Legal prism — 2026-10-15

What sanctions and scope of obligations take effect for Latvian merchants and media following the 2025–2026 amendments to state language regulation, and what is the timetable for their application.

Legal basis: Here I rely on the legal framework referred to in the news report, not on the text of the norms provided in the database. The report identifies three specific blocks of amendments: the 2025 amendments to the Credit Institutions Law, under which credit institutions must, by 30 September 2026, ensure the provision of financial services in Latvian, including documents, digital interfaces and communication solutions; the amendments to the Administrative Violations Law that entered into force in August 2026, which increased the monetary fine for disrespect towards the state language, for failing to form names in the state language, for not using the state language in the scope of professional duties, and for failing to provide translation; and the amendments to the Law on Public Electronic Mass Media and their Management adopted on 1 October 2026, which, from 1 January 2027, permit content in self-sufficient minority languages only in a state of emergency, a state of exception, or for the purpose of countering disinformation. A significant step is that, according to the legislator's interpretation, disrespect towards the language may also manifest itself in actions, gestures and internet comments, not merely in words — this broadens the range of sanctionable conduct. The specific amounts of the penalties are not stated in the report, so the analysis of quantitative sanctions rests solely on the ranges set out in the text of the law, not on data provided here.

Practical significance: Credit institutions' compliance and legal departments must verify that, by 30 September 2026, not only the contract text but the entire customer journey's digital interface is available in Latvian — this is a new category of obligation, not merely a translation exercise. Merchants with product names, packaging and consumer information must reckon with an elevated risk of administrative fines as early as August 2026; moreover, grounds for a violation may also arise from website content or public comments, which were previously practically never penalised. Media legal advisers must, by 1 January 2027, assess the legal basis of every piece of content produced in a minority language, since the list of exceptions is exhaustive and commercial interest or audience demand does not fall within it. The point to monitor is the State Language Centre's supervisory practice following the increase in penalties — the first administrative violation proceedings of 2026/2027 will show what the de facto intensity of enforcement will be.

What is the legal mechanism by which the merger of the three Baltic "SEB" banks into a single legal entity on 1 January 2027 transfers all contracts, rights and obligations to the new "SEB Bank" AS, and how does the jurisdiction for deposit protection change when the Latvian and Lithuanian guarantee schemes are replaced by Estonia's Tagatisfond?

Legal basis: The report does not cite specific statutory provisions, so I rely on the general legal principles formulated by the bank's own announcement: "all rights and obligations of the existing banks, as well as the services provided, will automatically transfer to 'SEB Bank' AS." This is a description of the principle of universal succession — the universal transfer of rights and obligations — which in cross-border bank mergers in the Baltic states is typically implemented through cross-border merger regulation and a merger decision adopted in each state, rather than through individual contract assignment (novation). The change in deposit protection indicated in the announcement rests on the logic of the EU Deposit Guarantee Schemes Directive (2014/49/EU): the level and procedure of protection are determined by the law of the Member State in which the merged bank is registered — in this case, Estonia's Tagatisfond. Since no direct statutory wording is available in the materials, the precise legal form of the merger (a cross-border merger under the relevant EU directive or another structural reorganisation) cannot be determined from the provided text, and I do not confirm this aspect.

Practical significance: The practically most important point is the change of jurisdiction for depositor and investor protection: from 1 January 2027, claims against the guarantee fund must be brought under Estonian law rather than under the Latvian deposit guarantee system, which changes the applicable procedure, any possible payout limits, and the payout procedure. Lawyers representing clients with large deposits or investment products should review the contractual references to the guarantee scheme and compare the Tagatisfond coverage parameters with the previous Latvian standard level of EUR 100,000 — the report does not state these Estonian limits, so they must be verified before the merger date. A second risk concerns the continuity of contracts: since existing contracts remain in force and transfer automatically, clients need not sign new contracts, and any request from "the bank" to do so or to confirm data via a link is a sign of fraud — the bank itself states that it does not send links to internet banking by email and never asks for authentication credentials. A point for ongoing monitoring: watch for the merger decision to be approved by the Finance and Capital Market Commission and Estonia's Finantsinspektsion, and for the official client communication document on the procedure for the transition of deposit guarantees to be issued before 1 January 2027.

