THE CONSTITUTIONAL COURT OF THE REPUBLIC OF LITHUANIA

Transcription

1 Case No. 10/02 THE CONSTITUTIONAL COURT OF THE REPUBLIC OF LITHUANIA RULING ON THE COMPLIANCE OF THE REPUBLIC OF LITHUANIA S LAW ON THE PROCEDURE OF THE REORGANISATION AND LIQUIDATION OF ESTABLISHMENTS OF CULTURE (WORDING OF 13 JUNE 1995) AND ITEMS 1, 2.3 AND 2.4 OF THE RESOLUTION OF THE GOVERNMENT OF THE REPUBLIC OF LITHUANIA (NO. 1320) ON THE HOUSE OF SIGNATORIES TO THE ACT OF INDEPENDENCE OF LITHUANIA AND THE HOUSE OF ARTISTS OF LITHUANIA OF 28 NOVEMBER 1997 WITH THE CONSTITUTION OF THE REPUBLIC OF LITHUANIA 8 July 2005 Vilnius The Constitutional Court of the Republic of Lithuania, composed of the Justices of the Constitutional Court: Armanas Abramavičius, Toma Birmontienė, Egidijus Kūris, Kęstutis Lapinskas, Zenonas Namavičius, Ramutė Ruškytė, Vytautas Sinkevičius, Stasys Stačiokas, and Romualdas Kęstutis Urbaitis The court reporter Daiva Pitrėnaitė Marytė Bagdonavičienė, the chief expert at the Legal Department of the Office of the Seimas, acting as the representative of the Seimas of the Republic of Lithuania, a party concerned Sigutė Pučienė, the Head of Law and Personnel Division at the Ministry of Culture of the Republic of Lithuania, acting as the representative of the Government of the Republic of Lithuania, a party concerned The Constitutional Court of the Republic of Lithuania, pursuant to Articles 102 and 105 of the Constitution of the Republic of Lithuania and Article 1 of the Law on the Constitutional Court of the Republic of Lithuania, on 7 June 2005, in its public hearing, considered case No. 10/02 subsequent to the petition of the Vilnius Regional Administrative Court, the petitioner, requesting

2 2 an investigation into whether the Republic of Lithuania s Law On the Procedure of the Reorganisation and Liquidation of Establishments of Culture (wording of 13 June 1995) is not in conflict with Paragraph 2 of Article 120 of the Constitution of the Republic of Lithuania, Paragraph 1 of Article 3, Paragraphs 2 and 5 of Article 4, and Paragraph 1 of Article 6 of the European Charter of Local Self-Government, as well as whether Item 2.4 of the Resolution of the Government of the Republic of Lithuania (No. 1320) On the House of Signatories to the Act of Independence of Lithuania and the House of Artists of Lithuania of 28 November 1997 is not in conflict with Paragraph 2 of Article 120 of the Constitution of the Republic of Lithuania, Paragraph 1 of Article 3, Paragraphs 2 and 5 of Article 4, and Paragraph 1 of Article 6 of the European Charter of Local Self-Government, as well as Item 4 of Paragraph 1 of Article 4 and Item 13 of Paragraph 1 of Article 6 of the Republic of Lithuania s Law on Local Self-Government. The Constitutional Court has established: I 1. On 28 October 1993, the Seimas adopted the Republic of Lithuania s Law On the Procedure of the Reorganisation and Liquidation of Establishments of Culture (Official Gazette Valstybės žinios, 1993, No ). On 13 June 1995, the Seimas adopted the Republic of Lithuania s Law On Amending the Republic of Lithuania s Law On the Procedure of the Reorganisation and Liquidation of Establishments of Culture (Official Gazette Valstybės žinios, 1995, No ). 2. On 28 November 1997, the Government adopted the Resolution (No. 1320) On the House of Signatories to the Act of Independence of Lithuania and the House of Artists of Lithuania (Official Gazette Valstybės žinios, 1997, No ). 3. The Vilnius Regional Administrative Court, the petitioner, requests an investigation into whether the Law On the Procedure of the Reorganisation and Liquidation of Establishments of Culture (wording of 13 June 1995) is not in conflict with Paragraph 2 of Article 120 of the Constitution, Paragraph 1 of Article 3, Paragraphs 2 and 5 of Article 4, and Paragraph 1 of Article 6 of the European Charter of Local Self-Government, as well as whether Item 2.4 of the Government Resolution (No. 1320) On the House of Signatories to the Act of Independence of Lithuania and the House of Artists of Lithuania of 28 November 1997 is not in conflict with Paragraph 2 of Article 120 of the Constitution, Paragraph 1 of Article 3, Paragraphs 2 and 5 of Article 4, and Paragraph 1 of Article 6 of the European Charter of Local Self-Government, as well as Item 4 of Paragraph 1 of Article 4 and Item 13 of Paragraph 1 of Article 6 of the Law on Local Self- Government.

