Latvian law does not make requirements for the number or residence of the founders and members of the board. The founders of the Latvian company invest their capital in the company’s fixed capital and receive dividends in accordance with the number of shares of capital they own.
Registration of a latvian company
Latvia is a member of a number of international organizations, including the European Union, the WTO, and is a party to the Schengen Agreement. Participation in the European Union enabled Latvia to strengthen European trade relations, while maintaining the traditionally established trade relations with the CIS countries.
Legal forms of the company
There are several legal forms of companies in Latvia, the most popular of them are:
- Limited Liability Company (SIA)
- Joint-stock company (AS)
One of the most popular forms of companies in Latvia is the Limited Liability Company (LLC/SIA). Such companies have special privileges in the developing of fixed capital, aimed at the maintenance of a new business. Latvian SIA can be in two legal forms:
Low capital SIA € 1-2,799
- Low-capital SIA, with fixed capital from € 1 to € 2,799.
- Such SIA does not require a fixed capital at the time of registration of the company to the company’s temporary bank account.
- Over time, the fixed capital of a low capital LLC should increase up to € 2,800 or more.
- The low capital SIA has the right to only have individuals as its founders.
SIA with a total capital of € 2,800 +
- SIA with full-capital, i.e. € 2,800 or more.
- Must open a temporary bank account in Latvia before registering a company and contribute capital there.
- Capital can be used for the needs of the company after its registered in the Commercial Register.
- The founder can be any individual or legal person.
Comparison table of the company with complete and incomplete capital
Capital from €1 to 2799
Capital from € 2800
When incorporating a company it does not need to have a bank account.
You need a bank account, at least 50% of the capital must be added to the account before registration
Maximum 5 founders
No limit to the number of founders.
Founders are individuals.
The founder can be a member in only one company with incomplete capital.
The founder can be a member in only one company with incomplete capital.
Any kind of founders.
Board members must simultaneously be the owners of the company.
Any board members, any owners.
The obligation to increase the share capital to the full size (€ 2,800) as profit is received (25% of the profit goes towards the capital increase).
No obligations to increase share capital.
The ban on the sale of capital ratios until the capital increased to full.
Free sale of capital ratios.
A member of the company’s board may be issued a TRP after paying the full capital of the company.
A member of the company’s board may be issued a TRP at any time.
One of the advantages of this form of company is the fact that the founders are not responsible with their personal property for the company’s debts, and their liability is limited by the property and assets of the company.
What is required for company registration in Latvia
- Company name;
- The data of the founder of the company (a copy of the passport, address of residence);
- Data of the future member of the board – an individual, if this is not the same person as the founder of the company;
- The size of the company’s fixed capital, the number of shares and their nominal value;
- The written consent of the property owner to register the legal address.