A UAB is a company with limited liability and legal entity rights, and its share capital is divided into shares. The company has limited liability and is responsible only with its own assets, and the shareholders are liable only for the amount they paid for the shares.
Advantages of a Private Limited Liability Company (UAB):
- The most shareholders can lose is the monetary contribution for the acquired shares.
- UAB executives are not responsible for the consequences of the company’s actions if they act within the law and the company’s statutes.
- Easy transferability – shareholders can easily sell the UAB or part of it by selling the shares.
- It has the right to establish branches, which are registered according to the law.
- UAB can be reorganized into a public limited company (AB), state-owned company (VĮ), municipality-owned company, agricultural company (ŽŪB), or cooperative.
To be established, a Private Limited Liability Company (UAB) must have:
- Formed share capital (not less than 2500 EUR).
- Registered address.
- Company seal.
- Statutes.
- General shareholders’ meeting.
- Director/Manager.
- Bank account.
The share capital (not less than 2500 EUR) of a Private Limited Liability Company (UAB) is formed from contributions for the issued shares, which are acquired by the founders. The number of shareholders cannot exceed 50. Shareholders of UAB have influence in proportion to the number of shares they hold. Important decisions, including the formation of management bodies, are made by shareholders’ voting, and the number of votes for each shareholder depends on the number of shares they own. Shares are distributed privately, and only the founders of the company (UAB) can purchase them. Founders (shareholders) can be both natural and legal persons, as stipulated in the founding agreement. A company can be established by a single individual, in which case a company’s founding act is drawn up instead of an agreement. The founding agreement is the first official document that must be signed by the founders. It should include:
- Founders and their addresses.
- UAB name.
- Method of establishment.
- Number of shares acquired by founders.
- Procedure for resolving disputes among founders.
- Nominal value of shares, issue price, and distribution method.
Within 60 days after signing the agreement, the founders must convene the inaugural shareholders’ meeting, during which they approve the statutes and elect management bodies.
The statutes are a legal document that the company follows in its further activities, so it is crucial to prepare them responsibly. All founders must sign the statutes, with legal entities requiring the director’s signature and seal, while the signatures of natural persons are certified by a notary.
The establishment of a company (UAB) takes up to 2 weeks.
If you are interested in our services, choose from the following topics: company establishment, company sale, accounting services, company purchase, reorganization of companies into UAB, company certification and licensing.
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