3 3 II The petition of the petitioner is based on the following arguments. It was established in the Law On the Procedure of the Reorganisation and Liquidation of Establishments of Culture (wording of 13 June 1995) that establishments of culture that belong to the sphere of regulation of municipal councils may be reorganised or liquidated only upon receipt of written consent by the Ministry of Culture of the Republic of Lithuania. By Item 1 of the Government Resolution (No. 1320) On the House of Signatories to the Act of Independence of Lithuania and the House of Artists of Lithuania of 28 November 1997 the Ministry of Culture was obligated to transfer, by 1 January 1998, the functions of founder of the House of Artists of Lithuania to the Vilnius City Municipality, and by Item 2.4 of this resolution the Vilnius City Municipality was commissioned with the task, while discharging the functions of founder of the House of Artists of Lithuania, not to change the purpose of the House, type of its activity and its status, and to document this in a trilateral agreement on cooperation between the Vilnius City Board, the Ministry of Culture and the House of Artists of Lithuania. It is established in Article 120 of the Constitution that the state shall support municipalities (Paragraph 1); municipalities shall act freely and independently within their competence, which shall be established by the Constitution and laws (Paragraph 2). According to Item 4 (wording of 12 October 2000) of Paragraph 1 of Article 4 of the Law on Local Self-Government, one of the principles on which local self-government is based is freedom and independence of the activities of municipal institutions when they, while implementing laws, other legal acts and obligations to the community, adopt decisions. In Article 6 of the Law on Local Self-Government one established independent functions of municipalities and in Item 13 (wording of 12 October 2000) of Paragraph 1 of this article one prescribed that they are assigned with other independent functions that are not assigned to state institutions. In Paragraph 1 of Article 3 of the European Charter of Local Self-Government local selfgovernment is defined as the right and the ability of local authorities, within the limits of the law, to regulate and manage a substantial share of public affairs under their own responsibility and in the interests of the local population. Pursuant to Paragraph 2 of Article 4 of the aforementioned charter, local authorities shall, within the limits of the law, have full discretion to exercise their initiative with regard to any matter which is not excluded from their competence nor assigned to any other power; it is established in Paragraph 5 of Article 4 thereof that where powers are delegated to them by a central or regional power, local authorities shall, insofar as possible, be allowed discretion in adapting their exercise to local conditions. In Paragraph 1 of Article 6 of the European Charter of Local Self-Government local authorities are granted the right to determine independently their own internal administrative structures in order to adapt them to local needs and ensure effective

4 4 possession. III In the course of the preparation of the case for the Constitutional Court s hearing, written explanations of the representative of the Seimas, a party concerned, who was E. Mušinskis, a senior consultant at the Legal Department of the Office of the Seimas, the representative of the Seimas, a party concerned, M. Bagdonavičienė, and the representative of the Government, a party concerned, who was S. Pučienė. 1. E. Mušinskis and M. Bagdonavičienė state that the principle of co-ordination of interests of municipalities and the state is consolidated in the Constitution. It is consolidated in Article 4 of the Law on Local Self-Government as well. According to the representatives of the Seimas, a party concerned, in Lithuania, the model of administrative supervision over the activity of municipalities has been formed where municipalities are supervised by the executive power of the state. In Paragraph 2 of Article 123 of the Constitution one has entrenched the institute of supervision of administrative activity of municipalities. The legislature enjoys the right to establish various legal means by which institutions of central power are empowered to supervise the activity of municipal institutions. The representatives of the Seimas, a party concerned, believe that the duty, established in the impugned law, of municipal councils to obtain a written consent of the Ministry of Culture concerning reorganisation or liquidation of establishments of culture that belong to the sphere of regulation by municipalities is one of the forms of implementation of the principle of co-ordination of interests of the state and municipalities. Alongside, the representatives of the Seimas, a party concerned, note that the provision of Paragraph 2 of Article 120 of the Constitution that municipalities shall act freely and independently is linked to the provision of this paragraph that municipalities shall act freely and independently within their competence, which shall be established by the Constitution and laws. E. Mušinskis and M. Bagdonavičienė indicate that an analogous provision is consolidated in Paragraph 1 of Article 3 and Paragraph 2 of Article 4 of the European Charter of Local Self-Government as well. According to E. Mušinskis and M. Bagdonavičienė, the Ministry of Culture within its competence performs the functions of state administration in the area of culture which is assigned to it by law and other legal act, and implements state policy in this sphere. According to the representatives of the Seimas, institutions of the executive which implement the established state policy in any area in the whole territory of the state, should have an opportunity to control and coordinate the execution of provisions of this policy in the whole territory of the state, thus, in all municipalities as well. The coordination of relations between the Ministry of Culture and municipal councils when reorganising or liquidating municipal establishments of culture is an important

