Latvia company structures: at a glance

Options for registering companies in Latvia

As a member of the European Union and the Eurozone, Latvia is a strategic gateway for businesses aiming to operate across Northern Europe and connect with markets in the Baltic region and beyond.

Its pro-business policies, competitive tax system - which includes 0% corporate tax on reinvested profit - and well-developed infrastructure make it an appealing location for logistics, IT and export-oriented manufacturing.

Latvia offers international companies the following legal structures for establishing a local presence:

Limited liability company (Sabiedrība ar Ierobežotu Atbildību - SIA)

• The SIA is the most popular form of commercial activity in Latvia, suitable for small and medium-sized enterprises (SMEs) due to its flexibility and ease of setup.
• The standard minimum share capital is €2,800, of which at least 50% must be paid up before registration. A reduced capital SIA (capital below €2,800) is available, but it is subject to strict restrictions on ownership (individuals only) and turnover.
• The liability of the shareholders is limited to their capital contribution and both the management board and shareholders may be non-residents.

Public limited company (Akciju sabiedrība - AS)

• The AS is generally chosen for larger businesses, those planning significant capital investment, or entities intending to seek capital publicly by listing shares on the NASDAQ Riga Stock Exchange.
• It requires a substantially higher minimum share capital of €35,000, which must be fully paid up before registration.
• The AS has a more complex, mandatory three-tier governance structure, including a Shareholders' Meeting, a Supervisory Council and a Management Board, making it subject to more stringent corporate governance and disclosure standards.

Representative office (Pārstāvniecība)

• The Latvian representative office is not considered an independent legal entity and is strictly prohibited from performing any commercial activities or generating profit in Latvia.
• Its functions are limited to market research, liaison, advertising and promoting the foreign parent company's interests.
• There is no minimum share capital requirement, making it a low-cost option for initial market exploration. However, any income-generating activity would necessitate registration as a branch or SIA.

Free zone company

• Latvia operates several Special Economic Zones (SEZs) and Freeports (e.g., Riga, Ventspils, Liepāja, Latgale), which offer significant tax incentives to businesses that meet specific investment and job creation criteria.
• The key benefit is a substantial rebate on corporate income tax (up to 80% relief) and real estate tax (up to 100% relief), up to a maximum allowable intensity of the investment.
• Companies must first incorporate as a legal entity (SIA or AS) and then obtain a licence from the relevant SEZ authority to qualify for the tax relief programme.

To help you choose the right structure, we have created an 'at a glance' summary table for the common company types that outlines key differences in formation processes, requirements and timelines. It serves as a valuable resource for foreign companies looking to set up or expand a business in Latvia.

Comparison of the common types of companies in Latvia

Information verified against Investment and Development Agency of Latvia (LIAA)

Need help deciding?

Choosing the right business structure is crucial. Speak to our Latvia business setup experts today and get advice tailored to your plans.

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