The limits of fines under Article 41 of the Criminal Law are 1 to 100 minimum monthly wages for a criminal violation and up to 5,000 minimum monthly wages for a particularly serious crime, and the fine must be paid to the state within 30 days.

Article 50(4)(1) of the Criminal Law permits the accumulation of penalties of the same type, provided that the aggregate may not exceed the maximum by more than one half.

Core issue

The legal status of the persons involved in the sawmill case will henceforth be determined not by the Constitutional Court proceedings, which were discontinued this week, but by the criminal proceedings, which will continue following the announcement by the Prosecutor General's Office. The Constitutional Court's refusal to initiate the case does not affect the set of criminal liability risks grounded in the Criminal Law and the Criminal Procedure Law. The specific legal question is what penalties may be imposed, and in what manner, if the investigation concludes with charges of criminal offences related to the use of state forest resources at a below-market price. In such a resolution, Article 35, Article 36, Article 41, Article 46 and Article 50 of the Criminal Law will primarily apply, while the procedural framework will be governed by the Criminal Procedure Law.

Legal assessment

If a person is found guilty, the principal penalties provided for in Article 36(1) of the Criminal Law are imprisonment, probation supervision, community service, or a fine. Ancillary penalties under Article 36(2) include confiscation of property, expulsion from the Republic of Latvia, probation supervision, community service, a fine, and restriction of rights — confiscation of property being the practically most significant ancillary consequence in cases of this kind. The quantum of the penalty is determined under Article 46: the penalty corresponds to the sanction of the applicable provision of the Special Part, taking into account the nature of the offence, the harm caused, the personality of the offender, and any mitigating or aggravating circumstances. The limits of fines under Article 41 depend on the category of the criminal offence:

• for a criminal violation — 1 to 100 minimum monthly wages;
• for a less serious crime — 3 to 1,000 minimum monthly wages;
• for a serious crime punishable by imprisonment of up to 5 years — 5 to 2,000 minimum monthly wages;
• for a serious crime exceeding 5 years or a particularly serious crime — 10 to 5,000 minimum monthly wages.

If the proceedings consolidate several offences, Article 50(1) will apply — the penalty is determined separately for each offence, and Article 50(4)(1) permits the accumulation of penalties of the same type, provided that the aggregate may not exceed the maximum by more than one half. Procedurally, Article 290 of the Criminal Procedure Law permits the imposition of a warning or a coercive fine on persons who breach the procedural order, and Article 290(3) expressly states that this does not exclude administrative or criminal liability. In case law concerning fines imposed as procedural sanctions, the Constitutional Court, in its opinion on the conformity of Article 441(2) of the Civil Procedure Law with Article 92 of the Constitution, held that the primary function of such a sanction is to ensure the proper and timely course of the specific proceedings, and that it does not fall within the scope of a criminal penalty under Article 6 of the Convention — meaning that procedural sanctions and criminal penalties are distinct mechanisms with distinct safeguards. The enforcement of penalties after a judgment enters into force is governed by Articles 1 and 4 of the Latvian Sentence Enforcement Code: the basis for the enforcement of a penalty is a court decision that has entered into force, or a prosecutor's order imposing the penalty.

Consequences

The realistically possible scenarios in the sawmill case are as follows:

• the investigation will continue, and its outcome may be the bringing of charges or the termination of the proceedings — the decision rests with the person directing the proceedings;
• if a court or prosecutor finds guilt, the penalty may be a fine of up to 5,000 minimum monthly wages depending on the category of the offence, imprisonment, or lighter penalties under Article 36 of the Criminal Law;
• ancillary consequences — confiscation of property and restriction of rights under Article 36(2) and point 6 thereof, which for businesses may also entail a pecuniary loss exceeding the benefit derived from the lower price;
• if the offence was committed by an organised group, the possibility under Article 53(2) of the Criminal Law to impose a lighter type of penalty is excluded.

This is of practical importance both to the persons and companies involved, who must assess the risk of penalties and confiscation, and to the state, whose budget lays claim to fine and confiscation proceeds. The next point to monitor: the announcement of the Prosecutor General's Office regarding the course of the criminal proceedings and, should the case reach court, the indictment and the court judgment, which will constitute the basis for the enforcement of the penalty under Article 4 of the Sentence Enforcement Code.

