Supreme Court of Latvia publishes long-awaited digest of case law on corporate law

A Digest of Case Law on the practice of the Latvian Register of Enterprises has been published by the Supreme Court Senate.

The Register of Enterprises of the Republic of Latvia is a state institution that registers all trading companies in Latvia, as well as any changes to those documents.

In view of the increasing number of registrations of new commercial companies in Latvia, the Latvian Supreme Court Senate has published a Digest of Case Law on the practice of the Commercial Register over the last six years.

The Senate defines the role and functions of the Register in the process of registration of a new company, registration of changes and liquidation, as well as other issues of interest to businesses, lawyers and the interested public. This also applies to information on company beneficial owners.

The Digest highlights that the Commercial Register is not required to verify the factual circumstances related to documents to be registered. This means that the register has no competence to assess the factual circumstances of a trading company’s decision-making process. The Senate has indicated that only in exceptional cases may the Commercial Register question the legal validity of a document.

The Senate explains that most of the entries in the Commercial Register are declaratory. The purpose of including information in the Register is to protect the rights and interests of third parties.

By making an entry, the Register does not confirm that the decision or information in question is to be regarded as lawful. Rather, the Commercial Register fulfils a statutory obligation and makes information publicly available.

Trading companies must notify the Register of recent changes in the company and file documents drawn up in line with legal requirements, actual circumstances and containing correct information.

Disputes concerning decisions of shareholders or between shareholders and the company board are disputes between private persons and thus are to be settled between private parties in civil proceedings.

Source: www.at.gov.lv/tiesu-prakse

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