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Investor's Legal Brief, January 2019

  • Lithuania
  • Other

2019-01-14

1. The Government of Lithuania agreed on rules of virtual registration office of legal entities.
 
The Government approved the proposal of the Ministry of Economy to legalize the virtual registration office of legal entities which allows not only establish a legal entity in Lithuania via the electronic platform but also to ensure an effective, secure, legal and evidential communication with the public authorities as well as other entities.
If the current proposal is adopted the legal entities could be established by choosing an e-mail address instead of physical address.
Under current regulation, the registered office is described as a physical place of exact address that is located within certain area. If certain premises are not owned by right of ownership persons who want to establish a legal entity are required to receive a consent from the legal owners of the premises.
In order for the proposal to come into force, the proposal has to be adopted by the Parliament of the Republic of Lithuania, Seimas. According to the text of proposed amendments, the amended Civil Code should come into force on 1st of January, 2021.  

2. The Government of Lithuania is proposing to facilitate the rules of reorganization of business-friendly land-plots


The Government approved the proposal of the Ministry of Economy to simplify and shorten the procedures of reorganization of lands in free economic zones (FEZ) as well as industrial parks (IP). The procedures in both urban and rural areas are decided to be the same.
If the proposals are adopted, this would allow to accelerate the procedures of formation of land-plots in FEZ and IP areas, for instance, the procedure of partition or consolidation of adjacent land-plots.
The Law on Planning of Territories, Law on Land and Law on Forests are to be presented for the Seimas for the final voting.

3. The Ministry of Economy proposes to remove paper licences

The Ministry of Economy suggests that all licences should be issued, amended, halted or repealed electronically by the relevant institutions.
Under current regulation, the license that is issued can be both in paper and electronic format as well as records in the information systems or registries, plastic cards or other information recorded in specific journals or data of the subject that is recorded in other systems.
By removing the paper licenses, time and human resources would be saved as then there would be no need to process, store or provide the information since all information would be stored in electronic sphere. Additionally, according to the Minister of Economy, this is a much easier way to check the validity of the license issued.

4. Lithuania reached 14 place in World Bank research ‘Doing Business 2019’


‘Doing Business’ is a global research conducted by the World Bank that analyses the business conditions in 190 world countries.
According to the research, the biggest improvement was made by Lithuania in the fields of construction permits and electricity networks. Lithuania is also in the 7th place in the field of commercial dispute resolution.
In order to improve the business environment and the position of Lithuania in the ranking of ‘Doing Business’, the Government established the Governmental Programme Implementation Plan that consists of measures to be regulated by the ministries of Energy, Economy, Communications, Justice and Finance.
Lithuania has reached 14th place and this is the highest place Lithuania has ever achieved.

5. The Baltic countries establish a common union of capital markets

The Baltic countries – Lithuania, Latvia and Estonia – unite in establishment of Baltic union of capital markets. The purpose of this union is to attract foreign investments by creating common rules of investing as well as removing the unnecessary restrictions that appear due to the relatively small size of all Baltic countries.
One of the main goals of the union is to establish a common system of covered bonds as well as to ensure the sponsorship for the further development of Fintech ecosystem in the Baltic region. European Commission is set to provide the sponsorship via the European Bank for Reconstruction and Development (EBRD).
EBRD, since its establishment in 1991, has already invested about 2 billion euro in more than 250 projects in Lithuania, Latvia and Estonia. Strong private companies and capital markets are considered to be the main priorities of EBRD.

6. Lithuania will hold a referendum on dual citizenship


Lithuanian Liberal Movement - one of the centre-right parties in Lithuania - has prepared and submitted a project of the Constitution of the Republic of Lithuania. The proposal suggests deleting a provision of Article 12(2) of the Constitution stating “With the exception of individual cases provided for by law, no one may be a citizen of both the Republic of Lithuania and another state at the same time”.
According to the Law on Citizenship of the Republic of Lithuania, dual citizenship is only allowed in certain cases, such as for persons who were exiled from or fled the occupied Republic of Lithuania before the 11th of March, 1990, persons who acquired citizenship of the Republic of Lithuania and citizenship of another state at birth and so on.
Seimas adopted a decision which states that the referendum on dual citizenship shall be held on 12th and 26th of May, 2019 when the European Parliament and president elections take place.  
As a result of this, Seimas has inquired the Constitutional Court of the Republic of Lithuania whether the referendum on dual citizenship can take place with a two weeks’ break.

For more information contact

Rimtis Puišys, Partner

Disclaimer

This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full terms and conditions on our website.

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