional or even global level. Recent economical and financial crisis,

where authorities, following the doctrine of “too big to fail”, made huge government

spendings to stabilize the financial system, highlighted the need to take immediate action

and enhance the European financial regulation and supervision. European Union financial

regulatory and supervision reform is based on the core principles of the financial law.

Taking into account the fact that the European Union law has a direct impact on legal

systems of Member States, it is evident that this reform will affect financial sectors of each

of the Member States. However, there is a natural question of how such reform will impact

the development of the fundamental principles of financial regulation and supervision of

the Member States.

To this date the impact of the EU regulatory and supervision reform on the

development of the fundamental principles of Lithuanian financial markets supervision and

regulation hasn`t been analyzed from the legal science perspective. There are several

reasons to explain this phenomenon. Firstly, it is the very recent nature of the reform, which

prevented deeper scientific work on the subject and secondly, given the fact that the

Lithuanian financial regulation and supervision is basically implemented by the three

independent institutions, it is natural that theoretical studies have been focusing on separate

sectors of the financial markets and not on the financial system as a whole.

The first part of this article determines the concept of legal principle and general

notion of the principles of financial law. In the second section of this part the typology of

the principles of financial regulation and supervision and how these different principles are

understood by the law makers are presented.

The second part is dedicatedfor the understanding of the EU financial regulatory and

supervision reform. Also in this part the key legal factors which influenced the last

financial crisis are presented. At the end of this part, following the implementation of the

reform of the EU financial regulation and supervision and comparing it with the former EU

financial market regulation and supervision, general overview of the new framework of

financial regulation and supervision is provided.

2 Author`s note: Words of the President of the United States Mr. Barack Obama which was said

during the ceremony at the Ronald Regan Building, (2010 07 21);

<http://www.politico.com/news/stories/0710/40027.html> [visite 2011 05 20].




regulation”


No. 1 (8), 2012, p. 100-135

102

In the third part of this article the author examines one of the most important tasks of

the financial markets – prevention and management of the systemic risk, which leads to the

understanding of the framework of Lithuanian financial markets regulation and supervision.

This analysis shows the fact that Lithuanian financial regulation in generally is based on the

core recommendations and requirements of the European Union legislation, but there is no

doubt that European Union financial regulatory and supervision reform will have a major

impact on the fundamental principles of Lithuanian financial market regulation.

1. PRINCIPLES OF FINANCIAL REGULATION AND

SUPERVISION

1.1. GENERAL NOTION OF THE PRINCIPLES OF

FINANCIAL LAW

Taking into account the fact that this article is generally based on analysis of principles

of financial regulation and supervision and its impact to fundamental principles of

Lithuanian financial regulation and supervision at the beginning there is the need clearly

understand the weight of these principles to legislative process.

Principle of law is the basic provision of law and legal system3. Etymological

meaning of the word “principle” (in Latin – “principium”) is like “confidence, leading to

the human relationship to the reality of his behavior and performance standards”, like “head

of the theory, concept idea, the original claim”, like “a fundamental rule of any structures of

organizations or business”, like “head of any equipment, machine architecture or operating

characteristic”4. As was mentioned above, if principles in general are understood like the

concept idea or the head of theory, the principles of law must be understood as a basic

provision of law and legal system, through which all legislation and legal system are based.

One of the few scholars who give us a clear definition of legal principles is R.

Dworkin, who stated that:

“I call a “principle” a standard that is to be observed, not because it will

advance or serve an economic, political or social situation deemed desirable, but

because it is a requirement of justice or fairness or some other dimension of

reality‟. (Is Law a System of Rules? In The Philospohy of Law, 1977, p. 43.)5”

He continued that:

“the principles have the quality of weight or importance, in the sense of

being considerations „which officials must take into account... as... inclining in

one direction or another... When principles intersect... one who must resolve the

3E. KŪRIS, Konstitucinių principų plėtojimas konstitucinėje jurisprudencijoje (Lietuvos Respublikos

Konstitucinio Teismo ir Lenkijos Respublikos Konstitucinio Tribunolo šeštoji konferencija

"Konstitucinių principų plėtojimas konstitucinėje jurisprudencijoje", Neringa, 2001 m. birželio 11 -

12 d., Vilnius, 2002, p. 208-334), p. 208. 4V. KVIETKAUSKAS, Tarptautinių žodžių žodynas (Vilnius: Vyriausioji enciklopedijų redakcija,

1985), p. 399. 5I. MCLEOD, Legal Theoris (London: Palgrave Macmillan, 2007), p. 125.




regulation”


No. 1 (8), 2012, p. 100-135

103

conflict has to take into account the relative weight of each‟. (Is Law a System of

Rules? in The Philosophy of Law, (1977), p. 47.).”6

In addition, it should be noted that it is not enough to state the fact that the principles

of law are requirements of justice or faireness, or that the principles of law have the quality

of weight or importance, however, it is crucial to distinguish them from the norms of law.

Some scholars, for example Dworkin, Alexy, are drawing strict and clear line between

principles and rules, but another part of them, for example Esser, Larenz, Canaris, cannot

show it.

According to Dworkin, legal principles, “differ from such all-or-nothing rules because

when they are applicable they do not „necessitate‟ a decision but point towards or count in

favour of a decision, or state a reason which may be overridden but which the courts take

into account as inclining in one direction or another.”7 The well known legal theorist Robert

Alexy, partly dissented with Dworkin continued that, “in case principles collide, the

solution is not to determine immediately that one principle prevails over the other, but it is

found by weighing the colliding principles and then one of them, in some actual

circumstances, will prevail. This kind of tension and the way it is resolved is what

distinguishes principles from rules: while in the conflict of rules one needs to find out

whether the rule is within or without some legal order, in the conflict of principles this very

order has such conflict within itself“8. This legal theorist argued, that for him legal principle

consists only of one species of legal norms through which optimization commands are set

which are applicable in several degrees, according to norm and fact possibilities9. But both

of them underline that principles refer to the logical structure that is derived from

provisions, and not only in the sense of different gradation, but also definite differentiation.

Another famous scholar H. L. A. Hart, while his concept of law was criticized by

Dworkin, agreed with last-mentioned in one place that there are at least two features which

can distinguish legal principles from legal rules. “The first is a matter of degree: principles

are relatively to rules, broad, general, or unspecific, in the sense that often what would be

regarded as a number of distinct rules can be exhibited as the exemplifications or

instantiations of a single principle. The second feature is that principles, because they refer

more or less explicitly to some purpose, goal, entitlement, or value, are regarded from some

point of view as desirable to maintain, or to adhere to, and so not only as providing an

explanation or rationale of the rules which exemplify them, but as at least contributing to

their justifications.10

Notwithstanding various contrapositions of scholars who analyzed principles of law,

for example, Esser defined principles as norms that set forth bases for a given

commandment to be found, whereas in his opinion rules determine the decision itself."

Larenz defined principles as norms of great relevance for the legal order inasmuch as they

set forth normative foundations for the interpretation and application of the Law, therefrom

6Ibid, p. 127. 7H. L. A. HART, The Concept of Law (Oxford: Clarendon press, 1997), p. 260. 8 HUMBERTO AVILA, Theory of Legal Principles (Munich: Springer, 2001), p. 40. 9Ibid, p. 41. 10See supra note 6: H. L. A. HART, p. 260.




regulation”


No. 1 (8), 2012, p. 100-135

104

evolving, whether directly or indirectly, behavior norms11

,we can reach one important

finding that legislatures must be responsible for the formulation of general principles of

conduct which are of general, publicly promulgated and prospective applicability to a given

community for an indeterminate number of situations; administrators must apply such

general principles to more specific situations and often to specific groups within the

community – even though administrative orders and regulations often have certain

legislative aspects; and the courts must apply the prescriptions of legislators, or the

generalized principles deduced from a series of precedents to individual disputes12

.

In the view of what was mentioned above and the fact that, firstly, principles of law

are instruments that “work” for the benefit of implementation as well as formation of legal

policy and secondary, that “principles are immediately finalistic, primarily future regarding

norms should be stated, that principles of law trace the boundaries of behaviour, whose we

must not overstep13

. In accordance with the understanding of the principles of law given

above, it is reasonable to assume that principles of financial regulation and supervision

must be understood as the guiding ideology of the financial base or origin of the

comprehensive nature of the stability of the important legal principles and criteria through a

country's financial legal system.

Financial architecture14

is based on fundamental principles of financial law. In

general, financial law is a system of risk transfer15

. Financial law consists of regulation and

supervision of (i) insurance, (ii) banking and (iii) capital markets and investment

management sectors. In order that these markets works in proper way it is necessary to set

up appropriate regulatory and supervision legislative system, i.e. creators of financial

market regulatory and supervision system engaged in the financial architecture, which is

based on fundamental principles of financial market supervisory and regulatory. During

creation of financial market regulatory and supervision system, the developers must follow

the fundamental principles of these markets. The fundamental principles are considered as

a framework of minimum standards that justly supervise practice and are universally

applicable. Also, it is necessary to enable the legislature to determine the financial markets

regulatory and supervision shortcomings and setting priorities for addressing them.

The fundamental principles of financial law do not only have the guiding role of the

formation of financial regulation and supervision, but also constitute a proper

understanding rules of whole financial system on which they are based. Given the fact that

11See supra note 7: HUMBERTO AVILA, p. 12. 12W. FRIEDMANN, Legal Theory (New York: Columbia university press, 1967), p. 500. 13See supra note 2: E. KŪRIS, p. 1. 14In financial law literature, [t]he concept of international financial architecture “is generally

understood as encompassing the rules, guidelines, and other arrangements governing international

financial relations as well as the various institutions, entities and bodies through which such rules,

guidelines and other arrangements are developed, monitored and enforced. (P. NOBEL, Swiss Finance

law and international standards (Berne: Stempfli Publisher Ltd., 2002), p. 83.). 15 The author of this article make such conclusion because till this moment, scholars which are trying

to define what is a financial law, in generally agree only with one, that financial law is a system of

risk transfer, that is broadly means that ... the function of financial law is to permit risks (and the

rewards associated with taking them) to be transferred from protection buyers to risk takers, and to

circulate amongst risk takers in the financial markets. (J. BENJAMIN, Financial law (London: Oxford,

2008), p. 3.).




regulation”


No. 1 (8), 2012, p. 100-135

105

there are still debates on what is the financial law, as a result, different financial law experts

give us different view of fundamental principles of financial law, but in each of their work

they emphasize the three main principles, which are best reflected in this definitions:

“We define global governance if financial systems to involve three main

principles: effectiveness in devising efficient regulatory standard and rules,

accountability in the decision – making structure and chain of command, and

legitimacy, meaning that those subject to international regulatory standards

have participated in some meaningful way in their development”.16

Additionally it should be pointed that:

”Effective decision making in the IFI`s17

requires that states have strong

links and confidence in one another and that means that IFI decision making

should be accountable both procedurally and substantively. It also means that

the standard-setting process should be legitimate in the sense that all countries

and economies subject to these standards exercise a certain degree of

participation in the standard-setting process”.18

Analysis of today`s legal fiction and scholars works, author is detecting one more

important fundamental principal of financial markets regulation and supervision –

transparency. Before the last world financial crisis, the transparency was the only

important aspect of accountability, but nowadays, it becomes one of the main principles,

which is being adopted in IFI`s. One more factor regarding importance of principle of

transparency is that European union understanding the necessity of this principle, especially

in financial sector, consolidated the practical use of this principle in a separate directive19

,

which establishes requirements in relation to the disclosure of periodic and ongoing

information about issuers whose securities are already admitted to trading on a regulated

market situated or operating within a Member State.20

According to the mentioned above and taking into account the fact, that with every

such wave of crises, legislators of States are encouraged to develop and change governance

of financial markets, which must be based on fundamental principles of financial law, is

clear that stable financial regulation and supervision solely dependent on application of the

fundamental principles of financial regulation and supervision.

1.2. TYPHOLOGY OF THE PRINCIPLES OF FINANCIAL

REGULATION AND SUPERVISION

In the context of globalization, then the finance is not only a key indicator of the

separate State economy, but also plays important role in the dimension of region, i.e.

European Union, USA and etc., or even in the global level, principles become the

cornestone of every financial regulation and supervision. On one hand, successful

16K. ALEXANDER, R. DHUMALE, J. EATWELL, Global Governance of Financial Systems. The

International Regulation of Systemic Risk (London: Oxford University press, 2006), p. 14. 17Author`s note: International financial institutions. 18See supra note 15: K. ALEXANDER, R. DHUMALE, J. EATWELL, p. 34. 19Directive 2004/109/EC. 20Ibid, Article 1, para 1.




regulation”


No. 1 (8), 2012, p. 100-135

106

application of each principle is associated with regard to their meaning and purpose, but on

other hand, we cannot understand the successful use of fundamental principles without

close realation of them and sometimes overlaping each other. Without doubt we can state,

that objective regulation of each legal system, especially in finance, is associated with

clearancy, transparency and efficiency, so as a result, in order to achieve the objectives,

everyone has to be accountable to the responsible authorities.

