Lursoft news

The objective is to present general statistical data about the commercial activity in Latvia during 2003

2003. gada 13. augusts

All data are actualized from the original sources in real time, using the information systems crated by companies Lursoft and Lursoft IT for the Register of Enterprises, the Ministry of Justice, including those created for the companies themselves. The material is created by analysing the indicators of commercial activities that are collected in the following databases or registers:


  • Register of Enterprises;
  • Commercial Register;
  • Register of Commercial Pledges;
  • Register of Concerns;
  • Register of Concessions;
  • Register of Non-governmental organisations;
  • Register of Trade unions;
  • Register of Political organisations;
  • Register of married persons belongings;
  • Register of foreign businessman and representations of organisations;
  • Lursoft Register or the companies’ yearly turnovers;
  • Register of mass media;
  • Courts decisions analytical system;
  • Lursoft Courts database;
  • Insolvency and bankruptcy register;
  • Shareholders register;
  • Register of companies’ officials.

In the most of the cases the statistical data will be available without any restrictions in the Register of Enterprises, Courts’ and
Lursoft home pages and will be updated once every day, providing the possibility to follow latest data in all
the territory of the state in more than 400 different indicators.

Data are available in html and xls format, providing the ability to use them
on the users data analysing systems. For authorized users statistical data from Register of Enterprises/Commercial Register, Register of
Commercial pledges and Courts’ informative systems are available in real time regime centralised about all the territory of
the state.

Regular (daily) statistical information is available:

In the homepage of the Register of Enterprises “Information”

http://www.ur.gov.lv/index.php?t=3&a=1&v=lv
(in Latvian only)

In the home page of Lursoft “Statistics”
http://www.lursoft.lv/stat/(in Latvian only)

Information about legal proceedings in the courts’ home pages and in the portal:
http://www.tiesas.lv

If there is an interest it is possible to prepare in depth analysis of previously
mentioned fields and to create new statistical indicators.

General developments

Speaking about economic development 2003 comparing to the previous year could
be considered gradually growing, in addition for several indicators like the registration of new enterprises / businessman, crediting by
using the commercial pledges, the attraction of investments in enterprises capital shares the growth is very important even several
tens percentage. In the same time last year the concurrence and the intensity of the market were growing in
certain economic fields therefore less resources were attributed to the development of the enterprise. Even if the total turnover of
enterprises in 2002 has increased for about 8…10% the net income, to be attributed for the development of the enterprise
decreased considerably, mostly in the case of big enterprises and in some cases of fictive enterprises. This tendency shows how important
is to have state support for small and medium sized enterprises. From one side it is easier to manage and have bigger income with big
enterprises, from the other side economic and political change could have much greater impact on these enterprises. And in the case of
such changes both direct impact on economic system of the state and non-direct impact on the growth of unemployment level and following
growth of criminality create more important disadvantages for the state than in the case of bankruptcy of even several tens small enterprises,
which are easier to re-profile.

Each year analysing the reports for about 10 000 (in 2003 this number was 11175) enterprises that have submitted the
reports to the Register of Enterprises it is possible to conclude that the overallincome for this group of enterprises after the taxes has decreased
for 1,7%, with growth in the turnover for 8,3%. According to the submitted annual reports, it is possible to conclude that in 2002
enterprises have invested their incomes in the development and this tendency lasted in 2003.
http://www.lursoft.lv/stat/ur_stat_360.html (in Latvian only)

In the same way even if the number of registered commercial pledges has increased for 21% during the last year, the overall credit sum allocated for
these pledges, which is proportional to the credit amount allocated, has decreased for 15%.

The foreign investment in the enterprise capital shares in the end of the last year comparing to the 2002 has increased for 4,6% reaching the
amount of 1,17 milliard lats. It has to be added that during the last year the amount of Russian enterprises and physical persons
investment has increased notably (for 103,4% comparing to the investments in 2002) reaching the amount of 91 millions. And therefore in the “top” of the active foreign investment
Russia is in the 4th position after Sweden, US and Denmark. Russia is in the first place regarding the enterprise capital shares and the number of auctioneers (1620). Overall in
1/1/2004 the investors registered were from 113 countries. In the last year the investors appeared from such territories / countries as
Cote d’Ivoire, Saint Pierre and Mikelone – probably this is not so much related to the real investment from these countries
but to the fact that our businessmen are discovering new tax free zones.

