Latvian parliament advances bill removing insolvency administrators from anti-money-laundering subject list

On September 10, the Saeima referred several bills to parliamentary committees, covering areas ranging from insolvency administrator oversight to immigration and tax rules.

Administrators to be excluded from anti-money-laundering law

The Legal Affairs Committee received a bill that would remove insolvency process administrators from the list of entities subject to Latvia's law on prevention of money laundering and terrorism and proliferation financing. The change is tied to the liquidation of the Insolvency Control Service (MKD) as of September 30, 2026, with its functions transferring to the Ministry of Justice and the Court Administration. According to the bill's explanatory note, administrators are not designated as a separate category of obliged entities under FATF recommendations or the relevant EU regulation. A sector risk assessment covering 2023–2025 rated the overall risk as medium-low (0.33), with 89% of administrators' clients assessed as low risk. The changes would take effect October 1, 2026, with the Ministry of Justice taking over MKD's role in any unresolved appeal proceedings.

Special sanctions oversight regime also to be dropped

A related bill amending the Sanctions Law would eliminate the special sanctions-monitoring regime currently applied to administrators by MKD. The explanatory note stresses that administrators will still be required to comply with international and national sanctions, and their core duties within insolvency proceedings remain unchanged. This bill would also take effect October 1, 2026.

Other bills referred to committees

The Public Administration and Local Government Committee received amendments to the State Civil Service Law that would expand an agency head's authority to suspend a civil servant, including in cases where the person has been named a criminal suspect, aligning suspension periods with rules applied to other public sector employees.

The Defence, Internal Affairs and Corruption Prevention Committee received amendments to the new Immigration Law that would remove the option for foreigners to obtain a temporary residence permit in exchange for a minimum investment of €150,000 plus a €10,000 state budget payment, a mechanism deemed disproportionate and risky.

The Budget and Finance (Tax) Committee received amendments to the Personal Income Tax Law introducing changes to how tax relief documentation is submitted, raising the tax-exempt compensation limit for volunteers, and simplifying rules for certain groups of taxpayers.