[ESTABLISHING A BUSINESS ENTITY IN LITHUANIA] 316
the general meeting of shareholders which has approved the policy shall be made publicly available on the company’s website during all its’ validity period. From 1 July 2026 the competences of the board will be expanded. The meeting of the shareholders will be able to delegate its right to increase the company’s authorised capital to the board. Delegation shall be valid for up to 5 years with the possibility of renewal. The delegation may be linked to a specific amount or capital increase limit. In addition, the board and the manager may have the right to pay dividends for a period shorter than the financial year, if the right is provided for in the company’s articles of association. It will be mandatory to set the maximum amount the management body may allocate to dividends. Interim financial statements will have to be prepared, but their approval by the general meeting will not be required. In addition, the audit of these interim statements will not be required as well. Other notable changes from 1 July 2026 include: • a possibility to issue redeemable shares when such right is provided for in the company’s articles of association. For this purpose, a special reserve for redeemable shares shall be formed from distributable probit (at the time of redemption); • financial assistance for the acquisition of company shares. This will be implemented through the granting of loans or the provision of guarantees for the fulfilment of obligations. A separate financial assistance reserve shall be created for the duration of such a transaction; • liberalization of the regulation of preferred shares. It will be possible to provide for different rules in the articles
of association regarding the rights of ordinary shareholders to dividends; • new regulations on distribution of profits (losses). The requirement for no losses during the reporting period is waived; • waiver of interest rate restrictions when a shareholder grants loans to the company. The manager of the company will have the right to assess the reasonability of the interest rate and its impact to other shareholders and creditors. 3.2 Reporting Requirements The set of annual financial statements of a company together with the management report of the company and the auditor's report (if applicable) must be submitted to the Register of Legal Entities not later than within 30 days after the annual general meeting of shareholders of the company (it must be held within 4 months from the close of the financial year of the company). 3.3 Requirements for Local Shareholding / Directors For shareholders, there are no specific requirements in respect of their nationality (may be either Lithuanian or a foreign individual or company). There are no specific requirements for the CEO and members of the board in respect to their education, except for the requirement that they must be natural persons. However, large companies and publicly listed companies are required to ensure that members of the underrepresented gender make up no less than 33% (but no more than 49%) of their management, board of directors, and supervisory board. Moreover, specific laws that regulate activity of the company it is engaged in, or soft law may
ILN Corporate Group – Establishing a Business Entity Series
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