The Latvian Ministry of Economy has introduced (13 November) proposed amendments to the competition law, aiming to extend responsibility for competition law breaches to individual officials of companies involved in prohibited agreements. Currently, sanctions apply only to the corporate entities, but the new proposal intends to hold officials personally accountable for violations, enhancing preventative measures and encouraging active compliance.
The Ministry believes that placing liability on officials will incentivize them to prevent violations proactively or cooperate with the Competition Council in uncovering infractions. The draft law, open for public consultation until November 25, also includes provisions for inter-institutional coordination.
Under Latvia’s existing legal framework, the Competition Law safeguards fair competition across all sectors, targeting illegal practices like abuse of dominance and restrictive agreements. While companies found in violation can face fines of up to 10% of their annual net turnover, individuals are not currently penalized. However, the proposed amendments would introduce a specific chapter assigning accountability to company officials involved in anticompetitive practices. This administrative responsibility would include penalties for officials overseeing prohibited agreements.
Additionally, the amendments propose empowering the Competition Council with new authority to temporarily restrict offending officials from holding executive positions in any company, further deterring competition law breaches.
The Ministry highlights findings from the OECD member states, which suggest that corporate liability alone has limited deterrent effects. Imposing personal liability on individuals responsible for violations is expected to boost compliance efforts and prevent illegal conduct, strengthening competition integrity in Latvia.
The Ministry of Economy encourages interested parties to share their feedback on the draft amendments, fostering a collaborative approach to enhancing fair market practices.