The notification threshold under Section 15, Paragraph Two of the Competition Law for a transaction is a combined turnover of the concentration participants in Latvia in the preceding financial year of at least EUR 30 million, of which at least two participants each have a turnover of at least EUR 1.5 million.

Section 16, Paragraph One of the Competition Law: within one month of receipt of the notification, the Council examines the notification and either adopts a decision or decides to initiate an in-depth investigation; the time limit may be extended to up to four months.

Core issue

The contemplated transaction by “Virši-A” is legally not an ordinary acquisition of property, but rather a potential concentration of market participants, which may only be carried out prior to its implementation with the authorisation of the Competition Council. The acquisition of long-term lease rights over four fuel stations may qualify as a concentration within the meaning of Section 15, Paragraph One, Item 3 of the Competition Law — the acquisition of a market participant's assets or of rights to use them — and the assessment of such a transaction falls within the competence of the Council. The notice confirms that this mechanism is already in operation: the Council is reviewing the transaction and invites interested parties to submit their opinions by 21 October. The legal position is therefore not final: “Virši-A” may receive authorisation, a prohibition, or authorisation subject to conditions.

Legal assessment

The notification of the acquisition of assets or rights to use them must be submitted by the participant acquiring the assets or rights (Item 3 of the Cabinet Regulations on Notifications). The notification must also set out the legal, financial and economic aspects of the concentration, including restrictions of competition directly related to the transaction (Item 21 of the Regulations). The examination procedure is governed by Section 16, Paragraph One of the Competition Law: within one month of receipt of the notification, the Council examines the notification and either adopts a decision or decides to initiate an in-depth investigation. The rights of third parties — competitors and other interested parties — to express an opinion are ensured by the Cabinet Regulations issued pursuant to Section 15, Paragraph Five of the Competition Law, Item 36 of which provides for the publication of the invitation on the Council's website; an opinion submitted after the deadline may not be taken into account. Case law confirms that the acquisition of assets or of rights to use them is assessed as a concentration: in case No. p/08/10/1 against SIA “Latvijas Mobilais Telefons”, a violation of Section 15, Paragraph Two was established — the transaction was implemented without prior submission of a notification — and a fine was imposed. For the present situation, this means that the transaction may not be implemented until the Council's decision, and the key assessment criterion is the impact on the fuel retail market, including the local market segment between Riga and Jēkabpils.

Consequences

There are three possible scenarios:

• Authorisation — the transaction may be implemented, and the “Virši” network would grow to up to 105 fuel stations.
• Authorisation subject to conditions — the Council may make the authorisation of the transaction conditional upon additional conditions for the protection of competition.
• Prohibition — the transaction may not be implemented. In practical terms, this is important first and foremost for the other fuel retailers and retailers in the relevant market segments — they may submit a substantiated opinion on the impact on competition by 21 October. Following the transaction, “Naftimpeks” may lose its involvement in these stations, and its legal position is therefore likewise dependent on the decision.

Under Article 16(4) and Article 17(2) of the Constitutional Court Law, an application concerning the conformity of a non-normative act of the Cabinet of Ministers with law may be submitted only by the President of the State, the Saeima, no fewer than twenty Members of the Saeima, the Cabinet of Ministers, and the Judicial Council within the competence prescribed by law.

As noted in the materials on Article 19.2(4) of the Constitutional Court Law ([14]), the abstract review model provides no time limit for filing an application; therefore, an authorised subject applying even in 2026 would face no time-bar obstacle.

Core issue

The Prosecutor General and the ten involved persons in the "timber merchants case" are currently in a situation in which no one will be able to assess the legality of the Cabinet of Ministers' protocol decision until one of the institutions vested with the right to do so applies to the Constitutional Court. The government in office at the time the prosecutorial protest was examined did not annul the decisions, and the Constitutional Court did not initiate proceedings on the Prosecutor General's application because he does not have the right to file applications in the relevant category. The legal question is one of subjective standing: who may submit an application concerning the conformity of a non-normative act of the Cabinet of Ministers with law. The answer lies in the system of Article 17 and Article 16(4) of the Constitutional Court Law: under Article 16(4), the Constitutional Court reviews "the conformity of an act of the Saeima, the Cabinet of Ministers, the President of the State, the Speaker of the Saeima and the Prime Minister, other than administrative acts, with law", and an application concerning the conformity of such an act may be submitted only by the President of the State, the Saeima, no fewer than twenty Members of the Saeima, the Cabinet of Ministers, and the Judicial Council within the competence prescribed by law ([1], [2]). The Prosecutor General as an applicant is mentioned only in Article 17(1) in relation to abstract review of laws and normative acts ([6]), which does not cover a protocol decision instructing LVM to adjust prices in long-term contracts, as a non-normative act. The further legal situation therefore depends on political initiative — whether one of the five authorised subjects applies — and on the criminal proceedings, in which the question of damages will be resolved independently of constitutional litigation.

