LITHUANIA Law and Practice Contributed by: Donatas Šliora and Marius Matiukas, ADON legal
that jeopardise financial stability or regulatory compliance. 2.14 Impact of AML and Sanctions Rules AML/CFT and sanctions compliance are critical considerations for Lithuanian fintechs, with the level of obligations varying based on their spe - cific activities. Fintechs classified as “obliged entities” within the AML/CFT framework (eg, payment institu - tions, e-money institutions, providers of crypto- asset services, factoring service providers) face extensive requirements. This includes robust KYC procedures, transaction monitoring, sus - picious activity reporting and strict sanctions- screening systems. These obligations mirror those of traditional financial institutions. This situation has resulted in the creation of various AML/CFT compliance-related regtechs such as Amlyze (AML/CFT compliance tools) or iDenfy (remote identification). The current geopolitical context has elevated the scrutiny of sanctions compliance. Lithuanian fintechs must implement appropriate screening tools and internal controls to mitigate the risk of facilitating illicit activities or violating sanctions. The Bank of Lithuania and the FCIS have recent - ly issued specific sanctions compliance guide - lines, which fintechs should thoroughly review
latest enhanced follow-up review indicates that Lithuania is compliant or largely compliant with the vast majority of FATF Recommendations, with only a few areas (notably those concerning certain targeted sanctions and the supervision of designated non-financial businesses) still rated as partially compliant. In general, Lithuania is going in the right direction in terms of full com - pliance with the recommendations. 2.16 Reverse Solicitation Rules governing reverse solicitation originate at the EU level, primarily under MiFID II and MiCA. The main requirement is that the client must engage the financial institution operating from a different jurisdiction entirely on the client’s own exclusive initiative. Importantly, such client-ini - tiated contact does not grant the third-country financial institution any right to actively market additional financial products or services to that client. European supervisory bodies emphasise that the concept of reverse solicitation should be interpreted narrowly, underscoring the impor - tance of consumer protection and maintaining transparency and stability within financial mar - kets. 3. Robo-Advisers 3.1 Requirement for Different Business Models Generally, there is no distinction based on whether investment services are provided by humans or through automated or semi-automat - ed systems (robo-advisers). The same licensing requirements apply, although certain additional obligations must be observed, for example under ESMA Guidelines relating to MiFID II suit - ability requirements.
alongside EU sanctions regulations. 2.15 Financial Action Task Force Standards
Lithuania has a developed AML/CFT frame - work that largely adheres to Financial Action Task Force (FATF) standards. As an EU member state, Lithuania implements the EU’s AML Direc - tive and undergoes regular evaluations by the Council of Europe’s MONEYVAL to assess com - pliance with FATF’s 40 Recommendations. The
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