Court overturns EUR 569,400 correction imposed on Klaipeda municipality

Lithuania’s Supreme Administrative Court has overturned a EUR 569,400 financial correction imposed on Klaipeda municipality over public procurement violations, LRT reported.

The Central Project Management Agency imposed the correction after finding that, when construction deadlines were extended for a project to renovate apartment building courtyards, the municipality did not extend the contract performance guarantee or civil liability insurance. The agency said this changed the terms of the public procurement contract and set the correction at 10% of its value.

The court agreed that the municipality had breached public procurement requirements but said that a breach alone was not enough to justify a financial correction. The agency also had to explain how the violation could have affected the European Union budget, but did not provide such arguments.

The court upheld the municipality’s appeal and annulled the agency’s decision. The investigation into the violation remains open, and the agency must complete the procedure and issue a new decision.