“Doing business”

What is “Doing Business”?

  • The “Doing Business” report measures business environment according to the methodology and scenarios defined by the World Bank. As part of this survey the World Bank performs the analysis and ranking of the regulations that promote and restrict business in different  countries and regions.
  • The World Bank has been conducting the “Doing Business” report since 2002 and publishing its reports since 2003. The report covers the period running every year from 1 June to 1 June of the following year (except for the tax payment indicator the assessment of which covers a calendar year period).
  • Results of the World Bank’s report are based on information provided by national experts (respondents) to the World Bank. The World Bank cooperates directly with respondents by asking them to answer special questionnaires of the World Bank.
  • Business environment in the Report on “Doing Business” is measured according to 11 indicators:
    • Starting a business
    • Dealing with construction permits
    • Getting electricity
    • Registering property
    • Getting credit
    • Protecting minority investors
    • Paying taxes
    • Trading across borders
    • Enforcing contracts
    •  Resolving insolvency
    • Labor Market Regulation *
(*The indicator has no impact on the overall result of the country) 

Lithuania in the ranking of “Doing Business”

  • The last report published in October 2014 covered 189 economies. In terms of the ease of doing business, Singapore ranks the first, likewise last year, whereas New Zealand (ranking the second) and Hong Kong (ranking the third) have exchanged their second and third positions since last year. Lithuanian ranks 24 in the Report. From among 28 Member States of the EU Lithuania occupies the tenth position.
  • Changes implemented during the reference period that have positively contributed to Lithuania’s ranking:
    • In the area of starting a business, as from 13 July 2013 the amendments to the Civil Code and other legislative acts came into force according to which the seal is not mandatory for enterprises if the obligation to have a seal is not established in the incorporation instruments of an enterprise or laws. Also, the term of registration of an enterprise in the Register of VAT Payers has been shortened from 3 to 2 calendar days. As specified by the World Bank, to start a business in Lithuania only 3 procedures should be carried out and it takes 3.5 days.
    • In the area of dealing with construction permits, the term during which municipalities must issue special architectural requirements has been shortened by half from 42 to 21 calendar days.
    • The term during which AB Lesto must issue technical requirements to construction companies for connection to power grids has been shortened from 21 to 10 calendar days.
    • In the area of payment of taxes the land tax rate has changed from 1.5% to 0.01–4%.
    • In the area of enforcement of contracts, the enforced amendments to the Civil Code have enabled the submission of procedural documents to court by electronic means.
    • Also, as from September 2014, upon registration of a new business in the Register of Legal Entities it can also be registered as a VAT payer. Information about the registration of a new business and its application for becoming a VAT payer is communicated to the STI automatically, and the administrator’s decision is provided by electronic means via “My STI” system within 3 working days. This innovation further simplifies the procedures of starting a new business; however, the changes will be reflected only in the next year’s report of the World Bank.

Role of the Ministry of Economy

  • The Ministry of Economy is a coordinator of the “Doing Business” report in Lithuania.
  • The Report on “Doing Business” is an excellent means for identifying barriers faced by business in carrying out its activities, for comparing Lithuania in different areas with as many as 189 economies and, in may cases, for identifying the particular measures the implementation of which would allow Lithuania not only to achieve better results in “Doing Business” report, but also – and this is most important – to improve the business environment.
  • In view of the above, the Ministry of Economy analyses the results and methodology of Reports on “Doing Business”, cooperates with public authorities and business entities in developing proposals and measures that might positively contribute to the data of the Report.
  • On 24 November 2014, the Ministry of Economy introduced to the Government the specific measures aimed at improving the indicators of “Doing Business”. The measures were approved and the institutions according to their competences have been tasked with implementing them during 2015. The measures are aimed at improving business conditions in the areas of dealing with construction permits, getting electricity, paying taxes, protecting minority investors, resolving insolvency and trading across borders.

Useful links

Last updated: 30-09-2015