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Ease of Doing Business in

Lithuania

Lithuania Download Profile (1756.7KB, pdf)
Region Europe & Central Asia
Income Category High income
Population 2,910,199
GNI Per Capita (US$) 15,000
City covered Vilnius

190

1

DB 2017 Rank

1

100

DB 2017 DTF (% points)

  • local_library
  • group
Topics DB 2017 Rank DB 2016 Rank info_outline Change in Rank DB 2017 DTF (% points) info_outline DB 2016 DTF (% points) info_outline Change in DTF (% points) info_outline
Overall 21 21
0
78.84 78.60 down
0.24
Starting a Business 29 28 down
1
92.99 92.94 up
0.05
Dealing with Construction Permits 16 15 down
1
80.44 80.43 up
0.01
Getting Electricity 55 58 up
3
80.08 78.97 up
1.11
Registering Property 2 2
-
92.93 92.93
-
Getting Credit 32 29 down
3
70.00 70.00
-
Protecting Minority Investors 51 48 down
3
61.67 61.67
-
Paying Taxes 27 29 up
2
85.44 85.46 down
0.02
Trading across Borders 19 19
-
97.70 97.70
-
Enforcing Contracts 6 5 down
1
77.88 77.88
-
Resolving Insolvency 66 68 up
2
49.23 48.06 up
1.17

Positive= Doing Business reform making it easier to do business.Negative= Change making it more difficult to do business.

DB 2017 Rank:

66

DB 2016 Rank:

68

Change in Rank:

up2

DB 2017 DTF (% points):

49.23

DB 2016 DTF (% points):

48.06

Change in DTF (% points):

up1.17

Indicator Lithuania Europe & Central Asia OECD high income
Recovery rate (cents on the dollar) info_outline 45 38.2 73.0
Time (years) info_outline 2.3 2.2 1.7
Cost (% of estate) info_outline 10 13.1 9.1
Outcome (0 as piecemeal sale and 1 as going concern) info_outline 0 .. ..
Strength of insolvency framework index (0-16) info_outline 8 9.9 12.1
  • Indicator Explanation Answer
    Recovery rate (cents on the dollar) 45.0
    Proceeding Mirage management is interested in saving the business. Additionally, if the management does not initiates reorganization, BizBank will start recovery procedure and this will lead the company to liquidation. However, reorganization is likely to fail, because BizBank will be interested in getting paid as soon as possible and will not approve the reorganization plan. If reorganization plan is not approved, the court will terminate reorganization proceedings and initiate liquidation. liquidation (after an attempt at reorganization)
    Outcome Upon declaring the enterprise bankrupt and adopting a resolution to put the enterprise into liquidation by reason of bankruptcy, the court shall confirm the amount of revised claims of each creditor, the procedure of liquidation, other orders and instructions necessary for carrying out the liquidation procedure. In this stage pledged assets – the real estate - shall be sold at an auction. piecemeal sale
    Time (in years) Mirage management will file a petition for commencement of reorganization proceedings and send a notice of it to the creditors and to the Department of Enterprise Bankruptcy Management under the Ministry of Economy. The court will decide whether to initiate reorganization proceedings within 1 month of receiving the petition. Decision of the court to initiate reorganization proceedings stays all other enforcement actions against the debtor. An administrator will be appointed and creditors must submit their claims within specified period (usually 30 to 45 days). The claims must be approved by the court in order for the creditors to vote on the reorganization plan. A creditors' meeting will be held 30 days after the creditors' claims are approved, creditors will elect a creditors' committee. Mirage management must submit a reorganization plan within 6 months of the date when the decision on the opening of reorganization proceedings is made. Creditors representing at least 2/3 of the aggregate amount of certified claims must vote in favor of the plan, in order for it to be approved. If the creditors fail to approve the plan, reorganization proceedings will be terminated. After reorganization proceedings are terminated, there is no automatic conversion of proceedings into liquidation. However, BizBank will be able to petition the court to open liquidation proceedings. The court will issue a liquidation order and liquidation proceedings will commence. A bankruptcy administrator will be appointed, who must sell the assets to satisfy the creditors' claims. Immovable property must be sold at a public auction. Movable property and immovables not sold at an auction will be sold in accordance with the decision of the creditors. Claims of secured creditors have priority over all other claims, including employment and tax claims, and will be paid first from the proceedings of the sale. 2.3
    Cost (% of estate) Major expenses will include remuneration of the administrator (around 5%), attorneys' fees (up to 5%), and fees of other professionals involved in the insolvency proceedings, such as accountants and assessors (up to 5%). 10.0
    Answer Score
    Strength of insolvency framework index (0-16) 8.0
    Commencement of proceedings index (0-3) 2.5
    What procedures are available to a DEBTOR when commencing insolvency proceedings? (a) Debtor may file for both liquidation and reorganization 1.0
    Does the insolvency framework allow a CREDITOR to file for insolvency of the debtor? (b) Yes, but a creditor may file for liquidation only 0.5
    What basis for commencement of the insolvency proceedings is allowed under the insolvency framework? (c) Both (a) and (b) options are available, but only one of them needs to be complied with 1.0
    Management of debtor's assets index (0-6) 4.0
    Does the insolvency framework allow the continuation of contracts supplying essential goods and services to the debtor? Yes 1.0
    Does the insolvency framework allow the rejection by the debtor of overly burdensome contracts? Yes 1.0
    Does the insolvency framework allow avoidance of preferential transactions? Yes 1.0
    Does the insolvency framework allow avoidance of undervalued transactions? Yes 1.0
    Does the insolvency framework provide for the possibility of the debtor obtaining credit after commencement of insolvency proceedings? No 0.0
    Does the insolvency framework assign priority to post-commencement credit? (c) No priority is assigned to post-commencement creditors 0.0
    Reorganization proceedings index (0-3) 0.5
    Which creditors vote on the proposed reorganization plan? (a) All creditors 0.5
    Does the insolvency framework require that dissenting creditors in reorganization receive at least as much as what they would obtain in a liquidation? No 0.0
    Are the creditors devided into classes for the purposes of voting on the reorganization plan, does each class vote separately and are creditors in the same class treated equally? No 0.0
    Creditor participation index (0-4) 1.0
    Does the insolvency framework require approval by the creditors for selection or appointment of the insolvency representative? No 0.0
    Does the insolvency framework require approval by the creditors for sale of substantial assets of the debtor? No 0.0
    Does the insolvency framework provide that a creditor has the right to request information from the insolvency representative? No 0.0
    Does the insolvency framework provide that a creditor has the right to object to decisions accepting or rejecting creditors' claims? Yes 1.0

Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”.