13. Business Overall Latvia has a favorable legislative framework for the operation of business although complaints about administrative hurdles are quite common. All administrative acts of state agencies can be appealed. However, in practice one can expect lengthy proceedings in the court. While legal transparency requirements for the business sector are generally adequate, there is a general preponderance among Latvian companies to operate in a somewhat secretive manner. The dominant patterns of corruption are characteristic with a degree of collusion between some entrepreneurs and corrupt public officials rather than extorting and conflicting interaction (although cases of requesting bribes are known as well). All in all, while the business sector and associations are hardly on the forefront among anti-corruption policy champions, a certain degree of engagement has been seen continuously. Still it almost never amounts to what could be called a joint business-civil society initiative.
Business Indicator Resources Capacity 81 / 100 Independence Transparency Governance 67 / 100 Accountability Integrity Mechanisms Anti-Corruption Policy Engagement Role 38 / 100 Support for/Engagement with Civil Society
Overall Pillar Score: 62 / 100 Law Practice 75 75 100 75 75 50 100 50 75 50 50 25
Structure and organization Latvia is a functioning market economy and hence the private business plays a major role in the country. Most of Latvia’s gross domestic product (GDP) comes from services (74.4% est. for 2010), with industry following with 21.7% and agriculture – 4.0%.541 There are various assessments of the share of the grey economy and the World Bank estimates it at 42% of GDP.542 The company with limited liability is the most common form of enterprise in Latvia (112,811 registered as of 6 July 2011). Individual entrepreneurs come second (13,510), followed by joint stock companies (917).543 541 Latvia. The World Factbook. Central Intelligence Agency. As of 7 September 2011. https://www.cia.gov/library/publications/the-world-factbook/ geos/lg.html 542 Latvia County Assessment. Transition Report 2010: Recovery and Reform. European Bank for Reconstruction and Development (2010). http://www. ebrd.com/pages/research/publications/flagships/transition/latvia.shtml 543 Komercreģistrā reģistrēto komersantu un to filiāļu sadalījums pa uzņēmējdarbības formām (The Breakdown of Enterpreneurs and Their Branches Registered in the Commercial Register by the Form of Entrepreneurship). Lursoft statistika. http://www.lursoft.lv/lursoft-statistika/Komercregistra-registreto-komersantu-un-to-filialu-sadalijums-pa-uznemejdarbibas-formam&id=197 173