CEE Legal Matters

Category: Latvia

  • Glimstedt Advises DistIT on Acquisition of Sominis Technology

    Glimstedt Advises DistIT on Acquisition of Sominis Technology

    Glimstedt has advised DistIT AB on its EUR 1.2 million acquisition of an 80% stake in Sominis Technology UAB, a Vilnius-based distributor of PC, laptop, smartphone, and tablet accessories. Closing of the deal is contingent on various conditions, including approval from Lithuania’s competition authority. Deloitte advised the sellers on the deal.

    Sominis’s founder and CEO Mindaugas Apanavicius will retain 20% of the company’s shares and remain as CEO for the next four years. Apanavicius commented that: “We have an ambitious expansion plan for the coming years and believe that DistIT’s infrastructure, skills and knowledge in the IT distribution business will help us to develop Sominis as a strong partner for our customers and suppliers,” 

    According to Glimstedt, “Sominis Technology is basically engaged in selling products to other dealers on the European B2B market. It also sells consumer electronics products to a number of leading retail chains in the Baltic States, though on a smaller scale. Sominis Technology will operate as an independent sister company to DistIT’s other subsidiaries, such as Aurora, SweDeltaco and Septon, to ensure synergy and coordination between them, including coordination of decisions regarding assortment and logistics.”

    “Approximately 80% of Sominis Technology’s sales are in Europe, and we believe that the potential for growth is good,” said Siamak Alian, CEO of DistIT. “Sominis Technology’s products complement DistIT’s offer, and Sominis will maintain the organization’s profile and name in line with DistIT’s mission.” 

    The Glimstedt team was led by Senior Associate Karolina Baronaite-Birmonte.

    Deloitte did not reply to our inquiry on the matter.

  • Sorainen Provides Pro Bono Assistance in Efforts to Stop Liquidation of Riga Teacher Training Academy

    Sorainen Provides Pro Bono Assistance in Efforts to Stop Liquidation of Riga Teacher Training Academy

    Sorainen Latvia, acting pro bono, is assisting the Latvian Trade Union of Education and Science Employees (LIZDA) in its claim that liquidation proceedings of the Riga Teacher Training and Educational Management Academy (RPIVA) are not legal. With Sorainen’s assistance, LIZDA has asked policy makers in education and the parties involved to stop the liquidation of the academy, which was, the firm reports, “started in haste.”

    According to Sorainen, LIZDA and other organizations have indicated several times to the Latvian Ministry of Education and Science that the draft documents on liquidating the academy were defective. “However,” according to the firm, “the indications were not taken into account on their merits.”

    Sorainen Latvia drafted an opinion regarding the defects in the Cabinet’s draft order “Liquidation of Riga Teacher Training and Educational Management Academy” and ways it fails to comply with the applicable legal framework. “The opinion discloses several defects in the draft order,” Sorainen reports, “as well as assessing certain problematic issues that could arise when the order is enforced.”

    LIZDA has sent the opinion to Prime Minister Maris Kucinskic, representatives of political parties represented in the Parliament, independent MP Artuss Kaimiņc, the Parliamentary Education, Culture and Science Commission, the Ministry of Education and Science, the Council of Higher Education, the Rectors’ Council, the Latvian Student Association, and the Riga Teacher Training and Educational Management Academy.

    The firm’s pro bono assistance was provided by Partner Agris Repss and Counsel Raivo Raudzeps. 

  • Tark Grunte Sutkiene and Spigulis & Kukainis Advise on Buy-Out of Latvian Sawmill from Latvian Timber Ltd.

    Tark Grunte Sutkiene and Spigulis & Kukainis Advise on Buy-Out of Latvian Sawmill from Latvian Timber Ltd.

    Tark Grunte Sutkiene has assisted a minority (20%) shareholder of SIA Vudlande with a buy-out of the remaining 80% of the company from Latvian Timber Ltd. (UK), giving the former minority shareholder 100% ownership as a result of the transaction. Spigulis & Kukainis advised Latvian Timber on the deal.

    According to Tark Grunte Sutkiene, “SIA Vudlande (LV) is a woodworking company operating for more than 20 years, manufacturing, purchasing, exporting and trading with lumber and surfaced timber, providing lumber harvesting services and acquiring and logging forest lands and harvest sites.” In 2015, the turnover of the company was EUR 13 million, and the company employed 74 employees. 

