The European Bank for Reconstruction and Development will actively search further investment possibilities in the merchants of the Latvian energy supply safety and energy safety, financial and export sectors.
The development of the Rail Baltica project will be continued, inter alia, also the detailed technical due diligence of the development of railway connection.
On the political level, fight may be expected in the field of Latvian gas market liberalisation.
Extensive discussions in 2016 will be caused by the new Public Procurement Law, which has to be adopted by 17 April 2016, and the expected amendments to the Law on the Procurement of Public Service Providers and the Public and Private Partnership Law.The purpose of the new regulation is to facilitate the administrative procedures for customers. However, it will be more complicated for the suppliers to control the objectiveness of customers. Considering the fact that in certain industries the major part of the orders are received through public procurements, the issues of interpretation and application of that law will have a material impact influence on the businesses of the merchants operating in those industries. Such impact may be compared to the topicality of introduction of the principle of “the put down keys” and Regulation No. 2015/751 regarding the interbank commission fees applied to the payment transactions attached to cards, whereunder a significantly lower maximum commission fee was determined as compared to the previously applied fees, in the Banking sector in 2015.
Essential amendments to the Competition Law are expected in 2016; they are currently reviewed in the third reading by the Parliament and might come into effect already on 1 March 2016. Notwithstanding the fact that the amendments had been drafted for a period of three years, they caused broad discussions at the end of the previous year, prior to their review in the third reading. Those amendments will have a material impact on the activities of merchants, as they prescribe a) compulsory fine for the failure to comply with the legal obligation approved by the Competition Council (CC), b) the right of the CC to request information from the electronic communication merchants and credit institutions, c) having established during dawn raids that there is no evidence at the place of inspection, but having justified information that it is available elsewhere, e.g., at the cooperation partner, the investigators of the CC will be entitled to search for the evidence without the judge’s consent, and to obtain it after the inspection, d) the officials and employees of the CC will have to comply with confidentiality requirements also after termination of legal relationship with the CC, and they will not be able to represent a private individual, against whom they have performed certain activities within the competence of the CC, for a period of 2 years, e) the obligation to notify of the merger will be applied only upon certain sales criteria setting in; however, the CC will be entitled to request a merger notification, if the market share exceeds 40%, even without the aforementioned criteria setting in, f) in case of a merger the CC will be entitled to determine an additional period for the assessment of legal obligations, g) there will be larger fines for illegal merger, h) the CC will be able to determine priorities for initiation of cases by refusing to initiate investigation of each case, etc.
2016 will show how the Law on Prohibition of Unfair Retail Practice, the purpose whereof is to limit the power of a retailer towards suppliers in order to balance the interests of suppliers and retailers, will influence the range of products, their prices and product promotion campaigns in supermarkets. There is some concern that the necessity to ensure the above balance might have an adverse effect on the aforementioned indicators. The regulation may encumber access of suppliers to retail networks and reduce the range of products manufactured by them on the shelves of stores.
The increase of minimum wage by 10 euros and the increase of the excise tax upon growth of the oil price will increase the expenses of merchants in 2016. Introduction of the solidarity tax, which most probably will be contested in the Constitutional Court, may cause the merchants to look for solutions to motivate their managing staff. As from 1 April 2016 the credit institutions, payment service and electronic money service providers will have to notify the State Revenue Service of the suspicious transactions complying with the characteristics of suspicion in the tax area performed by persons registered in Latvia and residents of Latvia. For example, large transaction volume uncharacteristic to the particular client; the transaction lacks obvious legal purpose related to business or personal activity; a private individual invests in a commercial company, disburses, lends or borrows from another private individual in cash, through one or several transactions, EUR 60,000 or more; tax evasion; gross changes in the account balance (increase turnover, etc.); the transaction is atypical for the client or the client performs complex and unusual transactions, which themselves or certain terms whereof lack clear economic or legal purpose.
Responding to the decision adopted in October 2015 by the European Court of Justice in respect of Facebook case or the case Maximillian Schrems v Data Protection Commissioner, which cancelled the transfer of personal data to the USA as to a country that ensures the same data protection level as the EU member states, in 2016, the merchants, who have received and transferred data for processing in the USA, will continue assessing the volume of the received and transferred data and will work at the development of alternative solutions for data processing in the USA (the undertaking to ensure adequate data protection level and consent of the data subject to the transfer of data to the USA, or, if the transfer of personal data is performed within the framework of one group of companies, that the binding regulations of the company approved by the Data State Inspectorate have been introduced, etc.).
Since the Maxima store collapse, the Riga Castle fire and Latvijas projektēšanas sabiedrība raiderism cases will continue to be adjudicated, the understanding of the issues of the liability for construction and safety, moral damage, insurance of the respective risks and illegitimate takeover of companies will improve.
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