Latvia

Starting a Business in

Latvia

Below is a detailed summary of the bureaucratic and legal hurdles faced by entrepreneurs wishing to incorporate and register a new firm in Latvia. It examines the procedures, time and cost involved in launching a commercial or industrial firm with up to 50 employees and start-up capital of 10 times the economy's per-capita gross national income.

This information was collected as part of the Doing Business project, which measures and compares regulations relevant to the life cycle of a small- to medium-sized domestic business in 185 economies. The most recent round of data collection was completed in June 2012.

Compare Latvia to 184 other economies.

YearNew business densityNumber of new limited liability companies
2011 1.122,391

  • Standardized Company

  • Legal Form: Sabiedriba ar ierobe otu atbildibu (SIA)
  • Paid in Minimum Capital Requirement: LVL 1
  • City: Riga

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No. Procedure Time to Complete Associated Costs
1 Complete signatories’ cards and companies deeds, certify cards by a notary

The application to the Commercial Register and the consents for appointment to the Management Board must be notarized by a notary public.

Officials of the Companies Registry may verify the signature in case of a sole founder on the company's registration application and the sample signatures of management board members. The fee for the verification of one signature by the official of the Company Register is LVL 2.75. If three and more signatures must be verified in the freamework of one company, then the fee for verification of each signature is LVL 2.
1 day LVL 18
2 Open a bank account and get a receipt of reference from the bank

Most banks levy a small fee to open a bank account and obtaining a deposit notice. The fee is generally about LVL 5, depending on the bank.
1 day LVL 5
3 Register at the Commercial Registry and register with State Revenue Service (tax authority) for VAT

The following company incorporation documents must be submitted to the Company Register:

• Registration application, on a special form provided by the Registry (includes information on Board members and company share capital) signed in front of a notary public
• Company charter
• Foundation agreement (Resolution on foundation in case of one founder)
• Proof of investment
• Consent to the election to the Supervisory Board (if existance of Supervisory Board is provided in company charter)
• Consent to the election to the Management Board
• Notice of the Management Board on legal address of the Company
• Power of Attorney in case any of the founders is signing the Registration application via authorised person
• Document certifying payment of state duty
• Document certifying payment of the publication fee

With the amendments to the Commercial Code (as part of the implementation of EU directives), the rules on the mandatory appointment of the auditor upon establishing the process are withdrawn for all companies. An auditor is no longer registered with the Commercial Register. Appointment of a sworn auditor is necessary only if two of the three following criteria apply:

• The sum of the balance sheet exceeds LVL 100,000
• The annual turnover exceeds LVL 200,000
• During the financial year, the number of employees exceeds 25

The Regulations of the Cabinet of Ministers on Application of the norms of the Law On Value Added tax states that the entrepreneur has now the possibility to submit to Company Register simulaneoulsy with application for registration at the Commercial registry. In that case only B and C parts in the mentioned application must be filled out. The Company Register shall send the received application to State Revenue Service.
The same Regulation states that the State Revenue Service reviews the registration application and within 10 working days after receiving of application registers the person in the register of taxable persons or adopts a decision on refusal of registration. As of January 1, 2010 the application form can be submitted to the State Revenue Service also electronically. However, in such cases it must be signed with a secure electronic signature.

13 days LVL 124
4 Register employees for mandatory state social insurance contribution with the State Revenue Service

Regulation No 827 On Registration of Persons Performing Mandatory State Social Insurance Contributions and Personal Income Tax of the Cabinet of Ministers of Republic of Latvia (dated 7 September 2010) has been adopted and states that the following persons must register with the territorial agency of the State Revenue Service: employers, self-employed person, domestic employees working for foreign employers, and foreign employees working for foreign employers. The employer registers each employee with the territorial agency of the State Revenue Service not later than 1 day prior the person acquires employees status.This will be accomplished by submitting to the territorial agency of the State Revenue Service information about the employee on the basis of the Registration Card of Mandatory State Social Insurance Contributions. As advised by the representative of State Revenue Service, the State Revenue Service usually carries out this registration on the same day.
1 day no charge
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