    Tark Grunte Sutkiene team was led by Partners Ivars Grunte and Andra Rubene, supported by Associates Raivis Znotiņs, Rudolfs Vilsons, and Jekaterina Anohina.

    The Spigulis & Kukainis team consisted of Partner Matiss Davis Kukainis, Liva Upite, and Anna Pauconka.

  • Sorainen Successful for Bauskas Dzive in Latvian Supreme Court

    Sorainen Successful for Bauskas Dzive in Latvian Supreme Court

    Sorainen, acting on behalf of SIA Bauskas Dzive, the publisher of the Latvian newspaper of the same name, has persuaded the Latvian Supreme Court to partially satisfy a complaint against a decision of the Administrative District Court, which had refused to initiate a case on the basis of Bauskas Dzive’s application against the conduct of the Council of Iecava Region, itself the publisher of the Iecavas Zinas newspaper.

    As reported by CEE Legal Matters last summer, Sorainen is advising Bauskas Dzive pro bono in its claims against the Council of Iecava Region. On behalf of Bauskas Dzive, Sorainen requested that Iecavas Zinas: (1) be prohibited from publishing articles that do not relate to the municipality’s functions; (2) be excluded from the mass media register; and (3) be prohibited from operating in the advertising market. In addition, Sorainen requested that Bauskas Dzive be compensated for losses of more than 33,000 EUR.

    According to Sorainen, “although the Latvian Supreme Court did not provide a comprehensive assessment as to what extent the conduct of the Council of Iecava Region should be considered to be legal by issuing the specific newspaper, the Court set strict rules that the newspaper (and any newspaper, in fact, issued by any municipality as a means of mass media) must observe.” According to Sorainen, those rules are:

    1. the newspaper must be used for the benefit of the entire public;
    2. the publication must promote the principles and basis of the Latvian Constitution;
    3. the newspaper must not place unilateral emphasis on certain interests, groups, or political grouping;
    4. the publication must reflect a diversity of opinions, including those from political opponents.

    In addition, the Supreme Court stressed that “use of state funds for such mass media is justified only if the editorial part of the mass media meets the highest standards of journalistic quality (the truthfulness of published information has been carefully checked, diversity of opinions is appropriately reflected, and the principles of journalistic ethics have been observed).”

    According to Sorainen, “with this decision, the Cour’ has partially bridged the legal gap that ruled over the so-called “municipal press,’ which in fact simply imitated the free press and in essence should be recognized as advertising brochures for the municipality concerned.”

    The Court determined that, in Sorainen’s words, “a top-level institution [Ministry of Environmental Protection and Regional Development] must ensure observance of these criteria, such as keeping to the main values of the Latvian Constitution and maintaining journalistic quality. Taking into account that presently almost none of the publications issued by municipalities in Latvia as a means of mass media meet these criteria, the ministry is expected to assess the conduct of municipalities when funding them. In turn, with regard to operations by municipalities in the advertising market, the SC acknowledged that private mass media are entitled to go to court if these operations threaten their existence. In these cases the private mass media can claim:

    1. a stop on unequal conditions and eliminating the threat;
    2. a stop on or at least a decrease in the scope of activities by mass media funded by a local authority in the advertising market;
    3. a stop on subsidies from state funds or introduction of a suitable funding mechanism.”

    Finally, according to Sorainen, “on the one hand, the SC decision builds a strong foundation for Bauskas Dzive to continue protecting its rights in court against the Iecava Regional Council; on the other hand, the decision opens the door for other regional mass media to go to court against municipalities when their informative publications unfairly compete in the advertising market. In addition, the means of protection indicated by the Court are sufficiently wide to enable each of the private mass media to claim a satisfactory solution to the situation.”

    Bauskas Dzive was assisted in its claim by Sorainen Partner Agris Repss, Senior Associate Andris Taurins, and Associate Jorens Jaunozols. 

  • Primus Successful for VESTI Publishing House in Defamation Dispute

    Primus Successful for VESTI Publishing House in Defamation Dispute

    Primus has successfully represented the publishing house VESTI at court in a dispute with Latvian citizen Gulam Mohammad Gulami, who had brought an action for the retraction of defamatory information and damages.

