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Teksta versija
LEGAL ACTS OF THE REPUBLIC OF LATVIA
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The translation of this document is outdated.
Translation validity: 01.01.2002.–30.04.2004.
Amendments not included: 31.03.2004., 04.11.2004., 22.06.2005., 20.11.2008., 19.11.2009., 08.07.2011., 07.06.2012., 19.09.2013., 16.01.2014., 09.06.2016.

Disclaimer: The English language text below is provided by the Translation and Terminology Centre for information only; it confers no rights and imposes no obligations separate from those conferred or imposed by the legislation formally adopted and published. Only the latter is authentic. The original Latvian text uses masculine pronouns in the singular. The Translation and Terminology Centre uses the principle of gender-neutral language in its English translations. In addition, gender-specific Latvian nouns have been translated as gender-neutral terms, e.g. chairperson.

The Saeima1 has adopted and the
President has proclaimed the following Law:

Law on Procedures for the Coming into Force of The Commercial Law

Chapter I
General Provisions

Section 1. Recording of Merchants in the Commercial Register

Recording of merchants in the Commercial Register shall take place as of the day of the coming into force of The Commercial Law in conformity with the provisions of The Commercial Law and this Law.

Section 2. Commercial Register Office

(1) The Enterprise Register of the Republic of Latvia is the institution that keeps the Commercial Register and in cases determined by this Law, makes records in the Enterprise Register in compliance with the provisions of the Law On the Enterprise Register of the Republic of Latvia.

(2) The Enterprise Register, the Commercial Register, the data of these registers and the information included in them shall be the property of the State.

(3) In the registration procedure provisions of the Law On the Enterprise Register of the Republic of Latvia shall be applied to the matters that are not regulated by the provisions of this Law and the provisions of The Commercial Law regarding the Commercial Register.

(4) Until 31 December 2004 provisions of Section 10, Paragraph three of The Commercial Law shall not be applied and decisions regarding making a record in the Commercial Register, refusal to make a record or postponement of making a record shall be taken within 30 days of the day of the receipt of an application.

Section 3. Registration of Undertakings (Companies) in the Enterprise Register

(1) Newly established undertakings (companies) or undertakings (companies) established as a result of reorganisation, which undertakings are provided for in Chapter II of the Law On Entrepreneurial Activity, may not be registered in the Enterprise Register as of the day of coming into force of The Commercial Law.

(2) Until the adoption of relevant laws individual undertakings, farms and fishing undertakings, co-operative societies and their unions, limited liability companies of non-profit-making organisations, stock companies of non-profit-making organisations, as well as the entities referred to in Section 27, Paragraph three of this Law shall be registered in the Enterprise Register.

(3) For two months as of the day of coming into force of The Commercial Law, the new entities referred to in Paragraph one of this Section may be registered in the Enterprise Register if a decision regarding the establishment of such entity has been taken prior to the day of coming into force of The Commercial Law and application for the registration has been submitted not later than one month after the date of coming into force of The Commercial Law.

(4) It is permitted to register in the Enterprise Register such reorganisation of existing undertakings (companies) as has been provided for in Chapter II and Section 27 of this Law. Reorganisation of the entities referred to in Paragraph two of this Section shall be registered in the Enterprise Register, except in cases when the entity that has been established as a result of reorganisation is to be recorded in the Commercial Register.

(5) Registration of amendments and other changes in the basic documents up to the time periods referred to in Chapter II of this Law shall be performed in conformity with the provisions of the laws that regulate the registration of the relevant undertakings (companies), observing the relevant exceptions referred to in this Law.

Section 4. Meanings of Terms During Transitional Period

(1) Within the meaning of The Commercial Law terms that are used in other legal enactments shall be understood as follows:

1) the term "līgumsabiedrība" [business partnership] shall be understood as "personālsabiedrība" [partnership];

2) the term "līgumsabiedrība ar pilnu atbildību" [full liability business partnership] shall be understood as "pilnsabiedrība" [general partnership];

3) the term "komandītsabiedrība" [limited partnership: the Latvian spelling with a macron over the first "i"] shall be understood as "komanditsabiedrība" [limited partnership: the Latvian spelling without a macron over the first "i"];

4) the term "uzņēmējdarbība" [entrepreneurial activities] shall be understood as "komercdarbība" [commercial activities] if it does not result from the content of the legal norm that the term "uzņēmējdarbība" [entrepreneurial activities] is to be understood as other commercial activities;

5) the term "uzņēmējsabiedrība" [company] shall be understood as "komercsabiedrība" [commercial company] within the meaning of The Commercial Law, "kooperatīvā sabiedrība" [co-operative society] and "kooperatīvo sabiedrību savienība" [the union of co-operative societies] within the meaning of the Law On Co-operative Societies, as well as "paju sabiedrība" [co-operative share company] within the meaning of the Law On Co-operative Share Companies;

6) the term "statūtsabiedrība" [incorporated company] shall be understood as "kapitālsabiedrība" [capital company] within the meaning of The Commercial Law, "kooperatīvā sabiedrība" [co-operative society] and "kooperatīvo sabiedrību savienība" [the union of co-operative societies] within the meaning of the Law on Co-operative Societies, as well as "paju sabiedrība" [co-operative share company] within the meaning of the Law On Co-operative Share Companies.

(2) If in another regulatory enactment the term "uzņēmums" [undertaking] is used and it derives from the definition of the terms of such enactment or the purpose of the norm that such regulatory enactment (legal norm) refers to the undertaking as a holder of the right, the provisions of The Commercial Law regarding undertakings shall not be applied.

