The prosecutor says that in case of a merger, the Labor Party would cease to exist and would escape prosecution.
Meanwhile the court believes there will be no obstacles to the prosecution of the reorganized legal entity.
The ruling can be appealed in seven days. The prosecutor is yet to decide on whether to do so.
"The court believes there will be no obstacles to the prosecution of the reorganized legal entity. But we had expressed our position that it would be problematic to issue a verdict against an entity that no longer exists. Of course, there are all sorts of practices of litigation with deceased persons," Verseckas said.
The court also said that based on existing laws, the new legal entity would be responsible for the Labor Party's actions for three years following its establishment.
Vytautas Gapšys, deputy chairman of the Labor Party, told journalists he was glad that the court had heard the lawyer's arguments and that the party reorganization is no activity and that there were certain handover of obligations.
"If this ruling remains and is not appealed, so the decision will be based on legal provisions," he said.