Over the last decade, Lithuania has positioned itself as one of the most attractive destinations in Europe for business development. Its modern legal framework, openness to foreign investment, and access to the European Union’s single market have made it particularly appealing to entrepreneurs.
In this environment, the UAB in Lithuania has become the most widely chosen legal form for both local and international business ventures.
In 2025, the popularity of this structure continues to grow thanks to its limited liability protection, strong reputation among business partners, and adaptability to various industries. However, setting up a company in a new jurisdiction requires careful attention to compliance and procedure.
What is a UAB in Lithuania?
The abbreviation UAB stands for UĹľdaroji akcinÄ— bendrovÄ—, which translates to private limited liability company (LLC).
In practice, this means that shareholders are not personally liable for the company’s debts or obligations beyond the amount of their capital contributions. Their personal property remains protected, making the UAB structure a safe and attractive choice for entrepreneurs.
If you have ever wondered what UAB stands for in practical terms, it represents the most popular corporate form in Lithuania. Compared to alternatives such as IÄ® (individual enterprise), or VĹ Ä® (public institution), the UAB offers greater credibility and legal protection.
Unlike sole proprietorships or partnerships, which tie business obligations directly to the owners, the UAB creates a clear legal separation between the company and its shareholders.
This distinction is crucial for international founders who want a secure base in Lithuania while minimizing risks. As a result, the UAB company has become the default choice for investors, startups, and established businesses alike.
Advantages of a UAB Company in Lithuania
Choosing a UAB in Lithuania brings a number of advantages that are both legal and practical. First and foremost, the limited liability principle provides security, ensuring that shareholders’ personal assets are not at stake in the event of financial difficulties. This alone makes it an attractive structure compared to more informal business types.
Another advantage is the credibility it provides in the marketplace. Whether negotiating contracts, seeking investment, or applying for licenses, a UAB is widely recognized as a serious and reliable business form. It inspires confidence among partners, clients, and institutions.
Lithuania’s membership in the European Union further enhances the benefits of a UAB. Once established, the company enjoys access to the EU’s single market of more than 400 million consumers. This allows businesses to expand operations and provide services across the EU without the need for additional national registrations.
The tax environment is also competitive. Lithuania offers one of the lowest corporate income tax rates in the region, and there are exemptions or reductions available for small companies and reinvested profits. Combined with relatively low operating costs, this makes Lithuania a cost-efficient jurisdiction for business growth.Finally, the Lithuanian system is highly accessible to international entrepreneurs.
A UAB can be established and managed by foreign individuals or entities, and thanks to digitalization, many procedures can be completed remotely. This flexibility is particularly valuable for global businesses that want to operate efficiently without being physically present in the country.
UAB Setup Procedure in Lithuania: Step by Step
Setting up a UAB company in Lithuania involves several formal steps. Understanding the process ensures a smoother path to registration.
1. Deciding on Share Capital
The first step is determining the company’s share capital. In Lithuania, the minimum required amount for a UAB is relatively modest – EUR 1,000 – making it accessible for startups and small businesses.
Share capital can be contributed in cash, and in certain cases, in-kind contributions such as property or assets are also accepted. Proof of this contribution will later be required by the bank and the registering authority.
2. Opening a Corporate Bank Account
Before registration is finalized, a temporary corporate bank account must be opened with a Lithuanian bank or authorized fintech provider.
Shareholders deposit the initial share capital into this account, and proof of deposit is submitted to the Register of Legal Entities. After registration, the account becomes fully operational for company use.
3. Preparing the Articles of Association
The company’s Articles of Association must be drafted to outline its structure, activities, and internal rules.
These documents are submitted to the Register of Legal Entities (managed by the State Enterprise Centre of Registers). At this stage, entrepreneurs typically engage a notary to confirm the accuracy of the founding documents.
4. Appointing Directors and Shareholders
At least one director must be appointed, and this individual can be a Lithuanian resident or a foreign national.