Chapter II
Transitional Period for Undertakings (Companies), Branches, Divisions and Representation Offices Registered in the Enterprise Register

Section 5. Recording in the Commercial Register of the Undertakings (Companies), Branches, Divisions and Representation Offices that are Registered in the Enterprise Register

(1) The entities referred to in Section 17, Paragraph two of this Law and companies, their branches, divisions and representation offices that are registered in the Enterprise Register, except co-operative societies and their unions, in accordance with procedures and time periods specified in this Chapter and on the basis of an application shall be recorded in the Commercial Register without changing the numbering assigned by the Enterprise Register of the Republic of Latvia, or shall be liquidated. This provision shall not apply to the entities referred to in Section 17, Paragraph three of this Law.

(2) Decisions regarding restructuring of a company or amendments to the articles of association that are necessary in order for the company to apply for recording in the Commercial Register shall be taken at a meeting (general meeting) of the shareholders (stockholders) by a simple majority vote. The meeting (general meeting) shall be convened in accordance with the procedures determined by the law that regulates the relevant type of entrepreneurial activity and by the articles of association of the company. A re-convened meeting (general meeting) shall be entitled to make decisions, without application of the provisions of the law and the articles of association regarding the necessary quorum and qualified majority. In amending the articles of association, the scope of rights of the shareholders (stockholders) of the company shall not be changed.

(3) Applications for recording in the Commercial Register shall be signed by natural persons, who themselves apply for the recording as individual merchants in the Commercial Register, but on behalf of a company by persons with representation rights (Sections 91., 223., 303 of The Commercial Law), and in such cases the provisions of Section 10, Paragraph two of The Commercial Law shall not be applied.

(4) Each shareholder (stockholder) of a company, whose rights have been substantially infringed and whose vote might decide the results of voting, may contest the decision referred to in Paragraph two of this Section in court if the provisions of the laws regulating the relevant type of entrepreneurial activity regarding convening of meetings (general meetings) of shareholders (stockholders) or the procedures for decision-taking have been violated.

(5) The action referred to in Paragraph four of this Section may be brought to court within one month of the date of taking the decision or, if the procedures for convening of the meeting have been violated - from the date when the shareholder (stockholder) has become aware or should have become aware of the decision, but not later than within six months of the date of taking the decision.

(6) If a merchant to be recorded in the Commercial Register is registered in the Enterprise Register, then as of the moment of making such record the merchant shall be excluded from the Enterprise Register. A relevant record thereof shall be made in the Enterprise Register.

(7) The registration certificate issued by the Commercial Register shall be a document, on the basis of which amendments are made in relevant registers and other documents in accordance with the procedures determined by law.

Section 6. Law Applicable During the Transitional Period

(1) The laws regulating the activities of the relevant type of entrepreneurial activity shall be applied to activities and liquidation of undertakings (companies), branches, divisions and representation offices registered in the Enterprise Register until their recording in the Commercial Register, unless provided otherwise by this Law.

(2) Provisions of The Commercial Law shall be applied to the entities of commercial activities that are recorded in the Commercial Register.

Section 7. State Fee for Re-registration

(1) The State fee for the recording in the Commercial Register of undertakings (companies), branches, divisions or representation offices that are registered in the Enterprise Register shall be determined by the Cabinet.

(2) The State fee for the recording of amendments in other registers and the issuance of new documents [including special permits (licences)], that are related to recording in the Commercial Register the undertakings (companies), branches, divisions or representation offices registered in the Enterprise Register, shall be determined by the Cabinet.

(3) The amount of the State fee determined in Paragraphs one and two of this Section shall not exceed the administrative expenses related to the making of the relevant record and issuance of documents, as well as the amount of the State fee determined for the registration of relevant amendments until the date of coming into force of The Commercial Law.

Section 8. Firm Names

(1) Until 31 December 2003 recording of a firm name in the Commercial Register is permitted (Section 26, Paragraph two of The Commercial Law), without application of the provisions of Section 28 of The Commercial Law if the name (firm name) of the relevant undertaking (company) has been registered in the Enterprise Register up to the day of the coming into force of The Commercial Law. Firm names of commercial companies or individual merchants established in accordance with The Commercial Law as coincide with the name (firm name) of an undertaking (company) that has been registered in the Enterprise Register shall not be recorded in the Commercial Register.

(2) In applying Section 29, Paragraphs three and four of The Commercial Law regarding restrictions on the inclusion in firm names of the word "Latvija" [Latvia] and the names of other administrative territories or populated areas and their translations into foreign languages, rights to the firm name that have been acquired prior to the coming into force of The Commercial Law shall not be infringed.

(3) The Enterprise Register of the Republic of Latvia shall publish, by 1 April 2002, in the newspaper Latvijas Vēstnesis [official Gazette of the Government of Latvia] the list of such undertakings (companies) as have been registered in the Enterprise Register with an identical name (firm name).

(4) In the case if identical firm names are recorded in the Commercial Register priority right to the firm name shall be determined depending on the moment when such firm name was registered in the Enterprise Register. Rights to the protection of firm names (Section 33 of The Commercial Law) resulting from such priority right arise after the recording of merchants in the Commercial Register, insofar as earlier protection of rights in respect of firm names does not derive from the Law on Trademarks and Geographical Indications.

(5) Priority right to the firm name may be transferred to other merchants [undertakings (companies)], by entering into a notarised agreement regarding such transfer.