5 5 condition of even and efficient implementation of state policy of culture, while taking account of social and cultural situation in the territory of each municipality, cultural needs of local community, capabilities of the state and other conditions. In the opinion of the representatives of the Seimas, a party concerned, by the impugned regulation which is established in the law one does not revoke the actual right of municipalities to reorganise or liquidate the establishments of culture: the entrenched therein duty of municipal councils to obtain written consent of the Ministry of Culture should be considered not a limitation on the right of municipal councils, related to reorganisation or liquidation of establishments of culture that were established by them, but rather a co-ordination of joint actions of the state and municipalities when striving for the social objectives that are important to the state. According to the representative of the Seimas, a party concerned, the provisions of the impugned law do not limit the competence of municipalities which is set in the Constitution and which comprises also the right of municipal councils to reorganise or liquidate municipal establishments of culture and do not deny the guarantees of judicial defence of municipal rights, as pursuant to Article 122 of the Constitution municipal councils have the right to apply at any moment to court regarding the violation of their rights upon the procedure established in laws. Therefore, the representatives of the Seimas, a party concerned, believe that the duty of municipal councils, which is established in the impugned law, to obtain written consent of the Ministry of Culture concerning reorganisation or liquidation of establishments of culture that belong to the sphere of regulation by municipalities is not in conflict with Paragraph 2 of Article 120 of the Constitution. 2. S. Pučienė, the representative of the Government, a party concerned, states that in the Law On the Procedure of the Reorganisation and Liquidation of Establishments of Culture that was effective till 26 October 2004 one established the procedure of reorganisation or liquidation of establishments of culture, but did not deprive municipal institutions of the right to reorganise or liquidate establishments of culture. S. Pučienė pointed out that the Vilnius City Municipality decided to liquidate the House of Artists of Lithuania, a budgetary establishment, without addressing the Ministry of Culture concerning this issue. However, in her opinion, this does not mean that the Government Resolution (No. 1320) On the House of Signatories to the Act of Independence of Lithuania and the House of Artists of Lithuania of 28 November 1997 is in conflict with Paragraph 2 of Article 120 of the Constitution, Paragraph 1 of Article 3, Paragraphs 2 and 5 of Article 4, and Paragraph 1 of Article 6 of the European Charter of Local Self-Government, as well as Item 4 of Paragraph 1 of Article 4 and Item 13 of Paragraph 1 of Article 6 of the Law on Local Self-Government.

6 6 IV In the course of the preparation of the case for the Constitutional Court s hearing, written explanations of R. Dovydėnienė, the Minister of Culture of the Republic of Lithuania, A. Zuokas, Mayor of the Vilnius City Municipality, Assoc. Prof. Dr. E. Šileikis who works at the Constitutional and Administrative Law Department of the Faculty of Law of Vilnius University, Dr. A. Gazarian, Director of the Centre of Investigation of Self-Government Problems, and S. Šiupšinskas, Director of the Lithuanian Association of Municipalities, were received. V At the Constitutional Court s hearing the representative of the Seimas, a party concerned, who was M. Bagdonavičienė and the representative of the Government, a party concerned, who was S. Pučienė, virtually reiterated the arguments set forth in their written explanations and submitted additional explanations. At the Constitutional Court s hearing the witnesses, who were V. Klimantavičius, the Director of Administration of the Vilnius City Municipality, and J. Elzbergas, Director of Law and Personnel Department of the Vilnius City Municipality, were questioned. The Constitutional Court holds that: I 1. The Vilnius Regional Administrative Court, the petitioner, requests an investigation into whether the Law On the Procedure of the Reorganisation and Liquidation of Establishments of Culture (wording of 13 June 1995) is not in conflict with Paragraph 2 of Article 120 of the Constitution, Paragraph 1 of Article 3, Paragraphs 2 and 5 of Article 4, and Paragraph 1 of Article 6 of the European Charter of Local Self-Government, as well as whether Item 2.4 of the Government Resolution (No. 1320) On the House of Signatories to the Act of Independence of Lithuania and the House of Artists of Lithuania of 28 November 1997 is not in conflict with Paragraph 2 of Article 120 of the Constitution, Paragraph 1 of Article 3, Paragraphs 2 and 5 of Article 4, and Paragraph 1 of Article 6 of the European Charter of Local Self-Government, as well as Item 4 of Paragraph 1 of Article 4 and Item 13 of Paragraph 1 of Article 6 of the Law on Local Self- Government. 2. On 15 October 1985, the Council of Europe adopted the European Charter of Local Self- Government; it became effective on 1 September The Seimas ratified this charter by Article 1 of the Republic of Lithuania s Law On Ratification of the European Charter of Local Self- Government that was adopted on 25 May In its decision of 25 April 2002, the Constitutional Court held that pursuant to the

