Best Investment & Business Structuring Lawyers in Latvia

About Investment & Business Structuring Law in Latvia

Investment and business structuring in Latvia covers the legal framework governing how investments are organized, funded, and controlled within Latvian entities. It includes corporate formation, ownership transfers, governance rules, and compliance with national and EU requirements. The goal is to create clear ownership, enforceable contracts, and robust corporate governance while preserving flexibility for cross border activity.

Key features include formation and management of Latvian entities such as SIA (limited liability company) and AS (joint stock), rules for share transfers, and requirements for registered offices, board composition, and reporting. The framework also addresses anti money laundering (AML) obligations and the registration of beneficial owners. Practical structuring choices affect tax, liability, and access to incentives or public funding.

Why You May Need a Lawyer

• Incorporating an SIA for a foreign investor - A foreign company wants to set up a Latvian SIA to operate a manufacturing facility in Riga. You need tailored articles of association, an appropriate share structure, and registered capital documentation. A lawyer helps with notarial steps, e signing, and timely UR registration.

• Buying or selling shares in a Latvian company - A Baltic private equity fund plans to acquire 60 percent of an existing Latvian distributor. You need due diligence, pre emption rights checks, and a compliant share transfer process that updates the Enterprise Register and BO records.

• Capital increases or reductions in a Latvian entity - A group restructures its Latvian subsidiary to optimize financing. You must draft amendments to the articles, reflect new capital in the share register, and notify the Enterprise Register within deadlines.

Practical AML and beneficial ownership considerations - Latvia requires accurate BO registration and ongoing compliance with AML obligations. A lawyer helps design a compliant structure, prepare internal policies, and coordinate with authorities if needed. This minimizes risk of penalties and helps maintain good standing for business operations.

Local Laws Overview

Latvia relies on a core set of national laws to govern investment and business structuring, supplemented by EU directives. The main frameworks address company formation, governance, taxation, and financial integrity. Recent years have emphasized alignment with EU transparency rules and efficient corporate administration.

Civil Code and commercial governance - The Civil Code provides contract, liability, and property rules that underpin business transactions. It sets the basis for enforcement of commercial agreements and property transfers when structuring investments. Practical implications include contract formation, breach remedies, and ownership rights in corporate contexts.

Law on Companies and corporate restructuring - The Law on Companies (Sabiedrību likums) governs the creation, management, and reorganization of Latvian business entities such as SIA and AS. It covers share transfers, governance, and statutory filings with the Enterprise Register. Recent amendments have focused on modernizing procedures and improving cross border operation capabilities.

Corporate income tax and distribution rules - The Corporate Income Tax Law (Uzņēmumu ienākuma nodokļa likums) shapes how profits are taxed in Latvia, including the shift toward taxation on distributed profits from 2018 onward. This affects structuring decisions around reinvestment, dividends, and group financing arrangements.

AML and Beneficial Ownership regulations - Latvia applies EU AML directives through the AML Law and related regulations, requiring accurate identification of beneficial owners and ongoing monitoring of client relationships. Compliance reduces regulatory risk and supports legitimate investment activity.

directive 2015/849 on the prevention of money laundering and the financing of terrorism applies to Latvia and influences structuring choices and reporting responsibilities.

Latvia's government portal outlines national AML and business registration requirements and the roles of public authorities.

Frequently Asked Questions

What is the first step to set up a Latvian SIA for an international investor?

Prepare a business plan, collect shareholder information, and choose a local or foreign director. You will draft the articles of association and open a Latvian bank account for paid in capital before registration with the Enterprise Register.

How do I register a beneficial owner for a Latvian company?

You must provide information about natural persons with control over the company and file it with the Enterprise Register or relevant supervisory authorities. The process is tied to AML compliance and may require additional identity verification.

How much capital is required to form an SIA in Latvia?

The minimum paid in share capital for an SIA is 2 500 EUR. You can deposit this amount in a Latvian bank account before completing the registration with the Enterprise Register.

When can I change the ownership structure of a Latvian company?

Share transfers and ownership changes typically require board approvals and updating the share register and the Enterprise Register. Timelines depend on document readiness and any third party consents.

What is the difference between an SIA and an AS in Latvia?

An SIA is a limited liability company with simpler governance and lower capital requirements, while an AS is a joint stock company with a larger capital base and more formal governance. Both must be registered with the Enterprise Register and comply with the Law on Companies.

Do I need a Latvian resident director for an SIA?

As of recent practice, Latvia allows non resident directors in many cases, but some sectors or financing arrangements may require local residency or additional compliance steps. Confirm current rules with a local attorney based on your sector and ownership structure.

How long does it take to incorporate an SIA in Latvia?

Typically, incorporation can be completed within 2-5 business days from document submission, provided all documents are correct and apostilled where required. Additional checks or bank account setup may extend the timeline.

Is it possible to restructure a Latvian company through a cross border merger?

Yes. Latvia supports cross border mergers under EU rules, subject to national procedures and approvals. A lawyer can coordinate with foreign counterparties and ensure proper registration with the Enterprise Register.

What costs should I anticipate when setting up a Latvian company?

Costs include state filing fees, notary or legal services, potential bank charges, and ongoing annual maintenance. Typical upfront legal fees vary widely by complexity and may range from a few hundred to several thousand EUR.

What documents are usually required to open a Latvian company for a foreign national?

Common documents include passport copies, proof of address, corporate documents from the parent company, and a local director or service provider agreement. Some steps may require apostilles or translations into Latvian.

Can I align Latvia structuring with EU funds or incentives?

Yes. Latvia offers incentives and state support programs to eligible investors. Structuring with professional advice helps maximize access while staying compliant with EU and Latvian rules.

Additional Resources

• Latvian Government Portal (gov.lv) - official guidance on public administration and regulatory requirements
• EUR-Lex - EU law and directives including AML and company law provisions
• Uzņēmumu reģistrs (Enterprise Register) - official Latvian register for companies and filings

Next Steps

1. Define your investment structure and target outcomes, including preferred entity type (SIA or AS) and jurisdiction for ownership.
2. Gather key documents such as passports, proof of address, and corporate documents from any parent or investment group.
3. Engage a Latvia based Investment & Business Structuring lawyer for a prelim consultation to tailor the structure to your needs.
4. Draft or review the articles of association, shareholder agreement, and governance documents with local counsel.
5. Prepare for Enterprise Register filing by ensuring paid in capital and required director information are in order.
<3>Notify the Beneficial Owner registers and implement AML compliance procedures in line with EU directives. <7>Establish ongoing compliance processes and periodic reviews of corporate structure to adapt to changes in law or business needs.