(6) Undertakings (companies) shall lose the priority right to the firm name if they have not submitted, within a period of one year and a half from the day of the coming into force of The Commercial Law, an application for recording in the Commercial Register.

(7) In cases when a person having a priority right to the firm name cannot be reached at the legal address, the priority right to the firm name may be extinguished by judicial process in accordance with the procedures specified in the Civil Procedure Law, if at the request of a court within a period of three months no person has declared his or her right.

(8) If after 31 December 2003 several merchants with identical firm names are recorded in the Commercial Register, the Commercial Register Office shall bring an action in court regarding the change of a firm name against those merchants that do not have the priority right to the firm name (Paragraph four of this Section).

Section 9. Limited Liability Companies and Stock Companies

(1) Limited liability companies and stock companies registered in the Enterprise Register shall until 31 December 2004 apply for recording in the Commercial Register or, in accordance with a decision of the meeting (general meeting) of the shareholders (stockholders), the liquidation of such companies shall be commenced, applying it for registration in the Enterprise Register.

(2) In the application for recording in the Commercial Register the information provided for in Section 8 of The Commercial Law, as well as the registration number in the Enterprise Register shall be specified and the decision of the meeting (general meeting) of shareholders (stockholders) regarding recording of the company in the Commercial Register (Section 5, Paragraph two of this Law) and the necessary documents (Section 9 and Section 187, Paragraph six of The Commercial Law) shall be appended to the application if such documents have not been submitted to the Enterprise Register of the Republic of Latvia, or if the documents submitted to the Enterprise Register of the Republic of Latvia do not conform to the provisions of The Commercial Law.

(3) Stock companies are permitted to be restructured into limited liability companies in conformity with the provisions of The Commercial Law and to apply for recording in the Commercial Register. The provisions of The Commercial Law shall be applied to such reorganisation. Reorganisation in the process of privatisation shall take place in accordance with the provisions of Section 27 of this Law.

(4) Until the recording in the Commercial Register reserve stocks of the board of directors shall be convertible. Such stocks shall be repurchased by the company from the members of the board, if they do not wish to keep the stocks for themselves. Such activities shall be performed without releasing the members of the board from liability and the approval of the annual accounts. In State and local government stock companies reserve stocks of the board of directors shall be repurchased by the company.

(5) Meetings of shareholders of limited liability companies, in which amendments to the articles of association are adopted, shall perform all necessary activities so that the articles of association and the administrative bodies of the company fully conform to the provisions of The Commercial Law, and shall submit an application for the recording of the company in the Commercial Register concurrently with the amendments to the articles of association. Until the recording of a limited liability company in the Commercial Register, amendments to the articles of association of the company shall not be registered in the Enterprise Register. These provisions shall not apply to cases if the relevant meeting of shareholders has taken place before 1 July 2003.

Section 10. Business Partnerships

(1) Business partnerships shall apply for recording in the Commercial Register until 31 December 2004 or, in accordance with a decision of the shareholders, the liquidation of such partnerships shall be commenced, applying it for registration in the Enterprise Register.

(2) In the application for the recording of a business partnership in the Commercial Register the information provided for in Section 8 of The Commercial Law, as well as the registration number in the Enterprise Register shall be specified.

(3) After the recording of a business partnership in the Commercial Register the following provisions shall be observed:

1) if on the day of recording the business partnership in the Commercial Register the period of limitation provided for in Section 13 of the Law On Business Partnerships has not expired, the period of limitation, including the time expired, provided for in The Civil Law or other laws shall be applied;

2) the time period provided for in Section 117 of The Commercial Law shall be applied in cases when a shareholder of a business partnership (member of a partnership) withdraws from the business partnership (partnership) after the recording of the partnership in the Commercial Register; and

3) the provisions of Sections 15 and 16 of the Law On Business Partnerships shall be applied to the obligations that have arisen prior to the recording of the partnership in the Commercial Register.

Section 11. Companies with Supplemental Liability

(1) Companies with supplemental liability shall be restructured into capital companies with supplemental liability until 31 December 2004 and shall apply for recording in the Commercial Register or, in accordance with a decision of the shareholders, the liquidation of such companies shall be commenced, applying it for registration in the Enterprise Register.

(2) For the recording of companies with supplemental liability in the Commercial Register provisions of Section 9, Paragraph two of this Law shall be applied, but for the restructuring, provisions of The Commercial Law shall be applied.

Section 12. State and Local Government Undertakings

(1) The State or local government undertakings shall be restructured into capital companies and apply for recording in the Commercial Register until 31 December 2003 in accordance with an order of the Cabinet or a decision of the local government city or county council (parish or district council) respectively, in conformity with the provisions of the Law On Restructuring of State and Local Government Undertakings into Incorporated Companies, or the liquidation of such undertakings shall be commenced, applying it for registration in the Enterprise Register.

(2) Documents referred to in Section 9, Paragraph two of the Law On Restructuring of State and Local Government Undertakings into Incorporated Companies, as well as the documents referred to in Section 149, Paragraph three, Clauses 4 (if the company has a council), 5, 6 and 7 of The Commercial Law shall be appended to the application if such documents have not already been submitted to the Enterprise Register of the Republic of Latvia.

(3) The State undertakings may be restructured into the State institutions until 31 December 2003, in accordance with an order of the Cabinet. In such case all the property of the State undertaking shall be transferred to the State. The established State institution shall be a successor in rights and obligations of the State undertaking.

(4) Local government undertakings may be restructured into the local government institutions until 31 December 2003, in accordance with a decision of the local government city or county council (parish or district council). In such case all the property of the local government undertaking shall be transferred to the local government. The established local government institution shall be a successor in rights and obligations of the local government undertaking.