http://www.lursoft.lv/stat/ur_stat_inv_gru.html (in Latvian only)

It has to be added that during the 2003 comparing to 2002 the cases of insolvency submitted to the courts have increased for 15,7% and the number of
insolvency trials has increased for 3,8%. This process is to be explained not so much with the decrease in the financial situation of
the enterprises but more with the increase of the insolvency administration in the middle of the last year, which on the other hand is related to the fact that important financial resources from
the functioning enterprises in the form of risk duty were allocated to the funding of insolvency trials. As it was concluded this new
duty for working enterprises were calculated much bigger that it was necessary for the administration of the trials, therefore most of the
financial resources detracted from the working enterprises were blocked. Even if in the end of the year this mistake was discovered and the risk duty was decreased however this duty was maintained and
in order to justify the blocking of resources, the amount of the refund allocated to one person.

In the same way the work of the State income bureau was activated, as the result of which the Register of Enterprises is able to apply the norm
introduced in the Law long time ago about the deletion of the non-functioning enterprises from the Register. Hopefully as the result of this process as well as relating to the re-registration in
the Commercial Register during this year from 20 to 25 thousand enterprises could be liquidated and removed from the Register of
Enterprises. During the last year the State income bureau was the most active institution regarding the forbidding and the
re-registration of capital shares submission to the Register of Enterprises – during the last year this kind of restrictions
were registered for 3881 enterprise and 712 owners of the enterprise capital shares, that is less than in 2002 (4015 and 975 respectively)


http://www.lursoft.lv/stat/ur_stat_200.html (in Latvian only)

More detailed information about developments in 2003 could be found in the Lursoft home page at the Statistical data (in Latvian only). Data is
available free of charge about more than 400 different indicators and they are updated at least once a day. In particular cases it is
possible to prepare in-depth analysis of the given areas and prepare new statistical entries.

It total in the different registers of the Register of Enterprises till the 1st of January of 2004 following registration case
were introduced:











































































































Registered cases Registered Active 1
Enterprises (total) 175623 135043
Businessmen and commercial societies (including re-registered ones) 21007 20903
Concerns and decisive influences / partnerships 46 44
Non governmental organisations 7946 7706
Mass media 4288 3643
Representative of the foreign enterprises 987 395
Commercial pledge applications / registered acts 40508 21291
Contracts of Married Persons Belongings 3548 3540
Procurement 490 490
Procurists 507 507
Officials of the enterprises and commercial organisations* (of whom registered as dead-4357) 300000* 213936
Owners of the enterprises and commercial organisations (approx.) 590000*
Enterprise annual reports (column active – about 2002) 237759 44898
Concessions 1 1
Political parties and their unions 62 59
Members of the non-governmental organizations 178126 178126
Re-registration interdictions for enterprises imposed by the State income bureau 13265 12092
Interdictions to sold capital share imposed by the State income bureau 4897 2731
Insolvency cases in total / unfinished trials 6288 2597
Units in total (cases / documents) 1604373 1324022

1 active – enterprises or commercial organisations, (or acts) that are not excluded from the Register of Enterprises, for more and daily
up-dated information check:

http://www.lursoft.lv/stat/,
http://www.lursoft.lv/stat/ur_stat_002.html (in Latvian only)

* – approximately as in the beginning (1991 – 1993) person’s identification codes were not registered and there is no common
register of the legal persons.

More detailed analysis about the tendencies from every previously mentioned data position will be sent to the interested persons in the
following days.

Enterprises and Commercial Registers (further Register of Enterprises (RE)):

Registration of new commercial subjects

In 2003 comparing to 2002 the number of new commercial subjects has increased. In total 7,693 new legal persons have been registered and
7112 have been registered as commercial organisations or commersants.

http://www.lursoft.lv/stat/ur_stat_003.html(in Latvian only)

It has to be added that this is a very significant indicator of the growth of economic activity. In addition during the last ten years from 1992
when 37 679 enterprises were registered the pace of registration was decreasing every year for about 5 – 8 % and in 2002 it reached
6288 registered enterprises.

