Proposed amendments to the Lithuanian Law on Companies
On 7th September 2012 the Ministry of Economy of the Republic of Lithuania submitted a Draft Law on the amendment of the Law on Companies. The Draft Law contains a sufficient number of amendments concerning the management of public limited liability companies and decrease in the administrative burden, also it is intended to create conditions for providing financial assistance both public and private limited liability companies to purchase shares of a limited liability company. Furthermore, the Draft Law proposes to settle the right to grant financial aid to natural persons and legal entities in their purchase of the company’s shares.
One of the main purposes of the provisions of the Draft Law is to avoid the possible conflict of interest. The Draft Law sets the limits on the possibilities of members of the board to be employed as employees of the company. Moreover, the head of the company would not be eligible to become member of the board as well as a board of the company would be entitled to perform a supervisory function.
In the light of nearing completion of creation an information system on the shareholders of legal entities the Draft Law proposes that the list of shareholders of a private limited liability company should be submitted to the information system rather than to the register of the Commercial Register. The aim of the creating information system is to accumulate the data on shareholders and partners.
According to the present legislation, the registration of a company may take place only after the list of shareholders of a private limited liability company has been drawn up. However, the Draft Law proposes to abandon such a provision and to provide that the list of shareholders of a private limited liability company should be submitted to the information system on the shareholders (partners) of legal entities not later than within 5 days from the registration of a private limited liability company.