1. LITHUANIA: THE EU GATEWAY FOR YOUR FINTECH
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LITHUANIA: THE EU GATEWAY FOR YOUR FINTECH
Inga KARULAITYTĖ, Loreta ANDZIULYTĖ,
ECOVIS ProventusLaw

2. Speakers: Inga Karulaitytė, Loreta Andziulytė
INTRODUCTION
ECOVIS ProventusLaw is a part of ECOVIS global consulting network with over professionals operating in over 65 countries.
Our Law firm main focus area is Financial services (FinTech).
The FinTech team consist of 7 members.
Speakers: Inga Karulaitytė, Loreta Andziulytė

3. Speakers: Inga Karulaitytė, Loreta Andziulytė
WHY LITHUANIA? (1)
Strategy of Lithuanian Government to make Lithuania a
FinTech Hub in a region
Central Bank acts as a partner for FinTech companies
Central Bank has a Newcomer program - ,,one stop shop” for FinTech
Companies
Pre-application period: pre – assessment of the business model, consultations, meetings
Smooth and predictable licensing process
Fast licensing process (3 months for EMI and PI)
Licensing documentation can be submitted in English
Speakers: Inga Karulaitytė, Loreta Andziulytė

4. Speakers: Inga Karulaitytė, Loreta Andziulytė
WHY LITHUANIA? (2)
Possibility to get own sorting codes for IBAN accounts for the clients, non- banks have access to SEPA through SEPA MMS system
Innovative “know your customer” processes for remote client verification
Easy and fast license passporting to other EU/EEA jurisdictions
1 year sandbox regime – no sanctions from the regulator for the first year for minor infringements
Start-up visa. Special visas for the citizens of non-EU/EEA countries
Favorable tax and fees. Turnover taxes and fee for the issuance of a license and annual licence state fees for FinTech companies are among the lowest in the EU region. 3 times R&D deduction
Speakers: Inga Karulaitytė, Loreta Andziulytė

5. Speakers: Inga Karulaitytė, Loreta Andziulytė
WHY LITHUANIA? (3)
What else is planned to do for improving of FinTech sector:
To review supervisory requirements in order to reduce
administrative barriers
2. Increase efficiency of the licensing process
3. Analyze possibilities to apply regulatory technologies
Goals of the Bank of Lithuania:
1. To accelerate of innovative solutions in the market
2. To create competitive and innovative payment market in Lithuania
Speakers: Inga Karulaitytė, Loreta Andziulytė

6. Speakers: Inga Karulaitytė, Loreta Andziulytė
SEPA MMS SYSTEM
A new-generation retail payment system, created in Lithuania and managed by the Bank of Lithuania, that allows customers of banks and financial institutions to execute payments in euro quickly and at low cost
Service fees applied in the system:
for each credit payment order (up to the first million) submitted to and executed in the system - EUR 0.03
for each credit payment order (exceeding the first million) submitted to and executed in the system - EUR 0.01
for each credit payment order received from the system and executed – EUR 0.01
Speakers: Inga Karulaitytė, Loreta Andziulytė

7. FINTECH AND FINANCIAL INSTITUTIONS
Electronic Money Institution
Payment Institution
Specialised Bank
Securities Broker
Investment Management
Investment Fund
Crowdfunding Platform
Peer to Peer Lending Platform
Speakers: Inga Karulaitytė, Loreta Andziulytė

8. COMPARISON OF SERVICES
Type of PSPs
Services
Bank
Special purpose
bank
Electronic money institution
Payment institution
Payment services +
Money exchange
Issuance of electronic money -
Lending
Receipt of deposits
Investment services, clearing, services related to securities emissions
Speakers: Inga Karulaitytė, Loreta Andziulytė

9. Speakers: Inga Karulaitytė, Loreta Andziulytė
PAYMENT INSTITUTION
Main features:
Licensing time – 3 months
Equity capital – from EUR to EUR 125 000
No particular requirements for company management to reside in Lithuania
License application can be submitted without establishing a company
Speakers: Inga Karulaitytė, Loreta Andziulytė