Legal assessment

The Constitutional Court's refusal is not a judgment on the merits — the Prosecutor General points out that the prosecution's arguments regarding the absence of a delegation of authority to alienate the property of a public person on terms more favourable than those provided for in civil-law contracts have remained unassessed. The following division of competence emerges from the sources:

• Article 17(1) of the Constitutional Court Law ([6]): the Prosecutor General has the right to file applications concerning laws, international agreements, the conformity of normative acts with norms of superior force, and the conformity of national norms with international agreements — that is, the categories referred to in Article 16(1)–(3) and (6).
• Article 17(2) ([1], [2]): an application concerning the conformity of another act of the Cabinet of Ministers, other than administrative acts, with law is submitted by the President of the State, the Saeima, no fewer than twenty Members of the Saeima, the Cabinet of Ministers, and the Judicial Council within the competence prescribed by law.
• Article 25(1)(2) ([12]): if proceedings were nevertheless initiated, the Constitutional Court would hear the case in full composition, and under Article 24 the parties to the proceedings — the applicant and the issuer of the act — would acquire the right to familiarise themselves with the case materials. The status of the Judicial Council does not confer the right to file an application on Meists, because the Council has such rights only "within the competence prescribed by law", and the Prosecutor General explicitly states that he can neither indicate nor invite another institution to exercise its rights. Among the sources is Constitutional Court practice showing how the Court assesses the Cabinet of Ministers' conduct based on an authorisation: the judgment of 28 September 2020 in case No. 2019-37-0103 ([11]) — the Court examines whether the Cabinet of Ministers has respected the limits of the mandate set by the legislator, namely whether the specific provision conforms to the provision of law on the basis of which it was issued; an analogous approach is also expressed in the judgment of 20 March 2020 in case No. 2019-10-0103 ([7]). This approach would also be applicable to the facts of the "timber merchants case" — whether the Cabinet, by instructing LVM to change the price-setting procedure, acted on a delegation contained in law, as was the prosecution's argument. The distinction between abstract review and the other categories is also significant in terms of time limits: as noted in the materials on Article 19.2(4) of the Constitutional Court Law ([14]), the abstract review model provides no time limit for filing an application, since subjects representing the public interest may apply without temporal limitation. The route of a constitutional complaint (Article 19.2) requires the applicant to show a personal violation of fundamental rights ([9]), so an external application would have to rely precisely on the circle of subjects under Article 17(2).

Consequences

The realistically possible scenarios for development are as follows:

• None of the authorised subjects applies to the Constitutional Court — the legality of the protocol decision remains unassessed, and the issue will be closed only within the criminal proceedings; Meists notes that the invitation remains in the hands of officials and institutions.
• The President of the State, the Saeima, at least twenty Members of the Saeima, the Cabinet of Ministers itself, or the Judicial Council files an application under Article 16(4) — the Court would assess whether the decisions on price adjustments in LVM contracts had a lawful delegation of authority, applying the mandate-limits review formulated in case 2019-37-0103.
• The legislator considers expanding the Prosecutor General's powers or establishing clearer conditions for the government's applications after a change of government — this is a matter of political determination which Meists does not regulate.
• The criminal process continues independently: the ten persons' procedural statuses have not changed, no security measures have been applied, and Meists predicts that in the near future the prosecution will inform the public about the progress of the case; the amount of damages of around EUR 50 million will be assessed in the proceedings. This matters practically for state budget risk planning: if constitutional litigation never takes place, the question of the legality of the price adjustment will remain resolvable only through criminal-law and, potentially, civil-law compensation channels.