The Lithuanian financial industry is represented by several sub-sectors and foreign investors interested in setting up a financial company in Lithuania will benefit from the same regulations imposed to local entrepreneurs. The licenses for financial companies are issued by the Bank of Lithuania which is the national bank of the country.
Our company formation consultants in Lithuania will help you open a financial company here, if you decide to start a business in this domain.
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Types of financial companies to be set up in Lithuania
One of the greatest advantages of operating in the financial sector in Lithuania is having many options in terms of activities. The following types of financial companies can be set up in Lithuania, after obtaining the proper licenses:
- banks – private banks can be created by both local and foreign investors in Lithuania, as the market is very promising;
- credit institutions and consumer credit providers are also among the preferred choices of investors in this sector;
- financial management companies and advisers are easier to set up in Lithuania and enjoy a great popularity;
- traditional payment institutions and electronic payment companies which are new types of financial companies on the Lithuanian market;
- insurance companies and insurance intermediary companies can be created in Lithuania as well;
- investment funds and pension funds are very common types of financial institutions in this country;
- currency exchanges can also be set up by obtaining a license from the National Bank of Lithuania.
Those who want to open a financial company in Lithuania must complete the same steps up to the point of the licensing procedure which is different based on the main activity of the company. Our Lithuanian company formation specialists can help with the registration of a business which will operate in the financial sector.
Obtaining a banking license in Lithuania
One of the ways to complete the process of Lithuania company formation in the financial industry is by opening a bank. Banks in Lithuania can be incorporated by both local and foreign businessmen, they can be Lithuanian-based or branches of foreign banks, there aren’t any restrictions in this sense.
The licensing process is rather complex and this is why specialized assistance is mandatory. In the list below, our consultants in company formation in Lithuania present some of the few requirements investors should abide by when applying for this type of license:
- the activities of a banking institution must abide by the rules of the Article 3(4) of the Republic of Lithuania Law on Financial Institutions and Article 2(1) of the Republic of Lithuania Law on Banks;
- the legislation provides for 2 types of banking licenses, namely the regular and the specialized banking license;
- the licensing process can take around 6 months and up to 12 months;
- all applicants must pay a processing fee of EUR 4,175 (payable to the State Tax Inspectorate).
How to register a financial company in Lithuania
Those who want to start financial businesses in Lithuania must respect the Company Law and the regulations imposed by the National Bank. The following steps need to be taken in order to set up a financial company in Lithuania:
- choose a business form for the company (the private and public limited liability companies are the most suitable);
- reserve a business name which reflects the activity of the company with the Companies Register in Lithuania;
- have the incorporation documents drafted and notarized, then submitted for approval with the Trade Register;
- register for taxation and employment purposes with the relevant authorities in the country;
- apply for the specific licenses with the Bank of Lithuania in accordance with the activities to complete.
Foreign banks and other financial institutions can operate under branch offices in Lithuania, as the branch is the most employed business form in this industry. Our local advisors can help foreign investors who want to open a company in Lithuania in the financial sector, no matter if they are natural persons or legal entities.
Capital requirements for financial companies in Lithuania
The licenses to be obtained by financial companies in Lithuania depend on the activities they will complete. The National Bank has different regulations for each type of activity to complete.
For setting up a financial payment or credit union in Lithuania a banking license is required. The minimum share capital for establishing such an institution is EUR 1 million or EUR 5 million, depending on the activities to be undertaken.
There are also various requirements with respect to the number of directors appointed in the company which can reach up to 10 people. Out of these, it is mandatory to have 3 persons on the board of directors and 3 in the supervisory council.
In the case of insurance companies in Lithuania, the regulations impose a minimum share capital of EUR 1 million. The shareholders must have a clean reputation, a condition which also applies to the directors.
The capital requirements vary greatly from one type of company to another. For instance, investors who want to open a Lithuanian company as an electronic money institution (EMI), must prepare a capital of EUR 350,000.
Mandatory documentation for financial licenses applicants
Besides the basic documents that are obtained during the process of company registration in Lithuania, financial entities must provide various documents that are required when engaging in business activities in this field.
The Lithuanian authorities can request a business plan for the following 1 or 3 years, the evidence of having the necessary capital for setting up the business and operating in the first years of activity, the full list of activities to be carried, etc.
The business plan mentioned above should be prepared for the next 1 or 3 years depending on the type of financial activity the company will develop. Our consultants in company registration in Lithuania can advise on this matter.
Investors need to implement various internal rules that abide by the rules of Anti Money Laundering laws and are required to make proof that they have taken the necessary measures. Other basic rules vary greatly in accordance with the specific types of activities of the business, therefore it is important to address to a team of specialists, who can offer tailored legal support.
An interesting fact about setting up a financial company in Lithuania is the Newcomer Program which was enabled by the Bank of Lithuania with the purpose of attracting young investors specialized in the financial technology industry.
For this purpose, the National Bank has created a new type of financial company: the fintech company. The minimum share capital for opening such a company in Lithuania is EUR 1 million and the electronic license is issued within a maximum of 3 months.
The Lithuanian Newcomer Program is one of the most successful schemes in Europe at the moment, with more than 100 licenses issued. If you want to open a financial company and need assistance, please contact our company registration agents in Lithuania.