Company Incorporation in Lithuania – Trading with Russia and Ukraine – Tax Advantages
Lithuania is the biggest of the Baltic states and regards itself as the region’s economic powerhouse. Certainly it has succeeded in attracting significant inflows of foreign direct investment, with investors encouraged by a combination of a stable economy, low inflation, low labor costs and a liberal business environment
Requirements for company formation in Latvia
- Minimum share capital to be deposited: €2,896, to be fully paid up.
- No requirement for board or supervisory council.
- Maximum number of shareholders is 250.
- You will need to go over to Lithuania in order to sign documents with the Notary and to sign forms for the bank account.
What are the main types of company in Lithuania?
There are four main kinds of business entity for foreign investors, and they are as follows:
- public limited company (AB)
- private limited company (UAB)
- branch or representative office
What documents are required to register a public limited company?
incorporation agreement or act of incorporation
the company’s articles of association
minutes of the founding meeting
confirmation of Lithuanian bank account
confirmation of share registration with Securities Commission
report on company together with auditor’s opinion
What documents are required to register a private limited company?
- incorporation agreement or act of incorporation
- the company’s articles of association
- minutes of the founding meeting
- confirmation of Lithuanian bank account
What are the main features of a branch or representative office?
- foreign parent company is responsible for all liabilities
- branch office can conduct trade within scope set by parent company
- representative office can promote but cannot trade
- at least one manager must reside in Lithuania
- no formal auditing requirements
How easy is it to recruit staff in Lithuania?
Lithuania used to be known as Soviet Silicon Valley due to the reputation of its workforce for innovation and productivity. The Soviet era may now be over but its reputation remains intact. Lithuania’s workforce is generally young, well-educated and very highly motivated, while labour costs are among the lowest in Europe. Recruitment is straightforward – contact us if you require local help with this.
What is the regulatory environment like?
- government committed to free-market economy liberal business environment
- member of the WTO and has ratified most international treaties
- investment laws conform to European Union standards
- foreign investors are free to buy Lithuanian companies
- unrestricted movement of capital and dividends
- double-taxation agreements with many countries
Are there financial incentives available?
Investment incentives in Lithuania are centered on three Free Economic Zones in the cities of Klaipeda, Utena and Kaišiadorys. They include the following:
- tax holidays and tax reductions for companies investing over €1 million
- no taxes on dividends paid on foreign investments
- EU support funds for companies setting up in Klaipeda
And what about banking facilities?
Lithuanian banks offer the standard range of facilities, including foreign exchange and international payments. There are no foreign exchange restrictions. You will need a local bank account if you open a company in Lithuania which we can help you with.
For more information about company incorporation in Lithuania or opening a bank account, along with any other issues including tax advantages in the free economic zones and trading with Russia and Ukraine, please contact us on 0033 (0)1 53 57 49 10 or email us from our contact page and we’ll be happy to help.