7 7 Constitution the Constitutional Court does not investigate the compliance of a law with a legal act which has the force of a law, and it decided to refuse to investigate the petition of the Vilnius Regional Administrative Court wherein it requests an investigation into whether the Law On the Procedure of the Reorganisation and Liquidation of Establishments of Culture (wording of 13 June 1995) was not in conflict with Paragraph 1 of Article 3, Paragraphs 2 and 5 of Article 4, and Paragraph 1 of Article 6 of the European Charter of Local Self-Government. By the aforementioned decision, the Constitutional Court decided to accept for consideration the petition of the Vilnius Regional Administrative Court wherein it requests an investigation into whether the Law On the Procedure of the Reorganisation and Liquidation of Establishments of Culture (wording of 13 June 1995) was not in conflict with Paragraph 2 of Article 120 of the Constitution, and whether Item 2.4 of the Government Resolution (No. 1320) On the House of Signatories to the Act of Independence of Lithuania and the House of Artists of Lithuania of 28 November 1997 was not in conflict with Paragraph 2 of Article 120 of the Constitution, Paragraph 1 of Article 3, Paragraphs 2 and 5 of Article 4, and Paragraph 1 of Article 6 of the European Charter of Local Self-Government, as well as Item 4 of Paragraph 1 of Article 4 and Item 13 of Paragraph 1 of Article 6 of the Law on Local Self-Government. 3. The petitioner requests an investigation into whether the Law On the Procedure of the Reorganisation and Liquidation of Establishments of Culture (wording of 13 June 1995), which is set forth as follows: To stipulate that establishments of culture that belong to the sphere of administration of municipal councils may be reorganised or liquidated only upon receipt of written consent by the Ministry of Culture of the Republic of Lithuania is not in Conflict with the Constitution. 4. On 12 October 2004, the Seimas adopted the Republic of Lithuania s Law on Recognising the Law On the Procedure of the Reorganisation and Liquidation of Establishments of Culture and the Law which Substituted the Latter as No Longer Effective, by which it recognised the Republic of Lithuania s Law On the Procedure of the Reorganisation and Liquidation of Establishments of Culture (which was adopted on 28 October 1993) and the Republic of Lithuania s Law On Amending the Republic of Lithuania s Law On the Procedure of the Reorganisation and Liquidation of Establishments of Culture (which was adopted on 13 June 1995) that became effective on 26 October 2004 as no longer effective. Thus, the impugned Law On the Procedure of the Reorganisation and Liquidation of Establishments of Culture (wording of 13 June 1995) is not effective at the time of the consideration of the constitutional justice case at issue. 5. According to Paragraph 4 of Article 69 of the Law on the Constitutional Court, the annulment of the impugned legal act shall be grounds to adopt a decision to dismiss the initiated

8 8 legal proceedings. In its rulings the Constitutional Court has held more than once that, according to the Constitution, in the cases where the Constitutional Court is addressed by a court which considers a case and which has doubts concerning the compliance of a law applicable in that particular case with the Constitution or laws, the Constitutional Court has the duty to consider the petition of the court irrespective of the fact whether the impugned law or other legal act is in force or not. 6. The petitioner requests an investigation into whether Item 2.4 of the Government Resolution (No. 1320) On the House of Signatories to the Act of Independence of Lithuania and the House of Artists of Lithuania of 28 November 1997 is not in conflict with the Constitution and laws. This government resolution provides: The Government of the Republic of Lithuania resolves: 1. To obligate the Ministry of Culture to transfer, by 1 January 1998, the functions of founder of the House of Artists of Lithuania to the Vilnius City Municipality. 2. To assign to the Vilnius City Municipality the following tasks: 2.1. by 1 January 1998, to transfer to the Ministry of Culture the functions of founder of the House of Signatories to the Act of Independence of Lithuania; 2.2. to transfer the building located at Pilies St. 26, Vilnius, area of 1234,16 sq. m., of the House of Signatories to the Act of Independence of Lithuania, which is possessed by the Vilnius City Municipality under the right of trust, to the Ministry of Culture for possession and use as stateowned property under the right of trust after the repair and restoration of this building are finished after the state commission has adopted it for use; 2.3. by 1 January 1998, to take over from the House of Artists of Lithuania the house located at Didžioji St. 31, Vilnius for possession and use as state-owned property under the right of trust; 2.4. when performing the functions of founder of the House of Artists of Lithuania, not to change the purpose of the House, nor the type of its activity and status, and to document this in a trilateral agreement on cooperation between the Vilnius City Board, the Ministry of Culture and the House of Artists of Lithuania. 7. It should be noted that the impugned Item 2.4 of the Government Resolution (No. 1320) On the House of Signatories to the Act of Independence of Lithuania and the House of Artists of Lithuania of 28 November 1997 regulates the relations linked to the House of Artists of Lithuania and it is inseparably related to Items 1 and 2.3 of this government resolution. Therefore, the investigation into the compliance of Item 2.4 of the Government Resolution (No. 1320) On the House of Signatories to the Act of Independence of Lithuania and the House of Artists of Lithuania of 28 November 1997 with the Constitution and laws is inseparable from the