Accountability – clear line of authority between those who make decisions and those

who are subject of them. Traditional notion of accountability is based on the ability to

control and direct administrative behavior by requiring „answerability“ to some internal or

external authority that legitimate expectations of power as well as a clearly articulated chain

of command21

. In the financial regulatory field “Technical definitions of accountability …

have focused on the obligation owed by the person exercising authority to another person

for whom such authority is being exercised”22

. According to author of this article the best

and the clearest example of this principle is reflected in situation, which author found

during the analysis of this principle, i.e.:

“Mr Duisenberg`s accountability model, which suggests that as long as

daddy brings home the bacon, mummy and the children ought not to ask where

he got it, is not viable as a modern model for the relationship between the citizen

and the state.“23

Undoubtedlly, nowadays, there is no satisfactory explanation of this principle and we

cannot use it directly, but it shows the position of this principle at the begining of its

evolution and its importance in hierarchy of principles, especially in financial regulation

and supervision. Unquestionably, as was mentioned above, all principles are closely related

to each other and sometimes overlap each other. Moreover, it should be noted that the

principle of accountability we can identify as an essential element of principles of financial

supervision and regulation. This could be explained by the fact that unexpected decisions of

competitive authorities, especially in financial sector, are not desirable for their possible

consequences to the whole market. Accountability for finances is pretty straightforward

and reflects the expectations for how public officials will handle public dollars24

. In this

context, the principle of accountability in financial field is removed from the impact of

political day to day decisions of the country authorities, i.e. there must be clear lines of

authority that show where the regulator derives its authority and to which stakeholder

interests it is accountable. Moreovere, the regulator`s exercise of authority should be

measured for performance against some criteria of assessment25

, as a result, on impact of

globalization, especially in financial sector, then many decisions are taken in secret, good

21K. CALLAHAN, Elements of Effective Governance. Measurement, Accountability and Participation

(London: CRC Press, Taylor & Francis Group, LLC, 2007), p. 105. 22See supra note 15: K. ALEXANDER, R. DHUMALE, J. EATWELL, p. 43. 23 P. BOFINGER and others, Monetary Policy, Goals, Institutions, Strategies and Instruments, (Oxford:

University press, 2001), p. 224. 24K. CALLAHAN, Elements of Effective Governance. Measurement, Accountability and Participation

(London: CRC Press, Taylor & Francis Group, LLC, 2007), p. 117. 25See supra note 15: K. ALEXANDER, R. DHUMALE, J. EATWELL, p. 43.




regulation”


No. 1 (8), 2012, p. 100-135

107

governance26

calls for central banks and financial agencies to be accountable, especially

where these agencies are granted a high degree of autonomy27

. Additionaly it should be

noted, that working group of G20, more then in one recommendation, calls for “[t]he

structure of … coordinating mechanism [which] should be transparent, with clear

assignments of roles, responsibilities and accountability for each authority”.28

In view of the above, we can state, that in the process of lawmaking, when the

intention of legislature is to establish the effective uses of this principle in the State law

system they must answer two questions: (i) accountable for what? and (ii) accountable to

whom? If we will try to find answers in Lithuanian legislature of financial supervision and

regulation, the simple answers can be successive - from the point of view of banks sector of

Lithuania the answer to first question can be that the Bank of Lithuania is accountable for

maintainance of price stability29

and taking into account the fact that ownership of Bank of

Lithuania belongs to the State of Lithuania30

, the answer to second question in the broadest

sense – accountable to the citizens of the Republic of Lithuania. Morevore, International

monetary fund mentioned, that is not sufficient to answer to above mentioned questions, if

we want that:

“accountability for independent RSAs31

can be thought of as fulfilling four

main functions. These are to (i) provide public oversight; (ii) maintain and

enhance legitimacy; (iii) enhance agency governance; and (iv) improve agency

performance.The recognition that accountability fulfills four main functions

helps to bridge to a large extent the different emphasis that lawyers (political

dimension of accountability) and economists (performance) tend to put on

26

Author`s note: This approach is best characterized by International monetary fund, which gives us

description of global governance, that explain this like “Good governance refers to the management

of government in a manner that is essentially free of abuse and corruption, and with due regard for

the rule of law”. (Manual on fiscal Transparency, International monetary fund (2007), p.

111,<http://www.imf.org/external/np/fad/trans/manual.htm> [Visited 2011 04 26]). Future noted that

this conception is fixed in both parts of Lisbon treaty, i.e. „In order to promote good governance and

ensure the participation of civil society, the institutions, bodies, offices and agencies of the Union

shall conduct their work as openly as possible“. (Treaty on the Functioning of the Eurpoean Union,

Article 15 (ex Article 255 TEC), para 1) and that „the Union shall define and pursue common policies

and actions, and shall work for a high degree of cooperation in all fields of international relations, in

order to promote an international system based on stronger multilateral cooperation and good global

governance“. (Treaty of European Union, Article 21, para 2(h)). 27P. NOBEL, Swiss Finance Law and International Standards (Berne: Stempfli Publisher Ltd., 2002),

p. 84. 28Final report, Enhancing Sound Regulation and Strengthening Transparency, G20 working group,

(2009 03 25). 29 Republic of Lithuania law on the bank of Lithuania, Official Gazette (1994, No. 99-1957), Article

7, para 1: The Primary Objective of the Bank of Lithuania: In accordance with the Treaty

establishing the European Community, the primary objective of the Bank of Lithuania shall be to

maintain price stability. 30Ibid, Article 1, para 1:The Bank of Lithuania - The central bank of the Republic of Lithuania shall

be the Bank of Lithuania, belonging by the right of ownership to the State of Lithuania. 31Author`s note: Regulatory and Supervisory services.




regulation”


No. 1 (8), 2012, p. 100-135

108

accountability and that, at times, also confuses our thinking about accountability

(see Lastra (2001) and (2004) on the difference between both views)”32

.

In order to ensur[e] the concept of accountability is much more complicated than a

collection of rules and procedures designed to elicit certain behaviors and outcomes33

. For

this reason, in order to fully understand principle of accountability two more components

should be defined.

Firstly, as was mentioned above, in process of application of the principle of

accountability, it is important to drawn clear line from the impact of political day to day

decisions, as a result accountability mechanisms ensure control by the political authorities

and effective representation of diverse interests34

, after that is achieving, that authorities

shall be independent of ad hoc political pressures. For example:

“Unlike the IFIs, the accountability and independence of the ESCB35

are

provided for in treaty and statute. For instance, the European Central bank is

accountable to EU finance ministers and to the Parliament. At first glance, the

principles of accountability and independence may seem contradictory and,

when implemented into a financial regulatory regime, can result in a clash of

regulatory policy objectives. Although the EU treaty and accompanying

legislative framework provided for the institutional independence of the ECB36

and independant regulatory policy for the ESCB, it nonetheless incorporates the

legal requirements of accountability for the ECB with respect to other EU

institutions.“37

In the view of the listed above, it is clear that the part of successful implemention of

principle of accountability is independence, because without it authorities, cannot be

accountable. Another important factor of interaction of these principles is that „one of the

implication of independence is that regulatory authorities have to be accountable in political

sense, thorught a continuing dialogue with Parliament and with the public opinion“38

.

Another interesting fact the author want to distinguish about practical uses of

principle of accountability, that in economics, studies of central banks have focused on

measuring central bank independence by devising appropriate indices and statistically

32E. HÜPKES, M. QUINTYN, and others, The Accountability of Financial Sector Supervisors: Principles

and Practice, International Monetary fund working paper (March 2005), p. 6,

<http://www.imf.org/external/pubs/cat/longres.aspx?sk=18018.0>, [visited 2011 05 13]; 33K. CALLAHAN, Elements of Effective Governance. Measurement, Accountability and Participation

(London: CRC Press, Taylor & Francis Group, LLC, 2007), p. 127; 34L. E. PANOURGIAS, Banking Regulation and World Trade Law, GATS, EU and „Prudential‟

Institutions Building, (Oxford and Portland, Oregon: Hart Publishing, 2006), p. 180; 35Author`s note: European system of central banks; 36Author`s note: European central bank; 37S. FAZIO, The Harmonization of International Commercial Law, The Netherlands: Kluwer law

International, 2007), p. 8. 38Proceedings of an Expert Meeting in London, United Kingdom, OECD, Designing independent and

accountable regulatory authorities for high quality regulation, (2005 01 10-11)

<http://www.oecd.org/LongAbstract/0,3425,en_33873108_33873870_35028837_1_1_1_1,00.html>

[visited 2011 05 13]

http://www.imf.org/external/pubs/cat/longres.aspx?sk=18018.0




regulation”


No. 1 (8), 2012, p. 100-135

109

testing the effect of independence on macroeconomic variables…. Recently, a similar

statistical methodology has been applied to central bank accountability39

.

Secondly, another important factor is to distinguish principle of accountability from

principle of transparency. As was mentioned before, these two principles are often being

collated, but from the point of view of conceptions of these two principles they must be

analized separately.

Transparency is an eleventh commandment40

and essential element of the new

financial architecture. As we analized previously, principle of accountability is based on

political obligation, then legislature, through the law, establishes the mechanisms of

control. Although, as we shall see late in paragraph, the target of principle of transparency

is more or less the same like target of principle of accountability – public`s unquestioned (if

sometimes exaggerated) „Right to know““41

. As another similarity, we can exclude that

„[t]ransparency contributes to better decision making and diminishes uncertainties in the

system; consequently, it plays a major role in the reinforcement of the global efficiency of

the economy and in the field of stability.42

While at the same target of these both principles

the principal and thus the key difference is that obligation of principle of transparency is

resulting from economic approach, i.e.:

„helps to prevent the corruption that inevitably occurs when a few have

access to important information, allowing them to use it for personal gain.

Reduced price volatility also tends to be a byproduct of a transparent market

because all the market participants can base decisions of value on the same

data.“43

In general, the principle of the transparency describes like timely promtitude of

information, as a result, this principle is closely related to functions of the States

authorities. In legal literature principles of transparency describes like „an element of

visibility and clarity on the one hand and an element of empowerment and capability on the

other. Transparency in regulation thus entails the process of „seeing through‟ as well as the

„object‟ that is being looked at“44

. Additionally it should be noted, that the consolidation of

this principle in legislature, acts as a preventive measure for market abuse, as a result are

guaranteed protection against (i) market manipulation or insider dealing45

, and (ii) money

laundering or terrorism financing46

. In summary of the above mentioned we can do a

conclusion, that transparency must be developed through better exchanges of information

both in horizontal or vertical communication, i.e. this requires each competent authority to

39L. QUAGLIA, Central Banking Governance in the European union, A comparative analysis

(Routlede, Taylor&Francis Group: London and New York, 2008), p. 2. 40L. LOWENSTEIN, Financial Transparency and Corporate Governance: You Manage What You

Measure (Columbia Law review, Vol 96, No 5 (Jun., 1996)), p. 1342. 41Ibid, p. 1342. 42See supra note 26: P. NOBEL,p. 84. 43Such meaning of transparency is proposed in investors website www.investopedia.com <http://www.investopedia.com/terms/t/transparency.asp> [visited 2011 04 23] 44C.KAUFMANN and R. H. WEBER, The Role of Transparency in Financial Rregulation (Oxford:

Journal of International Economic Law, 2010), p. 782. 45Directive 2003/6/EC; 46Directive 2005/60/EC;

http://www.investopedia.com/

http://www.investopedia.com/terms/t/transparency.asp




regulation”


No. 1 (8), 2012, p. 100-135

110

require a regulated market to take measures to provide investors with certain information47

.

From this point of view it is possible to exclude three dimensions of transparency, i.e.:

1. The first dimension of transparency refers to anchoring financial

regulation in the overall legal framework. This constitutional dimension therefore

defines the procedures and institutions by which financial markets are being

regulated.

2. The second dimension of transparency relates to values and objectives of

financial regulation. It has two aspects: making the objectives and underlying

values of public financial policy transparent and at the same time ensuring that

information is both accessible and comprehensible. The essential element is

quality, not quantity, of information.

3. The third dimension of transparency addresses accountability as another

important aspect of good governance. Given the variety of actors and the multitude

of standards applicable to financial markets, ensuring accountability needs to be

addressed from different perspectives.

As with other principles, principle of transparency has also been affected by

globalization, as a result, in highest authorities level, began actively debates on the

importance of this principle. The main axis of this debate was that „investors and other

market observers could obtain only minimal information about pricing, trading volume, and

aggregate open interest in various products that trade“48

. The lack of information as well

experienced in responsible authorities level too, i.e. responsible authorities with a

institutional discretion quite often take decisions without disclousing information that

influenced the existence of such a decision, as a result decisions of the authorities isn`t

motivated and sufficiently supported by evidence. In order to avoid it, they have to

establish clarity in their procedures and to increase transparency. „Laws may require that

regulators' decisions be motivated and sufficiently supported by evidence. The conditions

under which decisions are made matter more than the qualifications of the regulators

themselves“49

, i.e. in the view to maintaining a stable financial system, regulation needs to

focus on preventing uncertainty by establishing transparent criteria for state actions.

Through this understanding of this principle we can resume that principle of transparency

comes from economical approach, whose main idea is the requirements for higher quality

information ensuring transparent and efficient system performance.

Effectiveness in decision making, especially regarding expertise and logistics. As

was mentioned above, the developers of financial markets regulatory and supervision

framework seeks what this system operates without any interference. It can be achieved

47Directive 2004/39/EC: Obligation to execute orders on terms most favourable to the client: 1.

Member States shall require that investment firms take all reasonable steps to obtain, when executing

orders, the best possible result for their clients taking into account price, costs, speed, likelihood of

execution and settlement, size, nature or any other consideration relevant to the execution of the

order. Nevertheless, whenever there is a specific instruction from the client the investment firm shall

execute the order following the specific instruction. 48See supra note 26: G20 working group1, final report. 49See supra note 37.




regulation”


No. 1 (8), 2012, p. 100-135

111

only through effective work50

of the system and it can be reached if all participant of the

system knows and understands the goals and instruments of the system51

. Nowadays, the

financial crisies show, that ineffective regulation of financial market in one country can

have impact not only for this state, but can have impact in international level. Taking into

account the fact that financial law is the system of risk transfer, “[t]he effectiveness of the

system of risk transfer in the financial markets depends on holding the risk to taker to its

losses.”52

As was mentioned above, the principle of effectiveness we need to understand

through proper work of whole system, i.e. through appropriate political, legal and

institutional care facilities; well-developed financial market infrastructure, efficient

financial sector, supervisory system, clearly define the key objectives, the necessary

powers, legal protection, financial resources,as well as independence of functions within a

confidential and supervisory standards body made up of a professional team, supervisory

cooperation andconfidentiality of information meeting exchanges. In order to achieve that

above mentioned components work smoothly there was a need for commonly accepted

standards. The efficient management of systemic risk in financial markets requires effective

international standards of financial regulation that encourage the efficient pricing of risk

and the effective supervision …, therefore, a more effective international regime is needed

to devise international standards and to monitor their implementation and enforcement53

.