Section 13. Co-operative Share Companies

(1) Co-operative share companies shall be restructured into commercial companies and apply for recording in the Commercial Register until 31 December 2004 or, in accordance with a decision of the meeting of the shareholders the liquidation of such companies shall be commenced, applying it for registration in the Enterprise Register.

(2) Restructuring of co-operative share companies shall be performed in accordance with the procedures determined by Sections 337, 339, 340-343, 345, 346; Section 348, Paragraphs three and four; Section 349, Paragraph four; Section 350, Paragraph one, the first sentence of Paragraph four, and Paragraphs five and seven; Section 351, Paragraph one; Sections 352, 357, 358, and Section 360, Paragraph one of The Commercial Law.

Section 14. Undertakings of Public and Religious Organisations

(1) Undertakings of public or religious organisations shall be restructured into capital companies and apply for recording in the Commercial Register until 31 December 2004 or, in accordance with a decision of the relevant organisation, the liquidation of such undertakings shall be commenced, applying it for registration in the Enterprise Register.

(2) For the restructuring of undertakings of public and religious organisations provisions of Section 13, Paragraph two of this Law shall be applied respectively.

Section 15. Undertakings of Companies

(1) Undertakings of companies, which do not have the status of a legal person shall be excluded from the Enterprise Register.

(2) Undertakings of companies, which undertakings have the status of a legal person, shall be liquidated and in accordance with a decision of an official of the Commercial Register Office shall be excluded from the Enterprise Register (Section 19).

(3) Upon exclusion of the owner of the undertaking of a company from the Enterprise Register, the relevant undertaking shall be excluded concurrently.

Section 16. Branches and Representation Offices

(1) A branch that is registered in the Enterprise Register shall apply for recording in the Commercial Register concurrently with the application regarding the recording of the merchant in the Commercial Register or, in accordance with a decision of its owner, shall be closed.

(2) In order to record a branch in the Commercial Register, an application shall be submitted to the Commercial Register Office, in which the information provided for in Section 8 or Section 23 or 25 respectively of The Commercial Law, as well as the registration number in the Enterprise Register shall be specified.

(3) If the branch has the status of a legal person, in case of failure to fulfil the provisions referred to in Paragraph one of this Section the branch shall be excluded from the Enterprise Register (Section 19), but if the branch does not have the status of a legal person, then after 31 December 2004 the branch shall be considered to be non-existent and, in accordance with a decision of an official of the Commercial Register Office, shall be excluded from the Enterprise Register.

4) Representation offices of undertakings (companies) that are registered in the Enterprise Register shall apply for recording in the Commercial Register as branches until 31 December 2004 or, in accordance with a decision of their owner, shall be closed. If these activities have not been performed, then after 1 January 2005 the representation office, in accordance with a decision of an official of the Commercial Register Office, shall be excluded from the Enterprise Register.

(5) In order for a representation office of an undertaking (company) that is registered in the Enterprise Register to apply for recording as a branch in the Commercial Register, an application shall be submitted to the Commercial Register Office in conformity with Section 23 of The Commercial Law, in addition specifying the registration number of the representation office in the Enterprise Register.

(6) The branch of an undertaking (company) that is registered in the Enterprise Register may not be recorded in the Commercial Register if its owner is not recorded in the Commercial Register.

(7) Upon exclusion of the owner of the branch or representation office from the Enterprise Register, the relevant branch or representation office shall be excluded concurrently.

(8) Permanent representation offices of foreign merchants performing commercial activities shall apply for recording as branches in the Commercial Register until 31 December 2004 or shall be restructured into capital companies and apply for recording in the Commercial Register or, in accordance with a decision of their owners, the liquidation of such representation offices shall be commenced, applying it for registration in the Enterprise Register.

(9) In order for a permanent representation office to apply for recording as a branch in the Commercial Register, an application shall be submitted to the Commercial Register Office in conformity with Section 25 of The Commercial Law, in addition specifying the registration number of such representation office in the Enterprise Register, and the documents referred to in Section 25 of The Commercial Law shall be appended to the application if such documents have not been submitted to the Enterprise Register of the Republic of Latvia.

(10) For the restructuring of permanent representation offices of foreign merchants into capital companies the provisions of Section 13, Paragraph two of this Law shall be applied respectively.

Section 17. Individual (Family) Undertakings, Farms and Fishing Undertakings, and Persons Carrying out Independent Work

(1) Individual (family) undertakings, farms and fishing undertakings, as well as persons carrying out individual work until the date of coming into force of the law regulating trade activities shall act in conformity with the law, in accordance with which they have been established, taking into account the exceptions specified in this Section.

(2) The owners of such individual undertakings as conform to the criteria prescribed in Section 75, Paragraph one of The Commercial Law shall until 31 December 2004 apply themselves for recording as individual merchants in the Commercial Register or shall restructure the individual undertakings into commercial companies, or, in accordance with their own decision, shall commence the liquidation of such undertakings, by applying it for registration in the Enterprise Register. In case of failure to fulfil these provisions, the undertaking, in accordance with a decision of an official of the Commercial Register Office, shall be excluded from the Enterprise Register (Section 19).

(3) The provision of Paragraph two of this Section shall not be applied to farms and fishing undertakings, as well as to the individual undertakings whose principal type of operation are craft activities within the meaning of Section 1 of the Law On Craft Activities.