9 9 investigation into the compliance of Items 1 and 2.3 of this government resolution with the Constitution and laws. II 1. The petitioner has doubts as to whether the Law On the Procedure of the Reorganisation and Liquidation of Establishments of Culture (wording of 13 June 1995) is not in conflict with Paragraph 2 of Article 120 of the Constitution wherein it is prescribed that municipalities shall act freely and independently within their competence, which shall be established by the Constitution and laws. Moreover, the petitioner had doubts as to whether the provision To assign to the Vilnius City Municipality the following tasks: < > 2.4. when performing the functions of founder of the House of Artists of Lithuania, not to change the purpose of the House, nor the type of its activity and status, and to document this in a trilateral agreement on cooperation between the Vilnius City Board, the Ministry of Culture and the House of Artists of Lithuania of Item 2 of the Government Resolution (No. 1320) On the House of Signatories to the Act of Independence of Lithuania and the House of Artists of Lithuania of 28 November 1997 is not in conflict with, inter alia, Paragraph 2 of Article 120 of the Constitution. 2. The content of the indicated by the petitioner provision of Paragraph 2 of Article 120 of the Constitution that municipalities shall act freely and independently within their competence, which shall be established by the Constitution and laws, may not be construed separately from other provisions of the Constitution, which consolidate the constitutional concept of local selfgovernment, inter alia, the functioning of local self-government as a system of public power, as well as constitutional bases of relations between local self-government and state administration. The majority of these provisions are set forth in Chapter X Local Self-Government and Administration of the Constitution (Articles ). In its ruling of 24 December 2002, the Constitutional Court held that, under the Constitution, certain functions are vested exceptionally in the municipalities (respective competence of municipalities is directly entrenched in the Constitution); moreover, municipalities may be assigned also with commission of certain functions of the state by law. In this regard, the concept functions of municipality is a generalising one; it comprises all functions performed by municipalities according to the Constitution and laws, including those that are performed by municipalities due to the fact that pursuant to the Constitution these functions are assigned exceptionally to them, and those the performance of which must be guaranteed by the state, but which are performed, under laws, through municipalities or with certain participation of municipalities to (institutions or officials of) which respective competence (empowerments) is assigned. Thus, in the cases of constitutional justice, when deciding whether the law-established legal regulation by which the performance of certain functions is transferred to municipalities is not

10 10 in conflict with Paragraph 2 of Article 120 of the Constitution, as well as whether the legal regulation, established in laws and/or substatutory legal acts of the Government, by which municipalities (their institutions or officials) are assigned with certain competence (empowerments) which is needed in order to perform the functions transferred to municipalities is not in conflict with Paragraph 2 of Article 120 of the Constitution, one must take account of the norms of the Constitution and the principles of the Constitution, which establish constitutional bases of legal regulation of respective public relations, and interrelations of these norms and principles with provisions of the Constitution that entrench the constitutional concept of local self-government. In the constitutional justice case at issue, when deciding whether the Law On the Procedure of the Reorganisation and Liquidation of Establishments of Culture (wording of 13 June 1995) and Items 1, 2.3 and 2.4 of the Government Resolution (No. 1320) On the House of Signatories to the Act of Independence of Lithuania and the House of Artists of Lithuania of 28 November 1997 are not in conflict with Paragraph 2 of Article 120 of the Constitution, one should take account of the provisions of Article 42 of the Constitution which consolidate, inter alia, freedom of culture as well as constitutional bases of state support to culture and protection of cultural monuments and valuables, the provisions of Articles 23, 47 and 128 of the Constitution which consolidate the constitutional bases of relations of ownership in the Republic of Lithuania, as well as interrelations of respective provisions of Articles 23, 42, 47 ad 128 of the Constitution with the indicated by the petitioner provision of Paragraph 2 of Article 120 of the Constitution that municipalities shall act freely and independently within their competence, which shall be established by the Constitution and laws, as well as other provisions of the Constitution that consolidate the constitutional concept of local self-government. 3. The Constitutional Court, when construing Paragraph 2 of Article 120 of the Constitution in the context of other provisions of the Constitution (inter alia, those that consolidate the constitutional concept of local self-government), has held in its rulings that governance of the state and local self-government are two systems of public power which are established in the Constitution. They are not identical. In the Constitution local self-government is consolidated as a local system of public administration, which acts on the basis of self-activity and is not under direct jurisdiction of institutions of state power: self-administration and self-activity of territorial communities of established in laws administrative units, as per competence which is defined in the Constitution and laws. Local self-government is power of territorial communities of administrative units, which is formed and which functions on the constitutional bases other than those of state power. Each above-mentioned system of public power performs functions that are characteristic of the particular system only. On the other hand, a self-governing territorial community constitutes a part of the whole community of the state the civil Nation therefore, the public interest of