One of the most widely applicable international standard, there we can found consolidated

rules of uses of principle of effectiveness is manual of core principles of effective banking

supervision54

. The rules can be divided into the following categories: (i) preconditions for

effective banking supervision (Principle 1), (ii) licensing and structure (Principles 2 to 5),

(iii) Prudential regulations and requirements (Principles 6 to 15), (iv) Methods of ongoing

banking supervision (Principles 16 to 20), (v) Information requirements (Principle 21), (vi)

Formal powers of supervisors (Principle 22), and Cross-border banking (Principles 23 to

25). Additionally it should be noted, that some rules (group of rules) are specific to the

banking market, but some of them are well established and can be usefull in regulation of

whole financial regulation and supervision, for example – (i) an effective system of …

supervision will have clear responsibilities and objectives for each agency involved in the

50

Author`s note: At the level of European union effectiveness is understood throught [p]olicies

[which] must be effective and timely, delivering what is needed on the basis of clear objectives, an

evaluation of future impact and, where available, of past experience. Effectiveness also depends on

implementing EU policies in a proportionate manner and on taking decisions at the most appropriate

level. (European governance, White paper, Commission of the European Communities (2001 07 25,

Brussels, COM (2001) 428 final); 51Author`s note: The idea of participant understanding of goals and instruments of the system is the

main factor for effective work of every system, which importance is enshrined in raport of De

Larosiere roup, in which is saying, that“[t]he Group believes that an effective means of challenging

the decisions of the homeregulator is needed, and therefore makes recommendations designed both to

achieve a step change in the speed and effectiveness of the present arrangements for peer review

(which are at a very early stage of development), and to give force to a considereddecision (if arrived

at), that a home regulator has not met the necessary supervisorystandards. 52J. BENJAMIN, Financial Law (London: Oxford, 2008), p. 579. 53See supra note 15: K. ALEXANDER, R. DHUMALE, J. EATWELL, p. 32. 54Core Principles of Effective Banking Supervision, Basel Committee on Banking Supervision, Basel,

Septemper 1997;




regulation”


No. 1 (8), 2012, p. 100-135

112

supervision of … organisations. Each such agency should possess operational

independence and adequate resources55

, (ii) supervisors must be satisfied that banks have in

place systems that accurately measure, monitor and adequately control market risks;

supervisors should have powers to impose specific limits and/or a specific capital charge on

market risk exposures, if warranted56

and (iii) [a] key component of consolidated

supervision is establishing contact and information exchange with the various other

supervisors involved, primarily host country supervisory authorities57

.

“The [European] Union`s recent approach attempts to combine the effectiveness of a

largely expert-driven rule making process with a sufficient degree of priority setting and

oversight by the politically accountable institutions58

. Additionally, it should be noted that

Community`s approache relies on effective supervision of the institutions of financial

services provision by the member state59

.

Taking into account above mentioned it can be concluded that efficient supervision in

the European Union enhances financial stability which in turn solidifies the continuing

integration. It allows the integrated market to function in proper way and prevents stability

problems, as the result establishes legal certainty, which is essential for creating a stable

environment for efficient financial regulation and supervision. However, in order to achieve

targets mentioned above and establish these principles, the principles must be legislated.

Legitimacy as a process that contributes to state-building60

. Nowadays, as capital in

international markets is moving freely, especially in finance, the last important fundamental

principal of framework of financial regulation and supervision is legitimacy61

. The

legitimacy of international standards62

and rules that regulate different state behavior,

especially in the area of financial regulation, should be determined, in part, by the extent to

which all states that are subject to such standards have an opportunity to participate in their

development. Because states have different levels of power and influence in international

relations, we do not equate the opportunity to participate with actual influence. “The basic

principle of legitimacy in international policymaking should involve the recognition that

the state which is a subject to international norms of economic regulation should have the

55Ibid, Preposition 1. 56Ibid, Preposition 12. 57Ibid, Preposition 24. 58R. GROTE and T. MARAUHN, The Regulation of International Financial Markets, (Cambridge:

University press, 2006), p. 119; 59Author`s note: For example the first generation Directive on prospect uses, simply requires Member

States to identify who are the competent authorities to approve prospectuses, (Council Directive

80/390/EEC); 60Workshop of the OECD INCAF Task Team on Peacebuilding, State Building and Security,

Strengthening State legitimacy in fragile situations, What role and which policies for donors? (2009

03 16) <http://www.oecd.org/document/25/0,3746,en_2649_33693550_44782932_1_1_1_1,00.html>

[visited 2011 05 15]; 61Athor`s note: Only if the actions of an independent regulatory agency have legitimacy in the eyes of

the political principals, the regulated firms, and the broader public can it be genuinely effective and

use the granted independence effectively. (See supra note 37: NOBEL, M. QUINTYN, and others). 62Author`s note: The New Basel Capital Accord and other standards of committee Bank of

International Settlements are undoubtedly perceived as international standards of best practice witrh

broad adherence by most countries of the world.

http://www.oecd.org/document/25/0,3746,en_2649_33693550_44782932_1_1_1_1,00.html




regulation”


No. 1 (8), 2012, p. 100-135

113

opportunity to participate and influence the development and maintenance of such

standards”.63

The emphyrical approach of legitimacy is concerned with people‟s

perceptions and beliefs, rather than with observance of normative rules: whether, how and

why people accept a particular form of rule as being legitimate. A political order, institution

or actor is legitimate to the extent that people regard it as satisfactory and believe that no

available alternative would be vastly superior (Bonnell and Breslauer, 2001)64

. In generally

uses of principle of legitimacy is based of four sources, i.e.:

“[I]nput or process legitimacy, which is tied to agreed rules of procedure;

output or performance legitimacy, defined in relation to the effectiveness and

quality of public goods and services (in fragile situations, security will play a

central role); shared beliefs, including a sense of political community, and

beliefs shaped by religion, traditions and “charismatic” leaders; and

international legitimacy, i.e. recognition of the state‟s external sovereignty and

legitimacy.”65

The importance of this principle can be explained by the fact that today, when states

act in international market, they have different levels of powers and some of them cannot

have influence to decision making in international relations, as a result, in order to prevent

their participation in decision-making process, this process must be structured in the way,

that these states can act in rule making process. “This type of involvement gives a greater

degree of ownership over the standards and possibly fosters a certain political willingness

to implement and enforce the standards in good faith.”66

And finally, it can be concluded that legitimization is a never ending process with

basis on which the state and the society are linked and interact and by which state authority

is justified. “It is about a vision of what the authority and the community who shares it is

about and is to do”.67

As was mentioned above, it is concluded, that only cooperation of all mentioned

principles can give the result for better governance and the framework for better financial

regulation and supervision, that can be achieved

“[T]hroughout the global governance of financial systems requires

effectiveness in decision making, especially regarding expertise and logistics,

accountability in ensuring that decision making is transparent and provides

clear lines of authority between those who make decisions and those who are

subject to them, and legitimacy concerning the degree of ownership and

influence that countries have in setting international standards.”68

63See supra note 15: K. ALEXANDER, R. DHUMALE, J. EATWELL, p. 45. 64Conflict and Fragility, The State‟s Legitimacy in Fragile Situations unpacking complexity, OECD

(2010), p. 16. 65Ibid, p. 23. 66See supra note 15: K. ALEXANDER, R. DHUMALE, J. EATWELL, p. 45. 67See supra note 63: OECD, p. 6. 68See supra note 15: K. ALEXANDER, R. DHUMALE, J. EATWELL, p. 33.




regulation”


No. 1 (8), 2012, p. 100-135

114

2. REFORM OF EUROPEAN UNION FINANCIAL

REGULATION AND SUPERVISION

Nowadays, especially when all restrictions on the movement of capital between

Member States and between Member States and third countries are prohibited69

, financial

services have become increasingly important in the European Union70

. Such services are

essential not only for the everyday life of EU citizens, but also for the EU economy at large.

In general, the recent economical and financial crisis, then authorities in accordance with

doctrine of “too big to fail”71

spent huge government spending to stabilize the banking

system, highlighted the need to take immediate action, thereby enhancing, the European

financial regulation and supervision. Facts mentioned above explain the large number of

offered EU specific regulatory measures, which were and are taken in the area of financial

services and directly or indirectly affect financial service in whole EU. Many of new

regulating and supervision measures were proposed in the De Larosière report72

in 25

February 2009. We can also detect the need to reform the EU financial system in The

Turner Review73

and his discussion paper DP 09/274

too. Future noted that this reports, i.e.

De Larosière report and Turner Review, fundamentally agree on main task`s of this reform.

After De Larosière report the Commission of the European communities on 27 May 2009

issued the comunnication regarding Europien financial supervision75

, which in general

reflected the main proposals presented in the De Larosière report. According to the De

Larosière report and above mentioned communication from the commission, in which was

proposed, that the new Europen financial supervisory system should be created of two

69Consolidated versions of the Treaty on European Union and the Treaty on the Functioning of the

European Union, 2010/C 83/01, article 63 (ex Article 56 TEC); 70hereafter – “EU”. 71The idea of „Too big to fail“ is that a business has become so large and ingrained in the economy

that a government will provide assistance to prevent its failure. "Too big to fail" describes the belief

that if an enormous company fails, it will have a disastrous ripple effect throughout the economy

<http://www.investopedia.com/terms/t/too-big-to-fail.asp> [Visited 2011 04 23]. The meaning of

„too big to fail“ we can find in the report of The High-Level group on Financial supervision in the

E.U, chaired by Jacques del Larosiere (Brussels, 2009 02 25) too. They are explaining it like meaning

that they [banks] can expose the rest of society to major costs and are subject to acute moral hazard.

(The high-level group on financial supervision in the EU, The de Larosiere Group report(Brussels,

2009 02 25), paras 234. 72 Report of The High-Level group on Financial supervision in the EU published on 25 February

2009. The Group was chaired by Mr Jacques de Larosière.Hereafter – “DeLarosière report”. 73The Turner Review, A Regulatory Response to the Global Banking Crisis, (March 2009)

<http://www.fsa.gov.uk/pages/Library/Corporate/turner/index.shtml> [visited 2011 04 23]. The Lord

Aidair Turner is chairman of Financial Services Authority (FSA) which is the regulator of the

financial services industry in the UK<http://www.fsa.gov.uk/Pages/About/Who/board/turner.shtml>. 74Discussion paper DP09/2: A regulatory response to the global banking crisis,

<http://www.fsa.gov.uk/pages/Library/Policy/DP/2009/09_02.shtml> [Visited 2011 0423] 75European financial supervision, Communication from the Commission (2009 05 27, {SEC (2009)

715}, {SEC(2009) 716}).




regulation”


No. 1 (8), 2012, p. 100-135

115

pillars which will be the new, based on two levels, system of European financial regulation

and supervision. The main recommendations of the de Larosière group focus on76

:

Creation of a European Systemic Risk Board77

that would be responsible

for macro-prudential oversight of the financial system within the Community in

order to prevent or mitigate systemic risks, to avoid episodes of widespread

financial distress, contribute to a smooth functioning of the Internal Market and

ensure a sustainable contribution of the financial sector to economic growth78

. It

will be the „macro-prudential supervision“, and

Creation of a European System of Financial Supervision79

consisting of

a network of national financial supervisors working in tandem with new European

Supervisory Authorities (ESA`s), created by the transformation of existing

European supervisory committees in a European Banking Authority (EBA), a

European Securities and Markets Authority (ESMA), and a European Insurance

and Occupational Pensions Authority (EIOPA). The ESFS should be built on

shared and mutually-reinforcing responsibilities, combining nationally-based

supervision of firms with specific tasks at the European level. The ESFS would

also foster harmonised rules and coherent supervisory practice and enforcement80

.

Thereby creating „micro-prudential supervision“.

On 22 September 2010, European Parliament – following agreement by all Member

States - voted through the new supervisory framework proposed by the Commission. This

was confirmed by the ECOFIN Council on 17 November 2010. Three European

supervisory authorities (ESA`s) and a European Systemic Risk Board (ESRB) were

established as from January 2011 and replaced the former supervisory committees.81

2.1. MACRO-PRUDENTIAL SUPERVISION: ESRB

The ESRB is the essential building block which ensures macro-prudential

supervision. As mentioned above, by the beginning of the reform regulation it was focused

mainly on the national level, e.c. supervisors were assessed by the balance sheets of

individual financial institutions without due consideration for interactions between

institutions and between institutions and the broader financial system. Seen from today`s

perspective, when ESRB is established82

and started his work from 01 January 2011,

emergence new macro level supervision. The main role83

of established board are macro-

prudential oversight of the financial system within the Community in order to prevent or

mitigate systemic risks within the financial system. The ESRB isn`t legal person and was

76Proposal for a Regulation of the European parliament and of the council on Community macro

prudential oversight of the financial system and establishing a European Systemic Risk Board (2009

09 23, Brussels, COM (2009) 499 final, 2009/0140 (COD)). 77Hereafter – “ESRB”. 78See supra note 75: Proposal, Chapter 1, p. 2. 79Hereafter – “ESFS”. 80See supra note 75: Proposal, Chapter 1, p. 2. 81Information from official website of European Commission

<http://ec.europa.eu/internal_market/finances/committees/index_en.htm> [visited 2011 04 23]. 82See supra note 75: Proposal, Article 1. 83Ibid, Article 3, para 2.




regulation”


No. 1 (8), 2012, p. 100-135

116

established on the basis of Article 95 of the EC Treaty84

. It does not have legally binding

powers and its main responsibility is to avoid episodes of widespread financial distress,

contribute to a smooth functioning of the Internal Market and ensure a sustainable

contribution of the financial sector to economic growth. The creation of ESRB was an

unprecedented event in EU as result it should be the fixation of main principles of financial

market supervision and regulation, i.e.:

before reform supervision was in pursuance of states national authorities,

when the stability of individual firms was supervised in isolation with little focus

on degree of interdependence within national financial system. Establishing of

ESRB will create warnings mechanism in the interaction between micro and macro

levels, as a result, will be assured principle of efficiency of financial supervision

and regulation. Future noted that the lack of the efficiency was the general

weakness of EU financial system, which cause the financial crisis of hole

community,

Another important issue before crisies was risk asssessments, then

systemic risk was observable and manageable only at the national level, as a result

supranational authorities could not have clear view of whole community financial

system and could not manage its macro level. ESRB without being a legal entity,

but giving to them a broad leeway for independent judgements, high quality

analysis and sharpness in its conclusions, willensure principle of legitimacy,

And finally the ESRB will be the main pathfinder, whose task will be the

developement of the European macro-prudential perspectives to address the

problem of fragmented individual risk analysis at national level;

In order to implement the principle of efficiency the main decision-making body of

the ESRB will be the General Board. The General board will consists of two parts – the

members of the General Board with voting rights85

and members without voting rights86

. In

everyday work of the board they have been granted the rights of collecting87

and

84By way of derogation from Article 94 and save where otherwise provided in this Treaty, the

following provisions shall apply for the achievement of the objectives set out in Article 14. The

Council shall, acting in accordance with the procedure referred to in Article 251 and after consulting

the Economic and Social Committee, adopt the measures for the approximation of the provisions laid

down by law, regulation or administrative action in Member States which have as their object the

establishment and functioning of the internal market. 85See supra note 76:Article 6, para 1:The following persons shall be Members of the General Board

with voting rights (a) the President and Vice-President of the ECB; (b) the Governors of the national

central banks; (c) a Member of the European Commission; (d) the Chairperson of the European

Banking Authority; (e) the Chairperson of the European Insurance and Occupational Pensions

Authority; (f) the Chairperson of the European Securities and Market Authority. 86Ibid, Article 6, para 2: The following persons shall be Members of the General Board without

voting rights: (a) one high level representative per Member State of the competent national

supervisory authorities; (b) the President of the Economic and Financial Comittee; 87 Ibid, Article 15, para 2: The European Supervisory Authorities, the national central banks and

Member States shall cooperate closely with the ESRB and provide all the information necessary fort

he fulfilment of its tasks in accordance with Community legislation;




regulation”


No. 1 (8), 2012, p. 100-135

117

exchanging88

the information what a result after the identification of significant risk, which

is defined in Article 3, para 1, of above mentioned proposal89

, the ESRB will must provide

warnings and, where appropriate, issue recommendations for remedial action90

. Warnings

will be transmitted through the Council, thereby achieving the weight and legitimacy of

ESRB recommendations.

