According to data from the Register of Enterprises, 272 corporate insolvency proceedings were initiated in Latvia in 2025, compared to 288 in 2024. This represents a year-on-year decrease of 5.6%, indicating a downward trend in insolvency.
At the same time, a significant structural factor must be taken into account: the number of active companies (companies that submitted annual reports for 2024) declined by approximately 20%. This suggests that the lower number of insolvency proceedings is not solely the result of improved financial stability, but also a consequence of a reduced number of active companies operating in the market.
A similar dynamic can be observed in legal protection proceedings (LPP). In 2025, LPP was initiated for 126 companies, compared with 143 companies in 2024, representing a decrease of 12%.
Sectors (according to NACE Rev.2) with the highest number of insolvency proceedings in 2025
• Wholesale and retail trade; repair of motor vehicles and motorcycles
• Construction
• Manufacturing
• Accommodation and food service activities
• Transportation and storage and Professional, scientific and technical activities
| NACE sector | Insolvency proceedings in 2025 | Sectoral share in 2025 (%) | Insolvency trends by sector (2024–2025) |
|---|
| Wholesale and retail trade; repair of motor vehicles and motorcycles | 55 | 20.2% | -14% |
| Construction | 49 | 18% | +2% |
| Manufacturing | 35 | 12.9% | -10% |
| Accommodation and food service activities | 30 | 11% | +30% |
| Transportation and storage | 16 | 5.9% | -27% |
| Professional, scientific and technical activities | 16 | 5.9% | 0% |
| Agriculture, forestry and fishing | 15 | 5.5% | -17% |
| Real estate activities | 14 | 5.1% | +17% |
| Administrative and support service activities | 12 | 4.4% | -8% |
| Arts, entertainment and recreation | 8 | 2.9% | +14% |
| Information and communication | 5 | 1.8% | -55% |
| Education | 5 | 1.8% | +67% |
| Other service activities | 5 | 1.8% | +25% |
| Financial and insurance activities | 4 | 1.5% | 0% |
| Human health and social work activities | 2 | 0.7% | 0% |
| Mining and quarrying | 1 | 0.4% | -50% |
| Electricity, gas, steam and air conditioning supply | 0 | 0% | 0% |
| Water supply; sewerage, waste management and remediation activities | 0 | 0% | 0% |
| Public administration and defence; compulsory social security | 0 | 0% | 0% |
| Activities of households as employers; undifferentiated goods- and services-producing activities of households for own use | 0 | 0% | 0% |
In 2025, no insolvency proceedings were registered in the sectors of electricity, gas, steam and air conditioning supply; water supply, sewerage, waste management and remediation activities; public administration and defence, compulsory social security; as well as activities of households as employers and undifferentiated goods- and services-producing activities of households for own use.
In contrast, the mining and quarrying sector recorded only one insolvency proceeding (0.4%).
Sectors with the fastest increase in insolvency between 2024 and 2025
• Education
• Accommodation and food service activities
• Other service activities
• Real estate activities
• Arts, entertainment and recreation
Largest companies by turnover with declared insolvency
Among the companies with the highest turnover for which insolvency proceedings were initiated in 2025,
SIA Baltic Builders stands out – a construction company engaged in building and ship construction as well as the installation of metal structures. The company closed 2024 with a turnover of 10.56 million EUR. Compared with 2023, revenue declined by 41%, and the year ended with a loss of 1.78 million EUR. Insolvency proceedings were initiated on 20 May 2025. Although the company had no tax arrears prior to the initiation of insolvency proceedings, its first tax debt appeared in July 2025 and had reached 76 thousand EUR as of 9 February 2026.
Similarly,
SIA BALTIC LOCO GROUP, a railway rolling stock repair and modernisation company specialising in locomotive maintenance and reconstruction, illustrates that insolvency proceedings may be initiated even in companies with very strong financial performance in the preceding year. In 2024, the company achieved a turnover of 10.19 million EUR, an increase of more than 1300% compared with 2023, and recorded a profit of 4.39 million EUR. Despite this rapid growth, insolvency proceedings were initiated on 4 November 2025. This case clearly demonstrates that high turnover and profitability do not necessarily ensure long-term financial sustainability.
A third example is
SIA Ferroplan, operating in the manufacturing sector and specialising in the production of lifting and handling equipment and conveyor components. In 2024, the company increased its turnover to 3.3 million EUR, representing a 31% increase year on year. However, the year ended with a loss of 350 thousand EUR. Insolvency proceedings were initiated on 2 September 2025 and were significantly influenced by the insolvency of its parent company in Finland, which resulted in the loss of control over its technologies and product rights. Alongside financial difficulties, the company’s tax arrears increased and reached 51 thousand EUR as of 9 February 2026.
The largest companies in each sector by turnover in 2024 with declared insolvencies in 2025
| NACE sector | Company name | Turnover in 2024, EUR | Profit/Loss in 2024, EUR |
|---|
| Wholesale and retail trade; repair of motor vehicles and motorcycles | SIA "BALTIKA LATVIJA" | 2 255 169,-- | 20 865,-- |
| Construction | SIA "Baltic Builders" | 10 560 249,-- | -1 782 803,-- |
| Manufacturing | Sabiedrība ar ierobežotu atbildību "BALTIC LOCO GROUP" | 10 192 198,-- | 4 386 954,-- |
| Accommodation and food service activities | SIA "Āzijas Virtuve" | 1 330 319,-- | -13 594,-- |
| Transportation and storage | SIA "DeDeco Cargo" | 1 720 226,-- | -1 678 313,-- |
| Professional, scientific and technical activities | Energy stream SIA | 1 181 109,-- | -110 343,-- |
| Agriculture, forestry and fishing | SIA "VALMAS" | 972 456,-- | 15 626,-- |
| Real estate activities | Sabiedrība ar ierobežotu atbildību "PLUS ĪPAŠUMS" | 719 008,-- | 166 152,-- |
| Administrative and support service activities | Tuul Mobility SIA | 1 209 707,-- | -308 345,-- |
| Arts, entertainment and recreation | Sabiedrība ar ierobežotu atbildību "Stiprs un Vesels" | 38 044,-- | 8 150,-- |
| Information and communication | SIA "Inovatīvo tehnoloģiju centrs" | 617 274,-- | -183 403,-- |
| Education | Sabiedrība ar ierobežotu atbildību "KIMKO LV" | 278 338,-- | -361 808,-- |
| Other service activities | "Minute Clinic" SIA | 382 110,-- | -797 823,-- |
| Human health and social work activities | SIA "Madeleine" | 85 489,-- | 4 531,-- |
Conclusions
In 2025, the total number of corporate insolvency proceedings in Latvia declined. However, this trend cannot be unequivocally interpreted as an improvement in the business environment. Data analysis shows that the decrease in insolvency occurred in parallel with a significant reduction in the number of active companies, indicating that the lower number of proceedings is partly structural rather than solely a result of improved financial stability.
Insolvencies remain concentrated in highly competitive sectors where companies lack financial buffers. As a result, even minor changes in demand or costs can quickly lead to serious financial distress.
Examples of large companies with turnover of several million euros demonstrate that insolvency risk exists for any company if financial flexibility and timely adaptation are insufficient.
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