10. SERVICES ACCORDING TO THE EQUITY CAPITAL
Speakers: Inga Karulaitytė, Loreta Andziulytė

11. ELECTRONIC MONEY INSTITUTION
Main features:
Licensing time – 3 months
Equity capital – from EUR 350 000
No particular requirements for company management to reside in Lithuania
License application can be submitted without establishing a company
Speakers: Inga Karulaitytė, Loreta Andziulytė

12. MINIMUM MANAGEMENT REQUIREMENTS
The management of both the Electronic money institution and the Payment institutions must consists of at least six people:
General manager/CEO;
3 Management Board members (General manager may be a part of the board);
3 Supervisory Board members.
Speakers: Inga Karulaitytė, Loreta Andziulytė

13. PROCESS OF LICENSING AND INCORPORATION OF PI AND EMI
Preparation of the package of the documents for submission for the license.
The length of the process depends on the cooperation of the shareholders and related parties
Selection of the management board, manager, other key personnel to inform the Central Bank on selected candidates.
Submitting prepared documents of activities, business, strategic plans and other related to submission documents together with the information about the managers and shareholders. License is to be granted within 3 months after the submission of all required documents, extensions are possible.
After getting the license, the Institusion is incorporated and it is registered within the Register of Legal Entities.
The management shall be appointed after the Central Bank approves their candidacies during the licensing process.
Registration of the company and getting a number of license should normally take 3 days after the decision of the board of the Central bank
Speakers: Inga Karulaitytė, Loreta Andziulytė

14. Speakers: Inga Karulaitytė, Loreta Andziulytė
SPECIALISED BANK
From the 1st of January, 2017 EU member state Lithuania introduces a new type of credit institution – Specialised Bank
Main features:
Licensing time – 6 months (may be extended up to 12 months)
Equity capital – from EUR 1 000 000
License is issued in cooperation between the Bank of Lithuania and the European Central Bank.
Main advantage:
All of the deposits are ensured under EU regulation. Lithuanian Specialised Bank opens a large European banking market at significantly lower cost and enables new players to challenge traditional banks in their large national markets.
Speakers: Inga Karulaitytė, Loreta Andziulytė

15. SERVICES OF SPECIALIZED BANK
Specialised Bank enables provision of almost all traditional banking services in EU/EEA markets, including acceptance of deposits and lending.
Specialised banks will not be able only to render the following banking services:
provide investment services;
manage investment, pension funds;
be active by providing other services related to security emissions.
Speakers: Inga Karulaitytė, Loreta Andziulytė

16. PROCESS OF LICENSING AND INCORPORATION
Strategic Commission formed within the Lithuanian Government needs to approve the incorporators as being compliant with the national security interests. Process takes up to 1 month and may be handled in parallel with the licensing
Preparation of the package of the documents for submission for the specialized bank license.
The process can take 1-4 months or more depending on the cooperation of the shareholders and related parties.
Selection of the management board, general manager, supervisory board, internal auditor, compliance manager, managers of the branches, other key personnel to inform the Central Bank on selected candidates.
Submitting prepared documents of activities, business, strategic plans and other related to submission documents together with the information about the managers and shareholders of the specialized bank to the Central Bank. License is to be granted within 6 months after the submission of all required documents, extensions are possible. European Central Bank reviews documents and gives approval to issue a license.
After getting a license, the Specialized bank is incorporated, the Bank is registered within the Register of Legal Entities.
The management shall be appointed after the Central Bank approves their candidacies during the licensing process.
Registration of the company and getting a number of license should normally take 1-2 weeks after the decision of the board of the Central bank
Speakers: Inga Karulaitytė, Loreta Andziulytė

17. ORGANIZATIONAL STRUCTURE (EXAMPLE)
Risk Committee
Credit Committee
Deputy General Manager
Compliance officer
Management Board (minimum 3 persons)
Internal audit
Supervisory Board (minimum 3 persons)
General Manager
AML Officer
General meeting of the shareholders
Audit Committee
Speakers: Inga Karulaitytė, Loreta Andziulytė

18. Speakers: Inga Karulaitytė, Loreta Andziulytė
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MANY THANKS!
ECOVIS ProventusLaw
Mėsinių 5, Vilnius
Tel.:
Internet:
Speakers: Inga Karulaitytė, Loreta Andziulytė