(4) Family undertakings shall be restructured into commercial companies until 31 December 2004 or, in accordance with a decision of their owners, the liquidation of such undertakings shall be commenced, applying it for registration in the Enterprise Register. In case of failure to fulfil with these provisions, the family undertaking, in accordance with a decision of an official of the Commercial Register Office, shall be excluded from the Enterprise Register (Section 19).

(5) The application for the registration in the Commercial Register shall be drawn up in conformity with the provisions of Section 75, Paragraph three of The Commercial Law, in addition specifying the registration number in the Enterprise Register.

(6) The owners of individual undertakings, farms and fishing undertakings may restructure their undertakings into commercial companies or apply themselves as individual merchants also in the case if the relevant undertaking does not conform to the criteria determined in Section 75, Paragraph one of The Commercial Law.

(7) The person that has acquired the status of an individual merchant in accordance with the procedures of this Section or the restructured commercial company shall be a successor in rights and obligations of the undertaking. The person that has acquired the status of an individual merchant or the restructured commercial company shall retain all the preferences and guarantees granted to such undertaking by law or on the basis of law. This provision shall not affect the application of the relevant law or other regulatory enactments.

(8) For the restructuring of individual undertakings into capital companies the provisions of Section 13, Paragraph two of this Law shall be applied respectively.

(9) The same natural person may not concurrently be an individual merchant recorded in the Commercial Register and the owner of an individual undertaking, farm or fishing undertaking registered in the Enterprise Register.

(10) Natural persons or owners of individual undertakings the activities of whom conform to the provisions referred to in Section 45 or 64 of The Commercial Law shall apply themselves for recording in the Commercial Register as individual merchants, without regard to the criteria prescribed in Section 75, Paragraph one of The Commercial Law, or shall establish a commercial company in accordance with the provisions of The Commercial Law.

Section 18. Examination of Applications after the Expiry of the Time Period for their Submission

(1) If the application for the recording in the Commercial Register has been submitted within the time period specified in this Chapter, but upon the expiry of this time period the Commercial Register Office has not yet examined such application, the provisions regarding termination of activities and exclusion from the Enterprise Register (Section 19) shall be applied as of the next day after a decision regarding refusal has been taken. If a decision regarding postponement of making a record has been taken, the provisions of Paragraph two of this Section shall be applied.

(2) If the time period specified in this Chapter for the submission of applications for the recording in the Commercial Register expires before the time period specified in the decision of an official of the Commercial Register Office regarding postponement of making a record in order to eliminate deficiencies, the provisions regarding termination of activities and exclusion from the Enterprise Register (Section 19) shall be applied as of the next day after:

1) the time period specified in the decision has expired if within such time period the corrected documents have not been submitted; or

2) a decision regarding refusal has been taken if the submitted documents repeatedly do not conform to the provisions of the Law.

(3) In the cases referred to in Paragraph two of this Section a repeat decision regarding postponement of making a record is not permitted.

Section 19. Termination of Activities of Undertakings (Companies), Branches, Divisions and Representation Offices, and their Exclusion from the Enterprise Register

(1) If an undertaking (company), branch, division or representation office has not applied for recording in the Commercial Register in conformity with the provisions of this Chapter and a decision regarding liquidation of such undertaking (company), branch, division or representation office has not been taken, it shall be liquidated in accordance with the procedures determined in this Section.

(2) As of the next day after the expiry of the relevant time period referred to in this Chapter, the undertaking (company), branch, division or representation office shall be deemed to have terminated its activities. The Commercial Register Office shall publish the list of such entities in the newspaper Latvijas Vēstnesis, specifying:

1) registration number and name (firm name); and

2) that within three months of the date of the publication a notification regarding claims shall be made (Paragraph three of this Section).

(3) Within three months from the day of the publication all the creditors of the relevant undertaking (company), branch, division or representation office and the tax administration may notify the Commercial Register Office of their material claims against the undertaking (company), branch, division or representation office.

(4) If within the time period referred to in Paragraph three of this Section the Commercial Register Office has not received any notifications regarding claims and no commercial pledges are registered in the register of commercial pledges, the undertaking (company), branch, division or representation office, shall be excluded from the Enterprise Register in accordance with a decision of an official of the Commercial Register Office.

(5) Property left after the exclusion of the undertaking (company), branch, division or representation office from the Enterprise Register shall be as comparable to property without heirs in conformity with the provisions of Section 417 of The Civil Law.

(6) If within the time period referred to in Paragraph three of this Section the Commercial Register Office has received a notification regarding claims, then as of the next day after the expiry of such time period the undertaking (company), branch, division or representation office shall not be entitled to perform commercial activities. In such case the continuation of the activities shall be deemed to be commercial activities without registration and, for violation of these provisions, persons at fault shall be held liable as prescribed by law.

Chapter III
Special Provisions

Section 20. Liability Matters of Capital Companies

(1) If an undertaking (company), branch, division or representation office registered in the Enterprise Register is recorded in the Commercial Register as a capital company, then as of the day of its recording in the Commercial Register, in applying the provisions of Chapter 4, Division 11 of The Commercial Law, also the provisions of this Section shall be observed.

(2) The provisions of Section 184 of The Commercial law shall be applied to transactions of property acquisition if such transactions are concluded after the recording of the company in the Commercial Register and if two years have not elapsed since the date of registration of such company in the Enterprise Register.

