European Investors and Agricultural Land: What’s New

The EU Court’s pivotal judgements that set a new precedent for European nationals buying agricultural land in Latvia.

In 2018, German citizens took legal action against the Latvian Republic when their company, established in Latvia, was denied the purchase of 8 hectares of agricultural land by the Madona local government (case C‑206/19). The legal basis for the rejection was the absence of Latvian language proficiency certificates according to Latvian land law.

Who is Subject to Law?

Citizens of other European Union Member States, European Economic Area States, or the Swiss Confederation

Main requirements

• EU Citizen Status: A certificate of registration as an EU citizen (essentially Latvian residency)
• Language Proficiency: A certificate confirming B2-level proficiency in the national language, enabling the handling of everyday and work-related discussions

Specific Conditions for Legal and Physical Buyers

• Legal Buyers: Entities represented or controlled by nationals of other Member States must comply with the requirement for acquiring more than 5 hectares of agricultural land.
• Physical Buyers: Acquisition threshold set for more than 10 hectares of agricultural land.

EU Court of Justice ruling

In the 2020 judgement, The Court ruled that the law discriminates based on nationality, limits the establishment rights of citizens from other Member States, and violates Articles 9, 10, and 14 of the EU’s 2006 Directive on internal market services

Legal Consequences

Latvian local authorities must align with the Court’s decision and prioritise EU law when issuing agricultural land permits.

Nevertheless, 3 years have passed since the Court’s ruling, yet the legal norm in the land law remains unchanged.

Practical Outcomes

In our agency’s experience, the language requirement, though still in the law, is effectively not applied. We successfully navigated two separate applications for EU investors in Latvia’s Vidzeme and Kurzeme regions. Our proactive communication and negotiations with local governments ensured the requirement was waived, in line with the Court’s judgement.

Renate Priedite, a senior expert at the State Division of Land Management and Reclamation, has recently publicly acknowledged this approach by local authorities.

Latest Development

In response to EU pressures, a draft law abolishing language and registration requirements for agricultural land buyers was submitted to the Saeima (Latvian Parliament) on September 7. Following a successful first reading on October 12, the bill is awaiting a second round of hearings.

We will keep you updated on the progress of this legislation. Meanwhile, for stress-free support in your agricultural land acquisition, contact us today!