Representation of a Company under a Power
of Attorney in Lithuania
Most of the clients of Company in Lithuania UAB are located outside Lithuania, and representation under a power of attorney in Lithuanian public services is a daily practice of our company. If there is a power of attorney, the director of a Lithuanian company does not have to visit Lithuania, and it is possible to organize most business processes remotely. In this article, we wanted to highlight the question of how to issue a power of attorney in Lithuania, whether it is possible to do this remotely and what is important to know before the procedure of drawing up a power of attorney.
What is a power of attorney
According to Article 2.137 (20) of the Civil Code of the Republic of Lithuania, a power of attorney is a written document issued by one person (grantor) to another (trusted agent) in order to represent the interests of the former when interacting with third parties. It is the Lithuanian Civil Code that specifies the form and types of authorization, the duties and rights of the grantor and the trusted agent, and other provisions.
The document can be issued to perform one or many different actions.
How to issue a power of attorney in Lithuania
The power of attorney is drawn up by the grantor. For the conclusion of a contract (and its entry into force), the presence and written consent of the representative is not required – it is necessary to know his or her last name, first name, identification number and place of residence in order to enter these data into the power of attorney. Only the director/board member has the right to issue a power of attorney, who has the right to represent the company.
When you need to contact a notary when drawing up a power of attorney
The list of actions for which a power of attorney from a notary in Lithuania is required (according to paragraph 1 of Article 2.138 of the Civil Code of the Republic of Lithuania):
- All transactions in which a notarial form of certification is used. For example, conclusion of a marriage or prenuptial agreement, transfer of rights to real estate, purchase or sale of shares (when the value is above 14.5 thousand Euros or 25% or more percent of shares have been sold). A list of all transactions is given in Articles 1.74, 4.171, 5.70 and other articles of the Civil Code of the Republic of Lithuania.
- Transfer of the authority to the trusted agent to interact with legal entities on behalf of an individual-grantor. Note that there are exceptions. They are fixed in Article 2.139 of the Civil Code, as well as in 4 of Article 25 of the Law on Financial Instruments Markets of the Republic of Lithuania and in a number of other articles.
- Transfer of the authority to the representative of an individual for the disposal, use or management of real estate.
The powers granted to the trusted agent can only be confirmed by the original document or its duplicate. Copies (even copies certified by a notary) have no legal force. According to the legislation of Lithuania, a copy of the power of attorney does not make it possible to establish the true conditions of the permit, specified in the original.
There is also the problem of a limited number of notaries in Lithuania. Today, the number of notaries is slightly more than 250 in the whole country. The reason: the model of the Latin notary, which Lithuania adopted in 1992 and which it still adheres to. It was possible to partially solve the above issues thanks to electronic self-service.
Simplified registration of a power of attorney online
At the moment, in Lithuania, some permits can be issued without visiting a notary, completely online. A special online platform of the Register Center has been developed for this purpose.
When is notarization of a power of attorney not required in Lithuania? In electronic form, you can create a permission to grant the following powers:
- Receive correspondence (parcels, money transfers)
- Collect wages and other charges related to employment
- Receive a pension (pensions), allowance, scholarship
- Use administrative and public services
On the website of the Registry Center, it is possible to register a permit for obtaining various verification letters and certificates (for example, a marriage certificate or birth certificate), licenses, driver’s licenses, car license plates, as well as for registration and de-registration of a car.
Special characteristics of online registration
Before registering a power of attorney in Lithuania in electronic form, you need to register on the online platform. Lithuanian citizens, as well as foreigners who have been issued identity documents in accordance with the procedure established by the legal acts of the Republic of Lithuania, have the right to use the self-service service on the Registry Center’s website. In doing this, the user should have an electronic signature. It
is not necessary to be within the country during the registration of a power of attorney: about 10% of powers of attorney are created outside Lithuania, according to the Registry Center. A power of attorney created online comes into force at the time of its entry into the register (except in cases when payment for registration has not been received). At the time of writing this article, the cost of the service was 3.69 Euros. The removal of the permit from the register is carried out free of charge.
In addition to issuing a power of attorney, you can check on the Registry Center’s website whether a person has a permit and the content of such a document. Due to this, there is no need to have a paper copy of the power of attorney.
Validity and cancellation of a power of attorney
The correct execution of a power of attorney in Lithuania implies specifying the date of its compilation. Otherwise, the document is considered invalid according to clause 3 of Article 2.142 of the Civil Code Moreover, the validity period is calculated from the date of registration of the permit and can be written in the form of a specific expiration date or a period of time in hours, days, weeks, months or years. Sometimes a deadline is a certain event. For example, while a trusted representative holds his or her position in the company. It is also allowed not to specify the term of authority. In this case, the document is valid for 1 year from the date of its conclusion.
Revocation of authority
A permit becomes invalid from the moment of its cancellation by at least one of the parties. The right to refuse to fulfil the conditions specified in the document at any time is provided for in Article 2.146 Part 1 of the Civil Code. In doing this, the reasons for the refusal may be covered up. But it is necessary to inform about the cancellation as soon as possible the trusted agent or the grantor and third parties, for the relationship with which the contract was created. The law does not specify in what form the cancellation should be notified (in writing or orally).
Other situations when the power of attorney becomes invalid:
- The validity period specified in the document has expired
- The legal entity to which the permit was issued has ceased to exist, or it has opened a bankruptcy case
- The legal entity that issued the power of attorney no longer exists
- If the individual who issued or received the permit is recognized as a missing or incapacitated person, or his or her death is announced
When the power of attorney has expired or the document has been cancelled by one of the parties, its original (if it is not in electronic form) should be returned to the grantor.
If your company’s business activity involves you being located outside Lithuania, then the accountants and lawyers of Company in Lithuania UAB can represent your company in the state departments of Lithuania under a power of attorney and will help simplify the company registration procedure in Lithuania and accounting services in Lithuania.