Private placement rules and law in Lithuania

1. Summary of private placement provisions for fund interests (if applicable)

As of 1 January 2015, the Law on Management Companies of Alternative Collective Investment Undertakings of the Republic of Lithuania (“Lithuanian AIFMD Law”), which implements AIFMD, was in force.

If the AIF is considered to be of a closed-end type the Law on Securities of the Republic of Lithuania (“Law on Securities”) and Prospectus Regulation (EU) 2017/1129 (“Prospectus Regulation”) apply.

Pursuant to Article 1(4) of the Prospectus Regulation, the following offerings are not deemed to have a public character and do not require to have a prospectus approved in Lithuania:

  1. offerings to professional investors only; and/ or 
  2. offerings to fewer than 150 natural or legal persons per Member State, other than professional investors; 
  3. offerings whose denomination per unit amounts to at least EUR 100,000; 
  4. offerings to investors who acquire securities for a total consideration of at least EUR 100,000 per investor, for each separate offer.     

Additionally, the Law on Securities establishes exemption from the obligation to have a prospectus approved when the total consideration of each such offer in the EEA is less than a monetary amount calculated over a period of 12 months which shall not exceed EUR 8,000,000 and such offers are not subject to notification in accordance with Article (25) of the Prospectus Regulation. 

2. Other forms of possible placement options for fund interests outside fund regulations

Reverse solicitation is not deemed to constitute a public offering of a fund interest in Lithuania and, in such context the collective investment undertaking does not need to be passported or have a prospectus approved in Lithuania.

3. Consequences of non-compliance with placement regimes for fund interests

Possible consequences include:

  1. Claims for damages by investors that have acquired the fund interests;
  2. Regulatory sanctions including warnings, bans on operations or activities in Lithuania, requirements to change the manager and/ or monetary fines.

4. Private placement rules for non-fund investments available

The private placement regime for non-fund investments is not defined by the law. In this regard “private placement” is a market developed concept which is understood as a placement of various securities such as shares, bonds, notes, etc. which are exempted from the requirement to publish an offering prospectus.

The exemptions from the obligation to publish a prospectus are established in the Law on Securities and the Prospectus Regulation.