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The crisis and its impacts have underscored yet again how important to fulfill consumer protection requirement in this specific field. Therefore, in this article we analyze the insurance sector related consumer protection. We emphasize that as of 1 January 2012 Lithuania made the significant financial markets supervision reform. Therefore, Bank of Lithuania (central bank of the Republic of Lithuania) is now the centralized financial market supervisor that is responsible for the consumer's protection in this sector. After reform the Bank of Lithuania acts as independent "referee" who looks at both sides of the insurance dispute, makes enquiries, asks questions and comes up with a solution (recommendation) that he believes is fair. It is worth to stress that the out-of-court settlement procedure is not binding, therefore in some cases out-of-court settlement procedure is not efficient enough. In the article we also rise the public administration problem -- in some cases State Consumer Rights Protection Authority that is the main institution in the field of consumer protection, may revise the standard insurance contract terms. Such public administration functions are also delegated to the Bank of Lithuania. Therefore, where the insurance-related consumer dispute rises, it is not clear which public institution is responsible to provide the competent opinion on insurance contract standard terms fulfillment with consumer protection laws. [ABSTRACT FROM AUTHOR]

Financial sector supervisory bodies are organized in different forms in different countries of the European Union. These "models" range from independent stand-alone supervisory authorities to consolidated (centralized) supervisors responsible for supervising the entire financial sector, including banks, insurance companies and securities firms. The aim of this article is to analyse the new financial market supervision approach in the Republic of Lithuania. Since 1 January 2012 the supervision of the Lithuanian financial market has been centralized. Therefore, the Central Bank of the Republic of Lithuania is the sole supervisory authority that supervises the Lithuanian financial market. The new financial market supervision approach has led to the further amendments. Under the Law on Bank of the Republic of Lithuania (Central Bank); since 1 January 2012 the supervision of the financial market funding partly derives from the fees imposed on regulated entities. The operational independence of the supervisory authority leads to more transparent and professional financial market supervision and unburdens public administration costs. However, as it is mentioned in the article, the global financial crisis has led to the disputes that the supervision of the national financial market as well as the financial market of the European Union should develop a harmonized core set of supervision standards that can be applied throughout the European Union. Therefore, by the de Larosiere report as a basis, the European Commission is attempting to establish a new European financial supervision system. Consequently, the new macroeconomic supervision approach will impact the further developments in the Lithuania's financial market supervision. [ABSTRACT FROM AUTHOR]

Non-responsible policy of financial institutions and governments became one of the forces accelerating the financial turmoil. The use of inadequate monitoring of financial markets or monitoring gap, unfair managing personnel salaries system (bonuses etc.) as well as tax avoidance and evasion strategies of multinationals and richest individuals destroy state finances already weakened by the economic crisis. Under such circumstances new tasks for tax administrations arise around the world. In order to achieve the tasks mentioned above new measures or sets of measures must be created and applied. The enforcement of fair tax competition and voluntary compliance as well as the cross-border exchange of tax information become one of the most important strategic goals for state tax and tax administration policy, especially during the economic recession. The article analyses the main problems arising for tax administrations nowadays and emphasizes activities of international organizations aiming at changing tax and tax administration policy, especially during economic crisis. Thereby, the article presents with the analysis of the strategies and measures employed by the USA, Australia, UK, and Sweden in their attempts to enforce tax administration. [ABSTRACT FROM AUTHOR]

The adoption of the Collateral Directive 2002/47/EC represents an important progress towards the implementation of a truly harmonized single financial market. The Lithuanian Financial Collateral Arrangements Act (the law) has implemented the Directive 2002/47/CC in time. The law establishes special regulation for financial securities given in transactions between „professional market participants“, between market participants and other companies, inclusive small and medium-sized enterprises. The law applies to certain transactions on the financial markets and aims at stabilizing the financial markets. Essentially, the Directive and the national implementing law ensure the enforceability of financial collateral arrangements and provide for rapid and non-formalistic enforcement of financial collateral procedures in insolvency cases. The realization of financial collaterals is made easier and cheaper. Firstly, the article describes the conception of the financial collateral arrangements and the financial collateral. Secondly, this article analyses the way in which financial collateral is enforced in case of an insolvency of the debtor. The law prescribes the liberal enforcement regime for the collateral and abolishes essential features of security interest in insolvency, such as the prescribed manner of enforcement and the prohibition of appropriation. The article analyses appropriation as a manner of realization of financial collateral, a protection of which in case of insolvency is a new conception in the Lithuanian Insolvency Law. Appropriation is possible only if it has been agreed upon by the parties and if they have also agreed on the objective evaluation of the financial instruments. The objective evaluation of the assets which are the object of recovery is one of the key issues in security law and in the insolvency law. National law must provide for strict procedures in order to prevent abuse and to guarantee maximum proceeds from such assets. The Law has far reaching consequences for insolvency regulation, which is generally more favorable for creditors -- security takers, and more detrimental to security providers and their other creditors. The provisions of the Lithuanian law on financial collateral arrangements create an effective framework for the realization of financial collaterals, but it lacks mechanisms for balancing the interests of the collateral taker and the collateral giver and in this respect has a negative impact on the insolvency regulation in Lithuania. The article attempts to provide an answer on how to protect the interests of the collateral giver and other creditors. [ABSTRACT FROM AUTHOR]

