Setting up a joint stock company (JSC) in Latvia has a similar procedure as for a limited liability company (LLC). The difference between the two entities is that the JSC is a public entity where shares can be traded publicly. A joint stock company in Latvia has various business activities, such as banking, insurance, or non-bank lending. Below you can find relevant guidance in this matter offered by our specialized company formation agents in Latvia.
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Key requirements for setting up a joint stock company in Latvia
There are certain aspects to consider before starting a company in Latvia and the JSC has some specific requirements to observe:
- Share capital: the minimum share capital required for opening a joint stock company in Latvia is €35,000. This capital must be fully subscribed and deposited before the company can be officially registered.
- Legal address: the company must have its legal address within the Republic of Latvia. This address will be used for all official correspondence and documentation related to the company.
- Legal status: a joint stock company in Latvia is recognized as a legal entity under Latvian law, meaning it can engage in all business activities permitted by law. However, for certain industries, the company may need to obtain a specific license before starting operations.
- Liability: a JSC in Latvia is legally responsible for its debts and obligations up to the value of its assets. Shareholders, on the other hand, are not personally liable for the company’s debts. Similarly, the company has no responsibility for the personal obligations of its shareholders.
- Company representation: the JSC in Latvia is represented by the board members, who have the authority to make decisions on behalf of the company in legal matters.
Setting up a company in Latvia might seem difficult at first, but the process is easy to follow with professional support. You can rely on our company formation specialists in Latvia for more information on the requirements of opening a joint stock company in Latvia.
JSC registration process in Latvia
The process of registering a joint stock company in Latvia involves the following steps:
- Gathering required information: collect all the necessary details for company registration, including founder and director information, business activity, and share capital;
- Preparation of founding documents: draft and prepare the company’s founding documents, including the Articles of Association;
- Notarization of documents: founding documents must be signed and notarized;
- Opening a temporary bank account: A temporary bank account is required to deposit the company’s share capital;
- Payment of fees: the company formation and publication fees must be paid;
- Submission to the register of enterprises: the completed documents are submitted to the Register of Enterprises of the Republic of Latvia for official registration;
- Final registration: once the company is registered, the founders will receive the official documents confirming the establishment of the company.
Company formation in Latvia is based on the republic’s laws and regulations. Get relevant assistance from our specialized agents in Latvia in order to make the process as efficient as possible.
Documents required for opening a JSC in Latvia
To set up a joint stock company in Latvia, the following documents must be submitted to the Register of Enterprises:
- company registration application form;
- founders’ agreement or decision to establish the company;
- Articles of Association;
- bank reference for payment of share capital;
- list of founders and their details;
- confirmation of council and board members;
- proof of the company’s legal address;
- resolution from the property owner authorizing the company’s registration at its address;
- proof of payment for state fees and publication in the official government newspaper, Latvijas Vestnesis.
To get more information about company formation in Latvia and all the registration procedures, our team of professional agents is at your disposal.
Tax obligation for a joint stock company in Latvia
Taxation in Latvia is regulated by the Ministry of Finance and it has some specific procedures when it comes to tax duties for a JSC. We recommend to benefit from the services of specialized accountants in Latvia in order to easily follow the obligations below:
- VAT registration: If the company plans to export goods, provide services, or if its turnover exceeds €50,000 within the last 12 months, it must register for VAT;
- VAT reporting: VAT reports must be submitted on a monthly, quarterly, or semi-annual basis depending on the company’s VAT situation;
- Salary reporting: If the company employs staff, a monthly report of salaries and contributions must be submitted;
- Annual report: The company must submit an annual report to the authorities each year.
When referring to starting a company in Latvia, either is a JSC, LLC or other business structure, it is of high importance to consider all the tax regulations and requirements imposed by the Latvian authorities. Our specialized team of accountants in Latvia can offer support and assistance in tax issues, annual reports, budgeting and more.
Data on registered companies in Latvia
As official data mentions, the year 2023 was considered favorable in terms of recently registered companies, as company incorporation in Latvia has flourished:
- The total number of Latvian registered companies in 2023 was 181,720;
- From this total, 22% were small businesses (LLC);
- 1% from the companies registered in Latvia in 2023 were joint stock companies.
For more information on opening a joint stock company in Latvia and various services related to the business field in this country, do not hesitate to contact us.