After 17 months of bureaucratic activity, the Cabinet of Ministers has criticized and rejected the initiative of the Saeima’s Defence, Internal Affairs and Corruption Prevention Committee to anonymise the board members and beneficial owners of the Ministry of Defence’s strategic partners, and has still not offered its own solution for their protection.
The head of the responsible committee, Raimonds Bergmanis, believes that classifying the entrepreneurs of the military industry who have concluded supply contracts with the Ministry of Defence is self‑evident. He accepts the government’s decision to reject the committee’s initiative and the solutions offered, but does not understand why the government does not propose its own solution.
“Not everyone needs to see everything; there are matters where people are very important to our country,” says R. Bergmanis (United List) and adds, “then why doesn’t the government submit its own proposals.”
The responsible committee already on 27 March 2024 turned to the Cabinet of Ministers with a proposal to develop regulations that would allow the Register of Enterprises not to disclose the board members and beneficial owners of the Ministry of Defence’s strategic partners, for example, the manufacturer of the light tactical vehicle VR Fox, and to restrict their freedom to travel. Today, on 19 August 2025, the government will approve the letter to be sent to the committee.
The letter states that the Cabinet of Ministers supports the objective expressed in the proposals, but does not support the solution offered for achieving this objective, while not offering one of its own.
For example, the Saeima committee proposed anonymising board and council members and owners in the Register of Enterprises. The government believes that this would complicate the day‑to‑day operations of strategic partners, because “The ability to easily verify representation and ownership is essential for the rapid and secure conclusion of transactions.”
“[…] it must be possible to quickly verify information in the commercial register. Especially if someone else claims to be a representative of a capital company. If this information is available only upon request, the Register of Enterprises of the Republic of Latvia will not be able to process this request within minutes or hours, which in some cases may be decisive for concluding a transaction. Not only would the speed of commercial turnover be reduced, but it would also complicate other processes in which strategic partners interact with third parties,” the government explains in more detail the reasons for its refusal.
The government also believes that in this way the objective of the regulation to achieve greater security would not be met, because the information, once an application is submitted to the Register of Enterprises, would still be available, since the Register of Enterprises would not be obliged to verify whether the requester really has serious intentions to conclude a transaction with a representative of the military industry. Moreover, a potential enemy, noticing a company whose owners and beneficial owners are not identified, would certainly pay greater attention to such a company.
“In the case of a limited liability company, it is not necessary to indicate its type of activity; the articles of association may also record any activity that does not associate it with the defence industry. By contrast, if information about the board, council and owners of strategic partners were not available, these entities would be more exposed, could attract media attention, and it would be clear that such an exceptional requirement applies only to strategic partners, since information about other capital companies is freely and directly available,” the government justifies the refusal.
The government is also concerned that by anonymising beneficial owners Latvia would violate the requirements of the Anti‑Money Laundering Directive.
When assessing the usefulness of restricting freedom of movement, the Cabinet of Ministers reminds that the Ministry of Foreign Affairs regularly updates its travel recommendations outside Latvia in connection with actions initiated by the Investigative Committee of Russia. It has been emphasised that there are risks for Latvian officials, especially when travelling privately outside the territories of Latvia, the European Union and NATO member states. Therefore, board and council members and owners of strategic partners must themselves be aware of these risks and avoid private travel to the aforementioned countries.
Originally published at https://inc-baltics.com/militaras-industrijas-ipasniekus-pagaidam-vel-neanonimize-valdibas-lemumam-vajadzeja-17-menesus/
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