(3) If on the day of the registration of the company in the Commercial Register, the period of limitation determined in The Civil Law or other laws has not expired, but The Commercial Law specifies:

1) a longer period - the period of limitation determined by The Commercial Law, including the time expired, shall be applied; or

2) a shorter period - the period of limitation determined by The Commercial Law shall be applied, which period shall be counted from the day of the registration of the company in the Commercial Register. If in conformity with such calculation the period of limitation is longer than the existing period of limitation, it shall expire on the day, when it should have expired in accordance with The Civil Law or other regulatory enactments.

Section 21. Minimum Amount of Equity Capital for Specific Stock Companies

(1) The minimum amount of equity capital to be paid before the establishment shall be as follows:

1) for life insurance stock companies - 1 000 000 lati, for other insurance companies - 500 000 lati;

2) for exchange stock companies - 100 000 lati; and

3) for pawnshop companies - 25 000 lati.

(2) The minimum amount of equity capital to be paid within the time period of five years after the date of the establishment of the stock company shall be as follows:

1) for life insurance stock companies - 2 000 000 lati, for other insurance companies - 1 000 000 lati;

2) for exchange stock companies - 250 000 lati; and

3) for pawnshop companies - 50 000 lati.

Section 22. Co-operative Societies and their Unions

(1) Co-operative societies may be restructured into capital companies. The provisions of Section 13, Paragraph two of this Law shall be applied in such case.

(2) The general meeting of the members of a co-operative society (meeting of authorised persons), when taking a decision regarding reorganisation, shall approve also the articles of association of the relevant capital company (the acquiring company). The articles of association shall be signed by the executive board of the acquiring company.

(3) If the articles of association of the co-operative company provide that a decision regarding reorganisation shall be taken by the meeting of authorised persons, such decision shall replace the decision of the general meeting of the members. In such case the members of the co-operative society are entitled to notify in writing the co-operative society that they do not agree to the reorganisation within one month after the publication provided for in Section 345, Paragraph two of The Commercial Law. In such case the members of the co-operative society shall acquire the rights provided for in Section 353 of The Commercial Law.

Section 23. Uncompleted Liquidation Proceedings

(1) Liquidation proceedings of undertakings (companies), branches, divisions and representation offices that have been commenced and have applied to the Enterprise Register until the day of coming into force of The Commercial Law shall be completed by 31 December 2004, by applying it for registration in the Enterprise Register.

(2) The liquidation proceedings commenced in accordance with Chapter II of this Law on the basis of a decision of the meeting (general meeting) of the shareholders (stockholders) or a decision of the owner shall be completed by 31 December 2004, by applying it for registration in the Enterprise Register.

(3) Such provisions of the laws and articles of association shall be applied to the liquidation procedures referred to in Paragraph one and two of this Section as were in force on the day when the decision regarding liquidation was taken.

(4) If the liquidation proceedings have not been completed within the time periods referred to in Paragraph one and two of this Section, then as of the next day after the expiry of the time period such undertakings (companies), branches, divisions or representation offices shall not be entitled to perform economic activities and for violations of these provisions shall be held liable for performing economic activities without registration as prescribed by law.

Section 24. Commenced Insolvency Proceedings

(1) Undertakings (companies) registered in the Enterprise Register that do not conform to the provisions of The Commercial Law according to the type of entrepreneurial activity and have been declared insolvent by 31 December 2004, are entitled to retain the existing type of entrepreneurial activities, except in the case provided for in Paragraph two of this Section during the whole time of insolvency proceedings until the termination of the bankruptcy procedure.

(2) Insolvency proceedings of the undertakings (companies) referred to in Paragraph one of this Section may be terminated otherwise than by the termination of the bankruptcy procedure only in the case if the relevant undertaking (company) has been previously restructured into a type of a merchant provided for in The Commercial Law. Provisions of The Commercial Law apply to such restructuring.

Section 25. Non-profit-making Organisations

(1) Undertakings (companies) registered in the Enterprise Register, which have been established as non-profit-making organisations, shall continue to perform activities in conformity with the laws, in accordance with which they have been established after the coming into force of The Commercial Law and until the adoption or relevant laws.

(2) The entities referred to in Paragraph one of this Section may be restructured into public organisations, without the alienation of reserve funds.

(3) The State undertakings (companies) that have been established as non-profit-making organisations may be restructured into the State institutions until 31 December 2003, by an order of the Cabinet and in accordance with the prescribed procedures. In such case all the property of the State non-profit-making organisation shall be transferred to the State. The established State institution shall be a successor in rights and obligations of the State non-profit-making organisation.

(4) Local government undertakings (companies) that have been established as non-profit-making organisations, until 31 December 2003 by a decision of the local government city or county council (parish or district council) and in accordance with the prescribed procedures may be restructured into the local government institutions. In such case all the property of the local government non-profit-making organisation shall be transferred to the relevant local government. The established local government institution shall be a successor in rights and obligations of the local government non-profit-making organisation.

(5) Granting of the status of a non-profit-making organisation to the merchants recorded in the Commercial Register is not permitted.

Section 26. Lease and Lease with Option to Purchase of State and Local Government Undertakings

(1) After the coming into force of The Commercial Law entering into new contracts of lease and lease with an option to the purchase of the State and local government undertakings is not permitted.

(2) If the time period of the contract of lease or lease with an option to the purchase of the State and local government undertakings expires before 31 December 2004, extension of the time period of the contract is not permitted.

(3) If the time period of the contract of lease or lease with an option to the purchase of the State or local government undertakings expires before 1 April 2002, extension of the time period of the contract is permitted for a time period not longer than until 31 December 2004. After this date extension of the time period of the contract is not permitted.