Additionally, it should be noted that efficiency of ESRB will also be realised through

the cooperation with the relevant international financial institutions, like International

Monetary Fund, Financial Services Authority and another third countries bodies with

purpose to maintain the financial stability in macro-prudential level.

As can be seen from the above mentioned, on the one hand, ESRB being only an

advisory body, but with a flexible and widely adjustable EU regulatory framework,

consolidate two main principles of financial supervision and regulation – efficiency and

legitimacy, but in other hand, the purpose of justifying the useful work of ESRB can be

understood only throught the effective cooperation with ESFS.

2.2. EUROPEAN SYSTEM OF FINANCIAL SUPERVISION:

THREE NEW ESAS

New ESAs with legal personality, legal powers and greater authority. After

completion of the reform ESFS in tandem with ESRB will create common innovative

framework of European financial regulation and supervision, in which ESFS become an

operational European network with shared and mutually reinforcing responsibilities. Before

outgoing reform at the EU level there were three committees of supervisors, i.e. (i)

Committee of European Banking Supervisors (CEBS), (ii) Committee of European

Insurance and Occupational Pensions Supervisors (CEIOPS) and (iii) Committee of

European Securities Regulators (CESR), which in the implementation of the reform have

been replaced by three new European Supervisory Authorities (ESAs), i.e.:

European Banking Authority91

which take over, as appropriate, all

existing and ongoing tasks from the Committee of European Banking Supervisors

(CEBS)92

,

European Insurance and Occupational Pensions Authority93

which take

over, as appropriate, all existing and ongoing tasks from the Committee of

European Insurance and Occupational Pensions Supervisors (CEIOPS)94

, and

88Ibid, Article 15, para 1:The ESRB shall provide the European Supervisory Authorities with the

information on systemic risks necessary for the achievement of their tasks; 89See supra note 76, Article 3, para 1: The ESRB shall be responsible for the macro-prudential

oversight of the financial system within the Community in order to prevent or mitigate systemic risks

within the financial system, so as to avoid episodes of widespread financial distress, contribute to a

smooth functioning of the Internal Market and ensure a sustainable contribution of the financial sector

to economic growth. 90Ibid, Article 16, para 1. 91Regulation (EU) No 1093/2010, Article 1, para 1. 92Ibid, Article 8, para 1 (l), thereafter – “EBA”; 93Regulation (EU) No 1094/2010, Article 1, Para 1. 94Ibid, Article 8, para 1 (l), thereafter – „EIOPA“.




regulation”


No. 1 (8), 2012, p. 100-135

118

European Securities and Markets Authority95

to take over, as appropriate,

all existing and ongoing tasks from the Committee of European Securities

Regulators (CESR)96

.

After the enforcement of above mentioned regulations97

and taking into account the

fact that these new authorities were created as a result of a single reform of European

financial market regulation and supervision, therefore their activity is regulated in a similar

legal way. It should be noted only the fact, that the slight difference is in regulation of

EIPOA, as this supervisor stakeholder group. In this Authority, to help to facilitate

consultation with stakeholders in areas relevant to the tasks of the EIPOA two groups were

established – an Insurance and Reinsurance Stakeholder Group and an Occupational

Pensions Stakeholder Group98

, while in EBA and ESMA is only one stakeholder group99

.

Despite these differences, all above mentioned ESAs are faced with similar task. The main

task of ESAs, which is relevant to the main point of this article is next: (i) to contribute to

the establishment of high-quality common regulatory and supervisory standards and

practices100

, to contribute to the consistent application of legally binding Union acts101

, to

monitor and assess market developments in the area of its competence102

and to contribute

to the consistent and coherent functioning of colleges of supervisors, the monitoring,

assessment and measurement of systemic risk, the development and coordination of

recovery and resolution plans, providing a high level of protection [of their supervised

areas] and throughout the Union103

. In order to achieve this tasks, after the author`s

systematization of powers, we can divide this groups of ESAs powers: (i) developement

draft regulatory and implementing technical standarts in the specific cases, (ii) issue

guidelines, recommendations and opinions to the European Parliament, the Council or the

Commission, (iii) taking individual decisions addressed to competent authorities in their

supervised areas, (iv) collecting the necessary information, (v) developing of common

methodologies and (vi) providing a centrally accessible database in their supervised areas.

The above mentioned appropriatable powers, which were given to ESAs and cleary

defined tasks of the ESA`s, provide incentives and as a result will be guaranteed principles

of integrity, transparency, effeciency and orderly functioning of financial markets.

Additionally should be noted, that these principles were embbeded in all of our analyzed

regulations104

. Following the implementation of the reform of the EU financial regulation

95Regulation (EU) No 1095/2010, Article 1, para 1. 96Ibid, Article 8, para 1 (l), thereafter – „ESMA“. 97 i.e. Regulation (EU) No 1093/2010, No 1094/2010 and No 1095/2010; 98 Regulation (EU) No 1094/2010,Article 37, para 1 99 Accordingly Regulation (EU) No 1093/2010, Article 37, para 1 and Regulation (EU) No

1095/2010, Article 37, para 1; 100 Accordingly Regulation (EU) No 1093/2010, Article 8, para 1(a), Regulation (EU) 1094/2010,

Article 8, para 1(a) and Regulation (EU) No 1095/2010, Article 8, para 1(a); 101 Accordingly Regulation (EU) No 1093/2010, Article 8, para 1(b), Regulation (EU) 1094/2010,

Article 8, para 1(b) and Regulation (EU) No 1095/2010, Article 8, para 1(b); 102 Accordingly Regulation (EU) No 1093/2010, Article 8, para 1(f), Regulation (EU) 1094/2010,

Article 8, para 1(f) and Regulation (EU) No 1095/2010, Article 8, para 1(f); 103 Accordingly Regulation (EU) No 1093/2010, Article 8, para 1(i), Regulation (EU) 1094/2010,

Article 8, para 1(i) and Regulation (EU) No 1095/2010, Article 8, para 1(i); 104See supra note 90: Regulation (EU) No 1093/2010,Article 1, para 5 (b).




regulation”


No. 1 (8), 2012, p. 100-135

119

and supervision and comparing it with the former EU financial market regulation and

supervision we can exclude this general points of our new system.

Ensure single set of rules. Before the reform one of the main problems was the lack

of a consistent set of rules. As noted in the report of the de Larosière group105

:

“ There [was] at least four reasons for this:

- a single financial market - which is one of the key-features of the Union –

cannot function properly if national rules and regulations are significantly

different from one country to the other;

- such a diversity is bound to lead to competitive distortions among

financial institutions and encourage regulatory arbitrage;

- for cross-border groups, regulatory diversity goes against efficiency and

the normal group approaches to risk management and capital allocation;

- in cases of institutional failures, the management of crises in case of

cross-border institutions is made all the more difficult“.

In order to avoid situation, when inconsistent transportation of EU financial market

regulation, what occurred through derogations, exceptions, additions founds in Directives,

required to develop directly applicable rules at ESFS level. The Legislator influenced by

this problem in the new ESAs regulations give the directly applicable powers to competent

authority, for example, “If a competent authority does not comply with the settlement

decision addressed to it, the Authority should be empowered to adopt decisions directly

addressed to financial institutions in areas of Union law directly applicable to them“106

.

After the consolidation of these powers it became an effective instrument of establishment

of harmonized regulatory technical standards and it would be ensured through a single

rulebook. In addition, it should be noted also that this idea is defined not only in the report

of the de Larosière group, but also in regulations of ESAs107

. On one hand, a process of

agreeing a single rulebook and removing of inconsistencies in transposition across Member

States will help to consolidate the principles of effectiveness and accountability, but on the

other hand, this would also limit the ability of Member States to implement legislation in a

way that is appropriate for the national market, that in some cases provide possibilities

infringe the main principle on which is based whole Union law – Subsidiary.

Ensure consistent application of EU rules. Situation, before the reform which partly

influenced the crises, could be understood as a lack of communication between Members

State‟s authorities. Moreover, this situation was not able to ensure the correct and

consistent application of European Union law but allow the emergence of the financial

crises. This was another reason for allowing the arising of the financial crises. In the report

of the de Larosière group it was mentioned that the clear and consistent framework for

crisis management is required withfull transparency and certainty that the authorities have

developed concrete crisis management plans to be used in cases where absence of such

105See supra note 71: The de Larosiere Group report,p. 28. 106See supra note 92: Regulation (EU) No 1094/2010, Introduction, Para 31; 107 For example, Introduction, para 21, of Regulation (EU) No 1095/2010 OF THE EUROPEAN

PARLIAMENT AND OF THE COUNCIL of 24 November 2010 establishing a European

Supervisory Authority (European Securities and Markets Authority, amending Decision No

716/2009/EC and repealing Commission Decision 2009/77/EC);




regulation”


No. 1 (8), 2012, p. 100-135

120

public sector support is likely to create uncertainty and threaten financial stability108

. The

Commission of the European community‟s highlighted the lack of consistency too. They

mentioned that “a clear and consistent framework for crisis management is required with

full transparency and certainty that the authorities have developed concrete crisis

management plans to be used in cases where absence of such public sector support is likely

to create uncertainty and threaten financial stability”109

.Then ESAs regulations entry into

force to them was given binding and proportionate decision-making powers in respect of

whether rsupervisors are meeting their requirements under the proposed single rule book

and relevant EU legislation. On the basis of these regulations colleges of supervisors will

play an important role. Their main tasks will be to ensure the efficient, effective and

consistent supervision of financial market participants operating across borders.

Consistency will also be pursued through the investigations of authorities and after that

putting the recommendations to the Members states regulators.

Supervisory powers for some specific pan-European entities. In nowadays, as a

result of globalization, esspecially in European financial markets, then these markets are

increasingly integrated, and the banking and insurance sectors are dominate by pan-

European groups, for example in Lithuania 77,10% of banking sector is on the

Scandinavian capital, and the management of their group`s is centralized in the

headquarters, including the management of risk management too, the effective and timely

communication of pan-European entities is essential thing for crises prevention. Of course

the power to prosecute the communication with entities is fixed in the regulations of ESAs,

for example, “Concerning the issue of direct supervision of institutions or infrastructures of

pan-European reach and taking account of market developments, the Commission shall

draw up an annual report on the appropriateness of entrusting the Authority with further

supervisory responsibilities in this area“110

, but pointed out that this place raise further

doubts about whether it is appropriate instruments to achieve the goals of the reforms and

the principles of them.

2.3. CONCLUSION

The new European financial regulation and supervision framework111

, which was

launched on the 1st of January, 2011, is different from the one which was before the crises.

The authorities which were established after the reform, consisting of macro and micro

prudential level, everyday supervision of companies will perform with supervisors of the

Members States. The main difference is that ESAs will have abbility to influence and in

some cases prohibit the actions of authorities of the Member States. Another important

factor is that the creation of the single rulebook of European financial market regulation

and supervision will limit ability to take national considerations into account when they

will be implementing these rules domestically, that result is clear and of course it is fixed in

regulation, that all ESAs will have binding powers over Member States supervisors in the

108See supra note 71: The de Larosiere Group report,p. 34. 109See supra note 74: Communication from the Commission, p. 33. 110See supra note 90: Regulation (EU) No 1093/2010,Article 81, para 3; 111See Annex 1 – “Framework of European Financial Regulation and Supervision”




regulation”


No. 1 (8), 2012, p. 100-135

121

areas of competence of them. Also it should be noted that authorities of Member states will

be regulated through the macro level too. The macro-level European financial market

supervision will be secure by the ESRB. It should be noted, that the creation of the ESRB,

was unprecedented event and it shows, how much power and flexibilities European Union

law has. After the analysis of ongoing reform, we can access the conclusion, that the new

European financial regulatory and supervision mechanism will work constructivelly, if (i)

the ESRB and ESFS cooperate in the proper way, (ii) listening to the position of the

Member States authorities and (iii) adopting some important recommendations by adopting

them to specific needs of the Members State. Only through this constructive cooperation

European competetive Authorities ensure proper, based on fundamental principles of

financial law, like transparency, effeciency, accountability and legitimacy,work of new

framework of European financial regulatory and supervision.

3. IMPACT THE DEVELOPEMENT OF THE

FUNDAMENTAL PRINCIPLES OF LITHUANIA

FINANCIAL MARKES REGULATION

Since 1 January 2011 European Union began to work in three new supranational

authorities, i.e. new ESA`s, which was created by the transformation of existing European

supervisory committees of the EBA, ESMA and EIOPA, and which is acting in micro level

and accordingly ESRB, which is acting in macro level. The member of European

Commision Mr. Michel Barnier, who is responsible for the financial services said „We

reach a historical agreement“112

and „[t]his new structure are the control tower and the radar

screens that the financial sector needs.”113

The creation of new Authorities, and thus the

creation of new framework of European Union financial regulation and supervision, was

influenced by the fact that of repetition of the former global financial crisis, i.e. the bases

for this reform is to manage systemic risk of financial sector at the European Union level.

So, before we will start to analyze the impact of the reform of the European Union financial

regulation and supervision to fundamental principles of Lithuanian financial regulation and

supervision, we need to take a look on the essential element of Systemic risk.

