Latvia’s planned Immigration Law would significantly change the country’s residence-by-investment framework by removing the real estate and bank capital routes, adding a new state-linked fund option, and shortening the remaining company investment route. The law has passed parliament but is not yet in force after President Edgars Rinkēvičs returned it for further review.
Latvia’s Saeima passed the new Immigration Law on 11 June by 65 votes to 17. The law would replace the immigration statute that has governed foreign residence since 2002.
Eight days later, President Edgars Rinkēvičs declined to promulgate the law and sent it back for a second review. The president’s objections focus on the investment-residence provisions. Because the spring parliamentary session closed on 18 June, any second vote will take place in the autumn.
Until the Saeima acts again, promulgation remains on hold and the law is not in force.
Real estate and bank routes would be removed
Under the current statute, a foreigner can obtain residence by:
- Buying real estate worth at least €250,000
- Placing €280,000 as subordinated capital with a Latvian credit institution
Neither route is included in the rewritten law. This would end the property route that drove Latvia’s investment-residence program for years, along with the banking option.
Existing holders would not immediately lose their permits. Applications filed and accepted before the new law takes effect would continue under current rules. Existing permits would remain valid until their registration date, after which holders would reapply under transitional rules.
The real estate route was reconsidered before being rejected. Economy Minister Viktors Valainis proposed restoring a five-year permit for property worth at least €250,000 in Riga, Jūrmala, and a defined list of municipalities, or two properties of equal combined value elsewhere. The committee rejected the proposal, including related conditions on cadastral value, cashless payment, and certified valuations.
New €150,000 fund route
The main new investment route appears in Article 27(1)(36). It would grant a residence permit for up to five years if the applicant signs a contract and transfers at least €150,000 for no less than five years to a state-created alternative investment fund manager.
The applicant would also have to pay €10,000 into the state budget.
The route is not yet operational. The state-created fund that would receive the €150,000 has not been built, and the vehicle still requires separate legislation.
The proposal was introduced by Andris Kulbergs before he became prime minister in late May. His original version tied the investment to private funds that placed at least half their assets in Latvian companies. The responsible committee rewrote the proposal, replacing it with a single state-run manager, removing the local-investment requirement, and adding the €10,000 budget payment.
The permit would remain valid only while the state-created alternative investment fund manager confirms that the investment contract has not been terminated and that the investment balance remains at least €150,000.
Company investment route would survive, but for two years
The company share-capital route would continue under Article 27(1)(10), but with a shorter permit term.
The route would grant a permit for up to two years if the applicant invests in the share capital of a Latvian capital company and pays €10,000 into the state budget.
The smaller tier requires at least €50,000 invested in a company with:
- No more than 50 employees
- Annual turnover or balance sheet below €10 million
The larger tier requires €100,000 invested in a company that, together with its subsidiaries:
- Employs more than 50 people
- Exceeds €10 million in turnover or balance sheet size
No more than 10 foreigners may qualify through a single company.
The main change is the permit duration. The route previously offered a five-year permit, renewed annually through ID cards. The new law would cut the term to two years.
The tax condition remains unchanged:
- At least €40,000 per year for the smaller tier
- At least €100,000 per year for the larger tier
Rejected investment proposals
Several additional investment proposals reached the third reading but were rejected.
Failed proposals included:
- A €150,000 stake in companies founded by Latvia’s special economic zone and freeport authorities
- Revival of a zero-interest government bond route
- Two proposals to extend the company permit from two years to five years
- A proposal allowing investors on these routes to become Latvian taxpayers through a flat annual payment of €60,000
President’s concerns
President Rinkēvičs said the third reading included 158 proposals, some technical and some creating a fundamentally new legal framework for residence by investment. He asked the Saeima to reconsider several points.
On real estate, he asked lawmakers to consider whether citizens of NATO, OECD, and European Economic Area states, and possibly other countries friendly to Latvia on a Cabinet list, should be able to request residence by buying property. He said a similar appeal had come from major representatives of the real estate transactions sector.
On the new fund route, he asked whether the provision is complete and sufficient, and whether the Cabinet of Ministers should be delegated authority to check the source of investor funds and define what the fund may finance.
The president also pointed to the handling of Russian and Belarusian citizens. As first passed, the fund route did not bar citizens of Russia and Belarus. Parliament rushed a separate amendment through on 18 June to close that gap. Committee chair Raimonds Bergmanis acknowledged that the omission had slipped past lawmakers the first time. For Rinkēvičs, the late correction signaled that the package had been assembled in haste.
The law also includes separate restrictions routing discretionary permits for citizens of Russia and Belarus through the interior minister. Such permits would be available only where a grant accords with international legal norms or is connected with humanitarian considerations, with further limits added by a ministerial amendment.
Background and next steps
Latvia introduced its golden visa in 2010 under Ainārs Šlesers, when few European countries had similar programs. Russian buyers dominated early demand until a 2022 ban excluded them. Demand had already fallen sharply after 2016.
A critical 2018 Moneyval review pushed Latvia to tighten the system and rely more heavily on its financial intelligence service to vet investors. The new law would end the property and bank routes that defined the early program.
The timing follows investigations into more than 20 firms over suspected abuse of the share-capital route. The Progressives, the party that asked the president to return the law, pointed to laundering risk concerns.
The Saeima now has three main options:
- Re-adopt the law unchanged, which would oblige the president to promulgate it
- Amend the law to address the president’s objections
- Leave the matter unresolved through the recess
Until parliament acts, Latvia’s company investment route remains the only working investment-migration pathway, while the proposed state fund route has not yet been built.
Source article: www.imidaily.com
