Lursoft data shows that 8,772 new companies were registered in Latvia in 2023, while for the first time in seven years, the number of liquidated companies was lower than that of newly registered ones. Last year, 7,844 companies were liquidated, which means the actual number of companies in Latvia has grown by 928.
Although the number of newly registered companies remained almost unchanged compared to the previous year, it was the lowest figure in the last twenty years. Data compiled by Lursoft shows that lower activity in registering new companies was only observed in the period from 1999 to 2003. The highest number of new companies recorded to date was back in 1992, when 37,600 companies were registered in a single year.
Analysing the 2023 data, it is evident that the highest activity in registering new companies occurred in the first months of the year. In both January and February, 833 new companies were registered, while in March, the number exceeded 900. Throughout the rest of the period, the number of new companies per month remained above 700. The exceptions were July 2023, when 497 new companies were registered, and December, when 561 new merchants joined the ranks of businesses. It should be noted that in the last four years, even fewer new companies were registered only in April (445) and May (544) of 2020, when the introduction of Covid-19 pandemic restrictions significantly reduced new company registration activity.
Of the 8,772 new companies registered last year, 88.65% were limited liability companies (SIA), and more than half of those (66.33%) were SIAs with reduced share capital, meaning their paid-up share capital was less than 2,800 euros. For a third of all low-capital SIAs registered last year, the share capital was only 1 euro or even less. Data compiled by Lursoft reveals that companies with share capital of 1 and 5 cents were also registered in 2023.
The smallest SIA founded last year is the May-registered SIA “CONGLOMERATE” with a share capital of 1 cent. Lursoft records show that SIA “CONGLOMERATE”, owned by Sandris Keišs, works in the real estate sector. In addition to the company founded last year, the entrepreneur holds shares in five other companies. The second smallest SIA registered last year was SIA “Souly” with a share capital of 5 cents. Based on Lursoft records, the core business of SIA “Souly”, owned by Hugo Grūbe, is related to the manufacture of other concrete, plaster, and cement products. During the first half of its operation, the Cēsis region company had not yet registered any structural units. SIA “Souly” is the first company for its owner, Hugo Grūbe.
While the share capital of SIA “CONGLOMERATE” and SIA “Souly” remained unchanged, Lursoft discovered that paid-up share capital was increased by nearly 10% of all low-capital SIAs established last year. In most cases (73.44%), the share capital was increased to 2,800 euros, while in five cases, the volume of low-capital SIA share capital reached 100,000 EUR or more after the increase. In this regard, it is worth highlighting SIA “Planderi AK”, registered in September 2023, whose share capital was initially 50 euros, increased to 2,800 EUR a month later, and just a few days later, reached 352,800 EUR. The core business of the Salaspils-registered SIA “Planderi AK” is related to buying and selling its own real estate. SIA “Planderi AK” is the first company for its owner, Anita Kolbina.
A total of 5,146 individuals registered their first company in 2023.
These include both young entrepreneurs who have recently reached adulthood and persons who had passed the age of 80 when registering their first company.
Based on information compiled by Lursoft, share capital has been increased in 7.95% of all SIAs registered in 2023. In fourteen cases, the share capital of SIAs registered last year was increased by more than 1 million EUR. The volume of paid-up share capital grew most significantly in the case of SIA “RPH INVEST”. Part of the “Repharm” group, the holding company SIA “RPH INVEST” was initially registered last September with a share capital of 50,000 EUR, which was increased to 20.05 million EUR in the same month, and then to 81.05 million EUR two months later.
The largest paid-up share capital at the time of registration last year was that of AS “Strops investīcijas” – 39.23 million EUR. The company’s shareholders and beneficial owners are Andris, Jānis, and Pēteris Bite. Lursoft data shows that Andris Bite has been appointed as a board member of the newly registered company, while Pēteris Bite has become the chairman of the council, and Jānis Bite is the deputy chairman. Gaļina Radiloveca has also been appointed to the company’s council. It should be noted that the legal address of the newly registered AS “Strops investīcijas” is registered at Atlantijas iela 15, Riga, where the Bite family-owned SIA “Karavela” is also located.
A total of 14 joint-stock companies were registered last year.
The second largest paid-up share capital at the time of registration was that of SIA “Hotel J24”. The share capital of the hospitality company registered at Jēkaba iela 24, Riga, is 18 million EUR. The holder of the company’s shares is the holding company SIA “IDK Baltic”, established last year, which in turn is owned by the United Arab Emirates-registered IDK Investment L.L.C. It should be noted that 12% of all new companies registered last year involve foreign capital. As usual, the most participants are from Lithuania and Estonia, while Ukraine has significantly overtaken Russia, which had been in a leading position every year. Data from a Lursoft study shows that 165 new companies were registered in Latvia in 2023 where at least one of the participants is a Ukrainian national or a capital company registered in Ukraine. Meanwhile, 98 new companies with Russian capital were registered in Latvia last year.
