How to register a Startup in Latvia

 

This article can be considered as the ultimate guide for non-EU citizens, but it will be useful for anyone who are willing to establish their business in Latvia.

 

Latvia is often chosen as the starting point to reach the European market — and for many reasons.
It’s a member state of the European Union and the eurozone which means free mobility of goods and labor. In addition, Latvia boasts the largest air transportation hub in the Baltics — the Riga International Airport, which offers more than 100 direct flight destinations.

The Quality of Life index is also comparatively high with low cost of living and a high safety index. The locals are welcoming and so is the economic situation in Latvia.
The state has made it clear through its initiatives (such as the 
Welcome Pack), passed laws and state-sponsored programs that it intends to make itself open to innovation and startups from abroad. The only ‘missing part’ is — you!

 

This article will cover everything you’ll need to know to actually found a startup in Latvia:

 

1. Residency: Startup Visa

➡️ The main bonuses of receiving a Startup Visa (TRP) are:
🔹 Validity for up to 3 years (if all legal terms are met), with a requirement to extend the TRP annually;
🔹 Can be obtained by up to 5 startup founders (board members) with the same business idea;
🔹 Opportunity to move to Latvia with your immediate family (spouse and children);
🔹 Easy, no-visa travel within the European Union;
🔹 Opportunity to use an e-signature to sign documents, use online public services and governmental services remotely.

➡️ How to apply for a Startup Visa (TRP):
1. Contact Magnetic Latvia Startup at the Investment and Development Agency of Latvia (LIAA) to check your eligibility for a Startup Visa. This is not a mandatory step, but it may help you to speed up the process and get valuable insights before submitting all documents. Use their contact info email: Этот адрес электронной почты защищён от спам-ботов. У вас должен быть включен JavaScript для просмотра..
2. Book an appointment at the Office of Citizenship and Migration Affairs (OCMA) in Latvia to apply for a Startup Visa (TRP), or visit your local Embassy of Latvia by filling in the application form and preparing all the necessary documents (highlighted in the orange field).
3. Receive an answer from the OCMA (it will arrive by email). If positive, continue to the next step.
4. Visit the OCMA branch in Latvia to receive your TRP residency card.
5. Renew your TRP status annually. Keep in mind that you’re able to renew it for up to 3 years. After the 3 years have passed, you’ll be able to use a regular residence permit.

Processing time: 30 business days
Regular procedure fee: 100.00 EUR
Here’s a comprehensive guide on how to apply for a residence permit.

➡️ Mandatory actions to keep your Startup Visa:
🔹 You mustn’t be employed or be a member of a board of another company — you have to fully focus on your startup;
🔹 Within 3 months of receiving a TRP: you must register a company in Latvia or become a board member of a company registered no later than one year ago;
🔹 Attract an investment (EUR 30,000 from VC fund or EUR 15,000 from an accelerator/business angel) within 12 months from 
qualified investors OR provide a report demonstrating continued product creation, manufacturing or development.

If your investor is not on the list of qualified investors, they can apply here(1st link) or you can submit an application on behalf of them (2nd link). For more information, contact Этот адрес электронной почты защищён от спам-ботов. У вас должен быть включен JavaScript для просмотра..

If by any chance you don’t meet some of the Startup Visa criteria — you can opt for another type of residence permit like the Share capital investor residence permit. This permit will require you to invest your own money into the company’s capital.
A full list of residence permit types can be found 
here. Otherwise, feel free to contact the OCMA for more information regarding visas.

 

2. Legal Business Entity Types

✔️ Limited Liability Company (LLC) with reduced equity

The cost of application for an LLC with reduced equity is 34.23 EUR + 4.00 EUR, if applying in person.
If at any point you find that an LLC with reduced equity doesn’t fulfill your needs, you are free to change your type of business entity at any time.
To learn more about the process of founding an LLC with reduced equity and what documentation is needed, visit 
the Register of Enterprises of the Republic of Latvia.

✔️ Limited Liability Company

The cost of application for an LLC is 177.03 EUR + 4.00 EUR, if applying in person.
To find out more about the application process and documents needed to apply for an LLC, visit the 
the Register of Enterprises of the Republic of Latvia.

 

3. Company Registration Process

✔️ One of the requirements for registering a company in Latvia is that you have to be able to provide a legal address of the company.
The address must be within the territory of Latvia and you must also grant evidence that you’re able to use the address for business needs. Because of that, the owner of the property has to provide a letter describing that they allow you to register your company at the mentioned address.

