The Lithuanian Ministry of Finance has submitted legislative proposals to the Seimas aimed at fundamentally reforming the regulation of insolvency proceedings in Lithuania. The proposals cover both the Law on Insolvency of Legal Persons and the Law on Bankruptcy of Natural Persons.
Key Proposed Changes
Under the proposed amendments, the minimum debt threshold required for an individual to initiate bankruptcy proceedings would be abolished. This would allow more individuals facing severe financial difficulties to access bankruptcy protection.
The proposals also aim to restrict insolvency administrators from simultaneously managing multiple legal persons’ insolvency proceedings. This measure is intended to ensure that each case receives adequate attention and resources.
Corruption Risk Assessment and Environmental Safeguards
The draft laws also introduce stricter corruption risk assessments in insolvency processes and new environmental safeguards for companies with untreated waste or contaminated soil. These provisions aim to protect both creditors and the public from potential harm.
Entry into Force
If approved by the Seimas, the amendments would take effect from 1 January 2027, giving businesses and legal professionals sufficient time to prepare for the new requirements.
Insolvency proceedings are a complex legal area requiring professional guidance. If your company or personal business is facing financial difficulties, contact Law&Key lawyers for a consultation.