The present paper deals with the impact of alternative investment funds on economy and possibilities of improving regulation of their activity. The recent years have seen a rapid development of alternative investment funds, namely hedge funds and private equity funds. Due to relatively low interest rates and excess liquidity in financial markets, these funds reached such a scale that they could influence real economies. Although the activities of the alternative investment funds may influence liquidity and efficiency of the markets in a positive way, they could not be valuated unequivocally, since they often have negative consequences. Contradictory objectives of the alternative investment funds and the Lisbon Strategy or at least their different time horizons determine the negative impacts of these funds on the long-term economic growth and employment in the labour market. Furthermore, these funds have different impacts (and most often negative ones) on the behaviour of the companies and financial markets. The lack of transparency and regulation, employment reduction, overindebtedness of the companies, tax avoidance and other corporate governance problems distort competition and endanger economic stability. The present article aims at searching for adequate regulation of the activities of alternative investment funds. The methodology of the research comprises statistical methods and a comparative analysis of the regulation norms. In order to neutralise the negative impacts of hedge and private equity funds, it is recommended to develop the regulation of the considered norms in the following directions: 1) to encourage long-term investments in the following ways: weighting of the voting rights according to the duration of property, higher tax rates for short-term investments; 2) to prevent tax avoidance providing the following: collection of taxes according to the country of the contract subject or fund manager (not to the country of fund registration because most of them are registered in so-called "tax heavens"), tax discrimination of the offshore funds, as well as limited interest exclusion from the taxable profit; 3) to ensure greater transparency of the markets and to strengthen economic stability by the following means: minimum financial reporting standards, a new European directive introducing minimum standards for information disclosure, and minimum capital requirements for companies; 4) to enhance investor and employee protection. [ABSTRACT FROM AUTHOR]

Despite growing globalisation, the international trade is acquiring a regional character. Lithuania is integrated through its international value chain into these regional trade hubs. Traditionally Northern European countries belong to the region where Lithuania has the interest to strengthen mutual economical relations. These countries are leading in foreign direct investments in Lithuania; its bank sector is largely integrated into Scandinavian bank system. Northern region companies source in Lithuania widely, particularly in textile, engineering, as well as furniture manufacturing sectors. Lithuanian companies already have established close linkages, and bilateral trade is expanding dynamically. However, are Baltic countries ready to respond to the current challenges? Is the integration level of Lithuania sufficient and the mutual benefit equivalent yet? There is still too little analysed. Under just subcontracting, Lithuanian companies position themselves in the lowest point of value creation curve where the received value added is not adequate. In order to enhance competitiveness and the integration level, essential steps are to be implemented. They would facilitate creation of a favourable environment for business growth across the region and bring benefit to the region's countries. increase the competitiveness of European companies in international financial markets. [ABSTRACT FROM AUTHOR]

Recently investment funds have gained a significant impact on modern international economy. Solid attention to the investment funds industry is common not only in the EU, but also in separate developed countries. When the assets under management of investment funds exceeded the total GDP in the EU, the largest centres of investment funds administration, distribution and management were clarified: the Grand Duchy of Luxembourg and the Republic of Ireland. The Grand Duchy of Luxembourg is the main investment funds distribution centre in Europe because of a centralised law system, tax rebates for the corporate clients, attractiveness for higher competence workers and usage of new modern technologies in investment funds management and accounting companies. EU investment laws and directives are prepared in a qualified way as the foreign assets management companies are eager to choose Luxembourg as the main funds, shares or units distribution centre in Europe for having attractive European-distribution advantages. The Law of Specialised Investment Funds accepted in Luxembourg is one of the greatest steps to launch more alternative investment funds. It has reduced the requirements for assets management and administration of alternative investment funds. Furthermore, the rules for distribution of riskier investment funds were mitigated. Despite the fact that there are numerous sophisticated changes in investment funds activities, the trade systems are the most important to guarantee the correct and fair settlement between both the sides -- the buyer and the seller. The highest advantage when choosing the right trade system is considered to be the cost saving factor, as according to the made market research almost 2 of 3 US and European assets management companies pay annually significant amounts of money for international settlement services. It is worth mentioning that too great concentration of central depositories in the EU is reducing the competitive advantage of European assets management companies in international financial markets. It was agreed on the common Directive of Financial Markets Instruments in the European Union that equal market conditions for all financial market participants will be ensured and the competition level between separate providers of financial services improved. It will possibly ensure a higher level of efficiency of EU assets management companies and will increase the competitiveness of European companies in international financial markets. [ABSTRACT FROM AUTHOR]