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Minister: restriction for offshores from participating in public procurements threatens with litigation

Dana Reizniece-Ozola/flickr.com/Finance Ministery.
Saeima’s decisions to prohibit offshores from taking part in public procurements is unsupportable and threatens with litigation, says Latvian Finance Minister Dana Reizniece-Ozola.

On 1 February, the Saeima approved amendments to the law in which companies registered in countries with low taxes and contenders in Latvia associated with such businesses are prohibited from participating in public procurements. The proposal was submitted by the Saeima faction of the National Alliance.

Finance Ministry, Procurement Monitoring Bureau and lawyers assessed the parliament’s decision and concluded that it does not comply with international norms.

«Economic activities must not be allowed to be limited based solely on the place of registration. A completely different factor is if a business in question is caught avoiding taxes and laundering funds. The place of registration cannot be a reason for denying businesses the ability to participate in procurements,» said the finance minister.

Finance Ministry is busy preparing a report to President Raimonds Vējonis for him to assess the ministry’s arguments before amendments are approved.

«If the president declares amendments to the law, it is possible litigation may follow shortly after, because amendments propose unequal treatment of businessmen,» adds Reizniece-Ozola.

As previously reported, Unity and Union of Greens and Farmers supported the proposal to deny offshores the right to participate in procurements. Still, members of the two parties are concerned about amendments resulting in sanctions being applied on Latvia by the European Union.

Latvian Chamber for Commerce and Industry supports Saeima’s approved amendments that prohibit businesses registered in low-tax countries from taking part in procurements, said LCCI president Aigars Rostovskis.


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