11 11 municipalities territorial communities may not be confronted with the public interest of the community of the entire state, which must be ensured by state institutions within their competence as well. An interrelation exists between administration of the state and local self-government, which manifests itself, inter alia, in the fact that centralised governance of the state in territorial administrative units is combined with de-centralisation, in the fact that one consolidates in laws the cooperation of institutions of central power and municipalities, in the fact that the state supports municipalities in various ways and forms, as well as the fact that the state, upon the forms established by law, supervises the activity of municipalities and coordinates joint actions of the state and municipalities, when important social objectives are being sought (the Constitutional Court s rulings of 18 February 1998, 13 June 2000, 28 June 2001, 14 January 2002, 24 December 2002, 30 May 2003, and 13 December 2004). In its rulings the Constitutional Court has held also more than once that the provision of Paragraph 2 of Article 120 of the Constitution that municipalities shall act freely and independently within their competence, which shall be established by the Constitution and laws, is the guarantee of participation of local communities in administration of respective territories. 4. It was mentioned that pursuant to the Constitution certain functions are vested exceptionally in municipalities, moreover, one may transfer, by law, certain functions of the state to be performed by municipalities as well. It should be noted that the possibility which originates from the Constitution to transfer by law certain functions of the state to be performed by municipalities means also that the aforementioned functions may be assigned by law to be performed by municipalities on the full-scale or only to a certain extent. In the latter case one must especially stress the requirement of clarity of legal regulation which originates from the Constitution: legal regulation which is established by law must be such where it is clear to what extent do municipalities perform a particular function, and to what extent the performance of this function is left to the state. In the context of the constitutional justice case at issue it should be held that the performance of certain functions of the state, speaking objectively, may not, to a certain extent, be not transferred to municipalities, as, without doing so, one could not guarantee an effective performance of such functions. It should be stressed that according to the Constitution functions of municipalities may be established only by law; it may not be done by substatutory legal act. In the area of legal regulation of relation of local self-government, the legislature enjoys a broad discretion. This discretion comprises not only the right of the legislature to establish by means of a law as to which functions (full-scope or a certain extent of them) are transferred to municipalities, but to differentiate these functions, inter alia, according to freedom of decision-

12 12 making and, on this basis, to set the types of functions that are transferred to municipalities as well. The level of self-dependence of municipalities when performing various functions that are established by law may differ: when performing some functions municipalities may enjoy more self-dependence, meanwhile, when performing other functions, freedom of activity of municipalities is restricted by respective decisions of the state institutions and/or officials (the Constitutional Court s ruling of 24 December 2002). It should be stressed also that when establishing the functions of municipalities and their types, the legislature must pay heed to the self-dependence of municipalities and freedom of their activity within the competence established by the Constitution and laws, the principles of coordination of interests of municipalities and the state, as well as the constitutional concept of local self-government. In this context, it should be noted that, as already held by the Constitutional Court in its rulings of 24 December 2002 and 13 December 2004, the constitutional provision that municipalities act freely and independently within their competence, which shall be established by the Constitution and laws means also that in case certain functions are assigned to municipalities by the Constitution or laws, so the municipalities perform them (both the ones, that are performed by them due to the fact that these functions, pursuant to the Constitution, are assigned exceptionally to municipalities, and the ones the performance of which, according to the Constitution, must be guaranteed by the state, but which are performed, in order to guarantee, inter alia, a more efficient interaction between state power and citizens, as well as democracy of administration, all of them or some of them to a certain extent are transferred by law to be performed by municipalities), to the extent that they are assigned to the latter. However, none of these functions means absolute independence of municipalities in respective area; they are all regulated by law. 5. The Constitutional Court has held that one may not assign any functions to institutions of self-government, which they are not able to perform (the Constitutional Court s ruling of 14 January 2002), and that in case the functions of the state are transferred by law to municipalities, as well as in case laws and other legal acts create duties of municipalities, funds needed for performance of these functions (fulfilment of duties) must be allocated as well (the Constitutional Court s ruling of 24 December 2002). It was held in the Constitutional Court s rulings of 14 January 2002, 24 December 2002, and 13 December 2003 that, according to the Constitution, municipalities must execute laws, including the laws by which municipalities are obligated to perform functions of the state that are assigned to them, and that funds, which are needed in order to ensure the fully-fledged functioning of self-government and performance of municipal functions, must be provided for in the state budget. It should be held that from the Constitution (inter alia, the provision of Paragraph 1 of Article 120 of the Constitution that the State shall support

13 13 municipalities) stems a duty of the legislature to establish by law such legal regulation, where, having taken account of resources of the state and society, material and financial capabilities, as well as other important factors, funding for municipal functions might be guaranteed. On the other hand, the constitutional duty of the legislature to establish such legal regulation where, having taken account of resources of the state and society, material and financial capabilities, as well as other important factors, funding for municipal functions might be guaranteed, does not deny the duty of municipalities (their institutions or officials) to adopt decisions, within the competence established by the Constitution and laws, to collect funds needed for performing their functions and to use these funds in a due way; the aforesaid constitutional duty of the legislature does not deny the responsibility of municipalities (their institutions or officials) for the proper performance of the functions transferred to them. In this context it should be noted that according to the Constitution municipalities draft and confirm their budget (Paragraph 1 of Article 121 of the Constitution), that municipal budgets are independent (Paragraph 1 of Article 127), as well as that municipal councils have the right to establish local levies within the limits and in accordance with the procedure provided for by law, moreover, municipal councils may provide for preferences with respect to taxes and levies at the expense of their own budget (Paragraph 2 of Article 121 of the Constitution). It should be noted that according to the Constitution no legal regulation, where, having established by law certain functions of municipalities, municipal institutions and/or officials through which these functions should be performed have no respective competence (empowerments), may exist. Otherwise, one would have to hold that the functions which were transferred to municipalities by law are the ones which municipalities are not able to perform. 6. The public interest which must be guaranteed by local self-government as well, as one of the systems of public power provided for in the Constitution, as well as particular tasks that are faced within a particular period by the whole society, the state and territorial communities, are dynamic and they are subject to change. Therefore, the legislature may, and, in certain cases, it even must, change by law (expand, narrow or correct it otherwise) the scope and content of functions that are transferred to municipalities, transfer new functions, which previously were not performed, to be performed by municipalities and/or stipulate that municipalities cease to perform certain functions, which were performed earlier; the legislature may, and in certain cases even must, also respectively correct the competence (empowerments) of municipalities (their institutions or officials), which is needed in order to perform the functions transferred to municipalities. When doing so the legislature must pay heed to the norms and principles of the Constitution, inter alia, the imperative which originates from the Constitution to establish by law such legal regulation, where, having taken into account the resources of the state and society, material and financial capabilities, and other important factors, the funding for the municipal functions is ensured; moreover, in case

