Startup Visas Legalised in Lithuania
Most foreigners find Lithuania an attractive country due to its geographical position, good transport links with other countries and a favourable tax environment. However, rather stringent requirements set in place for aliens seeking temporary residence and work permits usually determine that ambitious young entrepreneurs, potential investors and other people from third countries with good business ideas bypass Lithuania and choose other countries for their businesses. To address the problem, amendments to the Law on the Legal Status of Aliens were passed a month ago in order to facilitate the rules of migration by legalising Startup Visa. Although certain reasons caused the amendments to be vetoed by the President, it is likely that after an additional review citizens of foreign countries will be able to take full advantage of the possibility as early as 1st of January, 2017.
What is Startup Visa?
Startup Visa is generally referred to as the new amendments to the Law on the Legal Status of Aliens. The amendments provide an opportunity for the aliens obtain a temporary residence permit on yet another basis of legitimate activity related to the introduction of new technologies or other innovations, significant to the economy or social development of Lithuania. In other words, the opportunity will be available to foreign startups with a high standard of competence, mainly businesses associated with the sector of information and communication technology (IT sector) as well as other innovative business areas.
Better Terms to Obtain Temporary Residence Permit
Prior to the introduction of the aforementioned amendments, the condition to employ a minimum of 3 Lithuanian citizens or aliens who are permanent residents of the country was one of the most difficult requirements that foreign startups had to comply with. It is often the case that within early stages of establishment, the company does not need to employ so many employees or it is not able to employ so many employees, whereas further expansion is only planned a few years later. This requirement often led to a situation where members of staff were employed fictitiously to comply with the criteria for the issue of the temporary residence permit. Another novelty is that foreign startups are no longer required to have the equity capital value of at least 28 000 EUR., of which no less than EUR 14 000 are to be the funds or other assets invested by the aforementioned alien. In other words, the minimum capital depends on requirements for specific legal entity. For example, limited liability company – 2 500 EUR.
The amendments to the Law on the Legal Status of Aliens also provide that a temporary residence permit shall be issued for a period of 1 year with a possibility of renewal for another year. Two years later, the person will be able to apply for a temporary residence permit on other grounds, e.g. in the capacity of the general manager or shareholder of a company.
Another important novelty is that the deadlines for the issuance of a temporary residence permit are being reduced. At present, the deadline for the issue of a temporary residence permit is 4 months, or 2 months in case of an urgent procedure. The time-limit for the issue of Startup Visa will be 2 months as standard procedure, or 1 month in case of urgent circumstances.
Benefits of Startup Visa
Startup Visa provides an excellent opportunity both for aliens and Lithuania as well. Startup Visa is a particularly attractive chance for foreign startups to start and develop their businesses in Lithuania without undergoing long bureaucratic procedures. Therefore, one can unequivocally claim that the above mentioned amendments are in line with the needs of modern business and the conditions of global economy, and can furthermore offer new opportunities for Lithuania in attracting innovative foreign experts and fresh ideas, encourage aliens to associate their future plans with Lithuania and thus offset the losses caused by emigration.