On Thursday, the Saeima’s Legal Affairs Committee approved for the third reading a new draft law that would prohibit Russia and Belarus, as well as their citizens, from purchasing real estate in Latvia.
The proposed ban would also apply to legal entities registered in Russia or Belarus. Furthermore, it would extend to legal entities in which citizens of these countries hold at least 25% of the share capital, where Russian or Belarusian citizens are beneficial owners, as well as to legal structures established in Russia or Belarus.
The ban would apply to transactions concluded after the law comes into force.
According to the authors of the draft law, alongside its military aggression in Ukraine, Russia is waging a hybrid war against other democratic and sovereign states that do not support or that condemn Russia’s aggression, or that support Ukraine in its defense. Latvia is among these countries.
One of the tools used by Russia to exert non-military influence — and a component of hybrid warfare — is the indirect acquisition of real estate in other countries. Russia has also used the presence of its citizens abroad as a pretext for initiating military actions, justifying its military conduct as the defense of its citizens. The Saeima has previously emphasized that the war initiated by Russia — Latvia’s neighboring country — against Ukraine necessitates special attention to the protection of Latvia’s national security and consideration of new national security measures, the draft law’s authors note.
The explanatory note stresses that ignorance of the law does not exempt parties to a transaction from the obligation to comply with it. Individuals must choose transaction partners who meet the legal criteria and cannot claim they were unaware of the law’s provisions. Therefore, potential sellers of real estate will be responsible for evaluating whom they are signing purchase agreements with and must take into account the consequences — namely, that under the law, such transactions will be deemed invalid.
For the law to enter into force, it must still be passed in the final reading by the Saeima.