Latvia has a favorable location in the Baltic region and provides easy access to Northern and Eastern Europe. This is why foreign investors will often choose to establish a branch in Latvia
and run their regional operations form this location.
The branch is an extension of the parent company abroad that performs the same business activities and functions under the same name. It is a common manner of expanding a business to another market because of the lower costs compared to opening a new legal entity in a country.
Steps for opening a branch in Latvia
A Latvian branch is incorporated once the parent company has adopted a special Decision for this purpose. The branch will act as the Latvian counterpart of the foreign company. It will be an independent unit in terms of location but it will depend on the parent company in case of liabilities. All of its activities will be conducted on behalf of the main company and according to the existing business and management plans.
An important advantage of opening a branch in Latvia is that this business form has lighter incorporation and reporting requirements compared to a subsidiary which acts as an independent Latvian company.
Conditions for operating a branch in Latvia
A few formalities need to be observed when registering a branch of a foreign company in Latvia. The corporation opens the branch through a special Decision which is submitted together with the rest of the incorporation documents. The next step is to draw up the articles of association and to sign the documents in front of a notary public. Once it is registered with the Latvian Commercial Registry, the branch can begin its business activities.
The branch needs to have a registered address in Latvia and it will be registered for tax and VAT purposes. Taxation in Latvia will fall under the provisions of a double tax treaty
, should this type of agreement exist between the foreign company's country of origin and Latvia. It also needs to observe the ongoing requirements for employment.
our team of agents who specialize in company registration in Latvia
for complete details on how we can assist you in opening a branch.