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Current revision as of 09:32, 15 May 2008

Types of the company having status of a legal person in Lithuania

Legal norms regulating foundation, legal status, management bodies and their competence, liquidation and reorganization of different company types in Lithuania are contained in the Civil Code of the Republic of Lithuania. According to the Civil Code, all companies operating in Lithuania have a status of a legal person. A legal person shall be defined as a company, institution or organization, which may acquire and exercise rights and obligations in its own name.

The following types of company are permitted to operate in the Republic of Lithuania:

• Individual enterprise;

• General partnership;

• Limited partnership;

• Public company;

• Private company;

• State enterprise;

• Municipal enterprise;

• Agricultural company;

• Co-operative enterprise;

• European company.

Both Lithuanian and foreign companies may establish their branches and representative offices. They shall function under the regulations of the incorporator and they have no status of a legal person. For tax purposes a foreign company may set-up a permanent establishment in Lithuania. The legal persons are allowed to merge into concerns, consortiums, associations and other formations if it is not in contradiction to competition laws. The most common way to invest in the Republic of Lithuania is a way of an establishment of a private company.

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. Corporation tax is 15%, one of the lowest rates in the EU.

There are four main types of business entity:

• public limited company (AB);

• private limited company (UAB);

• partnership;

• branch or representative office.

1. Public limited company

The main features:

• the most common business vehicle for medium/large companies;

• minimum share capital is €43,443, at least 25% to be paid up;

• minimum of three board or supervisory council directors;

• auditors required to prepare annual financial statement;

• company and its shareholders have limited liability.

Documents are required to register:

• 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.

2. Private limited company

The main features:

• popular format for smaller foreign investors;

• minimum share capital is €2,896, at least 25% to be paid up;

• no requirement for board or supervisory council;

• maximum number of shareholders is 250;

• company and its shareholders have limited liability;

• conditional requirement for auditors (e.g. if annual revenue exceeds €1.4m).

Documents, which are required to register:

• incorporation agreement or act of incorporation( memorandum of association);

• the company’s articles of association;

• minutes of the founding meeting;

• confirmation of Lithuanian bank account.

3. Partnership

The main features:

• available as a general or limited partnership;

• general partnerships have unlimited liability;

• limited partnerships have limited liability.

4. A branch or representative office

The main features:

• foreign parent is responsible for all liabilities;

• branch office can conduct trade within scope set by parent;

• representative office can promote but cannot trade;

• at least one manager must reside in Lithuania;

• no formal auditing requirements.

Types of business in Portugal / Lithuania

Public Limited Company (Plc)

In Portugal, the Public Limited Company (Plc) is called Sociedade Anonima.

In Sociedades Anonimas, the capital is divided into shares and each member limits its liability to the value of shares subscribed. The minimum denomination is the capital of 50,000 Euros and all shares have the same nominal value.

Sociedades Anonimas can not be formed by fewer than five, with a few exceptions allowed by law.

The firm can be made up of the name of some or all members, with a particular name or a meeting of the two, and in all cases it has to be followed by "Sociedade Anonima" or the abbreviation "S. A.".

If you need more legal information go to this link: [[1]]

Next, we will give you some examples of Sociedades Anonimas in Portugal:

Private Limited Companies

In Portugal "Sociedades por Quotas", are the equivalent to private limited companies in the UK. First of all, to set up a private limited company you need a minimum of two partners and a minimum capital of 5000 euros. All founding partners, must contribute with capital in cash, to the formation of private limited companies.

Private Limited Companies' capital is divided into shares, which belong to the different company's founders and owners. All shares must worth at least 100 euros each, the correspondent to 2% of the minimum foundation capital.

The shareholders liability is restricted to the total amount of the company's capital, except when the capital isn´t fully realized, in this case shareholders are solidarialy responsible for the missing part of the capital. Only the company's assets respond to the company's debts.