3.1. SYSTEMIC RISK

General definition of a systemic risk is considered as a „risk inherent to the entire

market or entire market segment.“114

A more comprehensive definition of systemic risk is

proposed by European Central Bank, which is defining it like:

112Speech of commissioner Mr. Michel Barnier, Debates on Financial Agreement, (2010 10 22,

Strasbourg) <http://www.europarl.europa.eu/sides/getDoc.do?pubRef=-

//EP//TEXT+CRE+20100922+ITEM-004+DOC+XML+V0//EN> [visited 2011 05 16]; 113Speech of European Union commissioner Mr. Michael Barnier,

<http://ec.europa.eu/commission_2010-2014/barnier/headlines/speeches/2011/01/20110101_en.htm>

[visited 2011 05 16]; 114Such definition of systemic risk is proposed in investors website

www.investopedia.com<http://www.investopedia.com/terms/s/systematicrisk.asp>, [Visited 2011 04

23];




regulation”


No. 1 (8), 2012, p. 100-135

122

„the risk that the inability of one participant to meet its obligations in a

system will cause other participants to be unable to meet their obligations when

they become due, potentially with spillover effects (e.g. significant liquidity or

credit problems) threatening the stability of or confidence in the financial

system. That inability to meet obligations can be caused by operational or

financial problems“.115

and Bank of Lithuania, which understand systemic risk quite simillar like European

Central bank. For them systemic risk is:

„the risk that the inability of one participant to meet its obligations in a

system will cause other participants to be unable to meet their obligations.

Forsuch adefaultcouldcause significant liquidity or credit problems that could

jeopardize the financial stability of the system. This inability to fulfill its

obligations may result in operational or financial problems.”116

As is clear from the above definitions117

of systemic risk the main aim of financial

regulation is to avoid, contain, or minimise some of the considerable risk inherent in

financial market, originally especially the system risk, in order to protect clients or

customers against the adverse consequences of a failure of their banks or insurance

companies better. “One of the key purposes of financial regulation is to ensure that an

appropriate legal and regulatory framework is maintained that imposes sufficient

obligations on financial institutions to make sure that they manage effectively the risk and

exposures that their activities generate”.118

Modern financial regulation has increasingly

been conducted on a risk basis. This involves the identification of the separate risks and

exposure involved and the imposition of appropriate controls in respect of each.

“Supervision by risk may generally be understood to refer either to the selection of

particular risk for control purpose or the evaluation of regulatory performance against the

particular objective set119

.

Depending on different type of institutions, or even on different countries, this is

achieved by different measures, but all of them should be much better defined or clarified

in accordance with this main financial supervision regulation aims120

:

(i) The protection of clients, like bank depositors, securities investors, and

insurance policy holders against (i) a bankruptcy of the service

provider, (ii) bad selling or advisory practice often cause by a conflict

of interest between service provider and client, or (iii) risky products.

115Annual report 2010, European central bank, p. 275. 116Annual report 2010,Bank of Lithuania, p. 117. 117Author`s note: Aditionally it should be noted that in the legal literature the definition of systemic

risk is quite simillar to this which is proposed in this chapter, i.e. „Risk for the whole of the financial

system, probably arising throught contagion from problems in indivuals banks, sectors of the market

or countries“. (P. HOWELLS and K. BAIN, Financial Markets and Institutions, Fifth Edition, (London:

Pearson Education limited), p. 387); 118 M. BLAIR, G. WALKER, Financial Service Law (London: Oxford university press, 2007) p. 139. 119Ibid, p. 32. 120J. H. DALHUISEN, Dalhuisen on Transnational and Comparative Commercial, Financial and trade

law (Oregon: Hart Publishing, 2007), p. 1106-1111.




regulation”


No. 1 (8), 2012, p. 100-135

123

(ii) The creation of a simplified enforcement regime. Another important

(closely related) aspect of financial regulation is that it may introduce a

quick and cheap complaint procedure for the smaller customers or

investors either through ombudsmen or compulsory arbitration scheme.

(iii) The creation or a proper legal framework for financial products and

services generally. Regulatory concern extends to the legal

characterization and structure of financial products and services. This is

important (and often ignored) area of modern regulatory concern which

may also go into transferability or proper unwinding of investments as

in the case of the more sophisticated derivatives.

(iv) The minimalisation of contagion or systemic risk whilst attempting to

prevent the collapse of one financial firm affecting others.

(v) The integrity and smooth operation of markets. This is of importance

foremost in the investment services industry, more so than in

commercial banking.

(vi) The concern with asymmetric markets. This is a particular academic

concern with the functioning of the markets and with market

transparency. The idea is that goods that cannot be properly inspected

and valued should be sold at an average price, which may be so low that

it induces the seller of the better goods to withdraw from the market

altogether.

(vii) The creation of a level playing field, especially between commercial

banks. The idea here is that the more prudent bank should not in the

short term be punished for its financial prudence and affected in its

competition with other banks.

(viii) The prevention of monopolies amongst intermediaries in the financial

services.

(ix) Concern for the reputation and soundness of the financial services

industry and financial sectors and markets in the centre(s), from which

they operate. This goes beyond systemic concerns and market integrity

and is more properly the issue of confidence.

Thus, it follows from the definition of systemic risk and main aims of financial

regulation, the object of it is stable condition of individual financial institution, as a result is

guaranteed the protection of client of financial institutions.

3.2. IMPLEMENTATION OF LITHUANIA FINANCIAL

AMRKET REGULATION AND SUPERVISION

As is clear from this article, for the smooth operation of any system, the regulation

and supervision must be based on fundamental principles of this system. Each system is

based on its own, to their satisfaction adopted, fundamental principles. Financial regulation

and supervision is based on principles, which ensure that rules of regulation and

supervision are legitimate, which is achieved through the accountability of responsible

authorities, which must be transparent, as a result this system become effective. While these




regulation”


No. 1 (8), 2012, p. 100-135

124

principles can be applied to separate systems of financial regulation and supervision, but

they must be tailored to the specific needs of each system.

Framework of Lithuanian financial regulation and supervision - three independent

financial supervisory authorities. Currently, the Lithuanian financial market supervision is

executing by the three financial market supervision authorities – Bank of Lithuania, The

Securities Commission of Republic of Lithuania and The Insurance Supervisory

Commission of the Respublic of Lithuania.

Bank of Lithuania is responsible for prudential supervision of credit institutions,

whose activity is regulated by the Republic of Lithuania law on the bank of Lithuania121

.

To summarize, the main goal of the Bank of Lithuania in credit institutions supervision

field „is to monitor the compliance of credit institutions with the standards as set by the law

and legislation of the Bank of Lithuania and recommended in International Accounting

Standards and by the Basle Committee on Banking Supervision“.122

These activities include

– licensing, information gathering, which is necessary for the supervision, analysis,

supervision of financial institutions and the assessment of the state according to the

information maintained by agencies and statutory inspection ofthe impact of measures for

their application. The Bank of Lithuania shall exercise supervision of credit institutions

governed by the above mentioned Republic of Lithuania law on the bank of Lithuania,

Republic of Lithuania law on banks123

, Republic of Lithuania law on the central credit

union,124

Republic of Lithuania law on credit unions.125

Additionally it should be noted, that

the Bank of Lithuania must comply with Republic of Lithuania law on financial

institutions.126

As was mentioned in the second part of this article, banking sector is the

most important sector in Lithuanian finance system, since it`s smooth and efficient

operation depends on the overall market stability. As a result, Bank of Lithuania approved

the core principles for the effective banking supervision, which provides that:

“in effective system of supervision, all institutions which engaged in

banking supervision, must clearly define the objectives and responsibilities. Such

institutions must be independent, their processes must be trasnparent, proper

management, their must have sufficient recources to conduct its business and

must be accountable for their responsibilities”.127

The Securities Commission of Republic of Lithuania128

has jurisdiction on the

supervision of the securities market and protection of investors. The Securities Commission

is responsible for prudential supervision of brokerage firms, management firms, financial

121 The Republic of Lithuania Law on the Bank of Lithuania (200103 13, No VIII-1835); 122Supervision of credit institutions,<http://www.lb.lt/about_the_supervisory_activities> [visited

2011 05 19]. 123Republic of Lithuania law on banks, OG (2004, No. 54-1832); 124Republic of Lithuania law on the central credit union, OG (2008, No. 76-3003); 125Republic of Lithuania law on credit unions, OG (1995, No. 26-578); OG (2000, No. 45-1289); OG

(2001, No. 23-762); OG (2002, Nr. 65-2639), OG (2008, No. 76-3003); 126Republic of Lithuania law on financial institutions, OG (2002, No. 91-3891); 127 Of the impelemtation of the main principles for effective banking supervision which was approved

by the Basel Committee on Banking Supervision, Decision of Board of Bank of Lithuania (1998 12

17, No 224); 128 Thereafter – „The Securities Commission“;




regulation”


No. 1 (8), 2012, p. 100-135

125

advisory firms and prudential supervision of customer services. This institution is governed

by the above mentioned Republic of Lithuania Law on Financial Institutions, Republic of

Lithuania Securities Law,129

Republic of Lithuania Law on Markets in Minancial

Instruments,130

Republic of Lithuania Law Amending Law on Pension Funds,131

Republic

of Lithuania Faw on the Accumulation of Pensions,132

Republic of Lithuania Law on the

Accumulation of Occupational Pensions,133

Law on Collective Investment Undertakings,134

Republic of Lithuania Holding Investment Company Law,135

and legislation of Securities

Commission. Summarizing the above mentioned legislation, it must be concluded that the

head of the Securities Commision is responsible for136

(i) legislative development and

improvement, i.e. in order to improve regulation and increase legal certainty and thereby

contribution to the development of the market conditions, the Securities Commission is

preparing laws and drafts of law, other drafts of law, official explanations, guidelines and

planned new legislation changes. It should be noted, that through this activity the efficient

functioning of financial markets is ensured. (ii) supervision of financial instruments, i.e.

supervision of issuers, regulated market supervision, supervision of management

companies and pension funds, supervision of financial brokerage firms and corporate

governance compliance with adequacy requirements, supervision of implementation of

markets in financial instruments acts, investigates complaints, participation in proceedings

and finally licensing, (iii) Education of investors, i.e. The main aims of ongoing investors

education program – to encourage people to take care of their finances and secure financial

future, to develop a global culture of investment, encourage the public, governmental and

non governmental organization be interested in the topic of financial education, (iv)

institutional cooperation, i.e. The Securities Commission actively cooperate with European

Securities Regulator Committee and it`s working groups, for example transparency group,

takeover group and others, the International organization of Securities Commission, and

other international organisations. Of course, the Securities Commission carries out inter

institutional cooperation too.

The Insurance Supervisory Commission of the Respublic of Lithuania137

perform

supervision of insurance, reinsurance, insurance and reinsurance brokerage business138

.

The main purpose of the Supervisory Commission is to ensure reliability, efficiency, safety,

and stability of the insurance system and protection of interests and rights of the

129Republic of Lithuania Securities Law, OG (2007, No. 17-626); 130 Republic of Lithuania law on markets in financial instruments, OG (2007, No. 17-627); 131Republic of Lithuania law amending law on pension funds, OG (1999, No. 55-1765); 132Republic of Lithuania law on the accumulation of pensions, OG (2003, No. 75-3472); 133Republic of Lithuania law on the accumulation of occupational pensions, OG (2006, No. 82-3248); 134Law on collective investment undertakings, OG (2007, No. 117-4772); 135Republic of Lithuania Holding Investment Company law, OG (2003, No. 74-3425); 136Report of the Securities Commision and Financial Instrument Market Trends, The Securities

Commission of the Respublic of Lithuania, 2009. 137 Thereafter – „The Insurance Commission“; 138 Regulations of the Insurance Supervisory Commission of the Respublic of Lithuania (2004 01 13,

Decision No 27), Para 1.




regulation”


No. 1 (8), 2012, p. 100-135

126

policyholders, insured, beneficiaries, and injured third parties139

. In general, this institution

is governed by the Republic of Lithuania law on insurance140

and above mentioned

regulation. According to the author of this article, we can distinguish the following main

functions of Insurance Comission141

: (i) draft, approve, amend, and repeal legal acts

regulating activities of insurance undertakings, insurance intermediaries, branches of non-

member-country insurance undertakings and branches of companies of independent

insurance intermediaries established in the Republic of Lithuania, including financial and

statistical accounts of insurance undertakings and branches of non-member-country

insurance undertakings, (ii) grant and revoke licences to engage in insurance and insurance

mediation activity, (iii) observe, analyse, check and supervise in other ways activities of

insurance undertakings, insurance broker companies, branches of non-member-country

insurance undertakings and branches of independent insurance intermediaries established in

the Republic of Lithuania, (iv) apply sanctions provided by the law, (v) co-operate with

competent authorities, financial and capital market supervisory institutions, competition

and consumer rights protection institutions of the Republic of Lithuania, other European

Union Member States and non-member states as well as with other institutions of the

Republic of Lithuania, and (vi) inform the public about fulfillment of the functions of the

Insurance Commission, significant changes in the insurance system and publish drafts of

the Insurance Commission regulations on the Internet website of the Insurance

Commission. Additionally it should be noted, that for effective work of Insurance

Commision they have the right to detailing the legislation of the insurance law. Taking into

account the fact that one of the most important functions of financial regulation and

supervision is protection of consumer interest, one of the important functions of the

Insurance Commission is the disput resolution of the consumers and insurer142

. Technically

disputes are dealt in writing to the Insurance Commission by the correspondence with the

insurer and the consumer, to a mutually satisfactory solution. In one hand, the efficiency of

this kind of disputes resolution is, that the dispute settlement are heard by the experts of the

Insurance field and they are free of charge, what makes this approach attractive, but in

other hand the decisions of the Insurance Commission are only recommendatory, which do

not create rights and obligations of the parties. In the author`s opinion, for the effectiveness

litigation, the law should contain a rule that decisions taken by the Insurance Commission

were binding powers to the parties.

Thus, the analysis of the framework of Lithuanian financial supervision and regulation

shows that different financial sectors are governed by different laws and these sectors are

supervised by the different responsible supervision authorities. It is worth to note that

139 Regulations of the Insurance Supervisory Commission of the Respublic of Lithuania (2004 01 13,

Decision No 27), Para 5; 140Republic of Lithuania law on Insurance, OG (2003, No. 94-4246); 141Main functions of Insurance commission, <http://www.dpk.lt/en/apie.funkcijos.php>, [visited 2011

05 19] 142Republic of Lithuania law on Insurance, OG (2003, No. 94-4246), Article 207, para 1, which is

saying that the supervisory committee examines consumer`s disputes with insurer, if the insurance

contract arising out of or in connection with it, if the contract is the applicable law of the Republic of

Lithuania.




regulation”


No. 1 (8), 2012, p. 100-135

127

during the writing of this article, financial market regulation and supervision began major

changes in Lithuania, i.e. by the decision of the Government of Republic of Lithuania

conception of the Lithuania financial sector Supervisors interconnection had beed

approved143

. The main idea of this conception is to combine the above analised financial

market supervisory authorities into a single, for the purpose of carrying out common

institutional supervision of financial market, i.e. it will be liquidated the Securities

Commission and the Insurance Commission and their oversight functions will be

transferred to the Bank of Lithuania144

. However, in the view to the fact that this Lithuanian

financial supervision reform is only at the initial stage145

, as a result currently prepared

drafts of law`s, were not analyzed in this work because this is not the aim of this article.

