OREANDA-NEWS. May 13, 2014. SORAINEN successfully represented Zalvaris, a leading Lithuanian waste recycling company, and Baltical, Lithuania’s largest secondary aluminium casting company, in highly significant tax disputes with the Customs Department valued at a total of almost one million litas.

The Lithuanian Supreme Administrative Court has set a significant precedent in Lithuanian law regarding tax disputes with the customs authorities. The court explained that in order to impose anti-dumping duties, the customs authorities had to prove the origin of the goods and the fact that no goods processing operations have been carried out in another country that would serve as a basis for changing the origin of the goods.

In the case of the disputes between Zalvaris, Baltical and the Lithuanian customs authorities, after carrying out an inspection of the activities of these companies following the import of goods, the customs authorities did not recognise the certificates of origin for the goods provided by these companies. The Lithuanian customs authorities stated that the country of origin of the imported goods was the People’s Republic of China and imposed anti-dumping duties, additional charges, penalties and default interest.

The court took into account the fact that the Lithuanian customs authorities had failed to exercise all of their rights and carry out an independent inspection, and relied solely on European Anti-Fraud Office (OLAF) reports. Therefore, unlike in the case of preferential rates, the customs authorities had to prove the reason for applying anti-dumping duties. The court also pointed out that the OLAF reports did not have a higher evidential value and were treated in the same way as any other evidence.

In its final judgement, the Lithuanian Supreme Administrative Court granted the appeals of both companies and revoked the decisions of courts of lower instance and of the Lithuanian customs authorities that were adverse to the companies.

Attorney-at-law Kestutis Svirinas, partner with SORAINEN, and attorney-at-law Jonas Sakalauskas represented Zalvaris and Baltical in the landmark disputes with the Lithuanian customs authorities.