Increase of the Authorized Capital of a Lithuanian Company
The authorized capital of a Lithuanian company is the property invested by the shareholders of the company during its establishment, and the amount of capital, as well as the nominal value of the shares, is reflected by the company’s charter. As of now, the minimum amount of authorized capital established by the law of Lithuania for a UAB (Uzdaroji Akcine Bendrove) is 2,500 euros.
The registered authorized capital of a company must be formed during its establishment on the company’s settlement account in one of the Lithuanian banks (Swedbank, SEB bank, Luminor, Šiauliu bankas, Medicinos bankas, and Danske bank). The authorized capital is divided into shareholders’ shares in proportion to their ownership of the company.
The increase of the authorized capital of a UAB can be carried out in the following ways:
- By additional contributions of shareholders when issuing new shares of the company;
- From the retained earnings of the company by issuing additional shares, which are distributed among the shareholders in proportion to the ownership shares
Documents necessary to increase the authorized capital of a Lithuanian company:
- Extract of the company from the Registrų centras
- Company Charter
- If the authorized capital of a UAB is increased by additional monetary contributions, a document is required confirming that the newly issued shares are paid for by a monetary contribution
- If the authorized capital of a UAB is increased from the company’s funds, the company’s financial statements (annual report) are required
The authorized capital of a Lithuanian company may be increased by the decision of the General meeting of shareholders of the company by issuing new shares or by increasing the nominal value of already issued shares. The increase of the authorized capital of the company is only valid after the registration of the amended charter of the company in the Register of Legal Entities. The authorized capital can be increased from the company’s funds, i.e. retained earnings, share attachments and reserves.
To increase the authorized capital of a Lithuanian company, the participation of both the lawyer and the accountant of the company is required.
The procedure for increasing the authorized capital of a Lithuanian company consists of 5 stages:
- A decision is made to increase the authorized capital of a Lithuanian company by additional contributions from shareholders, and a share placement agreement is signed with the terms of their payment. These documents are prepared by the lawyer based on the data provided by the owner of the company (the amount of increase of the authorized capital, the proportion of increase for the shareholders of the company, the method of payment for new shares of the company).
- The signed decision is registered in the Registrų centras – the registration procedure takes from 3 working days. At the beginning of the capital increase procedure, it is necessary to provide a power of attorney to the lawyer of Company in Lithuania UAB – from 3 working days from the date of receipt of the original power of attorney.
- Drafting and approval of the new charter by the shareholders of the company (from 3 working days).
- Approval of the new list of shareholders of a Lithuanian company and distribution of their shares after the increase of the authorized capital in the Registrų centras (from 3 working days).
- Payment by the shareholders of a Lithuanian company of the issued shares by private means by transferring funds to the company’s account or by cash contributions to the cashier’s department (in this case, the accountant issues a cash receipt order). The increased authorized capital is deposited into the company’s balance sheet. You do not need to provide to the Registrų centras documents confirming the payment of the authorized capital, as this is an internal document of the company required for accounting and filing financial statements for the year, which should reflect the increase of the authorized capital.
|Procedure for increasing the authorized capital||3,000 EUR *|
* The cost includes all fees of the Registration Center of Lithuania.
* The procedure for increasing the authorized capital can be carried out in a completely remote mode