In 2008-11-11 new amendments of the Law on Companies of Republic of Lithuania have been approved. The main changes are discussed here.

The European Commission has proposed an important revision of the EU framework for investment funds known as 'UCITS' (Undertakings for Collective Investment in Transferable Securities). The new provisions will increase the efficiency of the current legislative framework in a number of key areas. First, it will allow UCITS managers to develop their cross-border activities and generate savings consolidation and economies of scale. Second, investors will benefit from a greater choice of investment funds operating at lower costs. Third, the proposal also seeks to improve investor protection by making sure that retail investors receive clear, easily understandable and relevant information when investing in UCITS. More information here.

On the 1st of March, 2008 new amendments of the law shall open new opportunities for the specialised investment funds in Lithuania. These funds include private equity (risk capital), real estate, alternative investment (hedge) funds and other specialized collective investment undertakings (SCIU), both close-end and open-end. SCIU can be registered as investment funds (fund assets legally belong to the unit holders but not the fund manager) or investment companies (investment company is organized in form of a public limited liability company). One of the main SCIU merit is tax advantage: SCIU is exempt from corporate income tax. Investment income (returns from investments), dividends and other distributed profits received by investment funds is non-taxable income under the Law on Corporate Income Tax. Investment income of investment companies, except dividends and other distributed profit, is non-taxable income too. However, dividends and distributed profit received by investment company is non-taxable when investment company holds more than 10% of voting shares not less than 12 months. Otherwise, corporate tax income rate of 15% is applied to income received as dividends and other distributed profit. Consequently, new amendments of law provide us with clear legal infrastructure in the real estate and private capital market together with favorable tax regime.

In 2007-11-15 Lithuanian Securities Commission agreed on the Rules of Alternative securities market First North in Lithuania. Not receiving Lithuanian Securities Commission agreement was mainly the reason Alternative market did not opened in summer. Now only Vilnius Stock Exchange, which will operate Alternative market, determines when this market is opened. Certainly, the fact that this market is opened does not mean to investor anything. The main thing is whether there is companies listing on Alternative market. For example, there is no companies listing on Alternative market in Latvia, though the market is opened since 2007-06-01.