In cases where it’s not possible to provide a legal address for your startup, approach local co-working spaces. TechHub Riga is one of the many to name, who offer using their legal address for a small fee.

✔️ The procedure of registering a company in Latvia:

You can register a company in person, on behalf of another person with their consent, online or by preparing and sending the documents by mail. If any of the above mentioned ways to register a company are not preferable for you — there are various registry companies and legal firms available to help you with registering your startup in Latvia.

 

➡️ Step 1: Set up a temporary bank account & transfer equity funds

The application process for setting up a temporary business bank account can be done:
🔹 remotely, using an e-signature;
🔹 in person, heading down to the bank;
🔹 by a third person with your power of attorney.

✔️ After opening a temporary account, your next step will be to transfer the company equity to it. The amount of equity depends on the type of company you’ve intended to found:
🔹 LLC with reduced equity — starting from 1 EUR to 2799 EUR;
🔹 LLC — a minimum of 2800 EUR.
When the transfer is complete, you’ll have to obtain a payment order or a reference on payment of equity capital from the bank.

✔️ After receiving the payment order clearly stating the equity capital on your bank account, your next step is to submit documents at the Register of Enterprises.

 

➡️ Step 2: Register your business at the Register of Enterprises

Registering your startup at the Register of Enterprises can be done:
🔹 In person at a bureau of the Register of Enterprises of Latvia (here are their locations). Keep in mind that some documents must be certified by a notary, however, it can be done on the spot.
🔹 By email — separately sign all of the documents with a secure eID e-signature and send them via 
Этот адрес электронной почты защищён от спам-ботов. У вас должен быть включен JavaScript для просмотра. to the Register of Enterprises of Latvia. In this case, notary certificates are not required.
🔹 Online — visit the 
Latvija.lv platform and sign all documents with a secure eID e-signature. You can log into the platform if you have a Latvian e-signature and/or a Latvian bank account.
🔹 On another person’s behalf — use the help of a local partner who can submit the documents on your behalf. In this case, authorization from your attorney is not required. However, if the applications are sent via the post office, some documents may require a notary certification.

The Register of Enterprises of Latvia accepts documents e-signed using two extensions:
.edoc — signed with a Latvian e-signature;
.asice — the EU standard ASiC-E.
The Estonian e-ID e-signature is also accepted, but only as .asice not .bdoc.

While the online registration process (with a Latvian resident code) is currently only available in Latvian, English localization is already in progress.

Take note that all of the documents should be in the Latvian language or supported by a notary certified translation. Here are some useful templates for the industry-standard legal documents in English/Latvian languages prepared by Sorainen.

Find step by step instructions and information about costs and necessary documents to apply for the Register of Enterprises here:
🔹 
Limited liability company with reduced equity🔹 
Limited liability company

✔️ After you’ve submitted your application to the Register of Enterprises, it will be processed within the next 3 business days. You’ll receive a letter confirming your application to the legal address you provided in your application.

 

➡️ Step 3: Create a full-fledged bank account

Bring your new letter of acceptance along, as it will include your registration number which will be required by the bank. Take note that this can be done only in person.

 

➡️ Step 4: Register at the State Revenue Service and apply for VAT if needed

In addition to document submission, the EDS offers other online services, such as finding practical information about VAT and other taxes. To apply for VAT, fill in an application form (KR4) at the Register of Enterprises. After completion, the Register of Enterprises will forward your application to the State Revenue Service and you’ll be all set.

 

🚀 You’re ready to do business in Latvia! #startinLatvia

✔️ There are many associations and groups that support startups and even organizes multiple startup-related events. You’ll also have the opportunity to join the Latvian Startup Association Startin.LV and be a part of the community.

✔️ The Latvian government offers many benefits, such as the Startup tax, that provides special taxation for startups aimed to reduce their costs. In addition, there’s also the “Explore the Globe” travel grant program that offers financing for startups to attend global level conferences and arrange meetings with investors in any country.

 

🚀 Good luck on your journey! If at some point you run into any unclarities in regards to the provided Welcome Pack or startup TRP, contact the Magnetic Latvia Startup team via Этот адрес электронной почты защищён от спам-ботов. У вас должен быть включен JavaScript для просмотра..

 

 

Источник: medium.com



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