Legal expert warns new criminal law on procurement cartels could backfire
Legal commentator Romāns Meļņiks warns that a new Criminal Law article on procurement cartels, rushed through parliament before elections, may create more problems than it solves. He calls for careful evaluation of evidentiary challenges and comparison with Estonia, which decriminalized similar violations last year.
Amendments to Latvia's Criminal Law heading to a third reading in parliament would introduce a new Article 211.1, establishing criminal liability for prohibited agreements in public procurement — such as coordinating bids with competitors or agreeing not to participate in a tender. Serious violations could carry a prison sentence of up to five years, though a person who is first to voluntarily report a violation could be exempted from liability. The law is slated to take effect on October 15, 2026.
Legal commentator Romāns Meļņiks stresses that cartels themselves are unacceptable and must be firmly opposed, but voices concern about the chosen legislative tool. He recalls Latvia's prior experience: in 2021, the Competition Council imposed a €16.65 million fine on a construction-industry cartel, but the country's highest court later overturned the decision due to the lawfulness of how evidence had been obtained and used. Similar cases involving an energy-construction cartel and a Volkswagen dealer cartel also dragged on for years in court.
Meļņiks points to the risk that companies could be excluded from procurement procedures based merely on suspicion, before an individual's guilt is established in criminal proceedings — creating divergent and uncoordinated outcomes. He also warns of unequal enforcement against international companies, whose decisions and negotiations may take place abroad, making it harder to gather evidence within Latvia.
He highlights Estonia's example in particular: the neighboring country decriminalized competition violations in July 2025, replacing criminal liability with an administrative oversight procedure to simplify and strengthen enforcement. Meļņiks urges lawmakers to answer questions about proving guilt, ensuring equal treatment, and using evidence obtained abroad before adopting the new article, arguing that responsible policy means adopting proven, evenly applied regulation — not the toughest possible penalty ahead of an election.