14 14 the scope of functions transferred to municipalities is being changed (expanded, narrowed or corrected otherwise), the legislature may, and in certain cases even must, respectively correct (increase or reduce) the funding for municipal functions. It should be noted in this context that, as already held in the Constitutional Court s rulings of 14 January 2002, 24 December 2002, and 13 December 2004, in case additional functions of the state are transferred (other duties are assigned) to municipalities prior to the end of the budgetary year, the funds must be allocated for implementation of the latter as well. It should especially be stressed that pursuant to the Constitution it is only by law how one may change (expand, narrow or correct otherwise) the scope and content of functions transferred to municipalities, transfer new functions, which were previously not performed, to be performed by municipalities and/or stipulate that municipalities cease to perform certain functions, which were performed earlier; this may not be done by substatutory legal act. 7. Municipalities perform all their functions (including those that are performed, as according to the Constitution they are vested solely in municipalities, and those the performance of which must be guaranteed by the state, however, in order to ensure, inter alia, a more efficient interaction between state power and citizens, as well as democracy of governance, they all or to a certain extent are transferred by law to be performed by municipalities) and implement their competence (empowerments) through institutions of self-government municipal councils the members of which have the mandate of territorial community, as well as through executive bodies that are established by and accountable to municipal councils and other institutions accountable to municipal councils (municipal establishments or enterprises). In its rulings of 24 December 2002, 17 March 2003, and 13 December 2004, the Constitutional Court held that municipal institutions are established in order to implement the interests of municipality, and to directly implement laws, resolutions of the Government and decisions of the municipal council; thus, pursuant to the Constitution, municipal councils, executive bodies that are accountable to them, and other institutions established by municipal councils should be considered municipal institutions as well. The concept municipal institutions expresses the subordination of respective institutions to respective municipality. In this context, it should be mentioned that the Constitution directly consolidates the bases and procedure of forming (electing) self-government institutions, the municipal councils (Paragraph 2 of Article 119 of the Constitution); moreover, the Constitution expressis verbis requires that municipal councils establish executive bodies accountable to them (Paragraph 4 of Article 119 of the Constitution). In its ruling of 13 December 2004, the Constitutional Court held that in the established cases municipal councils (representative institutions) and executive bodies accountable to them (executive institutions) are granted authoritative empowerments, and that such municipal

15 15 institutions are institutions of municipal power and public administration. It should be stressed that municipal councils, i.e. institutions through which the right of selfgovernment of territorial communities is implemented, according to the Constitution have the right to establish various institutions accountable to them municipal establishments, enterprises that are needed in order to perform functions transferred to municipalities, and in cases provided for by law they must establish such institutions (municipal establishments or enterprises). Paragraph 2 of Article 120 of the Constitution, wherein it is prescribed that municipalities act freely and independently within their competence, which shall be established by the Constitution and laws, and Paragraph 3 of Article 119 of the Constitution, wherein it is established, inter alia, that the procedure of activity of self-government institutions is established by law, imply also that the legislature has the duty to set by law the procedure of establishment of municipal establishments or enterprises, and municipal councils must establish municipal establishments or enterprises according to the requirements set in laws. In the context of the case at issue, it should be noted that the legislature, while paying heed to the Constitution, may establish by law certain conditions and/or procedures, which must be followed by municipalities when implementing their rights of the founder of the establishments or enterprises founded by them, and one may establish also by law other limitations which to a certain extent restrict the rights of municipalities as founders of respective establishments or enterprises. In its decision of 11 February 2004, the Constitutional Court held: if the laws provide that certain relations connected with the procedure (procedures) of implementation of requirements of laws, thus, also the requirements of the laws whereby municipal functions are established, are regulated by the Government, then the Government must do so; such legal regulation established by the Government is obligatory to municipal institutions as well; if it is established in the laws that certain relations connected with the procedure (procedures) of the implementation of laws, thus, also the laws establishing municipal functions, are regulated by an institution empowered by the Government (for example, a ministry), then the Government has a duty to establish, by means of a resolution, which state institutions have to do so, while the latter institution (its head) must issue a respective legal act; such legal regulation established by the institution (its head) empowered by the Government is obligatory to municipal institutions as well; if it is established in the laws that certain relations connected with the procedure (procedures) of the implementation of laws, thus, also the laws establishing municipal functions, are regulated by a ministry (minister) or another state institution (its head), then this ministry (minister) or another state institution (its head) must issue a corresponding legal act, and the legal regulation established by this ministry (minister) or other state institution (its head) is obligatory to municipal institutions as well; however, these government resolutions, substatutory legal acts issued by ministries (ministers) or other state

