More About Establishing a Small Partnership (MB)

Small Partnership (MB) is a limited liability legal entity, which means that its members are not personally liable for the company’s failures. Only individuals can be founders of an MB, making it more challenging to attract new investments from other companies compared to a private limited company (UAB). Additionally, a Small Partnership can have up to 10 members, but this does not mean that the number of employees can’t exceed this limit. With an MB, you can engage in any activity that does not contradict the laws of the Republic of Lithuania. One of the main advantages of establishing a Small Partnership is that there is no requirement for a minimum share capital; the initial contribution can be as low as 1 euro. Establishing an MB is suitable for small or family businesses, as founders typically do not invest large sums of money to start the business. It’s common for individuals who have a close relationship to establish an MB together, allowing them to engage in a joint venture that can generate income. The legal and tax framework for Small Partnerships is also appealing to new entrepreneurs. Since an MB is not required to hire an accountant, this can save costs that can be used for business development. However, if your business activity becomes sufficiently established, it is advisable to have someone or a company oversee the accounting.