(4) If the time period of a lease contract or lease contract with an option to the purchase of the State or local government undertakings in conformity with the provisions of the contract expires after 31 December 2004, the contract shall terminate on 31 December 2004 or it shall be renewed into a contract of property lease or lease with an option to purchase in conformity with the provisions of The Civil Law.

Section 27. Privatisation of Objects of State and Local Government Property

(1) If objects of the State or local government property are privatised utilising the reorganisation method referred to in Section 2, Paragraph two, Clause 5 of the Law On Privatisation of Objects of State and Local Government Property, then:

1) in such a privatisation process only limited liability companies, stock companies and companies with supplemental liability may be involved;

2) reorganisation shall be performed in accordance with the provisions of The Commercial Law; and

3) the companies involved in such privatisation process shall be recorded in the Commercial Register prior to taking the decision regarding reorganisation referred to in Section 343 of The Commercial Law.

(2) If objects of the State or local government property are privatised utilising the privatisation method referred to in Section 3, Paragraph three, Clause 5 of the Law On Privatisation of Objects of State and Local Government Property, then:

1) the State or local government undertakings may be restructured only into limited liability companies or stock companies which act in accordance with the provisions of The Commercial Law; and

2) restructuring of the State or local government undertakings shall take place in accordance with the procedures provided for in Chapter 2 of the Law On Restructuring of State and Local Government Undertakings into Incorporated Companies.

(3) If the privatisation regulations of a State undertaking or the privatisation project of a local government undertaking, which project provides that an incorporated company shall be privatised utilising the method referred to in Paragraph two of this Section, are approved until the date of coming into force of The Commercial Law, such privatisation may be carried out by applying the provisions of such laws as were in force on the day of approval of the privatisation regulations or the privatisation project if the company that is established as a result of privatisation is registered in the Enterprise Register by 1 October 2003.

(4) If the State capital share has been transferred for privatisation prior to the coming into force of The Commercial Law and reorganisation of a limited liability company into a stock company is provided for in the conditions of the privatisation of such object, which conditions are regulated by the Cabinet in accordance with Section 12 of the Law On Privatisation of Objects of State and Local Government Property, such reorganisation shall take place in conformity with the requirements of the Law On Entrepreneurial Activity and the Law On Limited Liability Companies.

(5) If the contract, in accordance with which a State or local government undertaking intended for privatisation was sold, is terminated, the activities of such undertaking shall not be renewed, but on its basis a capital company shall be established.

Section 28. Retaining of Relief for Undertakings with Foreign Investments

(1) Undertakings with foreign investments, which are entitled to utilise tax relief in conformity with the Law On Foreign Investments in the Republic of Latvia, shall continue to utilise such relief in conformity with the provisions that were in force until the day of coming into force of The Commercial Law.

(2) The maximum period for the utilisation of the relief referred to in Paragraph one of this Section shall be 31 December 2005.

Transitional Provisions

1. The following are repealed on 1 January 2005:

1) the Law On Entrepreneurial Activity (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1990, No. 42; 1991, No. 27/28; 1992, No. 22/23; 1993, No. 3/4; 12/13, 18/19, 20/21, 22/23; Latvijas Republikas Saeimas un Ministru Kabineta Ziņotājs, 1994, No. 6, 14; 1995, No. 10, 24; 1996, No. 21; 1997, No. 13; 1998, No. 1; 2000, No. 10, 13);

2) the Law On Business Partnerships (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1991, No. 11/12; Latvijas Republikas Saeimas un Ministru Kabineta Ziņotājs, 1996, No. 22);

3) the Law On Limited Liability Companies (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1991, No. 9/10, 23/24; 1992, No. 22/23; Latvijas Republikas Saeimas un Ministru Kabineta Ziņotājs, 1995, No. 3; 1996, No. 21; 1997, No. 13; 2000, No. 10; 2001, No. 14);

4) the Law On Stock Companies (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1993, No. 24/25; Latvijas Republikas Saeimas un Ministru Kabineta Ziņotājs, 1994, No. 17; 1995, No. 3, 20; 1996, No. 21; 1997, No. 13; 1998, No. 7; 1999, No. 18; 2000, No. 2, 10, 13; 2001, No. 14);

5) the Law On Foreign Investments in the Republic of Latvia (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1991, No. 46; 1993, No. 10/11; Latvijas Republikas Saeimas un Ministru Kabineta Ziņotājs, 1994, No. 13; 1995, No. 9; 1996, No. 19);

6) the Law On Restructuring of State and Local Government Undertakings into Incorporated Companies (Latvijas Republikas Saeimas un Ministru Kabineta Ziņotājs, 1996, No. 16; 2000, No. 2);

7) the Law On the Administration of Shares of the State and Local Government Capital in Companies (Latvijas Republikas Saeimas un Ministru Kabineta Ziņotājs, 1996, No. 16; 1997, No. 3, 22; 1996, No. 15; 2001, No. 1);

8) the Law On Co-operative Share Companies (Latvijas Republikas Saeimas un Ministru Kabineta Ziņotājs, 1996, No. 22; 2000, No. 10);

9) the Law On State Undertakings (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1992, No. 29/31; 1993, No. 23/22; Latvijas Republikas Saeimas un Ministru Kabineta Ziņotājs, 1994, No. 17; 1996, No. 1, 13; 2001, No. 14);

10) the Law On Local Government Undertakings (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1991, No. 17/18; Latvijas Republikas Saeimas un Ministru Kabineta Ziņotājs, 1994, No. 3; 1996, No. 22);

