Background of the occupation of the Baltic states The background of the occupation of the Baltic states covers the period before the first Soviet occupation on 14 June 1940 , stretching from independence in 1918 to the Soviet ultimatums in 1939 – 1940 . The Baltic states gained their independence during and after the Russian revolutions of 1917 ; Lenin ' s government allowed them to secede . They managed to sign non - aggression treaties in the 1920s and 1930s . Despite the treaties , the Baltic states were forcibly incorporated into the Soviet Union in 1940 in the aftermath of the German – Soviet pact of 1939 . Independence process . The Russian Empire absorbed the Baltic areas progressively through the Treaty of Nystad in 1721 and Courland in 1795 . In 1914 , World War I broke out and by 1915 German armies had occupied Lithuania and Courland incorporating the areas into Ober Ost . As the Russian Empire began to collapse , independence movements sprung up on many regions . After the 1917 October Revolution in Russia , Baltic political leaders attempted to establish the independent states of Estonia , Latvia and Lithuania ; however , German control continued throughout the area until early 1918 . Later in 1918 , the area was drawn into the Russian Civil War and proclamations of independence were issued in Lithuania on 16 February , in Estonia on 24 February and in Latvia on 18 November 1918 . Between years of 1918 – 1920 , the bolsheviks tried to establish Soviet republics in the Baltic area . In November 1918 the Red Army conquested Narva . They proclaimed the Commune of the Working People of Estonia , but it was able to function only for a six week . In December , the Latvian communists controlled Riga and proclaimed the Latvian Socialist Soviet Republic . In May 1919 , the communist control ended when the city was taken by combined German , Latvian and White Russian troops . By 1920 , German troops had withdrawn and the Russian Civil War was in its final phase . Consequently , the Baltic states signed peace treaties with Soviet Russia . Estonia signed the Treaty of Tartu on 2 February , Lithuania signed the Soviet – Lithuanian Peace Treaty on 12 July and Latvia signed the Latvian – Soviet Peace Treaty on 15 August 1920 . In 1920 , all three Baltic states adopted constitutions including universal suffrage , a multi - party system and parliamentary with a president . However , the communists were prohibited from participation in politics . Diplomacy in the 1920s and early 1930s . Baltic states seek security guarantees . The Bolsheviks could not prevent the independence of the Baltic states , but the West had to be persuaded to accept it . By 1921 Lithuania , and by 1922 Estonia and Latvia , all obtained " de jure " international recognition . All three states joined the League of Nations in 1921 . The Baltic states begin to build a regional alliance system with their neighbors in Scandinavia and eastern Europe . In the south , Poland was reconstituted with consolidation of territories from Germany and Russia . Furthermore , Polish troops seized the Lithuanian capital of Vilnius in October 1920 , poisoning relations with the Baltic states . In the north , Finland had also been under Russian control from 1809 until its independence in 1918 , but the Finns looked to Scandinavia rather than towards the Baltic states . In the west , Sweden followed a policy of neutrality , but during the 1920s it took a more active regional role . Between 1917 and 1934 the Baltic states worked to improve security , and unsuccessfully attempted to build a regional bloc stretching from Scandinavia to Romania . The Estonians and Latvians concluded a military convention in 1923 , which Lithuania joined in 1934 . Further , the Estonians and Latvians held a joint military exercise in 1931 , but it was not repeated and collaboration remained a dead letter thereafter . However , the Finns and the Estonians had secret military exercises in the early 1930s , reconstructing the tsarist naval batteries . Finally in 1934 the three Baltic states reached the Baltic Entente agreement . In spite of the Vilnius issue , the Baltic states were open to the Polish option . The Warsaw Accord was signed in March 1922 by Finland , Poland , Estonia and Latvia , but the Finnish parliament failed to ratify it . Lithuania joined the Warsaw Accord in 1934 , but the bloc had become impotent . German – Soviet trade and non - aggression agreements . The April 1922 Genoa Conference between Germany , the Soviet Union , and the Allied powers was an attempt to reconstruct Europe . Soon the Germans and the Soviets agreed on the Rapallo Treaty which provided mutual liquidation of war debts and the recognition of the Soviet state . It was also a begin of the direct economic co - operation between these two giants . The Baltic leaders had lost their chance of planned international consortium to trade with the Soviets . Next , the Locarno Conference in 1925 gave a framework for European security . The Locarno treaties guaranteed Germany ' s western borders , but left open questions about Germany ' s eastern borders . The Germans and Soviets agreed to the Treaty of Berlin in 1926 as the Soviets feared the West could use Germany in its anti - Bolshevik crusade . The Baltic states were warned to not become military outposts of Great Britain against the Soviet Union . Germany developed positive relationship with the Baltic states , especially with Latvia . Latvia represented