🧾 Introduction
Ever heard the term “akcine bendrove” and wondered what it actually means? If you’re eyeing Lithuania as a place to launch or expand your business, then understanding this company type is essential. In English, akcine bendrove (AB) is equivalent to a public limited liability company, a corporate form designed for larger businesses that need substantial capital and a structured governance model.
Let’s dive deep into what makes an akcine bendrove unique, especially its €40,000 capital requirement, and how it stands out in Lithuania’s corporate environment.
📚 Legal Definition and Framework
Under Lithuanian law, an akcine bendrove (AB) is defined as a legal entity with limited liability, where capital is divided into shares and shareholders are not liable for the company’s debts beyond their shareholding.
It’s regulated primarily under:
- Law on Companies of the Republic of Lithuania
- Civil Code of Lithuania
These laws ensure transparency, investor protection, and clear governance standards.
🧩 Key Features of Akcinė Bendrovė
✅ Separate Legal Personality
Once incorporated, an AB is independent of its shareholders. It can:
- Enter contracts
- Own property
- Sue and be sued
✅ Limited Liability
Shareholders’ losses are capped at the amount they invested. No personal assets are at risk unless fraud is involved.
✅ Shareholder Rights
Shareholders can:
- Vote in meetings
- Receive dividends
- Access company reports
💶 Minimum Capital Requirement: €40,000 Explained
One standout feature of Lithuania’s AB structure is the minimum capital threshold of €40,000. But why this figure?
Why €40,000?
This amount acts as a financial buffer, ensuring the company has enough liquidity to operate and protect creditors’ interests.
What Counts as Capital?
- Cash contributions
- Tangible assets (with valuations)
- Intangible assets (some restrictions apply)
Note: Capital must be verified and fully paid before registration.
🏛 Capital Structure
Ordinary vs Preferred Shares
- Ordinary shares: One vote per share, entitled to dividends.
- Preferred shares: May have dividend priority but limited voting rights.
Nominal Share Value
Each share must have a fixed nominal value, clearly stated in the company’s charter.
Issuing Shares
Shares can be:
- Privately placed (e.g., to founders/investors)
- Publicly offered (after meeting additional requirements)
📝 Incorporation Process
Starting an AB in Lithuania is relatively straightforward if you follow the steps:
Step-by-Step
- Reserve company name
- Draft Articles of Association
- Deposit capital in a bank account
- Notarize incorporation documents
- Submit to the Centre of Registers
- Register for taxes (State Tax Inspectorate)
👥 Founders and Shareholders
Who Can Establish an AB?
- Natural persons
- Legal entities (domestic or foreign)
Minimum Shareholders
- Only one founder is needed
- No maximum limit
Resident vs Non-Resident
Foreign nationals and companies can fully own and operate an AB, making Lithuania a startup-friendly nation.
📋 Management and Governance Structure
Lithuanian ABs require a structured hierarchy:
General Meeting of Shareholders
Supreme decision-making body—elects board members and approves reports.
Board of Directors
Handles strategy, hires CEO, monitors performance.
CEO
Runs day-to-day operations.
Supervisory Board (Optional)
In large companies, this additional layer adds oversight.
💰 Taxation and Financial Reporting
Corporate Tax
Flat 15% corporate income tax is applicable.
Annual Reports
Filed with:
- Centre of Registers
- State Tax Inspectorate
Audit Requirements
Mandatory if:
- Revenue exceeds thresholds
- Public interest company
- Listed on stock exchange
🚀 Advantages of Akcinė Bendrovė
- Access to capital markets (possibility to go public)
- High investor confidence
- Ideal for scaling and global partnerships
⚠️ Disadvantages or Limitations
- €40,000 upfront cost can be a barrier for small entrepreneurs
- Ongoing compliance and reporting
- Mandatory audits for larger firms
🔍 Comparison with Other Legal Entities
AB vs UAB
| Feature | AB | UAB |
|---|---|---|
| Min Capital | €40,000 | €2,500 |
| Public Listing | Allowed | Not allowed |
| Shareholder Transparency | Higher | Lower |
| Ideal For | Large companies | SMEs |
AB vs Partnerships
- Partnerships have unlimited liability
- Less suitable for capital-intensive businesses
🌍 Suitability for Foreign Investors
Lithuania’s liberal investment laws make ABs a preferred choice for:
- Multinationals
- VC-backed startups
- Tech companies aiming for IPO
🏭 Common Use Cases in Lithuania
ABs are common in:
- Banking
- Energy
- Telecom
- Large-scale manufacturing
Example: Lietuvos Energija AB (Lithuanian energy giant)
📑 Compliance and Ongoing Obligations
- Hold annual shareholder meetings
- Submit financial statements
- Comply with labor and tax laws
Failure to comply? You risk fines, audits, or even dissolution.
🔚 Dissolution or Reorganization
Companies can be dissolved:
- Voluntarily by shareholders
- Involuntarily due to bankruptcy or law violations
Reorganization methods:
- Mergers
- Spin-offs
- Share conversions
🧭 Conclusion
The Akcinė Bendrovė is Lithuania’s robust public company structure tailored for large-scale operations and investor transparency. With a €40,000 capital requirement, it ensures financial resilience, credibility, and access to public funding—making it ideal for companies with serious growth ambitions.
Whether you’re a local entrepreneur or a global investor, understanding this corporate form could be the game-changer for your business strategy in the Baltics.