Best Venture Capital Lawyers in Skuodas

About Venture Capital Law in Skuodas, Republic of Lithuania

Venture capital in Skuodas operates under the laws of the Republic of Lithuania, an EU member state with a modern legal framework for investing in early stage and growth companies. Although Skuodas is a smaller municipality, founders and investors use national systems that are largely centralized and digital, including company registration, filings, tax reporting, and regulatory supervision. Most startup companies are incorporated as a private limited liability company known as a UAB, and many investment funds are structured as alternative investment funds managed by licensed or registered managers. Transactions commonly follow international market practice adapted to Lithuanian corporate, tax, and regulatory requirements.

The Lithuanian market supports seed through growth stage financing, with additional public co-investment and guarantee programs available through national development institutions. In practice, term sheets, shareholders agreements, and convertible instruments are tailored to Lithuanian law, while cross-border deals may also involve foreign law documents where appropriate. The Bank of Lithuania supervises fund managers and financial market participants, and the State Enterprise Centre of Registers maintains core company and beneficial ownership registries.

Why You May Need a Lawyer

Venture capital deals combine corporate, securities, tax, regulatory, and employment considerations. A lawyer can help you choose the right vehicle, manage risk, and ensure compliance while preserving commercial flexibility. Founders typically seek legal help to set up a UAB, prepare a cap table that supports future rounds, implement an employee option plan, and negotiate a term sheet that balances valuation against control and dilution. Investors typically seek counsel to perform legal due diligence, structure and document preferred equity or convertible instruments, negotiate protective provisions and governance rights, and confirm compliance with investment restrictions or manager licensing thresholds.

Legal representation is especially important if you are issuing or transferring UAB shares, since Lithuanian law imposes specific formalities, or if you intend to raise or manage third party capital, as this can trigger authorization or registration as a manager of alternative investment funds. A lawyer can also help plan for tax efficiency, align intellectual property ownership with the company, address personal data and cybersecurity obligations, and navigate foreign investment screening for sensitive sectors. Finally, counsel is critical when resolving disputes, enforcing shareholder rights, preparing exits, or localizing foreign templates such as SAFEs and KISS agreements to Lithuanian law.

Local Laws Overview

Corporate forms and governance. Startups are most often established as a UAB, which offers limited liability, flexible share classes, and suitability for private capital. Public companies are ABs and can list securities. The Law on Companies sets rules on management bodies, share issuance, pre-emptive rights, and corporate actions. Shareholders agreements are commonly used to supplement the articles of association with provisions on vesting, drag-along, tag-along, anti-dilution, information rights, and board composition.

Share transfers and formalities. Transfers of UAB shares are subject to statutory formalities. Depending on how the shares are registered, a transfer may need notarial certification or may be settled via a securities account maintained with a financial intermediary and the central securities depository. Founders and investors should plan closing mechanics, timing, and costs accordingly. UAB shares cannot be publicly offered, and any public offering rules under securities law must be observed for fundraising communications.

Investment instruments. Preferred equity, convertible loan agreements, and convertible bonds are used in Lithuania. SAFEs are not a statutory instrument under Lithuanian law, but similar results can be achieved with carefully drafted local law agreements or with foreign law contracts that are appropriately adapted and enforceable. Anti-dilution, liquidation preference, and protective provisions must be drafted to comply with Lithuanian corporate law and the company articles.

Funds and managers. VC funds in Lithuania are typically alternative investment funds. Managers are supervised under the national implementation of the EU Alternative Investment Fund Managers Directive. Small managers within EU thresholds may operate under a lighter registration regime, while larger managers require authorization. The Bank of Lithuania is the competent authority. Lithuanian managers may also use the EU EuVECA label if eligible, which facilitates marketing to professional investors subject to specific rules.

Foreign investment screening. Investments in sectors important to national security can be reviewed under national screening rules and EU cooperation frameworks. Early assessment is advisable for deals involving strategic infrastructure, defense-related goods, or other sensitive activities.

Tax considerations. Lithuania applies a corporate income tax to companies and personal income tax to individuals, with specific rules for dividends, capital gains, and withholding. Participation exemptions and treaty relief may be available for corporate investors subject to conditions. Employee stock options benefit from a preferential regime if statutory holding and other conditions are met. Given the importance of tax in structuring investment and exit, coordinated corporate and personal tax advice is recommended.

Employment and incentives. Employee share option plans are common in Lithuanian startups. Plans must comply with the Law on Companies and be properly documented in corporate resolutions and option agreements. Options for non-employees and advisors require additional care. Equity awards should be aligned with IP assignment and confidentiality obligations.

Intellectual property and data. Founders should ensure that IP created by employees and contractors is assigned to the company. Registration of trademarks, patents, and designs is handled nationally, with access to EU-wide systems. Data processing must comply with the EU General Data Protection Regulation and Lithuanian implementing rules, which can affect product development, customer data use, and due diligence.

Registries and disclosures. Companies must file key information with the Register of Legal Entities. Beneficial ownership reporting obligations apply. Changes in share capital, articles, and management must be registered. Anti-money laundering and know-your-customer obligations arise for financial institutions and can indirectly affect investor onboarding.

Dispute resolution. Venture capital documents often include Lithuanian court jurisdiction or arbitration clauses. The Vilnius Court of Commercial Arbitration is a commonly selected forum for private disputes. Choice of law and venue should be considered early to avoid enforceability issues.

