If you’re exploring business opportunities in Lithuania or expanding into the Baltic region, you may come across the term “Akcinė Bendrovė.” Translated as “joint-stock company,” an Akcinė Bendrovė (abbreviated as AB) is one of Lithuania’s most robust legal business structures. It’s designed for companies that want to attract shareholders, raise public capital, and scale in a stable legal environment.
This model is especially relevant for businesses with long-term growth ambitions and the desire to enter public markets. Whether you’re an entrepreneur, investor, or business strategist, understanding how ABs function in Lithuania is key to making informed decisions.
What Is an Akcinė Bendrovė?
An Akcinė Bendrovė is a joint-stock company recognized under Lithuanian law. It divides its capital into shares, which can be owned by one or multiple shareholders. These shares represent ownership and come with rights such as voting and dividend earnings.
ABs can be either public or private, although public ones are usually listed on the stock exchange and allow anyone to invest. This makes the structure highly appealing for companies seeking outside funding and broader credibility.
AB vs UAB: What’s the Difference?
In Lithuania, another common company type is the Uždaroji Akcinė Bendrovė (UAB), or private limited liability company. While both AB and UAB structures limit owner liability, they differ in scale and function.
| Feature | AB | UAB |
|---|---|---|
| Public Trading | Yes | No |
| Minimum Capital | €40,000 | €2,500 |
| Shareholders | 1 or more | 1 to 249 |
| Reporting Requirements | Higher | Moderate |
If your business plans include going public or raising significant external funding, an AB is often the better fit.
Legal Framework and Governance
ABs operate under the Lithuanian Civil Code and the Law on Companies. These laws ensure transparency, protect shareholder interests, and standardize corporate practices. This legal clarity has made Lithuania a favorable location for local and international investors alike.
How to Form an Akcinė Bendrovė in Lithuania
Starting an AB involves several steps and legal obligations.
Requirements:
- Unique company name
- At least one shareholder
- Minimum capital of €40,000
- Articles of Association
Step-by-Step Process:
- Draft founding documents and Articles of Association
- Open a bank account and deposit the minimum capital
- Register with the Register of Legal Entities
- Obtain a tax ID and register with the State Tax Inspectorate
- Appoint company directors and management
Documents such as the founding agreement, shareholder list, and proof of capital deposit are all essential to complete the process.
Corporate Governance Structure
ABs are managed through a structured corporate hierarchy:
- Board of Directors oversees strategic direction
- Supervisory Board is optional but provides added oversight, especially for public companies
- CEO or Managing Director handles daily operations
This structure separates ownership from management, helping safeguard shareholder interests and ensuring accountability.
Shareholder Rights and Share Types
ABs may issue both ordinary and preferred shares.
- Ordinary shares grant voting rights and dividend eligibility
- Preferred shares may offer priority in profit distribution but limited voting rights
Shareholders have the right to vote, attend meetings, receive dividends, and access important company documents.
Profit and Dividends
Profits are distributed in proportion to shares held, typically in the form of dividends. These distributions depend on the company’s financial results and board decisions.
Financial Responsibilities and Taxation
The corporate income tax rate in Lithuania is 15%. Startups and certain sectors may qualify for reduced rates or tax relief.
Dividends are also taxed at 15%, although tax treaties with other countries may reduce the withholding tax for foreign shareholders.
Large ABs must conduct annual audits and file financial statements with public authorities. This ensures transparency and keeps investors informed.
Compliance and Regulatory Oversight
Several institutions oversee the activities of ABs:
- Register of Legal Entities handles registration and corporate records
- State Tax Inspectorate monitors tax compliance
- Bank of Lithuania regulates companies listed on the stock exchange
Penalties for non-compliance can include fines, suspension of operations, or even business dissolution.
Examples of Successful ABs in Lithuania
- Ignitis grupė (AB) – A leading energy company
- Vilniaus baldai (AB) – Specializes in furniture manufacturing
- Lietuvos energija (AB) – Major electricity provider
These companies leveraged the AB structure to scale operations, attract investors, and build trust in competitive markets.
When to Choose an Akcinė Bendrovė
An AB is best suited for:
- Businesses planning an IPO
- Companies that require substantial external funding
- Organizations aiming for long-term market presence
- Firms with international ambitions
If you’re working on a high-growth strategy and need investor trust and public visibility, the AB structure delivers.
Global Comparisons
The Akcinė Bendrovė shares similarities with other joint-stock entities across the world:
- USA: Corporation (Inc.)
- Germany: Aktiengesellschaft (AG)
- France: Société Anonyme (SA)
These structures offer similar benefits like limited liability, share-based capital, and public trading opportunities.
Foreign Investment in ABs
Lithuania welcomes foreign shareholders in its ABs. As an EU member, the country provides direct access to the European market, making it an attractive base for global companies.
Conclusion
An Akcinė Bendrovė isn’t just a legal form—it’s a gateway to serious business opportunities in Lithuania and across the EU. With structured governance, flexible investment models, and full legal protection, the AB model supports companies ready for growth and impact. If you’re looking to build a credible and scalable enterprise, forming an Akcinė Bendrovė could be your smartest move yet.
