Limitations to Foreigners
1. Are there in your national system any limitations to foreigner citizens or foreign companies/companies controlled by foreign citizens regarding the acquisition of immovable properties? If yes:
1.1. Which legal regulations regulate in your country the prohibitions or limitations for foreigners’ acquisitions in case of transfer of property? Please specify the legal regulation and/or the range of the regulation that contains the prohibition.
Land Register Law.
On land reform in the cities of the Republic of Latvia Law.
On land privatization in rural areas Law.
1.2. What do these limitations consist of?
There are restrictions on land ownership in both urban and rural areas.
• Land in urban areas can get:
– Latvian citizens and citizens of other European Union member states.
– State and local government, state and local government companies (statutory companies)
– Statutory company (capital company) registered in the Republic of Latvia or another member state of the European Union:
a) whose share capital is more than half owned by Latvian citizens, citizens of other European Union member states, the Latvian state or local government
b) whose share capital is more than half owned by individuals or legal entities from countries with which the Republic of Latvia has concluded international agreements on the promotion and protection of investments, which were approved by the Saeima until December 31, 1996. The aforementioned also applies to natural or legal persons from countries with which international agreements were concluded after December 31, 1996, if these agreements provide for the right of natural and legal persons registered in the Republic of Latvia to purchase land in the respective country,
c) whose share capital is more than half owned by several entities referred to in subparagraphs «a» and «b» together,
d) which is a public joint-stock company, if its shares are listed on the stock exchange;
e) religious organizations registered in Latvia until July 21, 1940;
f) state and municipal universities
– Citizens of the third country, legal entities can obtain it with the consent of the head of the municipality.
• Land in urban areas cannot get (citizens of third countries, their legal entities and non-citizens):
– Land in the state border strips.
– Land in the protective zones of the dunes of the Baltic Sea and the Gulf of Riga and in the protective zones of other public bodies of water and watercourses, except for cases where they are intended for construction in accordance with the city master plan.
– Agricultural and forest land according to the territorial planning of the city municipality.
• Land in rural areas can get:
– Citizens of the Republic of Latvia and citizens of other European Union member states, as well as citizens of the countries of the European Economic Area, the Swiss Confederation and the members of the Organization for Economic Cooperation and Development.
– The Republic of Latvia as the original legal entity under public law and derived public entities.
– A capital company registered in the Republic of Latvia, as well as a capital company registered in another member state of the European Union, a country of the European Economic Area, the Swiss Confederation or a member state of the Organization for Economic Cooperation and Development, which is a taxpayer in the Republic of Latvia in accordance with regulatory enactments and:
a) all participants of which are the entities mentioned in clauses 1 or 2 of this part, individually or several together,
b) all of whose participants, natural or legal persons, are from countries with which the Republic of Latvia has concluded international agreements on the promotion and protection of investments, which were approved by the Saeima until December 31, 1996. The aforementioned also applies to natural or legal persons from countries with which international agreements were concluded after December 31, 1996, if these agreements provide for the right of natural and legal persons registered in the Republic of Latvia to purchase land in the respective country,
c) all members of which are several entities mentioned in subparagraphs «a» and «b» of this clause together.
– Religious organizations registered in Latvia, whose period of operation, counting from the day they were registered without the obligation to re-register, or the day they gave a notification to the registry authority in the Republic of Latvia, is no less than three years.
A legal subject registered in the Republic of Latvia, another member state of the European Union, a country of the European Economic Area, the Swiss Confederation or a member state of the Organization for Economic Cooperation and Development, who is a tax payer or registered as a performer of economic activity in the Republic of Latvia in accordance with the laws and regulations and is:
a) the individual company, the owner of which is the person referred to in clause 1 of this part,
b) the individual merchant registered by the person referred to in paragraph 1 of this part,
c) a cooperative society, all members of which are in clauses 1, 2 and 3 of this part, as well as the entities mentioned in clauses «a», «b» and «d» of this clause individually or several together,
d) another legal subject registered in a member state of the European Union, a country of the European Economic Area, the Swiss Confederation or a member state of the Organization for Economic Cooperation and Development, which is equivalent to the subjects mentioned in this paragraph.
– Societies and foundations registered in the Register of Societies and Foundations of the Republic of Latvia, the period of operation of which, counting from the moment of registration in the Republic of Latvia, is not less than three years, the purpose of which is related to nature protection, the production of agricultural crops or products, or the organization and maintenance of a hunting farm, and which purchase land for the implementation of these objectives.
– Citizens of the third country, legal entities can obtain it with the consent of the head of the municipality.
• Land in rural areas cannot get (citizens of third countries, their legal entities and non-citizens):
– Land in the border strip of the country.
– Land in nature reserves and other protected areas in nature reserve zones.
– Land in the dune protection zone of the coast of the Baltic Sea and the Gulf of Riga.
– Land in the protective zones of public water bodies and watercourses, except for areas where construction is planned according to the municipal territorial plan.
– Agricultural and forest land, with the exception of areas where construction is planned according to the municipal territory plan.
– Land in mineral deposits of national importance.
There are several additional conditions for the purchase of agricultural land for both Latvian and EU citizens.
1.3. Do these limitations apply to any foreign citizen, regardless their nationality, or only to non-EU Members national citizens?
Latvian citizens and EU Members national citizens have the same rules. Non-EU Members national citizens have different/stronger rules for getting ownership of property.
1.4. Do these limitations have?
- A defensive/protective purpose
- An economic purpose
- «Both economic and defensive/protective purposes»
- Other purposes (please specify)
2. To which kind of land registry unit do these limitations apply? (Example: only land plots, only rural areas, only foreign borders, dwellings and homes, other buildings?
Land properties.
3. To which kind of transfers or burdens do these limitations apply? (Example: to every transfer, non-free transfers, differently in case of inheritance than in case of purchase, mortgages in favor of foreigners….)
To all transactions except inheritance.
4. Apart from the previous limitation to acquisition of property by foreigners, are there any other measures at your country relevant for this topic? (Example: pre-emption rights in case of purchase un favor of a foreigner, social or residential measures bases on nationality and non in residential permits….)
Currently not identified, but it is being discussed.
5. To what extent the land registrars’ controls in a deed of transfer the prohibitions imposed to foreigners to acquire land and buildings in your country?
5.1. Do you only check if the transfer administrative authorization requirement is met, or do you also confirm that the authorization is valid? For example, do you consider property type, like rural or forestry classification, which might limit foreign transfers? Or do you verify the percentage of foreign land ownership in a specific area, especially if there are restrictions on the number of buyers or land size?
Regardless of the specified information about the composition of the property in the contract and the content of the issued permits, the type and extent of use of the property is checked in available registers to determine whether the transaction is appropriate and acceptable. There are rules that determine how much (total) agricultural land a person can buy.
5.2. What would happen if an authorization were needed, and it does not come with the title submitted for registration?
The transaction would be rejected.
5.3. What would happen in case a deed of inheritance in favor of a foreigner transfers property over land or buildings subject to limitations for foreigners’ acquisitions in your country?
Restrictions do not apply to cases of inheritance.
5.4. If the states have preemption right in case of transfer, would you reject the registration if no notification to the state to enhanced it right is done?
Yes.
6. Do you expect any legal modifications on this issue?
Yes, there are currently discussions about possible amendments to the law, where additional restrictions on their purchase will be set for certain types of property.