    In 2015, VESTI had published in its Russian-language Vesti Segodnya (“Vesti Today”) newspaper three articles which, in Gulami’s opinion, contained defamatory statements.

    On February 21st, the court of first instance ruled that Gulami’s claim had no merit and dismissed it in full.

  • Tria Robit Persuades Competitor to Intercontinental Great Brands to Withdraw Trademark Application

    Tria Robit Persuades Competitor to Intercontinental Great Brands to Withdraw Trademark Application

    Acting on behalf of client Intercontinental Great Brands LLC, Tria Robit has convinced AS Siera Nams to withdraw its application to register the figurative mark PHILADELPHIA.

    According to Tria Robit, AS Siera Nams filed its application for the mark in Class 29 — which Tria Robit claims is “identical with the goods of the family of trademarks of the company Intercontinental Great Brands LLC — the client of Agency Tria Robit.” The firm reports that “we informed the client on the filing of the new mark in the name of the Latvian company and got instructions to forward to the representative of the applicant a request for immediate withdrawal of the filed application. The case was settled amicably: the opposite party took the request into consideration and withdrew the application.

  • The Buzz in Latvia: Interview with Dace Silava-Tomsone of Cobalt

    “I would single out a couple of developments, first of all in Construction Law, which I do a lot of” begins Dace Silava-Tomsone, the Managing Partner of Cobalt in Riga, when asked for the Buzz in Latvia.

    A couple of years ago the country enacted what Silava-Tomsone describes as a “major overhaul of the construction law” to make it more attractive to investors, but also in response to public outcry following the November 21, 2013 collapse of the roof of the Zolitude shopping center in Riga which killed 54 people. The resulting law was rushed into force a bit precipitously, Silava-Tomsone reports, “so it was impacted by post-tragedy emotions and political pressure, and ultimately the overhaul was not too successful. The construction process was supposed to become simpler and more efficient, but in fact it became even more cumbersome than before.”

    Several years of controversy and debate have followed about how it should be amended, “to ensure that the processes work efficiently and with due regard to safety and sustainability, as well as to clarify what limits on liability exist for the various roles of persons involved in the process — authorities, developers, contractors, owners, etc..” The new regulation already has undergone a number of cosmetic changes, but it is still far from satisfying all the market players. Amendments are being prepared and considered now, and Silava-Tomsone hopes it will reach the Parliament soon. “Investment into Latvian real estate lags behind our Baltic neighbors, and lack of a proper legal framework is one of the reasons. New initiatives aim to shorten the overall length of the construction process from permitting to the commissioning stage, introducing electronic processing of designs, etc. From a lawyer’s perspective it’s essential,” she says, “to shift emphasis from control and supervision exercised by municipal and state institutions to straightforward liability provisions for various roles which would work as a self-balancing mechanism. So this is certainly a very welcome development.”

    Overall, Silava-Tomsone says, business is good in Latvia, as it has been for the past couple of years. She expects the trend to continue going forward as well. “There are always ups and downs, of course,” she notes, pointing out that M&A in Q4 of 2016 was a bit slow as was construction for the entire 2016, but the work that was in the pipeline then is starting to manifest itself, so “activity is increasing.” She smiles. “Certainly our office is very busy both on the buyer’s and the seller’s side.”

    When asked about the ongoing consolidation of law firms in Latvia, most recently in the form of Ellex Klavins’ merger with Glimstedt’s Riga office, Silava-Tomsone is positive, calling it “certainly good for our market” after a “stagnant period for the last 10 years, during which firms grew organically, which is not always the fastest way to reach the necessary size and the right practice mix to best serve clients.” She points out that her own firm merged with Borenius in Latvia and Estonia — and took over a sizable team from Borenius in Lithuania as well — at the end of 2015 and she believes that the mergers and pan-Baltic alliance re-groupings that followed demonstrate that “other firms see the wisdom of it,” and that “the market has matured to the stage where it has become difficult to develop business any further unless some critical size is reached and strategic views of the partners are aligned.” The process may not be over yet; Silava-Tomsone expects to see still more consolidation on the Latvian market within the next year.