Re-registration in the Commercial Register

Taking into account the norms introduced in the Commerce Law in 2003 in more active way the re-registration of enterprises continued – in
the last year 8 236 enterprises or enterprise organisations re-registered themselves that is almost 9 times more than in 2002 (945). http://www.lursoft.lv/stat/ur_stat_198.html
(in Latvian only)

Herewith in 2003 the entries of Commercial Register and in the same time the amount of work for the RE in the last year augmented almost 3 times
comparing to the last year, even if the state funding remained almost unchangeable.
http://www.lursoft.lv/stat/ur_stat_164.html (in Latvian only)

Liquidation of commersants and enterprises

In 2003 2986 enterprises were liquidated that is for 8% more than in 2002. Before this indicator was 12%. This means that stable economic growth of the
last year is determined not only by the increase of the number of newly registered commercial organisations but also with the pace of
the enterprise liquidation, which decreased for about 4%. http://www.lursoft.lv/stat/ur_stat_003.html(in Latvian only)

The amount of the enterprise liquidation in areas of activity is to be accessed here: http://www.lursoft.lv/stat/ur_stat_124.html (in Latvian only)

More than a half of the enterprises liquidated in the last year were limited society enterprises.

Forms of the enterprises

In 2003 similarly to the previous years most of the registered enterprises were limited liability enterprises 5,484.
http://www.lursoft.lv/stat/ur_stat_015.html (in Latvian only)

This form of the enterprise was most popular also in the cases of the re-registration in the last year in the Commercial register
there were 7,947 enterprises of limited liability, which were registered previously in the Register or Enterprises.
http://www.lursoft.lv/stat/kmpall.html (in Latvian only)

In total till the beginning of this year there were 97967 limited liability enterprises registered, of those
liquidated 69240. Second most used form for the start of the commercial activity in 2003 was registration of individual
commersants – in the last year 1531 individual commersants were registered. It should be added that in the last year the registration
of individual enterprises continued – 47 new individual enterprises were registered. To remind that main difference between
the individual commersant and physical person is the responsibility – individual commersant is a physical person with rights to maintain
certain kind of business and it is responsible with all his movables. On the other hand individual enterprise is legal person created by
physical person with not really well defined level of responsibility during the first years of registration it is even possible to note
several individual enterprises that are owned by the same person. Updated list of subject registered within the Register of Enterprises
and Commercial Register regarding their legal form is available here: http://www.lursoft.lv/stat/ur_stat_021.html (in Latvian only)

Agricultural enterprises as legal and economic anachronism

Unfortunately, implementing the reform of the commercial register, the question of the status of agricultural and fishing enterprises
was not solved even if this form of business should not differ legally from the status of physical person with commercial activity –
commersant of legal person (family members or organisations founded by other person groups). The influence of particular political
parties during the elaboration and the adoption of the Commerce Law unfortunately this soviet (or even middle ages) anachronism was
maintained, creating obstacles the creation of harmonized legal and economic area. Starting with the basic things – if in the
Commerce law the responsibilities and rights of the enterprises are described in a cohesive form in order to analyse with what kind of
norms these organisations should be in conformity it is necessary to read more than 120 normative acts that were elaborated for the
regulation of the commercial activities.

Agriculture is in the most cases only one of the agriculturers (fishers) activities often in these enterprises alternative business
activities are developed, for example tourism or even sell the products produced in foreign countries and oil products. In the same
way both individual commersants and limited liability societies deal with agriculture.

In addition to the previously mentioned anachronism by applying the directive of the European Union part of these enterprises had to be
re-registered in the so called “Register of the Food Producers”, that is created as a separate register. It is possible to conclude that this lobbied inaccuracy in the Commerce law
and parallely created system of the “food producers registration” is to be explained not so much with interest topromote the enterprises related to the agriculture and protect them
from the negative impact of the re-registration process, but more with the interests to leave enough legal misunderstandings relating
to the future agriculture subsidy funds of the European Union and popular “e-solutions” for the acquisition of the money.
This kind of the conclusion is due to the fact that status of the agricultural enterprise sooner or later will be solved,
re-registration process in more accelerated process had to be done for them as well. And as a result for the financial means to be
attributed for the informative system during one year is two times bigger (more that 1 million EUR of the state budget funding) than all
the introduction of the Commercial Register and maintenance during three year period. It should be admitted that essentially this food
producers informative system describe one group of economic indicators – economic activity and forms or production, in
contrary to several tens of indicator groups, that are registered in the Commercial Register.

As a result of this anachronism in the last year as well 351 new agricultural organisations were registered and in
total this is the second most used form of business activity. In the Register of Enterprises there are in total 37 216 agricultural
societies of which liquidated 34 285. http://www.lursoft.lv/stat/ur_stat_021.html (in Latvian only)

To be continued…

Autors

Lursoft