As can be seen from this article, when the new framework were launched to the

financial market regulation and supervised at the European Union level, better manageable

systemic risk appeared as a result of financial crisis and can be identified at an early stages

for them. Taking into account the fact that Lithuania is a member of the European Union

and its financial regulation in generally is based on the core recomendations and

requirements of the European Union legislation, Lithuania„a financial market regulation

and supervision remain unchanged. Though the legislation will remain unchanged, there is

no doubt that European Union financial market regulatory and supervision reform will have

a major impact on the development of the fundamental principles of Lithuanian financial

market regulation.

As can be seen from the second part of this article, Lithuanian supervision authorities

will continue to be responsible for day to day regulation and supervision. The main

difference is that instead of taking part in the European Union supervisory committees, now

they will participate in the new established ESAs. Significant impact on fundamental

principles of Lithuanian financial market regulation will have the establishement of the

ESRB, i.e. the main task of ESRB is the identification of systemic risk in all financial

sectors, that a result with increased systemic risk, they will have powers launch

recomendation and warnings at micro level. These recomendations and warnings can be

dedicated for the whole European Union, for the ESAs and for member states and its

responsible supervision authorities. The fact, that ESRB through the monitoring of the

whole European Union and different member states will have indirect binding powers, it

will have direct impact to accountability principle at Lithuanian level, i.e. the powers of the

143Decision of the Approval of the Interconnection of the Financial Market Supervisory Authorities of

The Respublic of Lithuanian, Government of the Republic of the Lithuania (2010 05 19, No 580); 144See supra note 139: , para 36; 145Author`s note: The first discussion (conference) of the competent authorities and interested parties,

with the participation of the author of this article, took place at 2011 05 21. The main speakers was:

(i) Ms. Ingrida Šimonytė, Minister of Finance of the Republic of Lithuania, (ii) Dr. Audrius

Misevicius, Member of the Board of the Central Bank of the Republic of Lithuania, (iii) Mr. Ramunas

Kaklauskas, Head of the Department of Law and International Relations at The Securities

Commission of the Republic of Lithuania, (iv) Dr. Stasys Kropas, President of the Association of

Lithuanian Banks, (v) Mr. Andrius Romanovskis, Director of the Lithuanian Insurance Association,

(vi) Dr. Vitas Vasiliauskas, Chairman of the Board of the Central Bank of the Republic of Lithuania.

Organizator of the conference law firm „Eversheds Saladžius“, in cooperation with the Association of

Lithuanian Bank. More info on the law firm „Eversheds Saladžius“ website.

<http://www.evershedssaladzius.lt/en/news/?id=479>.




regulation”


No. 1 (8), 2012, p. 100-135

128

ESRB encourage that the participants of Lithuanian financial service accept full

responsibility for their behavior. It would require them to act in good faith, that a result

would be required to be given a fair and reliable information about the functioning of

financial markets and thereby ensure a higher degree of transparency.

At the Lithuanian level, transparency will be affected through the developement of

neccessary standards and requirements of wider access to information. Therefore, through

the ESAs creation of required standards and the recomendations to the Lithuanian financial

supervision authorities, will be ensured both the validity and legality of this actions. It

should be also noted that besides the positive impact to the principles of Lithuanian

financial market regulation and supervision, developement of such legitimacy will have a

negative impact too, i.e. the requirement of wider access to the information, held by some

market participants, will reduce the profitability of financial market participants, especially

it feels in derivatives market, which results could affect the entire economy of the

Lithuania. Regardless of these potential negative impact, it should be noted that the shift of

individual awarness of the principles of the Lithuanian financial market increase its

effectiveness.

The author of this article believes that the major importance, in terms of changes of

principles of Lithuanian financial markets regulation, will have changes for the principles

of effectiveness. This principle will be affected by the unified approach to processes of

supervision practice, the uniform application of rules in the Lithuania and another EU

member states. The importance of this principle occurs in the situations when Lithuanian

responsible supervision authorities have to cooperate with other EU member states

responsible supervision authorities, performing monitoring of the global operating financial

groups. In the point of view of Lithuania`s perspectives, importance is that ESAs can help

reach agreaments for common solutions and in case of dispute – to take dispute resolution

process.

CONCLUSIONS

The hypotesis that EU financial regulatory and supervision reform will revolutionize

the understanding of the fundamental principles of Lithuanian financial markets regulation

has been proved.

1. The basis of the theoretical and practical studies can argue that financial regulation

and supervision require effectiveness in decision making, accountability in ensuring that

decision making is transparent, providing clear lines of authorities between those who make

decisions and those who are subject to them, and legitimacy in influencing to the countries

setting of international standards.

2. Constructive cooperation of the European competetive authorities with the

Lithuanian responsible supervision authorities of the financial market ensure proper, based

on fundamental principles of financial law, like transparency, effeciency, accountability and

legitimacy,work of new framework of European financial regulatory and supervision.

3. The new framework of the European financial regulation and supervision is

different from the one which was before the crises. The authorities which were established

after the reform are performing the prudential macro and micro European Union financial




regulation”


No. 1 (8), 2012, p. 100-135

129

regulation and supervision. The main difference is that ESAs will have abbility to

influence and in some cases prohibit the actions of responsible supervision authorities of

the Lithuanian financial market. The creation of the new monitoring mechanism will

increase the level of accountability in Lithuanian financial law.

4. Analysis of the main causes of the global financial crisis can argue that the main

factor of the financial crisis was instability. The proper financial regulation and supervision

must be applied to the participations of the whole financial market. The stricter rules ensure

proper and reliable information about the work of the financial market to the investors and

general institutions. As a result it will change the understanding of the principles of the

transparency.

5. Under the regulation and supervision of cross border financial groups make a

possibility to agree on common decisions. Cooperation of the Lithuanian responsible

supervision authorities with the others Member State supervision authorities or ESAs, will

ensure maximum effectiveness of the Lithuanian financial regulation and supervision.

6. The principle of legitimacy will be enshrined only through the ESAs creation of

required standards and the recomendations of the Lithuanian financial supervision

authorities.

7. Only the interaction of the principles of the accountability, transparency,

effectiveness and legitimacy will create a suitable mechanism for monitoring the systemic

risk of the Lithuanian and the whole European Union financial regulation and supervision.

LITERATURE

BOOKS

HART H. L. A., The Concept of Law (Oxford: Clarendon press, 1997); AVILA, H., Theory of Legal Principles, (Munich: Springer, 2007); MCLEOD, I., Legal Theoris (London: Palgrave Macmillan, 2007); DALHUISEN Jan H., Dalhuisen on Transnational and Comparative Commercial, Financial

and Trade Law (Oregon: HART Publishing, 2007); BENJAMIN J., Financial Law, (London: Oxford, 2008); CALLAHAN K., Elements of Effective Governance. Measurement, Accountability and

Participation (London: CRC Press, Taylor & Francis Group, LLC, 2007); ALEXANDER K., DHUMALE R., EATWELL J., Global Governance of Financial systems. The

international regulation of systemic risk (London: Oxford University press, 2006); PANOURGIAS L. E., Banking Regulation and World Trade Law, GATS, EU and „Prudential‟

Institutions Building (Oxford and Portland, Oregon: HART Publishing, 2006); QUAGLIA L., Central Banking Governance in the European union, A comparative analysis

(Routlede, Taylor&Francis Group: London and New York, 2008); BLAIR M., WALKER G., Financial Markets and Exchanges Law (London: Oxford university

press, 2007); BOFINGER P. and others, Monetary Policy, Goals, Institutions, Strategies and instruments

(Oxford: University press, 2001);




regulation”


No. 1 (8), 2012, p. 100-135

130

HOWELLS P. and BAIN K., Financial Markets and Institutions, (fifth edition, London:

Pearson Education limited, 2007); NOBEL P., Swiss Finance Law and International Standards (Berne: Stempfli Publisher Ltd.,

2002); GROTE R. and MARAUHN T., The Regulation of International Financial Markets,

(Cambridge: University press, 2006); FAZIO S., The Harmonization of International Commercial Law (The Netherlands: Kluwer

law International, 2007); KVIETKAUSKAS V., Tarptautinių žodžių žodynas (Vilnius: Vyriausioji enciklopedijų

redakcija, 1985); FRIEDMANN W., Legal Theory (New York: Columbia university press, 1967);

JOURNALS

KAUFMANN CH. and WEBER R. H., The Role of Transparency in Financial Regulation

(Oxford: Journal of International Economic Law, 2010);

LOWENSTEIN L., Financial Transparency and Corporate Governance: you Manage what

you Measure (Columbia Law review, Vol 96, No 5 (Jun., 1996));

KŪRIS E., Konstitucinių principų plėtojimas konstitucinėje jurisprudencijoje (Lietuvos

Respublikos Konstitucinio Teismo ir Lenkijos Respublikos Konstitucinio Tribunolo

šeštoji konferencija "Konstitucinių principų plėtojimas konstitucinėje

jurisprudencijoje", Neringa, 2001 m. birželio 11 - 12 d., Vilnius, 2002);

LEGAL DOCUMENTS

Law on collective investment undertakings, Official Gazette (2007, No. 117-4772);

Republic of Lithuania Holding Investment Company law, Official Gazette(2003, No. 74-

3425);

Republic of Lithuania law amending law on pension funds, Official Gazette (1999, No. 55-

1765);

Republic of Lithuania law on banks, Official Gazette (2004, No. 54-1832);

Republic of Lithuania law on credit unions, Official Gazette (1995, No. 26-578); Official

Gazette(2000, No. 45-1289); Official Gazette(2001, No. 23-762); Official

Gazette(2002, Nr. 65-2639), Official Gazette(2008, No. 76-3003);

Republic of Lithuania law on financial institutions, Official Gazette(2002, No. 91-3891);

Republic of Lithuania law on insurance, Official Gazette (2003, No. 94-4246);

Republic of Lithuania law on markets in financial instruments, Official Gazette(2007, No.

17-627);

Republic of Lithuania law on the accumulation of occupational pensions, Official

Gazette(2006, No. 82-3248);

Republic of Lithuania law on the accumulation of pensions, Official Gazette(2003, No. 75-

3472);

Republic of Lithuania law on the bank of Lithuania, Official Gazette(1994, No. 99-1957);

Republic of Lithuania law on the central credit union, Official Gazette(2008, No. 76-3003);

Republic of Lithuania securities law, Official Gazette (2007, No. 17-626);




regulation”


No. 1 (8), 2012, p. 100-135

131

Annual report 2010, Bank of Lithuania;

Approval of the Interconnection of the Financial Market Supervisory Authorities of the

Respublic of Lithuanian, (Decision of the Government of the Republic of the

Lithuania), Official Gazette(2010, No. 61-2991);

Of the Impelemtation of the Main Principles for Effective Banking Supervision which was

Approved by the Basel Committee on Banking Supervision, Decision of Board of

Bank of Lithuania (1998 12 17, No 224);

Regulations of the Insurance Supervisory Commission of the Respublic of Lithuania (2004

01 13, Decision No 27);

Report of the Securities Commision and Financial Instrument Market Trends, The

Securities Commission of the Respublic of Lithuania (2009);

Consolidated versions of the Treaty on European Union and the Treaty on the Functioning

of the European Union, 2010/C 83/01;

Directive 2003/6/EC ;

Directive 2004/109/EC;



Directive 80/390/EEC;

Regulation (EU) No 1093/2010;



The New Basel Capital Accord, Basel Committee on Banking Supervision, 2003;

Treaty of European Union;

Treaty on the Functioning of the Eurpoean Union;

Annual Report 2010, European Central Bank;

Core principles of effective banking supervision, Basel committee on banking supervision,

Basel, Septemper 1997;

Discussion paper DP09/2: A Regulatory Response to the Global Banking Crisis;

European Financial Supervision, Communication from the Commission (2009 05 27, {SEC

(2009) 715}, {SEC(2009) 716});

European Governance, White Paper, Commission of the European Communities (2001 07

25, Brussels, COM (2001) 428 final);

Proposal for a Regulation of the European Parliament and of the Council on Community

Macro Prudential Oversight of the Financial System and Establishing a European

Systemic Risk Board (2009 09 23, Brussels, COM (2009) 499 final, 2009/0140

(COD));

The de Larosiere Group report, The high-level group on financial supervision in the EU,

(Brussels, 2009 02 25); Conflict and Fragility, The State‟s Legitimacy in Fragile Situations Unpacking Complexity,

OECD (2010);

Final Report, Enhancing Sound Regulation and Strengthening Transparency, G20 working

group, (2009 03 25), Manual on fiscal Transparency, International Monetary Fund (2007);




regulation”


No. 1 (8), 2012, p. 100-135

132

INTERNET SOURCES

Definition of systemic risk in investors website www.investopedia.com

<http://www.investopedia.com/terms/s/systematicrisk.asp> [visited 2011 04 23];

E. HÜPKES, M. QUINTYN, and others, The Accountability of Financial Sector Supervisors:

Principles and Practice, International Monetary Fund Working Paper, (March 2005),

<http://www.imf.org/external/pubs/cat/longres.aspx?sk=18018.0> [visited 2011 05

13];

Information about the Lord Aidair Turner who is chairman of Financial Services Authority

(FSA) in the UK <http://www.fsa.gov.uk/Pages/About/Who/board/turner.shtml>,

[visited 2011 04 23];

Information from official website of European Commission

<http://ec.europa.eu/internal_market/finances/committees/index_en.htm> [visited

2011 04 23].