    “I still believe that we’re at the stage that’s good for clients,” she says. “Firms in Latvia were too small, and not always able to offer full service and deep specialization across the board, so this process means that client service will be improved.” 

  • The Merger of Ellex Klavins and Glimstedt & Partners Wraps Up

    The Merger of Ellex Klavins and Glimstedt & Partners Wraps Up

    Ellex Klavins has announced that the firm’s merger with Glimstedt & Partners in Latvia is complete.

    The merger was initially announced in mid-January, 2017 (as reported by CEE Legal Matters on January 17). According to the Ellex Klavins announcement, “the entire teams of both law firms have joined up as of the 1st of February.” The firm reports that “We are now also all together located in one office at Valdemara 62 [in Riga].”

    Following the merger Ellex Klavins has 47 lawyers and 13 administrative staff. Its counterparts in Lithuania (Ellex Valiunas) and Estonia (Ellex Raidla) have 95 and 40 lawyers on their teams, respectively.

  • Vilgerts to Represent Proof IT in Challenge of Award of IT Service Contracts Before General Court of the EU

    Vilgerts to Represent Proof IT in Challenge of Award of IT Service Contracts Before General Court of the EU

    Vilgerts has been engaged by Proof IT to challenge the procurement decisions of the European Institute for Gender Equality involving the award of framework IT service contracts before the General Court of the EU.

    Proof IT is a custom software development company specializing in software development and testing, implementation and training, and system support and further development. It was founded in 2004, and is headquartered in Riga.

    The Vilgerts team is led by Latvian Partner Debora Pavila.

  • Klavins Ellex and Glimstedt Latvia to Merge

    Klavins Ellex and Glimstedt Latvia to Merge

    In the latest development in the ever-changing Baltic law firm landscape, Klavins Ellex has announced that it will be merging with Glimstedt’s Riga office to “form the largest law firm in Latvia.” The two firms will operate under the Klavins Ellex brand.

    Klavins Ellex Managing Partner Filips Klavins informed CEE Legal Matters that the Glimstedt team in Riga consists of 15 lawyers, including four partners, all of whom will be joining Klavins Ellex’s 32 legal professionals. The merger is expected to take legal effect on February first, contingent on its approval by the Council of the Latvian Bar association, which is scheduled to meet on January 31.

    “The main objective of the merger is to provide additional benefits to our clients,” Klavins commented in a press release distributed by the firm. “They are: the combined expertise of two strong legal teams, which complement each other and will now be available as a single team; also a higher capacity for effectively managing large-scale and sophisticated processes. Consolidation of law firms is one of the key trends in our industry on a global scale.” 

    “Both of us – Ellex and Glimstedt – are renowned for strong specialization in a number of areas of law,” added Peteris Dalderis, Managing Partner of Glimstedt, in that same press release. “By combining our expertise in each of these areas, we considerably extend the ‘geography’ of our services. Consolidation by both of our law firms will ensure more professional lawyers and a wider scope of services for the industry in general.” 

    In a separate statement published on the Glimstedt Lithuania website, the firm wished success in future endeavors to “partners in Latvia who have decided not to continue operating as a self-dependent firm,” and said that “from now on we will be providing legal services to our clients in Latvia directly or through cooperation with the partners whom we find to satisfy the highest standards of Glimstedt.”

    This merger forms a prominent part of the ongoing reshuffling and consolidation of the Baltic legal markets, including Tark Grunte Sutkiene’s 2016 merger with Varul in Estonia (as reported by CEE Legal Matters on April 14, 2016), the creation of the Leadell alliance (as reported by CEE Legal Matters on August 26, 2016), Cobalt’s merger with Borenius’s former offices across the Baltics (as reported on September 23, 2015), and more. The process was triggered, perhaps, by Tark Grunte Sutkiene’s merger with the former Baltic Legal Solutions office in Lithuania (as reported on September 10, 2014) and the 2015 trade of Estonian offices by the former Raidla, Lejins & Norcous and Lawin, and the firms’ rebranding as Ellex and Cobalt (as reported on May 19, 2015). The process was considered at length in the June 2015 issue of the CEE Legal Matters magazine).