16 16 institutions (their heads) cannot change or distort the legal regulation established in laws, these substatutory legal acts cannot establish any such legal regulation which would compete with that established in laws. In this context, it should be noted that according to Article 122 of the Constitution municipal councils may apply to court regarding violation of their rights. The right of municipal councils which originates from the Constitution and laws, to establish various institutions municipal establishments that are needed in order to perform the functions transferred to municipalities accountable to them implies also their right to liquidate, reorganise or upon the established procedure in any other way restructure the aforementioned institutions irrespective of the way how the liquidation, reorganisation or restructuring in any other way of municipal establishments or enterprises is called in laws or substatutory legal acts, including decisions of respective municipal councils. The above-mentioned requirements that originate from the Constitution, inter alia, the duty of the legislature to set forth by law the procedure of establishment of municipal establishments or enterprises and the duty of municipal councils to establish municipal establishments or enterprises while following requirements that are set forth in laws, as well as the duty of municipal councils to follow requirements of the government resolutions, substatutory legal acts of ministries (ministers) or other state institutions (their heads), are applicable also mutatis mutandis to municipal councils decisions, by which municipal establishments or enterprises are being liquidated, reorganised or restructured in any other way, irrespective of the way how the liquidation, reorganisation or restructuring in any other way of municipal establishments or enterprises is called in laws or substatutory legal acts, including decisions of respective municipal councils. It should be noted that the Constitution (in particular, having taken into account the fact that the principle of co-ordination of the interests of municipalities and the state is consolidated therein) does not prevent municipalities from holding the right of the founder of certain institutions (establishments or enterprises) through which the transferred to municipalities functions of the state are performed, if it is permitted by law, together with other subjects, inter alia, state institutions. 8. In its ruling of 24 December 2002, the Constitutional Court held that the executive bodies accountable to municipal councils have no right to adopt decisions which are not based on decisions of municipal councils, as well as decisions which are equal in their legal force to decisions of municipal councils. When construing this statement of the ruling of 24 December 2002, the Constitutional Court in its decision of 11 February 2004 held, inter alia, that the legislature, which has established by law that municipalities may establish their establishments or enterprises, may not set such legal regulation where decisions concerning the establishment of such establishments or enterprises are adopted by executive bodies accountable to municipal councils instead of the latter.

17 17 This provision is mutatis mutandis applicable also to decisions of municipal councils by which municipal establishments or enterprises are being liquidated, reorganised or restructured in any other way upon the established procedure irrespective of the way how the liquidation, reorganisation or restructuring in any other way of municipal establishments or enterprises is called in laws or substatutory legal acts, including decisions of respective municipal councils. 9. In its ruling of 13 December 2004 the Constitutional Court held: the system of state institutions comprises various state institutions; the variety of state institutions, their legal status and powers are determined by a variety of functions exercised by the state, particularities of managing the general affairs of the society, organisational and financial capabilities of the state, the content and expediency of the policy implemented during a concrete period of life of the society and development of the state, international obligations of the state, as well as other factors; certain state institutions are expressis verbis indicated in the Constitution; the Seimas, the President of the Republic, the Government, and courts are the institutions exercising state power; in the Constitution one has indicated also certain state institutions which are not assigned, pursuant to the Constitution, to the legislative, executive, or judicial branches of power; in the Constitution, the term institution comprises not only state institutions it bears a broader sense as well, because in certain cases nonstate institutions are called the same too. In the Constitutional Court s ruling of 13 December 2004 it is held also that according to the Constitution it is the Seimas and according to laws it is also the Government who enjoy the powers to establish state institutions other than those expressis verbis indicated in the Constitution, a need to establish which originates from the necessity to implement state governance, to administer affairs of the state, to ensure the performance of various state functions, that, while paying heed to the Constitution, law may also establish such legal regulation where certain state institutions may be established under the institution of the President of the Republic, the Head of State, as well as that law may also establish the legal regulation where certain state institutions that ensure independent administration of courts are founded under the judicial branch. It should be held that various state institutions (including establishments and enterprises) may or, in certain cases even must, be established, within their competence and pursuant to the requirements of laws, also by the state institutions which are not assigned by the Constitution to the legislative, executive, or judicial branches of power. In addition, it should be held that various state institutions (including establishments and enterprises) within their competence and in line with requirements of laws may, and in some cases even must, be also established by the state institutions which are not specified in the Constitution and which themselves were established according to the law by other state institutions as well. In this context, it should be emphasised that the concept used in the Constitution state