Financial Services, Latvia, Legislation, Markets and Companies

The new bill is a revised one from a previous bill passed by the parliament, but sent back for a repeat review by President Raimonds Vejonis.

According to the revised bill, the ban does not pertain to countries of the European Economic Zone and its territories, member states of the World Trade Organization, or countries with which the EU or Latvia have agreements on the opening of their markets for public tenders.

The National Alliance, which submitted the original bill, points out that the revised bill eliminates the president's initial concerns.

The bill will come into force on June 1.

As reported, the Latvian parliament on February 1 had passed in the final reading legislative amendments banning off-shore companies from taking part in public tenders in Latvia. Also, those Latvian-registered companies in which more than 25 percent belong to the companies registered in low-tax or tax-free countries or territories would be barred from tendering for public contracts in Latvia. Bidders were to be excluded from the competition also if any of their subcontractors is an offshore company.

The legislation was proposed by the Saeima faction of the National Alliance.

Support for the new legislation was not unanimous, as some lawmakers voiced concerns that the provisions might not be consistent with the EU regulation.

Latvian President Raimonds Vejonis on sent the legislation back to the parliament for revision.

"This is already the seventh bill that I have sent back to the parliament for revision because of sub-quality proposals adopted hastily in the final reading. The amendments to the Public Procurement Law clearly demonstrate that the third [final] reading is not the right time to propose solutions that had not been discussed thoroughly in the previous readings," Vejonis said in the letter to the parliament.

He explained that he would not promulgate the bill because of the contradictory provisions that would prevent achievement of the intended goals and may result in additional public expenditure due to possible violation of the EU laws.