The number of insolvency proceedings in Latvia continues to decrease, while the number of legal protection proceedings remains at the same level with slight fluctuations, according to a study by Lursoft IT, as reported by Dienas Bizness.
Last year, there were 562 insolvency proceedings announced for legal entities, while in 2024, there were 735. Among individuals, these figures were 274 and 299, respectively.
The data shows that a more rapid decrease in the number of insolvency proceedings has been observed since 2020, when government support measures introduced during the Covid-19 pandemic and the extension of tax payment deadlines allowed some businesses to cope with short-term problems, avoiding insolvency. In the following years, despite rising energy prices, high inflation, and increasing geopolitical risks, the number of insolvency proceedings did not return to previous levels.
"The number of declared insolvency proceedings for legal entities in 2025 was only slightly lower than in the previous year; however, the trend remained unchanged - insolvency proceedings cover only a small portion of businesses that have actually ceased operations and are unable to cover their debts. This is due to two main factors - the high costs of the process and the so-called simplified liquidation process, through which in recent years the State Revenue Service and the Register of Enterprises have liquidated tens of thousands of inactive companies," notes insolvency expert Helmuts Yauya.
He emphasizes that simplified liquidation has become a convenient tool through which entrepreneurs themselves try to get rid of unnecessary businesses, and sometimes also of liability for transactions made.
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