Frequently Asked Questions

What company form do startups in Skuodas usually choose for venture investment

Most founders choose a UAB because it limits liability, permits flexible shareholder arrangements, and is widely accepted by investors. A UAB accommodates preferred shares, convertible instruments, and option plans if properly structured under the Law on Companies and the articles of association.

Are SAFEs recognized in Lithuania

There is no statutory SAFE instrument in Lithuanian law. Investors and founders typically use Lithuanian law convertible loan agreements or carefully adapted agreements that achieve a similar economic effect. If a foreign law SAFE is used, additional steps may be needed to ensure enforceability and to align conversion mechanics with Lithuanian corporate formalities.

Do transfers of UAB shares require notarization

Depending on how the company has arranged share registration, a UAB share transfer may require notarial certification or may be executed through a securities account with a financial intermediary and settled at the central securities depository. Your lawyer will confirm the applicable method and closing steps for your company.

How binding is a term sheet under Lithuanian law

Term sheets are generally non-binding on the core commercial terms, but provisions on confidentiality, exclusivity, governing law, and costs can be binding. To avoid ambiguity, the document should clearly state which clauses are binding and which are not.

Do I need a license to raise a venture capital fund in Lithuania

Raising and managing capital from multiple investors typically triggers manager registration or authorization under the alternative investment fund rules, with the Bank of Lithuania as supervisor. Small managers may operate under a lighter regime if they remain within thresholds. A single-company investment without managing third party capital generally does not require manager authorization.

What taxes apply to venture investments and exits

Companies are subject to corporate income tax, while individuals are subject to personal income tax on dividends and capital gains, with rates and thresholds set by law. Participation exemptions and treaty benefits may reduce tax for corporate investors if conditions are met. Employee stock options can be tax-advantaged when statutory requirements, including a minimum holding period, are satisfied. Always obtain tailored tax advice before closing or exiting an investment.

Can a UAB issue preference shares and convertible instruments

Yes, subject to the Law on Companies and the company articles, a UAB can create different classes of shares with distinct rights and can use convertible instruments. The documentation must precisely define liquidation preference, anti-dilution, voting, and conversion mechanics to ensure enforceability and proper registration.

How are employee stock options structured and taxed

Employee options are established via corporate resolutions and option agreements that set vesting, exercise, and leaver terms. Lithuania provides a preferential personal tax regime for qualifying options after a statutory holding period. Compliance with securities, employment, and tax rules is essential, and non-employee awards may require different structures.

Do foreign investment screening rules affect venture deals

Investments in companies active in sectors important to national security may be subject to screening. Early assessment is advised for targets in defense-related, critical infrastructure, or other sensitive areas. Screening can affect deal timing and conditions.

Is there local venture support in or near Skuodas

While most regulatory and funding programs operate nationally, founders in Skuodas can access the same digital company registration, tax, and banking systems as any Lithuanian startup. National development institutions provide co-investment and guarantees, and regional business information centers can assist with local networking and facilities.

Additional Resources

Bank of Lithuania - the financial market supervisor responsible for licensing and supervising alternative investment fund managers, investment firms, and payment institutions. Useful for guidance on manager registration and EuVECA matters.

State Enterprise Centre of Registers - operates the Register of Legal Entities for company incorporation, filings, and beneficial ownership reporting. Essential for corporate changes, share capital updates, and official extracts.

State Tax Inspectorate - the primary tax authority for corporate income tax, VAT, withholding, and personal income tax matters related to dividends, capital gains, and employee options.

INVEGA - the national development agency offering co-investment funds, guarantees, and other risk-capital support measures that can complement private VC investments.

Invest Lithuania and Startup Lithuania - national agencies that provide guidance on setting up operations, talent, and incentives, and offer programs tailored to early stage companies.

State Patent Bureau - the authority for trademarks, patents, and designs, important for protecting IP prior to investment and during due diligence.

Vilnius Court of Commercial Arbitration - a widely used arbitration venue for private commercial disputes, often selected in venture capital documents.

Skuodas Municipality and regional business information centers - points of contact for local permits, facilities, and community support within the Klaipeda region.

Next Steps

Define your objectives. Clarify whether you are raising capital, investing, or forming a fund. Identify timing, target amounts, and key milestones such as MVP completion or revenue targets.

Choose the right structure. For startups, confirm that a UAB with appropriate share classes and articles suits your round plan. For investors, determine whether you invest directly or through a managed vehicle that may require registration or authorization.

Assemble your advisory team. Engage a Lithuanian venture lawyer, tax adviser, and an accountant familiar with startup finance. If you anticipate cross-border elements, add counsel in relevant jurisdictions.

Prepare documentation. For founders, update articles, cap table, IP assignments, and data protection policies. For investors, prepare a term sheet aligned with Lithuanian law, plan due diligence, and agree on governance and information rights.

Plan closing mechanics. Confirm whether UAB share transfers require notarial certification or settlement through a securities account. Schedule notary or intermediary appointments, and allocate time for registry filings.

Assess regulatory touchpoints. Verify whether fund manager rules, foreign investment screening, or sector-specific licenses apply. Engage with the Bank of Lithuania or other authorities as needed through your counsel.

Optimize tax and incentives. Review potential participation exemptions, withholding, and employee option benefits. Align equity awards with your hiring plan and budget.

Execute and monitor. Close the transaction, complete filings with the Register of Legal Entities, update the beneficial ownership register, and implement board and shareholder processes agreed in the documents.

This guide is for general information only. Always obtain tailored legal and tax advice before taking action in a specific venture capital matter in Skuodas or anywhere in Lithuania.