Meaning of transparency in investors website www.investopedia.com

<http://www.investopedia.com/terms/t/transparency.asp> [visited 2011 04 23];

Proceedings of an Expert Meeting in London, United Kingdom, OECD, Designing

independent and accountable regulatory authorities for high quality regulation, (2005

01 10-11)

<http://www.oecd.org/LongAbstract/0,3425,en_33873108_33873870_35028837_1_1_

1_1,00.html> [visited 2011 05 13];

Speech of commissioner Mr. Michel Barnier, Debates on Financial agreement, (2010 10

22, Strasbourg) <http://www.europarl.europa.eu/sides/getDoc.do?pubRef=-

//EP//TEXT+CRE+20100922+ITEM-004+DOC+XML+V0//EN> [visited 2011 05

16];

Speech of European Union commissioner Mr. Michael Barnier,

<http://ec.europa.eu/commission_2010-

2014/barnier/headlines/speeches/2011/01/20110101_en.htm> [visited 2011 05 16];

The Bank of Lithuania, Supervision of credit institutions,

<http://www.lb.lt/about_the_supervisory_activities> [visited 2011 05 19];

The idea of „Too big to fail“ in investors website

<http://www.investopedia.com/terms/t/too-big-to-fail.asp> [visited 2011 04 23];

The Turner Review, A regulatory response to the global banking crisis, (March 2009)

<http://www.fsa.gov.uk/pages/Library/Corporate/turner/index.shtml>, [visited 2011 04

23];

Words of the President of the United States Mr. Barack Obama which was said during the

ceremony at the Ronald Regan Building, (2010 07 21);

<http://www.politico.com/news/stories/0710/40027.html> [visite 2011 05 20];

Workshop of the OECD INCAF Task Team on Peacebuilding, StateBuilding and

Security,Strengthening state legitimacy in fragile situations, What role and which

policies for donors? (2009 03 16)

<http://www.oecd.org/document/25/0,3746,en_2649_33693550_44782932_1_1_1_1,0

0.html> [visited 2011 05 15];




regulation”


No. 1 (8), 2012, p. 100-135

133

SANTRAUKA

ES FINANSŲ REGULIAVIMO IR PRIEŽIŪROS

REFORMOS ĮTAKA PAGRINDINIŲ LIETUVOS

FINANSŲ RINKŲ REGULIAVIMO PRINCIPŲ

VYSTYMUISI

Lietuvos finansų sektorius yra viena svarbiausių šalies ekonomikos sudedamųjų dalių.

Nuo sėkmingo jo funkcionavimo itin priklauso visos likusios šalies ekonomikos vystymąsis.

Pagrindinė finansų sektoriaus paskirtis yra tarnauti realiai ekonomikai finansuojant

kompanijas ir jų projektus bei tenkinti individualių vartotojų poreikius. Paskutinė pasaulinė

finansų krizė išryškino esmines finansų rinkos problemas – finansų rinkos dalyviai vietoj to,

kad atliktų savo tiesiogines funkcijas buvo sutelkę dėmesį į trumpalaikius tikslus ir

trumpalaikio pelno siekimą. Ši krizė, kai institucijos vadovaudamosios doktrina „per

didelis žlugti“ skyrė didelią dalį valstybių lėšų tam, kad būtų stabilizuota finansų sistema,

išryškino poreikį imtis neatidėliotinų veiksmų tam, kad būtų tinkamai pakeistas Europos

finansų rinkos reguliavimas ir priežiūra. Pagrindinės reformos kryptys yra skaidrumas,

atskaitomybė, priežiūra, krizių prevencija ir valdymas. Atsižvelgiant į tai, kad Lietuvai

esant Europos Sąjungos nare, dalis teisės aktų yra taikoma tiesiogiai, nekyla klausimų, kad

ši reforma turės įtakos valstybių narių finansų sektoriui. Tačiau kyla svarbus klausimas,

kaip tai įtakos esminių Lietuvos finansų teisės principų tolimesnį vystymąsi.

Siekiant išsiaiškinti, kaip ES finansų reguliavimo ir priežiūros reforma įtakos

pagrindinių Lietuvos finansų rinkos reguliavimo principų vystymąsi, autoriaus yra

iškeliama hipotezė – ES finansų reguliavimo ir priežiūros reforma turės esminės įtakos

pagrindiniams Lietuvos finansų rinkos reguliavimo principams. Tuo tikslu šiame

straipsnyje yra iškeliami pagrindiniai tikslai: (i) nustatyti pagrindinius finansų teisės

principus bei išanalizuoti šių principų praktinį pritaikymą skirtingose finansų rinkos

reguliavimo ir priežiūros sistemose; (ii) išanalizuoti naujai kuriamą ES finansų rinkos

reguliavimo ir priežiūros sistemą reglamentuojančius teisės aktus bei išsiaiškinti galimą

įtaką valstybių narių teisėkūrai; (iii) išanalizuoti dabartinę Lietuvos finansų rinkos

priežiūros sistemą ir ją reglamentuojančius teisės aktus; (v) įvertinti ES finansų

reguliavimo ir priežiūros reformos įtaką atskirų pagrindinių Lietuvos finansų rinkų

reguliavimo principų vystymuisi.

Pagrįstai galima teigti, kad iki šiame moksliniame straipsnyje atliekamo tyrimo, apie

šiame moksliniame straipsnyje nagrinėjamą ES finansų reguliavimo ir priežiūros reformos

įtaką pagrindinių Lietuvos finansų rinkos reguliavimo principų vystymuisi, iš esmės nebuvo

atliekama. Tam yra keletas subjektyvių priežasčių: (i) ši reforma praktiniame lygmenyje

buvo pradėta įgyvendinti tik nuo 2011 m. sausio 1d.; bei (ii) atsižvelgiant į tai, jog Lietuvos

finansų rinkos reguliavimas yra vykdomas trijų nepriklausomų institucijų, todėl galime

teigti, kad buvo aptikta tik keletas teorinių studijų, kuriuos buvo atliekamos pavieniuose

sektoriuose (bankų, draudimo, vertybinių popierių ir pan.). Atsižvelgiant į aukščiau

pateiktas priežastis galima teigti, kad šis straipsnis yra pirmasis, kuris detaliai analizuoja




regulation”


No. 1 (8), 2012, p. 100-135

134

ES finansų reguliavimo ir priežiūros įtaką Lietuvos pagrindinių finansų rinkos reguliavimo

principų vystymuisi.

Pirmoje šio straipsnio dalyje yra pateikiamos ir analizuojamos skirtingos teorinės

teisės principų studijos. Remiantis įvairių autorių teorinėmis studijomis galima teigti, kad

teisės principas suprantamas kaip tam tikro reiškinio ar sistemos pamatinės nuostatos,

fundamentalūs pradai. Teisės principai yra teisės ir jos sistemos esminės nuostatos,

kuriomis grindžiamas visas teisinis reglamentavimas, visi teisiniai sprendimai ir bendrieji,

ir individualūs. Atsižvelgiant į pateiktą teisės principų suvokimą pagrįstai galima teigti, kad

finansų teisės principai turi būti suprantami kaip pamatinė finansų teisės ideologija, kurios

pagrindu yra kuriama šalies finansų rinkos reguliavimo ir priežiūros teisinė sistema.

Mokslinėse teisės studijose finansų teisė yra suprantama kaip rizikos perkėlimo sistema.

Tam, kad tinkamai būtų galima valdyti riziką, finansų rinkos reguliavimas ir priežiūra turi

būti paremti pagrindiniais finansų teisės principais. Šioje straipsnio dalyje konstatuojama,

kad finansų teisė yra paremta keturiais pagrindiniais principais – efektyvumu,

atskaitomybe, skaidrumu ir teisėtumu.

Antroje straipsnio dalyje analizuojama vykdoma ES finansų rinkos reguliavimo ir

priežiūros reforma. Prieš šią reformą finansų rinkos reguliavimas ir priežiūra iš esmės

buvo sukoncentruota nacionaliniame lygmenyje – kompetentingos finansų rinkos priežiūros

institucijos vykdydavo savarankiškai tik jiems atskaitingų subjektų priežiūrą

neatsižvelgdamos į būtinybę kompleksiniam reguliavimo ir priežiūros veiksmų derinimui.

ES finansų reguliavimo ir priežiūros reformos pasekoje buvo įsteigtos dvi institucijos –

Europos sisteminės rizikos valdyba, kuri yra atsakinga už bendrijos finansų rinkos

reguliavimą ir priežiūrą makro lygmenyje ir Europos finansų priežiūros sistema, kuri yra

atsakinga už bendrijos finansų rinkos reguliavimą bei priežiūrą mikro lygmenyje. Atlikus

vykdomos reformos analizę galima daryti išvadą, kad naujasis Europos finansų rinkos

reguliavimo ir priežiūros mechanizmas, tik tada veiks efektyviai, jei vyks konstruktyvus

makro ir mikro lygmens priežiūros institucijų bendradarbiavimas.

Trečioje straipsnio dalyje yra skiriamas dėmesys sisteminės rizikos teisiniam

reglamentavimui bei jos tinkamam suvokimui. Teorinėse ir praktinėse teisės studijose

sisteminė rizika suvokiama kaip, kad dėl vieno dalyvio negalėjimo įvykdyti savo

įsipareigojimų sistemoje kiti dalyviai negalės laiku įvykdyti savo įsipareigojimų, ko

pasekoje gali kilti didelių likvidumo ar kredito problemų, galinčių kelti pavojų finansų

sistemos stabilumui dėl tokio įsipareigojimų neįvykdymo. Operacinės ar finansinės

problemos gali lemti tokį negalėjimą įvykdyti įsipareigojimus. Taigi, kaip matoma iš

sisteminės rizikos apibrėžimo, pagrindinis finansų reguliavimo tikslas yra išvengti ar

minimalizuoti riziką įtakojančią finansų rinkas su tikslu apsaugoti klientus ar vartotojus

nuo nepageidaujamų pasėkmių žlugus bankams ar draudimo kompanijoms.

Lietuvos finansų rinkos priežiūrą atlieka trys nepriklausomos priežiūros institucijos:

(i) Lietuvos bankas, kuris atsakingas už kredito ir mokėjimo įstaigų priežiūrą, (ii) Lietuvos

Respublikos vertybinių popierių komisija, kuri turi priežiūros jurisdikciją vertybinių

popierių rinkai bei atlieka investuotojų apsaugą bei (iii) Lietuvos Respublikos draudimo

priežiūros komisija, kuri prižiūri draudimo, perdraudimo, draudimo bei perdraudimo

brokerių veiklas. Nors įgyvendinus ES finansų reguliavimo ir priežiūros reformą, Lietuvos

atsakingos institucijos išliks atsakingos už kasdieninį reguliavimą ir priežiūrą, tačiau tai




regulation”


No. 1 (8), 2012, p. 100-135

135

turės neabejotinos įtakos Lietuvos pagrindinių finansų rinkos reguliavimo principų

vystymuisi. Taigi, galima teigti, kad įgyvendinus reformą bei esant būtinybei, Lietuvos

finansų rinkos subjektai privalės atlikti šiuos veiksmus: (i) teikti teisingą ir išsamią

informaciją apie finansų rinkos funkcionavimą; (ii) prisiimti atsakomybę už savo veiksmus;

(iii) elgtis sąžiningai.


Finansų teisė, finansų rinkos reguliavimas, sisteminė rizika, ES finansų reguliavimo ir

priežiūros reforma, finansų teisės principai



No. 1 (8), 2012, p. 136-140

ŽURNALO TEISĖS APŽVALGA STRAIPSNIŲ

RENGIMO TAISYKLĖS

BENDRI REIKALAVIMAI

Pateikti straipsniai „Teisės apţvalga“ turi atitikti šiuos reikalavimus:

1. Pageidautinos mokslinio straipsnio apimties ribos – iki 150 000 spaudos ţenklų.

2. Straipsniai parengiami lietuvių arba kita kalba (anglų, prancūzų, vokiečių, rusų ar kt.).

„Teisės apţvalgoje“ straipsniai paprastai publikuojami lietuvių kalba.

3. Autorius kartu su straipsniu turi pateikti glaustą ir išsamią straipsnio santrauką ta pačia

kalba, kokia yra parengtas straipsnis. Šios santraukos apimtis – ne trumpesnė nei 600

spaudos ţenklų. Santrauka ne ilgesnė nei 1 puslapis. Pateikiami straipsnyje vartojami

reikšminiai ţodţiai (straipsnyje anglų kalba – keywords).

4. Lietuvių kalba parengto straipsnio pabaigoje pateikiama išsami santrauka ir

pagrindinės straipsnyje vartojamos sąvokos anglų kalba. Uţsienio kalba parengtų

straipsnių pabaigoje – santrauka ir pagrindinės sąvokos lietuvių kalba. Ši santrauka –

ne trumpesnė nei 2 200 spaudos ženklų.

5. Išnašos ir citatos turi atitikti Išnašų sudarymo taisykles.

6. Straipsnį recenzuoja ne maţiau kaip du redaktorių kolegijos paskirti recenzentai.

Vienas iš recenzentų – ne redaktorių kolegijos narys.

7. Straipsnio pabaigoje, po išvadų pateikiami straipsnyje naudoti literatūros šaltiniai

(anglų kalba straipsnyje – literature). Literatūros sąrašas suskirstytas pagal šaltinių

rūšis: knygos, periodiniai leidiniai, teisiniai dokumentai ir internetiniai šaltiniai.

IŠNAŠŲ, CITATŲ IR NUORODŲ SUDARYMO TVARKA

1. Ţurnale spausdinamo teksto išnašos pateikiamos jo kiekvieno puslapio pabaigoje.

Išnašose pateikiamos pastabos bei nurodoma, kokiu šaltiniu ar kokiais šaltiniais

kiekvienu konkrečiu atveju yra remiamasi.

2. Pirmojoje išnašoje, dedamoje po autoriaus pavarde ir ţymimoje skaičiu „1‟, yra

pateikiama trumpa informacija apie teksto autorių. Joje gali būti pateikiama trumpa

teksto istorija. Ši išnaša pateikiama po teksto turiniu pirmame puslapyje.

3. Pageidautina, kad išnašoje pirmiausia būtų pateikiamos pastabos (jeigu yra), po kurių

eitų nuorodos į kitus tekstus (jeigu yra).

4. Nuoroda į kitą tekstą lietuviškame tekste pradedama santrumpa „ţr.‟, angliškame –

ţodţiu „see‟. Pradėjus teksto nurodymą dedamas dvitaškis ir duomenys pateikiami

vardininko linksnyje, išskyrus 12 (c) 3 bei 14 taisyklėse numatytus atvejus.

5. Nuorodose yra leidţiamos lietuviškuose, angliškuose bei tarptautiniuose teisiniuose

tekstuose nusistovėjusios santrumpos. Pvz.: „Žin.‟ – Valstybės žinios, „LR‟ – Lietuvos

Respublika(os), „CPK‟ – Civilinio proceso kodeksas, „UN‟ – United Nations ir t.t.

Žurnalo Teisės apžvalga straipsnių rengimo

taisyklės


No. 1 (8), 2012, p. 136-140

137

6. Nurodomo teksto pavadinimas pateikiamas originalo kalba. Lietuviškuose tekstuose

skliausteliuose gali būti pateikiamas angliško pavadinimo vertimas į lietuvių kalbą.

