Restructuring across borders: Latvia

The factsheet provides an overview of corporate restructuring and insolvency procedures in Latvia, primarily governed by the Insolvency Law enacted in 2010 and amended multiple times since. It outlines the three main insolvency and restructuring regimes for companies:

1) Corporate Insolvency Proceedings – A terminal procedure initiated when a company is unable to meet its financial obligations, leading to liquidation and asset distribution.

2) Legal Protection Proceedings – A mechanism allowing financially troubled but viable companies to restructure debts and continue operations under a court-approved plan.

3) Voluntary Liquidation – A process for solvent companies to wind up operations, governed by the Commercial Law of 2000.

Key principles governing these processes include creditor rights retention, transparency, efficiency, and fair treatment of all creditors. The factsheet also highlights EU regulations impacting Latvia’s insolvency framework, including Regulation (EU) 2015/848 and Directive (EU) 2019/1023, which aim to enhance restructuring effectiveness.

The factsheet prepared by A&O Shearman experts and Ellex associate partner Maris Brizgo is available here.