itself as a bridge to an improved relationship with the Soviet Union . Latvia managed to sign a trade agreement with Germany in 1926 and with the Soviet Union in 1927 . Similarly , Lithuania signed a trade agreement with Germany in May 1926 . Lithuania was the key to improved relationship with the Soviet Union . In exchange for Soviet recognition of Lithuania ' s claim to Vilnius , the countries signed a non - aggression pact in September 1926 . The situation appeared to be stable for the Baltic states . The Soviet Union was not a significant threat as Joseph Stalin s rise to power was underway , and the state retreated to the Socialism in one country ideology . The Soviets signed non - aggression treaties with their neighbor states between 1926 – 1933 , including Finland , Latvia , Estonia and Poland . Europe becomes unstable . Rise of totalitarian regimes . The early 1930s saw the international community became unstable . First , the stock markets collapsed in 1929 , causing an economic slump . Second , economic woes and fear of Communism saw the rise of totalitarian regime s in Japan , Germany and Italy . Economic crises destabilized the internal politics of the Baltic states , causing the rise of authoritarian regime s . Antanas Smetona and Augustinas Voldemaras had already taken power in a " coup d ' état " in 1926 ; both Estonia and Latvia followed the example in 1934 . The Elder of State Konstantin Päts took power in Estonia , and shortly afterward Prime Minister Kārlis Ulmanis took power in Latvia . Furthermore , because of the Great Depression , the Baltic states ' two leading trading partners , Britain and Germany , limited their imports from the Baltic region . Adolf Hitler ' s rise to power in Germany increased Soviet fears , and made the Baltic position between these two giants difficult . The Germans responded to the banking crisis of 1931 by introducing the policy of " Grossraum wirtschaft " . It was a clearing agreement where states exchanged material goods instead of money . This increased German trade with the Baltic states and it integrated their economy with Germany , but it never dominated their trade as effectively as in the Balkans . In January 1934 , the Germans and the Poles signed an non - aggression pact . In March 1934 , the Soviet commissar for foreign affairs Maxim Litvinov proposed to the German ambassador in Moscow Rudolf Nadolny , a German - Soviet guarantee for the Baltic states which were " previously a part of the former Russian empire " . Hitler vetoed the proposed deal and Nadolny resigned . Next , the Soviets turned to the " Eastern Locarno " plan , which was originally proposed by French foreign minister Louis Barthou . The proposed plan would have allowed Soviet troops to enter the Baltic states in the name of mutual assistance . External threats led to the Baltic Entente of September 1934 , in which the Baltic states concluded a collective foreign policy , though it had no formal military provisions . Road to Nazi – Soviet co - operation . Germany increased the scope of its power and authority with the Anglo - German Naval Agreement in 1935 and the remilitarization of the Rhineland in 1936 . In response , Baltic chiefs of staff were invited to the May Day celebration in Moscow in 1936 . During their visit an Estonian officer was warned about German influence and offered a military alliance with the Soviet Union . Leningrad Bolshevik party leader Andrei Zhdanov made a speech to the eighth Soviet congress in November 1936 , in which he warned border states against acting on behalf of the fascist powers and hinted at an intervention by the Red Army on the other side of the border . Next , Germany annexed Austria in March 1938 . A few days after this Poland delivered an ultimatum , demanding that Lithuania recognise Polish sovereignty over Vilnius . Without support from their Baltic neighbours , the Lithuanians had to accede to the ultimatum . In September , the Germans occupied Czechoslovakia . Next , the Germans aimed to regain the Polish Corridor and Klaipėda in Lithuania . On 20 March 1939 , the Germans demanded Klaipėda from Lithuania . Two days later the Lithuanians agreed , losing 30 percent of their industrial capacity and their only major sea port . The dismemberment of Czechoslovakia caused France and Great Britain to guarantee Polish integrity on 30 March . The Soviet Union remained conciliatory with Baltic states in 1937 – 1938 . Moscow had welcomed the Baltic Entente earlier and Soviet marshal Alexander Yegorov visited all three Baltic capitals in 1937 . However , during the same period the Soviet Union built defences on the borders of Finland , Estonia and Latvia , and committed airspace infringement s . In early 1939 , the Germans and Soviets started secret meetings toward an agreement . The British had abandoned the idea of naval intervention in the Baltic with the Anglo - German Naval Agreement in 1935 . However , British politicians made visits to the area , and exported armaments . In 1939 , the British and French tried to arrange a " guarantee " of the Baltic states to the Soviet Union . The Baltic states would have preferred to remain neutral , but the only security systems on offer were German or Soviet . In June 1939 , Estonia and Latvia yielded to German pressure and signed non - aggression pacts . In late June , the German general Franz Halder visited Estonia and Finland , and later Admiral Wilhelm Canaris visited Estonia . The visits