The shareholders – whether individuals or corporate entities – must also be formally recorded. Their details are included in the registration documents filed with the Register of Legal Entities.
5. Establishing a Legal Address
Every UAB must have a registered office in Lithuania. This legal address is required for communication with state institutions and for official company documentation.
6. Registering with the Register of Legal Entities
Once the documents are prepared, the UAB must be officially registered with the Register of Legal Entities. This is the central authority responsible for maintaining records of all companies in Lithuania.
Registration requires submission of the Articles of Association, shareholder and director details, proof of share capital, and the company’s official legal address.
7. Obtaining Licenses and Additional Registrations (if applicable)
Depending on the company’s activity, additional licenses may be required.
For example, businesses operating in finance, cryptocurrency, or other regulated sectors must apply for licenses through the Bank of Lithuania or other relevant authorities.
Companies involved in transportation or logistics services must obtain a transport license from the Lithuanian Transport Safety Administration (LTSA).
This license is essential for enterprises engaged in commercial road transport, freight forwarding, or passenger transportation within Lithuania and across the EU.
Lawhill provides full assistance with these applications to ensure compliance from the start.
By following these steps carefully and working with experienced professionals, setting up a UAB can be completed in a relatively short timeframe, often within a few weeks.
Why Choose Lawhill for UAB Company Formation?
Although the Lithuanian system is business-friendly, navigating the legal and administrative requirements without local expertise can be challenging. This is why many entrepreneurs turn to Lawhill, a firm that has been guiding clients through company formation for more than 13 years.
Lawhill combines deep knowledge of Lithuanian corporate law with international experience. The firm assists clients in preparing and filing documents, coordinating with the Register of Legal Entities, opening bank accounts, and securing legal addresses.
For entrepreneurs seeking speed, Lawhill also offers ready-made companies that come with an existing bank account and legal address, allowing immediate business activity.
Beyond initial setup, Lawhill continues to support clients with corporate governance services, including amendments to articles of association, share capital increases, and changes to the management board. The firm’s ability to provide services remotely makes it particularly valuable for international clients who cannot be present in Lithuania during the process.
With a reputation built on trust, efficiency, and compliance, Lawhill is more than a service provider – it is a long-term partner for business growth in Lithuania.
Conclusion
In 2025, establishing a UAB in Lithuania remains the most practical option for entrepreneurs looking for a secure, flexible, and EU-accessible business structure. With its limited liability protection, strong credibility, and straightforward setup procedure, the UAB offers a solid foundation for both local startups and international ventures.
Yet, the success of your company formation depends on choosing the right partner. With over 13 years of expertise, Lawhill ensures that every stage of the process – from drafting the Articles of Association to securing licenses – is handled with precision and efficiency.Ready to launch your UAB company in Lithuania? Contact Lawhill today and let our experts take care of the entire setup procedure while you focus on your business goals.
Frequently Asked Questions
Can foreign citizens establish a UAB in Lithuania?
Yes. A UAB can be founded and managed by foreign individuals or companies. Lithuania is known for its openness to international investors, and most procedures can be completed remotely with the assistance of a legal partner like Lawhill.
How long does it take to register a UAB?
On average, setting up a UAB in Lithuania takes a few weeks. The timeline depends on the speed of document preparation, capital contribution, and registration with the Register of Legal Entities. Using professional legal services can significantly speed up the process.
Is a legal address required for a UAB?
Yes. Every UAB in Lithuania must have a registered legal address. This is used for official correspondence with authorities. Lawhill provides reliable legal address services in Vilnius as part of its company formation solutions.
Do all UAB companies require a license?
Not all UABs require a license. However, businesses in regulated industries such as finance, cryptocurrency, or certain service sectors must obtain approval from institutions like the Bank of Lithuania. Lawhill guides clients through the licensing process when needed.
Why should I choose a UAB instead of another company type?
The UAB offers limited liability, strong credibility, EU market access, and favorable taxation. Compared to sole proprietorships or small partnerships, it provides better protection and recognition, making it the preferred choice for serious business ventures.
