LRT | 17 July 2025
Lithuania and Veolia reach €38m settlement to end decade-long legal disputes
Lithuania and French energy group Veolia have reached a €35 million settlement that ends most of their decade-long legal disputes over municipal heating contracts, the Lithuanian Energy Ministry announced Thursday.
As part of the agreement, Veolia will withdraw its claims at the International Centre for Settlement of Investment Disputes (ICSID) in Washington, DC, and pay €35 million in damages to Lithuania. In exchange, Lithuania will drop its claims in local courts against Veolia Environnement and its subsidiaries – Veolia Energie International, Vilniaus Energija, and Litesko.
The settlement does not include claims against Icor, a former Lithuanian partner not part of the Veolia Group, or against individuals such as former Vilnius Mayor Artūras Zuokas and business figures Andrius Janukonis and Linas Samuolis. Lithuania’s case against them will continue in Vilnius Regional Court.
Veolia filed its ICSID case in 2016, seeking €79 million in damages over its investments in Vilnius’ district heating system. A final ruling had been expected later this summer.
“The settlement does not constitute an admission of liability by either party,” the ministry said in a press release. “It is a pragmatic decision to avoid further costly and time-consuming litigation, ending a decade-long dispute between the Republic of Lithuania and Veolia.”
Lithuanian Energy Minister Žygimantas Vaičiūnas said most of the settlement funds will go toward Lithuanian consumers, support for Ukraine, and covering arbitration costs.
“We are pleased about reaching this settlement, which not only closes prolonged litigation between the parties and restores legal peace, but also opens new avenues for future cooperation between Lithuanian and French business entities,” Vaičiūnas said.
Veolia Chief Legal Officer Erik Haza said the company was proud of its work in Lithuania and looked forward to rebuilding a cooperative relationship with authorities.
“Throughout this dispute, Veolia has successfully defended its business and reputation against baseless allegations and fought for the rightful enforcement of bilateral investment treaties,” Haza said. “We are proud of the excellent work completed in the service of Vilnius and other municipalities, efficiently and safely supplying heat.”
According to Haza, Veolia invested more than €177 million in Vilnius’ district heating infrastructure.
In May, Vilnius Regional Court began hearing a €240.7 million damages claim by the Lithuanian government against Veolia, its affiliates, and related individuals. The government alleged that Veolia and its partners engaged in a corrupt scheme to influence public officials, profit from inflated heating tariffs, and divert millions to offshore companies for fictitious services.
Lithuanian authorities claimed that Veolia and Icor unlawfully secured heating lease contracts in 10 municipalities between 1999 and 2003, reaping illegal profits at the expense of consumers. Veolia maintained that its actions were lawful and that Lithuanian authorities violated bilateral investment protection treaties.