Last week, M. Lingė registered amendments to the Land and State and Municipal Property Management Laws, announcing his intention to increase the transparency of auctions, extend the registration time for them, eliminate the registration fee, and introduce an “anti-speculation rule.”
According to this rule, a buyer who acquires an item at a public auction and transfers the property to another person within three years should pay the auction organizer 50% of the profit gained from transferring the property, with certain exceptions.
M. Lingė also proposes to limit the participation in the auction of entities who prepared the plot for sale or had access to inside information, and to consider the auction invalid if there is only one participant.
Additionally, it is proposed to increase the transparency of auctions, among other things by requiring announcements about the land sale to be posted on the plot, allowing registration for the auction until its end, eliminating the auction registration fee, with costs covered from the amount paid by the winner.
The politician told BNS that these amendments were not coordinated within the Homeland Union-Lithuanian Christian Democrats (TS-LKD) faction.
“We do not conduct an analysis, more or less we consult. I informed the chairman about the intention and received his approval for the amendments to be submitted,” said M. Lingė.
Committee Chair: Awareness is the main tool
J. Rojaka, Chair of the Committee on Economics and Innovation, told BNS that the proposals to tighten the state property auction rules address a real problem of lack of transparency and insufficiently competitive processes.
“Especially when we talk about state property, this problem really exists, it is real. Naturally, both the public and the community expect that property would be sold very transparently, publicly, clearly, and at market price, leaving no room for interpretations or behind-the-scenes agreements, which unfortunately do occur,” the politician said.
“But tightening procedures does not automatically mean increased transparency. And if the rules are too complicated, more competition will certainly not arise. On the contrary, it could become another bureaucratic obstacle that would not increase but decrease competition,” she added.
The “anti-speculation rule” proposed by M. Lingė, according to J. Rojaka, at first glance would prevent speculation with state property, but the politician misses balance in it.
“I try to imagine the opposite situation, when you buy property and something happens, and within three years that property depreciates. No one would reimburse you from the budget. (…) There is little balance here, I would say,” said the committee head.
According to her, awareness is the main tool that could reduce speculation.
“If information were accessible to everyone, the appetite for speculation would be much smaller and competition would be much greater. I would suggest seeking balance by strongly strengthening and making processes more transparent, not by regulating certain safeguards,” said J. Rojaka.
“I have no doubt that various scenarios (in the committee – BNS) would be examined and it would be necessary to look systematically at how many such events there are in total and what benefits could be possible,” the politician added.
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“I understand where Lingė is coming from”
J. Rojaka’s deputy in the Committee on Economics and Innovation, social democrat Birutė Vėsaitė, did not rule out that state property auctions should be “somewhat” tightened.
“Although there is not much state property left to be sold anywhere, I understand where Lingė is coming from,” said the politician, referring to the publicly discussed success of Prime Minister Mindaugas Sinkevičius in a state land auction.
“You need to take statistics, take data, analyze them. If there really are problems, maybe partly the proposals could be supported, but there is also an element of politicking,” said B. Vėsaitė.
She emphasized that in some cases state property, especially in municipalities, is not attractive, and stricter auction rules could prevent the sale of property.
“Well, it really is not attractive, so sometimes people are glad that a buyer appeared at all. So wouldn’t we stop it this way?” said the politician.
“If no more buyers appeared, probably I would not stop it, because sometimes auctions are completely hopeless. We would also stop the processes of municipalities that want to get rid of property that sometimes is an eyesore. So the issue should be considered from several sides,” said B. Vėsaitė.
In turn, M. Lingė emphasized to BNS that the draft amendments have a double reference point.
“The Jonava case is more of an illustration, but the problem is much deeper, and the Special Investigation Service (STT) had provided its assessment,” said the parliamentarian.
M. Lingė relies on the 2024 report of the Special Investigation Service (STT), which showed that in 44% of cases state or municipal property is sold at the starting price with only one participant in the auction.
In the statement, the conservative also said that the regulation of auctions is forced to change by the prime minister’s success, when in 2024 in Jonava the only auction participant who bought a state plot for 11.6 thousand euros, M. Sinkevičius, sold it within a year for 55 thousand euros.
According to M. Lingė, this discredits trust in state land auctions.
“When state property is sold without competition and soon resold with huge profit, every taxpayer loses. Such cases cast a shadow on all those who work honestly,” said the politician.
He hopes to submit the amendments to the Seimas at the beginning of the autumn session. The entry into force of the changes in the drafts is planned from next year.
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