Company types and legal structures in Latvia: What suits your needs?
Prior to establishing an enterprise it is essential to assess and choose the most appropriate type of an undertaking in terms of law and economics. This choice will affect not only the amount of necessary equity capital, but also the legal status of the enterprise and other business related issues.
There are several legal forms for running business in Latvia. Entrepreneurs usually register the following types of undertakings:
- limited liability company (SIA)
- joint stock company (AS)
- branch
- representative office of foreign merchant
According to Baltic Legal experience, the most popular type of business is a limited liability company (SIA). Baltic Legal will help to set up business or open a branch or representative office in Latvia. Our lawyers will assist you in preparation of incorporation documents and represent your interests in the competent state authorities.
Limited Liability Company (SIA)
Equity capital – when establishing a limited liability company, the minimum equity capital is EUR 2820. The equity capital contribution can take the form of both cash and property contribution.
Founder – one or more persons can be the founders of a limited liability company, and they can be both natural persons and legal entities. The founder may be a resident or non-resident of the Republic of Latvia.
Status – a limited liability company is considered a legal entity.
Liability – the company is liable for its obligations to the extent of its entire property. A founder or shareholder is not liable for the limited liability company's obligations, as well as the limited liability company is not liable for the founder's or shareholder's obligations.
Management body – the decision making body of a limited liability company is the board and, if needed, the council. The board consists of one or more natural persons who may be residents or non-residents of the Republic of Latvia.
The process of company formation and registration is not considered complex. The registration takes only four business days from the moment all incorporation documents are drafted and submitted with Commercial Registry of Republic of Latvia. The registration time might be reduced up to two business days upon such a request.
If you are interested in setting up a Limited Liability Company choose an option:
contact us or read company registration offer page.
Joint stock company (AS)
Joint Stock Company similarly as limited liability company (SIA) is considered a legal entity. The company is liable for its obligations to the extent of its entire property.
Founder can be one or more persons, and they can be both natural persons and legal entities. The founder may be a resident or non-resident of the Republic of Latvia.
Equity capital: comparing to SIA the minimum equity capital for joint stock company is much higher and amounts to EUR 35 210. The equity capital contribution can be made only in the form of a cash investment.
Management body: a joint stock company is managed by a shareholders' meeting, council and board, thus the corporate governance is more complex than SIA. One or more natural persons can become members of the board, and they may be residents or non-residents of the Republic of Latvia.
Branch of a foreign undertaking with right to conduct business
Branch of the foreign merchant is an organizationally independent unit or part of a foreign undertaking that is separated territorially from the main undertaking and where regular commercial activities are conducted on behalf of the relevant merchant in the territory of the Republic of Latvia. Branch is not considered an independent legal entity.
The foreign undertaking being the parent enterprise is fully liable for the activities and obligations of its branch.
The registration at State Registry takes only four business days from the moment all incorporation documents are drafted and submitted with Commercial Registry of Republic of Latvia. The registration time might be reduced up to two business days upon such a request.
If you are interested to open a branch in Latvia, please contact us
and our professional lawyers will be glad to assist you!
Representative office of a foreign undertaking
Foreign undertakings or organizations may establish representative offices or register official representatives in the Republic of Latvia.
Representative offices (representatives) do not have the right to conduct business. The objective and task of such representative offices is mostly the promotion of a foreign undertaking or organization in the Republic of Latvia or the Baltic region as a whole.
The representative office is a part of a foreign undertaking or organization, which is situated in the territory of the Republic of Latvia and is not considered an independent legal entity.
The state fee amounts to EUR 29 and the application at State Registry will be considered within 15 days. Depending on the paid state fee, the time might be reduced up to two business days.
