Understanding the new changes to the liquidation process in Lithuania

As of September 1, 2024, Lithuania has introduced new rules for company liquidation. Liquidation refers to the official process of closing a company.

In the past, this process could take an indefinite amount of time, leaving many companies stuck in the system as „liquidating” but never fully closed. This situation created confusion in business statistics and caused disorder in registry records.

To resolve this issue, the Civil Code of Lithuania has been amended to set a strict timeline for company liquidation. Under the new rules, companies are required to complete their liquidation process within one year.

If necessary, this period may be extended for an additional year. However, if the company fails to complete the liquidation within the set timeframe, the Registry Center will automatically remove it from the records. Additionally, the liquidator responsible for the process may face legal consequences if they do not fulfill their obligations properly.

Key points of the new rules:

  • Companies have one year to complete the liquidation process, with a possible extension of another year.
  • If the deadline is missed, the Registry Center will proceed with the automatic removal of the company from the records.
  • The liquidator may be held legally accountable for any damages caused by failing to complete the process.
  • Companies that acquired liquidation status before September 1, 2023, must be removed from records by January 1, 2025.
  • Companies that acquired liquidation status after September 1, 2023, must be removed from records by September 1, 2025.

What should we expect:

These new regulations aim to streamline the company closure process, improve the accuracy of business statistics, and ensure a more efficient management of company records in Lithuania.

If you own a business undergoing liquidation, it is crucial to comply with the new deadlines to avoid any potential legal or administrative issues. Make sure to stay informed and take the necessary steps to complete the process within the required timeframe.

If you have any questions, feel free to contact us here.