Among the TOP 10 largest new companies registered in 2023, SIA “Granita Industrial Park” from Ropaži municipality ranks third. During the last year, 183 new companies were registered in Ropaži municipality, which places it in 8th position among all Latvian municipalities by the number of newly registered companies.
TOP 10 largest companies registered in 2023 by volume of paid-up share capital (at the time of registration):
1. AS “Strops investīcijas”: 39.23 million EUR;
2. SIA “Hotel J24”: 18.00 million EUR;
3. SIA “Granita Industrial Park”: 4.74 million EUR;
4. SIA “Davhex”: 4.50 million EUR;
5. SIA “M UPES KORPUSS”: 3.40 million EUR;
6. SIA “Tērbatas kvartāls”: 3.00 million EUR;
7. SIA “Avenue Property 3”: 2.64 million EUR;
8. SIA “Kukelis Capital”: 2.52 million EUR;
9. SIA “Dzintaru prospekts 19”: 2.40 million EUR;
10. SIA “Q”: 2.40 million EUR.
In 2023, the total share capital of new companies at the time of registration was 111.28 million EUR, but by the end of the year, it had already increased to 387.87 million EUR. After the increase, the highest paid-up share capital belonged to the aforementioned SIA “RPH INVEST”, while SIA “J&A” ranks second. The business of SIA “J&A”, founded in April last year, is related to social care for the elderly and disabled without accommodation. The company’s initial paid-up share capital was 2,800 EUR, but it was significantly increased in July – to 75 million EUR. The sole shareholder of SIA “J&A” is Josifs Apts, whose status as a beneficial owner is also registered in several other companies, including SIA “Senior Service”, which works in care for the elderly and disabled, as well as the association “Senior Generation”, whose goal is to improve the quality of care for the elderly. At one time, the businessman was a beneficial owner in companies associated with AS “Veselības centru apvienība” and AS “Recipe Plus”. It should be added that at the end of last year, SIA “J&A” became the new owner of SIA “AB Celtnieks”, which once belonged to AS “AB CITY”.
Liquidation process already started for several
Lursoft has discovered that a liquidation process has already been started for several companies registered last year. There are a total of 19 such companies, six of which were registered only last November, meaning the liquidation process was started shortly after company registration. Almost all companies registered last year for which a liquidation process has already begun are low-capital SIAs. Of those, only five companies were registered with a share capital of 2,800 euros, one of which – SIA “V&K International Trading” – has foreign capital. Lursoft data shows that 50% of the shares of SIA “V&K International Trading” are owned by German national Joel Kreklau. The participants of the wholesale company for fuel, solid, liquid and gaseous fuels and similar products, founded in June last year, decided to initiate the liquidation process in November.
Just like the aforementioned companies for which the liquidation process was initiated shortly after registration, SIA “VOVIVI”, registered in March 2023, also failed to successfully implement its business plan. Lursoft data shows that an insolvency process was declared for the company, which works in the public catering sector, at the end of last year. SIA “VOVIVI”, which has a café registered at Stacijas laukums 2, Riga, had accumulated a tax debt of 28,000 EUR by the end of 2023. The company’s first tax debt exceeding 150 euros was recorded in July, and the volume of tax debt has grown constantly since October. The largest shareholder of SIA “VOVIVI”, Vitālijs Voinovs, was once a board member of the catering company SIA “DC restorāni”. It should be added that a legal protection process was initiated for that company in 2022, which was terminated in January of last year, with the insolvency of SIA “DC restorāni” declared a few months later.
Lursoft study data reveals that three companies registered in 2023 have had their operations suspended, while five others have had their economic activity suspended, and three more have terminated their operations. Among them is taxi service provider SIA “ANSAR”, which was initially registered with a share capital of 120 euros, but was soon increased to 2,800 euros. The activity of SIA “ANSAR” was terminated by a decision of a state notary of the Register of Enterprises of the Republic of Latvia at the end of November last year. It should be noted that the owner of SIA “ANSAR”, Oļesja Afromejeva, founded two more taxi transport firms last year – SIA “SAIL” and SIA “GRADO”. Unlike SIA “ANSAR”, these two companies have no tax debts.
The study uses generally accessible information published by the Register of Enterprises of the Republic of Latvia and the State Revenue Service, data as of 01.01.2024.