Lithuania: A new requirement to notarize all significant share sales-purchases, bills of exchange and cash loans enters into force as of 2015.
In September this year the Parliament adopted a new requirement to notarize certain transactions:
- Sales-purchases of shares in private limited companies when:
More than 25% of a company’s shares are being sold, or when
The value of sold shares is greater than EUR 14 500
- Bills of exchange, if their value is greater than EUR 3000
- Loan agreements, when made in cash, if their value is greater than EUR 3000
The amendments enter into force on 1 January 2015.
The main aim of the new requirements is to combat illegal enrichment, which is often covered up by fictitious agreements. Until now these transactions could be in simple written form, making it difficult to prove their fictitiousness. After the amendments enter into force, these transactions will have to be performed through a public notary, who will record their date, the sums transferred, and so on.
This is arguably unfavourable towards our colleagues who have a habit of negotiating in restaurants and signing their agreements on a napkin before dessert. It is also unfavourable for those who wish to make their deals outside Lithuania – they will need to find local notaries and possibly request apostilles, or even travel to Lithuania. It is also unfavourable for those who wish to agree on a deal tomorrow, and not when the notary is able to find time, and those who do not wish to incur additional notary expenses.
Of course, unless the agreement is not governed by Lithuanian law.
Source: Valtybės žinios, Nr. XIIP-248(2) / XIIP-249(2) / XIIP-250(2)