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Possibilities for Obtaining a Residence Permit in Latvia Have Been Expanded 08.01.2014

In January amendments to the Latvian Law on Immigration took effect – they expand the opportunities for foreign investors to obtain a residence permit.

Among the positive changes, there are some that pertain to investors obtaining a residence permit based on investments in the subordinated capital of a Latvian bank. If in the previous wording of the law two options of such investments were anticipated – a subordinated loan or the acquisition of subordinated bonds of a Latvian bank, then starting from 1 January 2014 the grounds for obtaining a residence permit are any subordinated liabilities with a bank, including stocks securities, etc. The term of the investments remains unchanged – five years, and the minimum amount is EUR 280 000 or equivalent in other currencies.

According to Alexander Gafin, Member of Rietumu Bank’s Council, these legislative amendments provide potential investors with wider opportunities for selecting tools for their investments. “It is well known that Rietumu Bank is a recognised leader in Latvia with regards to the number of attracted subordinated loans, primarily on the part of Russians who obtain a residence permit in Latvia. This year we also offer our clients an opportunity to acquire preference stocks, for which the forecasted return over a five year horizon exceeds 20%. Such investments will also become grounds for obtaining a residence permit,” noted Mr Gafin.

As of today, about 800 investors and their family members, primarily from Russia and other CIS countries, have obtained Latvian residence permits with the help of Rietumu Bank.

Opportunities for obtaining a residence permit have also been expanded in the event of purchasing real estate in Latvia. Starting from this year real estate for such a purpose can be obtained not only from private individuals and Latvian companies, but also from companies registered in the European Union, the European Economic Area and Switzerland.

The nuances of real estate valuation have been changed as well – in the event the cadastral value of real estate is below the value anticipated by law for obtaining a residence permit, it is required to perform the real estate market valuation in an amount not below the transaction amount anticipated by law. The minimum required amount of investments is EUR 142 300 – for buying real estate in Riga, the Riga Region and big cities, or EUR 71 150 – for buying real estate in other places.

To obtain a residence permit based on investing in a Latvian company, two options remain. In the first option (investments in a company’s equity capital in an amount not below EUR 35 000), further on the company will have to pay a minimum amount of taxes of EUR 40 thousand annually; the company’s staff must not exceed 50 employees and the annual turnover or balance must not exceed EUR 10 000 000. When investing in one and the same company, not more than three investors may apply for a residence permit.

In the second option (investments in a company’s equity capital in an amount not below EUR 150 000), the company’s staff must exceed 50 employees and the annual turnover or balance must exceed EUR 10 000 000.

A number of less significant amendments have been adopted as well – they refer, among other things, to the procedure of obtaining a residence permit and the subsequent registration.

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