11) the Law On Lease and Lease with an Option to Purchase of State and Local Government Undertakings (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1993, No. 8/9; Latvijas Republikas Saeimas un Ministru Kabineta Ziņotājs, 1996, No. 21);

12) the Law On Privatisation of Agricultural Undertakings and Collective Fisheries (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1991, No. 31/32; 1992, No. 39/40/41; 1993, No. 5/6; Latvijas Republikas Saeimas un Ministru Kabineta Ziņotājs, 1996, No. 1, 22; 1998, No. 1);

13) the 5 March 1992 decision of the Presidium of the Supreme Council of the Republic of Latvia On The Approval of State Capital Share in Specialised Agricultural Undertakings (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1992, No. 13);

14) the 12 August 1992 decision of the Presidium of the Supreme Council On Specific Privatisation Nature of Collective Fisheries (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1992, No. 35;

15) the 7 May 1992 decision of the Presidium of the Supreme Council On the Application of Section 19 of the Republic of Latvia Law of 21 June 1991 On Privatisation of Agricultural Undertakings and Collective Fisheries (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1992, No. 22);

16) the 9 January 1992 decision of the Presidium of the Supreme Council On the Application of Specific Sections of the Republic of Latvia Law of 21 June 1991 On Privatisation of Agricultural Undertakings and Collective Fisheries (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1992, No. 6);

17) the 3 December 1991 decision of the Presidium of the Supreme Council On Approval of the List of Specialised State Agricultural Undertakings Temporarily not Under Privatisation (not published);

18) the 24 October 1991 decision of the Presidium of the Supreme Council On Approval of the List of Specialised State Agricultural Undertakings and Specific Privatisation Nature of Such Undertakings (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1991, No. 45);

19) the 26 September 1991 decision of the Presidium of the Supreme Council On the Application of Specific Sections of the Republic of Latvia Law of 21 June 1991 On Privatisation of Agricultural Undertakings and Collective Fisheries (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1991, No. 41);

20) the 9 May 1991 decision of the Presidium of the Supreme Council On Approval of the List of Selection, Experimental, Scientific Research, Educational and Individual Specialised State Farms (not published);

21) the 11 February 1993 decision of the Presidium of the Supreme Council On the Application of Specific Sections of the Republic of Latvia Law of 21 June 1991 On Privatisation of Agricultural Undertakings and Collective Fisheries (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1993, No. 8);

22) the 9 June 1993 decision of the Presidium of the Supreme Council On Amendments in the 9 May 1991 Decision of the Presidium of the Supreme Council of the Republic of Latvia On Approval of the List of Selection, Experimental, Scientific Research, Educational and Individual Specialised State Farms (Latvijas Vēstnesis, 1993, No. 45);

23) the 12 December 1991 decision of the Presidium of the Supreme Council On Privatisation Commission of Agricultural Undertakings (not published); and

24) the 17 December 1991 decision of the Supreme Council On The Procedures by which Credits of Privatised Agricultural Undertakings and Collective Fisheries are Extinguished from the Budget of the Republic of Latvia (Latvijas Republikas Augstākās Padomes un Valdības Ziņotājs, 1992, No. 4).

2. The following Cabinet regulations issued pursuant to Section 32 of the Law On Entrepreneurial Activity shall be in force until 31 December 2004 if new Cabinet regulations have not been adopted in lieu of them:

1) Cabinet Regulation No. 312 of 31 October 1995, Regulations On Distribution and Public Demonstration of Films (Latvijas Vēstnesis, 1995, No. 172; 1996, No. 330);

2) Cabinet Regulation No. 261 of 16 July 1996, Procedures Regarding Purchase, Sale and Export of Ferrous and Non-ferrous Metal Waste and Scrap (Latvijas Vēstnesis, 1996, No. 123; 1998, No. 265);

3) Cabinet Regulation No. 444 of 3 December 1996, Regulations Regarding Calculation of Licence Fees for Energy Supply Undertakings (Companies) (Latvijas Vēstnesis, 1996, No. 211; 1998, No. 265/266); and

4) Cabinet Regulation No. 348 of 7 October 1997, Regulations Regarding Licensing of Certain Types of Entrepreneurial Activities (Latvijas Vēstnesis, 1997, No. 260/262, 334/335; 1998, No. 58/59, 147/149, 289/290, 367/368; 1999, No. 1, 64/65, 75/78, 167/168, 198/199; 2000, No. 109/110, 180/181, 307/309).

3. The Ministry of Justice shall develop and publish by 1 February 2002 in the newspaper Latvijas Vēstnesis models of the articles of association of capital companies, which shall be utilised for the preparation of the articles of association of merchants for the registration in the Commercial Register.

4. The Cabinet shall by 31 December 2002 develop and submit to the Saeima draft laws regarding associations and foundations, trade activities, insolvency, administration of the State and local government capital shares in capital companies, as well as develop and submit projects regarding the necessary amendments in other laws.

This Law comes into force on 1 January 2002.

This Law has been adopted by the Saeima on 20 December 2001.

Acting for the President,
Chairperson of the Saeima J. Straume

Rīga, 28 December 2001

 


1 The Parliament of the Republic of Latvia

Translation © 2002 Tulkošanas un terminoloģijas centrs (Translation and Terminology Centre)

 
Document information
Status:
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in force
Issuer: Saeima Type: law Adoption: 20.12.2001.Entry into force: 01.01.2002.Theme:  Commercial rightsPublication: Latvijas Vēstnesis, 188, 28.12.2001.; Latvijas Republikas Saeimas un Ministru Kabineta Ziņotājs, 2, 24.01.2002.
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