On 8 November 2023 the OECD’s Global Forum published the second-round peer review report on Latvia’s implementation of the standard on transparency and exchange of information (EOI). Latvia’s implementation of the EOIR standard was given an overall rating of “Largely Compliant”.
Generally beneficial ownership of general and limited partnerships takes a 25% ownership as a starting point and then looks at control if no beneficial owner is identified based on the percentage of ownership. However, there is no clear guidance on identifying beneficial ownership and the approach may not identify persons who have control but do not have a level of ownership above the threshold. The report therefore recommends that beneficial owners of partnerships must be identified on the basis of the form and structure of each partnership.
The report noted that Latvia has made progress in ensuring the availability of ownership information, through measures including through the establishment of a beneficial ownership register. The report recommended that Latvia should implement effective supervisory and enforcement measures to ensure the ownership information filed with the Enterprise Registrar is accurate.
The report recommended that Latvia should address the remaining gaps in its ability to access and exchange banking information. Latvia should ensure that its competent authority has the power to access all banking information that may be requested by treaty partners and that the domestic law allows this information to be exchanged.
In the period under review Latvia received 572 requests for information exchange and sent 969 information requests to EIO partner countries. The report noted that Latvia’s exchange of information mechanisms were effective in practice, with 92% of incoming requests answered within 90 days. The report recommended that regular status updates should be provided in relation to the remaining requests to keep the partner jurisdiction informed of progress in answering their request.
The provisions of Latvia’s EOI agreements override the domestic law confidentiality rules, which allow much wider use of the information. There is however a possibility that if information is not clearly identified as received under an EOI agreement it may be used for purposes not envisaged by the agreement. The report therefore recommends that Latvia should take action to address this by ensuring that information received from another jurisdiction can be clearly identified and subject to the more restrictive confidentiality rules provided for in the EOI agreements.