Text consolidated by Valsts valodas centrs (State Language Centre) with amending laws of

Section 344. Duty to Inform

The board of directors of the acquired or dividing company have a duty to inform the general meeting and the acquiring company regarding all substantial changes in the status of the property of the acquired or dividing company which have occurred up to the expiry of the powers of the board of directors or up to the time the reorganisation comes into effect.

Section 345. Protection of Creditors

(1) Within fifteen days from the day when a decision is taken regarding reorganisation, each of the companies involved in the reorganisation process shall inform in writing all of its known creditors which have had claim rights against the company up to the taking of the decision on reorganisation.

(2) Each of the companies involved in the reorganisation process has a duty to publish in the official gazette Latvijas Vēstnesis a notice that a decision on reorganisation has been taken. The notice shall indicate:

1) the firm name, registration number and legal address of the company;

2) the firm names, registration numbers and legal addresses of the other companies involved in the reorganisation;

3) the type of reorganisation;

4) the fact that a decision on reorganisation has been taken;

5) the place and time period for creditors to submit their claims, which may not be less than one month from the day when the notice is published.

(3) The acquired or dividing company shall secure the claims of creditors if so requested and submitted by them within the time period in the notice referred to in Paragraph two of this Section.

(4) Creditors of the acquiring company may request to have their claims secured only if they can prove that the reorganisation threatens the satisfaction of their claims.

(5) Secured creditors may request security only for the amount of the unsecured part of a debt.

[14 February 2002; 29 November 2012]

Section 346. Disputing a Decision on Reorganisation

(1) On the basis of a request of a shareholder or a member of a board of directors or of a council of a company involved in a reorganisation, a court may declare the decision on reorganisation as void if it was taken in violation of law, the articles of association of a capital company or a partnership agreement, and it is not possible to rectify these violations or they are not rectified within the time period specified by the court.

(2) The time period for bringing an action in a court shall be three months from the day when the notice, referred to in Section 345, Paragraph two of this Law, is published.

(3) A company, the decision on reorganisation taken by a meeting of shareholders or board of directors of which has been applied void, has a duty to publish a notice regarding this in the official gazette Latvijas Vēstnesis within 15 days from the day when the adjudication of the court has come into effect.

(4) The declaration of a decision on reorganisation as void shall not impact upon obligations which the company has assumed during the reorganisation process with respect to third parties.

(5) A decision on reorganisation shall not be applied void only because the capital share (stock) exchange coefficient or the amount of premium has been fixed too low.

(6) If the capital share (stock) exchange coefficient has been fixed too low, then a shareholder of the acquired, dividing or restructured company may request that the acquiring company pays a once only supplementary payment.

[16 June 2011; 29 November 2012]

Section 347. Application to the Commercial Register Office

(1) Each of the companies involved in the reorganisation process shall, not earlier than three months after the day when the notice is published, submit an application to the Commercial Register Office in order that the entering of the reorganisation is made in the Commercial Register. The following documents shall be appended to the application:

1) the agreement or its copy appropriately certified;

2) an extract of the minutes and the decision on reorganisation;

3) the list of the shareholders who voted against the reorganisation;

4) in cases specified by law – the reorganisation permit;

5) the prospectus (if the law requires the preparation of a prospectus);

6) the opinion of the auditor (if the law requires an auditor’s examination);

7) the closing financial account of the acquired or by way of splitting up dividing company (if the application is being submitted by the acquired or the dividing company);

8) the articles of association of the acquiring capital company (if a new company is formed as a result of the reorganisation, or if the company is being restructured);

9) the list of the members of the board of directors of the acquiring capital company or the shareholders of a partnership who have the right to represent the company (if a new company is formed as a result of the reorganisation); and

10) the list of council members of the acquiring capital company (if a new company is formed as a result of the reorganisation and if the acquiring company is to have a council).

(2) In its application, the company shall certify that:

1) the claims of those creditors who have submitted their claims within the time period specified have been secured or satisfied;

2) the decision on reorganisation has not been disputed in court or that the relevant action has not been satisfied;

3) in the case referred to in Section 339, Paragraph three of this Law all shareholders have agreed that a prospectus on reorganisation will not be prepared;

4) in the case referred to in Section 340, Paragraph three of this Law all shareholders have agreed that the auditor will not examine the agreement on reorganisation;

5) in the case referred to in Section 343, Paragraph 4.¹ of this Law all shareholders have agreed that a report on economic activities will not be prepared.