Lithuania will hold a referendum on keeping a ban on land sales to foreigners, officials said yesterday (17 February), a move analysts warned would put it at odds with EU regulations on the free movement of capital.

The vote got the go ahead after backers – among them a party led by one of the Baltic state's biggest farmland owners – collected the signatures of more than a tenth of the population to push the initiative through, said the electoral authority.

Lithuania had promised to drop the ban after joining the European Union in 2004 and was given a transitional period to keep it in place until May.

But campaigners called for it to be made permanent, some arguing lifting it could drive prices beyond the reach of locals.

Ownership of land is an emotional subject in a country that has suffered a string of occupations through its history.

"Lithuanians are very emotionally attached to land. We say that a sad person looks like if he has just sold his land'," Valdas Gaidys, head of pollster Vilmorus, told Reuters.

Opinion polls showed two-thirds of Lithuanians opposed to selling land to foreigners.

The referendum was initiated by the Lithuanian Nationalist Union and the Lithuanian Peasant and Green's Union, which is led by Ramunas Karbauskis, one of the biggest farmland owners in the Baltic state.

It is opposed by the ruling Social Democrats and the main opposition Homeland Union parties, as well as President Dalia Grybauskait?, who has said voting in favour of the ban would be equal to voting against Lithuania's EU membership.

"If the referendum succeeds, Lithuania will be in clear violation of European Union law because it will restrict the free flow of capital," said Ignas Vegele, a professor at Vilnius Mykolas Romeris University.

Lithuania could be fined by the European Court of Justice, and access to EU funds, which account for 16% of the state's public expenditure, could be restricted, he added.

Lithuania's Chief Electoral Commission confirmed on Monday that those behind the iniative had collected the 300,000 signatures needed to call a vote – the first such popular initiative to succeed since the country broke away from the former Soviet Union in the early 1990s.

Parliament must choose a date for the vote between May and July.

A 50% turnout is needed for the referendum to pass a binding decision, and at least a third of the electorate must support the measure.