Setting up a business in Lithuania19 November 2009
by Ina Dimireva -- last modified 02 July 2012
An overview of the process of starting a new business in Lithuania.
Legal forms of legal entities
Private legal entities that may be registered in the Register and their legal regulation:
- public limited liability companies;
- private limited liability companies; agricultural companies;
- cooperative societies (cooperatives);
- general and limited partnerships;
- individual enterprises;
- credit unions and other credit institutions;
- professional partnerships of advocates;
- European economic interest groupings;
- European companies;
- European cooperative societies.
To succeed, a new business needs a sound commercial strategy and secure financing.
Some standard requirements to be completed when setting up a business are the same as when opening a branch.
One-stop shop system
There is currently an option to submit the documents electronically (online) to add temporarily the name of the legal entity to the Register of Legal Entities and to register individual enterprise in accordance with the approved exemplary documents.
In the near future it will be possible to register electronically a private limited liability company with single shareholder in accordance with the exemplary documents.
Documents and data about objects of the Register, which are indicated in the Rules of the Register of Legal Entities, shall be submitted to the Manager of the Register by providers of such documents and data as indicated in the Rules.
Registering a legal entity
The State Enterprise Centre of Registers is the Register management establishment (Manager of the Register) that ensures the implementation of Register management functions in registering the legal entities.
http://www.registrucentras.lt/jar/atmintines/e-gidas.php?l=2&tipas=ubInformation about registering private legal entities in the Register of Legal Entities:
- European economic interest groupings
- European companies
- European cooperative societies
In accordance with the Rules of the Register of Legal Entities, documents and data about objects of the Register may be submitted to the Manager of the Register:
- by the promoters of the legal entity being created;
- by the governing body of a legal entity, if not foreseen otherwise by law or in the founding documents of the legal entity;
- in the case of branches and representative offices of foreign legal entities or other organisations - by the governing body if not foreseen otherwise by law or in the founding documents;
- in the case of traditional Lithuanian religious communities, associations and centres, as well as legal entities founded by them to realize the objectives of the same religion, when traditional Lithuanian religious communities, associations and centres, as well as legal entities, their branches and representative offices, founded by them for the realization of the objectives of the same religion, are being registered in the Register, when their data are being changed or when they are being removed from the register - by the Ministry of Justice;
- in the case of legal entities that are in bankruptcy or bankrupt - by the administrator (chairman of the liquidation commission);
- in the case of legal entities under restructuring - by the governing body or the administrator if one has been appointed;
- by the liquidator (chairman of the liquidation commission) of a legal entity if not foreseen otherwise by law or in the founding documents.
If document and data providers are acting through a representative, documents confirming authorisation to represent must be provided to the Manager of the Register along with the documents.
Upon receiving the documents indicated in the Rules, the Manager of the Register verifies whether there are any obstacles to registering the object of the Register, founding documents or the Register data within 3 business days.
If there are no obstacles, the Manager of the Register makes a decision, and registers the object of the Register, the founding documents, and the Register data, otherwise the Manager of the Register informs the provider of the documents and data and sets a term to address the deficiencies.
If deficiencies are not eliminated or corrected documents are not submitted over the set period of time, the Manager of the Register takes the decision to refuse to register or to deregister an object of the Register, to register amended founding documents of a legal entity, and to register Register data or changes thereof.
After registering a legal entity, branch or representative office, the Manager of the Register shall issue an extract from the Register of Legal Entities.
Registration/deregistration of taxpayers and policyholders from the Register of Taxpayers
Registration/deregistration of taxpayers from the Register of Taxpayers is regulated by the Rules of the Register of Taxpayers, approved
Regulation of the registration/deregistration of the payers of social security contributions - policyholders - is defined in the rules of the budget formation and implementation of the Republic of Lithuania State Social Insurance Fund, approved
by the Resolution No. 647 of Lithuania of 14 June 2005 of the Government of the Republic on the Approval of the Regulations for the Forming of the Budget of the Republic of Lithuania State Social Insurance Fund and its Implementation, Chapter VI.
Registration of foreign persons
Entities starting operations in Lithuania must register in the Register of Taxpayers by filling out the Form FR0227 for a foreign legal entity's request to be registered in the Register of Taxpayers/to be withdrawn from the Register of Taxpayers. Entities registered in the Register of Taxpayers receive taxpayer identification number that forms the basis for the VAT code.
Entities from a territory beyond the territory of the European Communities shall be registered as VAT payers through their subdivision in Lithuania or, if they do not have such subdivisions, through a fiscal agent appointed in the Republic of Lithuania.
The requirement to appoint a fiscal agent is not applicable to entities of EU Member States. Such entities may be registered as VAT payers directly, i.e. they (or their authorised persons) have to contact a County State Tax Inspectorate (hereinafter 'CSTI') and register as VAT payers.
Entities from EU Member States and legal entities established beyond the territory of the European Communities who wish to register as VAT payers must fill out Form FR0388 for a legal entity's request to be registered in the Register of Value Added Tax Payers/to be withdrawn from the Register of Value Added Tax Payers, while natural persons must fill out Form FR0389 for a natural person's request to be registered in the Register of Value Added Tax Payers/to be withdrawn from the Register of Value Added Tax Payers.
Source: Your Europe