Company Liquidation Lithuania
Efficient, Transparent, and Legally Compliant Closure Services with AM Law
Closing a business is never an easy decision, but when the time comes, it’s essential that the process is handled with legal precision, transparency, and efficiency. Whether your company in Lithuania is being closed due to financial challenges, restructuring plans, or simply the end of a business lifecycle, a legally compliant company liquidation is critical to avoid liabilities and protect stakeholders.
At AM Law, we specialize in company liquidation in Lithuania, guiding businesses through the legal and administrative process of voluntary or compulsory closure. Our experienced lawyers ensure that every detail is addressed so you can close your business confidently and move forward with peace of mind.
What Is Company Liquidation?
Company liquidation is the formal legal process of dissolving a company. During liquidation, a business ceases operations, settles its debts, disposes of its assets, and distributes any remaining funds to shareholders. Once the process is complete, the company is removed from the Register of Legal Entities in Lithuania, and its legal existence ends.
Liquidation in Lithuania can be voluntary—initiated by the company’s shareholders or directors—or compulsory, initiated by a court or authorities due to insolvency, inactivity, or legal violations. AM Law provides end-to-end legal assistance for both voluntary and court-ordered liquidations.
When Should a Company Be Liquidated?
There are various reasons why a business may choose to liquidate in Lithuania:
- The company has achieved its goals and is no longer needed
- The business has become unprofitable or financially unviable
- Shareholders are no longer interested in continuing the business
- Reorganization or restructuring of a group of companies is planned
- Compliance issues or penalties make ongoing operation unsustainable
- The company is inactive and hasn’t conducted operations for a long period
Whatever the reason, it is important to follow the proper legal procedure. Improper liquidation can result in personal liability for directors, fines, or long-term restrictions on future business activities.
Types of Company Liquidation in Lithuania
Understanding the type of liquidation is important to ensure the correct procedure is followed.
Voluntary Liquidation
Voluntary liquidation is initiated by the company’s shareholders or board when the company is solvent and all liabilities can be settled. This is the most common form of liquidation and is usually part of a strategic decision.
Compulsory (Involuntary) Liquidation
Compulsory liquidation occurs by court order, often due to insolvency, unresolved legal issues, or tax violations. Creditors, tax authorities, or state institutions can apply for the liquidation of a company that fails to meet its obligations.
At AM Law, we handle both voluntary and court-ordered liquidations, offering complete legal and administrative support for each type.
Legal Steps in the Liquidation Process
Liquidation in Lithuania follows a structured legal process. At AM Law, we handle each step to ensure full compliance with national laws and regulations.
Step 1: Decision to Liquidate
A General Meeting of Shareholders adopts a formal decision to liquidate the company. A liquidator is appointed, who may be one of the directors, a shareholder, or a third-party professional like AM Law.
Step 2: Notification and Registration
The decision is registered with the Register of Legal Entities, and public notices are published in the State Enterprise Centre of Registers. This informs creditors and stakeholders that the company is being dissolved.
Step 3: Settling Debts and Obligations
All outstanding debts must be settled. The company must pay taxes, close employee contracts, and resolve creditor claims. Any disputes must be resolved before continuing with liquidation.
Step 4: Disposal of Assets
The liquidator evaluates and sells any remaining company assets. The proceeds are used to pay off liabilities. Any funds left afterward are distributed among shareholders according to their share ownership.
Step 5: Final Accounts and Closure
Once all obligations are met, the liquidator prepares final financial statements and submits them to the authorities. The company is officially deregistered from the Register of Legal Entities.
With AM Law managing the entire process, you benefit from legal clarity, minimal administrative burden, and full peace of mind.
What Documents Are Required?
AM Law will handle the preparation and submission of all required documents, including:
- Shareholders’ resolution on liquidation
- Liquidator appointment forms
- Notifications to creditors and public registries
- Final balance sheets and financial reports
- Applications for company removal from the registry
- Employment termination agreements and tax settlement forms
Every case is unique, and additional documentation may be needed. Our legal team will ensure you meet all filing requirements and deadlines.
Tax and Employment Considerations
During liquidation, all tax obligations must be settled. This includes VAT, corporate income tax, social insurance payments, and payroll taxes. Tax authorities will review your records before approving final closure.
Employees must be formally dismissed, with all wages, benefits, and compensations paid. AM Law ensures proper notification and compliance with the Lithuanian Labor Code, preventing legal disputes and protecting company directors from liability.
How Long Does Liquidation Take in Lithuania?
The full liquidation process usually takes between 3 to 6 months, depending on the complexity of the company’s affairs. This timeline may be longer if the company has large debts, complex assets, or ongoing legal disputes.
AM Law works to streamline the process by preparing documents efficiently, coordinating with all relevant institutions, and keeping you updated at every step.
Liquidation for Foreign-Owned Companies
If your company in Lithuania is a subsidiary or branch of a foreign entity, AM Law provides bilingual support and cross-border legal coordination. We ensure that parent company policies, foreign shareholder requirements, and EU regulations are taken into account during the liquidation.
We also assist foreign directors in understanding local legal responsibilities and avoiding any penalties associated with incorrect or delayed closure.
Case Example: Successful Voluntary Liquidation
A German-owned UAB operating in Lithuania’s logistics sector decided to wind down operations due to restructuring. AM Law was engaged to manage the voluntary liquidation. We prepared all legal documents, resolved minor tax issues, closed employee contracts, and handled the asset sale.
The process was completed in just under four months, and the client successfully exited the market with full legal compliance and no post-liquidation liabilities.
Frequently Asked Questions
Can I liquidate a company with unpaid debts?
Yes, but the process becomes a compulsory liquidation and involves a court. AM Law helps you manage the legal and creditor negotiations required in such cases.
What happens if I don’t liquidate a dormant company?
Even dormant companies must be closed officially. Failure to do so may lead to fines or administrative sanctions. It’s better to complete a formal liquidation and deregistration.
Do shareholders need to be present in Lithuania?
No. AM Law can represent shareholders through a power of attorney. We offer remote consultations and can handle most procedures without requiring physical presence.
Start Your Company Liquidation with Confidence
If you are considering liquidating a company in Lithuania, don’t leave the process to chance. Legal, financial, and tax compliance are critical to protecting yourself and your business. With AM Law, you have a trusted partner who will manage every step with clarity, speed, and full legal compliance.
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