were merely political demonstration , but the Soviets saw them as unfriendly . Germany and the West raced for Soviet favours . The French were prepared to hand over the Baltic states to the Soviets in order to purchase an agreement but the British refused . The French and British went on to hold military conversations in Moscow in August 1939 . The Soviets demanded that the Western powers occupy bases in Finland and the Baltic states and then hand them over to the Red Army . Soon afterward , German foreign minister Joachim von Ribbentrop traveled to Moscow to negotiate the final stage of a new pact , later known as Molotov – Ribbentrop Pact . In its secret protocol , the Germans and Soviets divided Finland , Estonia , Latvia , Lithuania , Poland and Bessarabia between their spheres of influence . After the German invasion of Poland on 1 September , a second secret protocol of 28 September consigned Lithuania to the Soviet sphere of interest . Soviet ultimatums and occupation . Soviets demand and establish military bases . On August 23 , 1939 the Soviet Union asserted its control over the Baltic states with the Molotov – Ribbentrop Pact , which declared them as Soviet sphere of influence . On September 16 , the Soviets and Japanese governments signed a cease - fire agreement . Next , the Soviets invaded Poland on 17 September , concluding operations on 6 October . After occupying eastern Poland , the Soviets pressured Finland and the Baltic states to conclude mutual assistance treaties . The Soviets questioned the neutrality of Estonia following the escape of a Polish submarine on 18 September . A week later , on 24 September , the Estonian foreign minister Karl Selter was given an ultimatum in Moscow . The Soviets demanded the conclusion of a treaty of mutual assistance which included the establishment of military bases in Estonia . In early 1939 , the Leningrad Military District had already allocated 17 divisions , about 10 % of the Soviet Army , to the Baltic states . Mobilizations followed shortly . The 8th Army was dispatched to Pskov on 14 September 1939 , and the mobilized 7th Army placed under the Leningrad Military District . Invasion preparations were by now nearing completion . On 26 September the Leningrad Military District was ordered to " start concentrating troops on the Estonian - Latvian border and to finish that operation on 29 September . " The order noted , " for the time of starting the attack a separate directive will be issued . " On 24 September , warships of the Soviet Navy appeared off Estonian ports and Soviet bombers began threatening patrols over Tallinn and the nearby countryside . The USSR then entered the airspace of all three Baltic states , flying massive intelligence gathering operations on 25 September . After four days of negotiations , the Estonians had no choice but to accept naval , air and army bases on two Estonian islands and at the port of Paldiski . Soviet troop numbers in Estonia were put at 25 , 000 . The mutual assistance treaty was signed on 28 September and the Soviets made similar treaties with Latvia on 5 October and Lithuania on 10 October . The latter treaty transferred Vilnius district to Lithuania . Finland was invited to enter similar negotiations on 5 October . Unlike the Baltics , the Finnish - Soviet negotiations lasted weeks without result . The Soviets invaded Finland on 30 November . The Finns were able to resist the Soviets for over three months ; the nation lost over ten percent of its land area , though it retained its sovereignty . Occupation and annexation . In December 1939 , Latvian communists were called to consultation in Moscow . Their activities included , among others , collecting information on those who held opinions hostile to the Soviets . In May 1940 , the Soviets turned to the idea of direct military intervention , but still intended to use a puppet regime . Their model was the Finnish Democratic Republic , a puppet regime set up by the Soviets on the first day of the Winter War . The Soviets organised a press campaign against the allegedly pro - Allied sympathies of the Baltic governments . In May , the Germans invaded France ; the country was overrun and occupied a month later . In late May and early June , the Baltic states were accused of military collaboration against the Soviet Union . On 15 June , Lithuanian government had no choice but to agree to the Soviet ultimatum and permit the entry of an unspecified number of Soviet troops . Prime minister Antanas Smetona proposed armed resistance to the Soviets , but the government refused , proposing their own candidate to lead the regime . However , the Soviets refused and sent Vladimir Dekanozov to take charge of affairs while the Red Army occupied the state . On 16 June , Latvia and Estonia also received ultimatums . The Red Army occupied the two remaining Baltic states shortly thereafter . The Soviets installed Andrey Vyshinsky as leader of Latvia and Andrei Zhdanov in Estonia . New Baltic state governments were formed on 18 and 21 June along popular front lines . They were confirmed in office by rigged elections on 14 – 15 July . A few days afterward , on 18 July , " demonstrators " in major Baltic cities called for incorporation into the Soviet Union . Three days later , all three parliaments declared their states to be Soviet republics and applied for membership . Lithuania was incorporated into the Soviet Union on 3 August , Latvia on 5 August , and Estonia on 9 August .