Lithuanian companies can be liquidated voluntary, by the free will of their shareholders, or compulsory – by a Court’s decision. Usually, the reasons why a company is liquidated are various, such as: the expiration of the period posted in the articles of association, the achieving of the purposes stated in those articles, if the company has broken the law or if it’s facing bankruptcy. If you would like to close a company, it is recommended to solicit legal advice from our lawyers in Lithuania.
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What are the steps for company liquidation in Lithuania?
The decision of voluntary liquidation is taken by the general meeting of the shareholders or by the general partners in a partnership, only if there are no actions of the bankruptcy process issued against the company.
The former management body is replaced by a person authorized to take all the necessary actions in order to conclude the company liquidation in Lithuania. It has the same powers as the former manager, but cannot conclude any new contracts or business unless they are related to the process of company liquidation. There are other important steps to consider:
- The liquidator must inform the Register of Enterprise regarding the beginning of the liquidation process and must deliver his details as liquidator. From the moment of the company liquidation registration in Lithuania, all the documents must be signed with the company’s name followed by the termination “Öin Liquidation”.
- A balance sheet with all the available company’s assets must be elaborated by the liquidator and presented in front of a second general meeting. If approved, those assets will be used in order to cover the creditor’s claims.
- Besides the balance sheet, the liquidator must also elaborate the annual accounts and liquidation reports, but only if the process takes longer than a few years. These documents must be elaborated within three months of the end of each fiscal year.
We would like to highlight that those interested in winding up a company in Lithuania can benefit from legal assistance from our specialized lawyers in Lithuania.
Publishing the liquidation decision
In a period of time not shorter than two months, an announcement regarding the liquidation of the Lithuanian company must be published. This announcement must contain a notification to the creditors stating the way the claims can be elaborated and the specific time frame in which these can be deposited.
The liquidator will use the company’s assets in order to cover in full the claims. In certain cases, the company’s immovable or movable assets can be subject of auctions. The remaining assets are then divided between the entitled shareholders.
The last step which needs to be completed is erasing the company from the Lithuanian Register of Enterprises, process accomplished by the liquidator. If you would like to commence such process, please talk to our lawyers in Lithuania.
Documents required to close a company in Lithuania
Before closing a company in Lithuania, businesses must consider the documentation requirements to prepare, as follows:
- the company’s founding document and articles of association;
- financial statements from the bank that present the beginning and end of the liquidation process;
- securities report;
- documents that state the employment issues: hiring/firing applications, unpaid leave documents, unpaid leave orders, labor contracts, etc.;
- specific data of the liquidator: complete name, personal code, proof of residency in Lithuania.
Although the documentation requirements for winding up a company in Lithuania might seem difficult to prepare, our specialized attorneys in Lithuania can offer professional support in this matter.
How long does it take to liquidate a company in Lithuania?
The duration of winding up a company in Lithuania depends on many factors: the size of the company, the number of raised claims and the shareholders’ interests in the company. The shortest period of time in which a Lithuanian company can be liquidated is up to 12 weeks, depending on the circumstances.
Get in touch with our company formation lawyers in Lithuania for a more efficient process of liquidation of the company.
Key requirements for closing a company in Lithuania
As a short overview of the company liquidation process in Lithuania, find below the main details to consider:
- Generally, the dissolution process typically takes between 3 to 6 months to be fully completed;
- The fee for company dissolution services is about €850;
- The company must submit its annual financial reports before the process can begin;
- All outstanding debts must be settled prior to starting the dissolution.
Statistical data on Lithuanian companies
Considering that Lithuania is still offering a potential bright future in the business sector, below you can find some impressive numbers about Lithuanian companies, as official data mentions:
- In 2022, there were 328,600 enterprises registered in this country;
- Compared to 2021, there was a 9% growth in company registration in Lithuania;
- In 2022, the turnover of these enterprises on the Lithuanian economy was around 158 billion EUR, with a 27% growth compared to 2021.
Furthermore, if you are interested in more services provided by our specialized law firm in Lithuania, consider that our professionals can offer relevant support in a wide range of business issues, including immigration to Lithuania. We are at your service in offering assistance related to relocation to Lithuania or, later on, obtainig citizenship in Lithuania.
For a better understanding of the company liquidation process in Lithuania, we advise you to contact our law firm.