LATVIA Law and Practice Contributed by: Agita Sprūde, Artūrs Kazāks and Valts Nerets, Sorainen
2. Investment Treaties, Free Trade Agreements and Investment Laws 2.1 Bilateral and Multilateral Investment Treaties Latvia has concluded and ratified several BITs and participates in multilateral instruments applicable to investment protection (including the ICSID Conven- tion and the New York Convention). The complete list of Latvia’s international investment agreements (IIAs) is maintained in the UNCTAD investment treaty database, which currently lists nine BITs in force with Armenia, Azerbaijan, Canada, Iceland, Kyrgyzstan, Moldova, Singapore, Uzbekistan and the United States. Latvia’s treaty practice includes BITs with other Bal- tic states and a range of third countries concluded in the 1990s and 2000s. Some older intra‑EU BITs have been subject to scrutiny following the CJEU jurispru- dence. Latvia continues to manage its treaty network pragmatically, but there has been no mass accession to new BITs in 2024–25. 2.2 Model Bilateral Investment Treaty Many of Latvia’s BITs follow the classic 1990s Eastern European model BIT (broad protections for investors: FET, protection from expropriation, full protection and security, national and MFN treatment, and investor- state arbitration). While Latvia has not published a uniform ‘model BIT’ in recent years, its older treaties share those standard provisions. Recent practice and EU obligations have required careful revision in how those provisions are interpreted vis‑à‑vis EU law. 2.3 Free Trade Agreements Latvia is an EU member state (since 1 May 2004). As an EU member state, it is a party to EU trade and investment frameworks. Intra‑EU treaty arbitration has been restricted by the CJEU jurisprudence ( Achmea ) and later EU policy developments. Investment pro- tection for EU investors is often channelled through EU law remedies and state courts. For non‑EU inves- tors, BITs and multilateral treaties (including the ICSID Convention) remain available where treaty language allows.
2.4 Interpretive Aids Interpretive aids for investment treaties involving Lat- via are limited to the standard diplomatic exchanges and the treaty texts. Latvia (like many states) pub- lishes treaty texts on official channels, and the wider IIA community relies on tribunal decisions, UNCTAD and national foreign ministry materials as interpretive guidance. 2.5 Investment Laws In the classic sense, Latvia does not have a stan- dalone, comprehensive Foreign Investment Act. Investment protection in Latvia is provided through constitutional guarantees, sectoral laws, corporate law and treaty protections. Sectoral regimes (national security‑sensitive sectors, land rules, gambling, M&A screening in certain circumstances) interact with treaty protections. Where national law provides protections or restrictions, those interact with treaty standards and may be relevant to disputes, but do not replace treaty claims available to covered investors. 2.6 Arbitration Clauses in Investor–State Contracts Latvian State-owned companies are typically cautious concerning arbitration, and many State-owned com- panies consider the law as prohibiting such engage- ment. For the State institutions, it is forbidden to conclude arbitration agreements. Nevertheless, some State-owned entities agree to the use of international arbitration, particularly in concession and procure- ment contexts, but their prevalence varies by sec- tor. Such clauses can provide potent contract‑based remedies (including direct contractual damages and injunctive mechanisms) complementary to treaty pro- tection. Treaty protections often offer a broader pub- lic‑international-law standard (eg, FET) plus access to international arbitration. In contrast, contract clauses create private law obligations enforceable under cho- sen arbitration rules and seats.
3. Substantive Protections and Breaches 3.1 Common Complaints
Common treaty complaints brought against Latvia include: (i) indirect or direct expropriation (including
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