Nurodant į tarptautinį teisinį aktą, lietuviškuose tekstuose galima pateikti tik lietuvišką

pavadinimą.

7. Originalo kalba taip pat nurodomi: leidykla, periodinio ar oficialaus leidinio

pavadinimas, teisinio akto publikavimo ir identifikavimo duomenys. Kiti duomenys

nurodomi ţurnale spausdinamo teksto kalba.

8. Nurodomo teksto autorių pavardės pateikiamos didţiosiomis raidėmis.

9. Nuoroda į knygą.

(a) Nuorodos bendroji seka: knygos autoriaus vardų pirmos raidės ir pavardė,

knygos pavadinimas (kursyvu), tomas (jei yra), redagavimo ir vertimo

duomenys (nebūtinai), leidimo duomenys (skliaustuose), puslapiai (jei

reikalinga).

Pvz.: H. L. A. HART, Teisės samprata (Vilnius: Pradai, 1997), p. 100-101.

(b) Nurodant knygos redaktorių ar redaktorius, pradţioje pateikiamos tokios

santrumpos: lietuviškame tekste – „red.‟, angliškame tekste – „ed.‟ Ţr. pavyzdį

šios dalies (j) punkte.

(c) Nurodant knygos vertėją ar vertėjus, pradţioje pateikiamos tokios santrumpos:

lietuviškame tekste – „vert.‟, angliškame tekste – „trans.‟

Pvz.: A. V. DICEY, Konstitucinės teisės studijų įvadas, vert. L. Raudienė, R.

Petkus (Vilnius: Eugrimas, 1998).

(d) Nurodant tomą, pradţioje pateikiamos tokios santrumpos: lietuviškame tekste –

„t.‟, angliškame tekste – „vol.‟ Jeigu tomas turi atskirą pavadinimą, jis nurodomas

pateikus tomo numerį.

Pvz.: F. A. HAYEK, Teisė, įstatymų leidyba ir laisvė, t. 1, Taisyklės ir tvarka, vert.

A. Degutis (Vilnius: Eugrimas, 1998), p. 35-37.

(e) Jeigu knyga turi daugiau nei tris autorius, redaktorius ar vertėjus, yra pateikiamos

vieno asmens vardų pirmos raidės ir pavardė (to, kurio pavardės pirmoji raidė

abėcėline tvarka yra pirmesnė) toliau pateikiant tokias frazes: lietuviškame tekste

– „ir kiti‟, angliškame tekste – „et al.‟

Pvz.: V. MIKELĖNAS ir kiti, Civilinė teisė (Kaunas: Vijusta, 1998).

(f) Jeigu knyga neturi autoriaus, jo vietoje analogiškai pateikiami redaktoriaus ar

redaktorių vardai ir pavardės, pabaigoje pateikiant atitinkamas santrumpas.

(g) Jeigu knyga neturi nei autoriaus, nei redaktoriaus, nuoroda pradedama nuo

knygos pavadinimo.

(h) Knygos leidimo duomenis sudaro leidimo vieta (miestas), leidykla, leidimo metai.

Jeigu negalima nustatyti knygos leidimo vietos ar leidyklos, vienas iš šių

duomenų gali būti nenurodomas. Prieš nurodant leidimo duomenis gali būti

pateikiamas leidimo numeris.

Pvz.: J. C. GRAY, Nature and Sources of Law, antras leidimas (Niujorkas, 1921).

(i) Knygos pavadinimo pabaigoje, padėjus dvitaškį, gali būti nurodomos teksto

specifikacijos. Pvz.: „monografija‟, „tarptautinės konferencijos medžiaga‟ ir t.t.

Ţr. pavyzdį toliau einančiame punkte.


taisyklės


No. 1 (8), 2012, p. 136-140

138

(j) Straipsnį knygoje galima nurodyti vietoje knygos autoriaus duomenų analogiškai

pateikiant straipsnio autoriaus duomenis bei prieš knygos pavadinimą kabutėse

nurodant straipsnio pavadinimą; toliau nuorodos seka nesikeičia.

Pvz.: A. ŠAKOČIUS, „Teisinio reguliavimo pagrindai viešajame administravime“,

Viešasis administravimas: monografija, red. A. Raipa (Kaunas: Technologija,

1999).

10. Nuoroda į periodinį leidinį.

(a) Nuorodos bendroji seka: straipsnio autoriaus vardų pirmos raidės ir pavardė,

straipsnio pavadinimas (kabutėse), periodinio leidinio pavadinimas

(kursyvu), leidinio duomenys (skliaustuose), bei puslapis ar puslapiai (jei

reikalinga).

Pvz.: J. IMBRASAITĖ, „Išlygos ţmogaus teisių sutartims“, Teisės apžvalga (1999,

Nr. 1), p. 59; G. ALKSNINIS, „Lyderis klupinėja ties politikos abėcėle“, Lietuvos

rytas (1999 11 13, Nr. 45(365)).

(b) Lietuvoje išleisto leidinio duomenis sudaro leidinio išleidimo data arba metai ir

leidinio numeris. Ne Lietuvoje išleisto leidinio duomenys nurodomi pagal

atitinkamoje valstybėje ar organizacijoje nusistovėjusias taisykles arba pagal

aukščiau nurodytas taisykles.

Pvz.: S. SCHAUER, “Formalism”, 97 Yale Law Journal 509 (1988); L. L. FULLER,

“The Case of the Speluncean Explorers”, 62 Harward Law Review 616 (1949).

(c) Jeigu straipsnis neturi autoriaus, nuoroda pradedama nuo straipsnio pavadinimo.

11. Nuoroda į teisinį dokumentą.

(a) Nacionalinis teisinis aktas.

1) Nuorodos bendroji seka: akto pavadinimas (jei nėra tekste), aktą priėmusi

institucija bei akto forma (nebūtinai), oficialus leidinys, oficialaus

publikavimo duomenys (skliaustuose) bei straipsnis, straipsniai ar

puslapiai (jei reikalinga).

Pvz.: LR Socialinių paslaugų įstatymas, Žin. (1996, Nr. 104-2367); Žin. (1996,

Nr. 119-2772); Dėl dalies valstybės turto perdavimo savivaldybių nuosavybėn

tvarkos (LR Vyriausybės nutarimas), Žin. (1995, Nr. 79-1828).

2) Po akto pavadinimu skliaustuose gali būti nurodoma oficialių pakeitimų

paskutinė data.

Pvz.: LR Civilinis kodeksas (oficialus tekstas su pakeitimais iki 1998 m.

rugsėjo 10 d.), Žin. (1964, Nr. 19-138).

3) Nurodţius tam tikrą straipsnį, skliaustuose gali būti nurodoma jo redakcijos

priėmimo data.

4) Nurodant į netekusi galios teisinį aktą po akto pavadinimu skliaustuose

nurodomi nutarimo, kuriuo aktas neteko galios, duomenys.

5) Lietuvoje priimto akto oficialaus publikavimo duomenis sudaro publikavimo

oficialiame leidinyje metai, leidinio numeris bei dokumento eilės numeris.

Kitose valstybėse priimtų aktų publikavimo duomenys nurodomi pagal tose

valstybėse nusistovėjusią tvarką.

(b) Tarptautinis teisinis aktas.


taisyklės


No. 1 (8), 2012, p. 136-140

139

1) Nuorodos bendroji seka: akto pavadinimas, aktą priėmusi institucija bei

akto forma (nebūtinai), priėmimo vieta, priėmimo data, oficialus leidinys,

kuriame aktas yra publikuotas, ir publikavimo duomenys bei straipsnis,

straipsniai, ar puslapiai (jei reikalinga).

Pvz.: Geneva Protocol On Arbitration, Ţeneva, 1923 09 24, publikuotas 27

L.N.T.S. 157 (1924).

2) Jei yra nurodytas oficialus leidinys, kuriame aktas yra publikuotas, ir

publikavimo duomenys, akto priėmimo vieta bei priėmimo data gali būti

nenurodomos. Neesant oficialaus leidinio bei publikavimo duomenų, akto

priėmimo vieta ir data nurodomos būtinai.

(c) Byla.

1) Lietuvoje išspręsta byla nurodoma tokia seka: asmuo p. asmenį (kursyvu),

bylą sprendęs teismas, teismo skyrius (nebūtinai), bylos duomenys

(skliaustuose).

Pvz.: Pepsico Eesti AS p. UAB Samsonas, Lietuvos apeliacinis teismas (1999,

Nr. 2TA-44).

2) Baudţiamosiose bylose vienos iš šalių vietoje nurodoma Valstybė.

Administracinėse bylose vienos iš šalių arba abiejų šalių vietose nurodomos

atitinkamos valdţios institucijos.

Pvz.: Valstybė p. A.Kierą, Lietuvos Aukščiausiasis Teismas, (1995, Nr. 2K-

257).

3) Lietuvoje išspręstos bylos duomenis sudaro sprendimo byloje priėmimo metai

bei bylos numeris. Prieš nurodant ne Lietuvoje išspręstą bylą informuojama

apie šalį ar instituciją, kurioje ta byla buvo išspręsta, po to dedamas dvitaškis,

ir pagal taisykles, taikomas atitinkamoje šalyje ar institucijoje, originalo kalba

pateikiama byla.

Pvz.: Ţr. JAV bylą: McCulloch v. Maryland, 17 U.S. (4 Wheat.) 316 (1819).

4) Angliškuose tekstuose JAV išspręstos bylos gali būti nurodomos nenurodant

šalies.

(d) Nuoroda į teisinį dokumentą, atspausdintą knygoje ar periodiniame leidinyje,

atliekama pagal nurodymo į knygą ar leidinį taisykles.

Pvz.: J. G. MERRILLS, “Decisions on the European Convention on Human Rights

during 1991”, B.Y.B.I.L. (1991), p. 485; V. BERGER, Europos žmogaus teisių

teismo jurisprudencija, red. P. Kūris (Vilnius: Pradai, 1997), p. 57.

12. Nuoroda į internetinę svetainę.

(a) Nuorodos bendroji seka: teksto autoriaus vardų pirmos raidės ir pavardė,

teksto pavadinimas, puslapiai (jei reikalinga), šaltinio suradimo internetinėje

svetainėje data (pageidautina), pilnas internetinės svetainės adresas.

(b) Jeigu nurodoma į internete esančią knygą ar periodinio leidinio straipsnį, kiek

įmanoma pilniau išpildomos atitinkamo teksto nurodymo taisyklės.

(c) Jeigu nurodoma į internetinėje svetainėje esantį teisinį aktą, iki pateikiant pilną

internetinės svetainės adresą, pateikiami: akto pavadinimas, aktą priėmusi

institucija bei akto forma (nebūtinai), akto duomenys bei straipsniai (jei


taisyklės


No. 1 (8), 2012, p. 136-140

140

reikalinga). Lietuvoje išspręstos bylos atveju pateikiami šie duomenys: šalys, bylą

išsprendęs teismas, bylos duomenys.

(d) Lietuvoje priimto akto duomenis sudaro priėmimo data bei numeris; ne Lietuvoje

priimto akto (ar išspręstos bylos) duomenys pateikiami pagal atitinkamoje

valstybėje nusistovėjusias taisykles arba nurodomi duomenys, leidţiantys

pakankamai pilnai identifikuoti interneto svetainėje nurodytą tekstą.

Pvz.: LR Energetikos įstatymas, 1995 03 28, Nr. I-828, 1-3 str. // [ţiūrėta

1998.10.12] <www.lrs.lt>; US Code, Title 9, (1992) //

<www.internationalADR.com>

13. Nurodymo į pasikartojančius šaltinius taisyklės.

(a) Pirmą kartą šaltinis turi būti nurodomas pilnai.

(b) Jeigu prieš tai buvusioje išnašoje buvo pilnai ar sutrumpintai minimas tam tikras

šaltinis, toliau einančioje išnašoje tas pats šaltinis gali būti nurodomas

lietuviškame tekste fraze „ten pat‟, angliškame – santrumpa „id.‟ Puslapiai ar

straipsniai tokios nuorodos atveju gali keistis.

(c) Jeigu prieš daugiau nei vieną išnašą esančioje išnašoje buvo pilnai minimas tam

tikras šaltinis, vėliau lietuviškuose tekstuose jis gali būti nurodomas tokia išnašos

seka: Ţr. išnaša Nr. … : sutrumpinti identifikaciniai duomenys. Sutrumpinti

identifikaciniai duomenys yra tokie nuorodos duomenys, kurie leidţia

pakankamai pilnai nustatyti anksčiau nurodytą tekstą. Pvz.: autoriaus duomenys;

autoriaus duomenys ir sutrumpintas teksto pavadinimas; teksto pavadinimas ir

pan. Puslapiai ar straipsniai tokios nuorodos atveju gali keistis. Jei prieš daugiau

nei vieną išnašą esančioje išnašoje buvo tik nurodomas šaltinis ir tik vienas

šaltinis, ir jeigu nesikeičia puslapiai ar straipsniai, vėliau tas šaltinis nurodomas

tokia išnašos seka: Ţr. išnašą Nr. … . Angliškuose tekstuose šiais atvejais

vartojama frazė “supra note” ir jos mechanizmas.

Pvz.: 1

Ţr.: W. M. REYNOLDS et al., Conflict of Laws: Cases, Materials and

Problems (Matthew Bender & Co., 1990), p. 587. 2

Dėl teritorijos suskirstymo Lietuvoje ţr.: LR Teritorijos administracinių

vienetų ir jų ribų įstatymas, Žin. (1994, Nr. 60-1183), 1 str. 3 Ţr. ten pat.

4 Ţr. ten pat, 4 str.

5 Ţr. išnašą Nr. 1: W. M. REYNOLDS, p. 722.

14. Nuoroda į kitus tekstus.

Dėl nurodymo į šiose taisyklėse nenumatytus šaltinius tariamasi su ţurnalo redakcija

atskirai.

15. Literatūros sąrašo sudarymo taisyklė.

Šaltinio pirmojo autoriaus vardo pirmos raidės ir pavardės inversija (kiti autoriai

rašomi paprastai), šaltinio pavadinimas, tomas, redagavimo ir vertimo duomenys

(nebūtinai), leidimo duomenys (skliaustuose).

Pvz.: AMBRASIENĖ, D., E. BARANAUSKAS ir kiti, Civilinė teisė. Prievolių teisė

(Vilnius: MRU, 2009).

Documents

Zurnalas_1(8)