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The
privatization of state and municipal property commenced in the middle of 1991
with the adoption of the major principles of state ownership
transformation. Mass privatization began with the introduction of
privatization certificates in November 1992. The number of certificates
that each claimant was entitled to was dependent on the length of residence
in Latvia, citizenship and restitution claims against the property. With
the exception of small-scale privatization, when an estimated 70 percent of
all small businesses were transformed into privately owned entities by the
end of 1993, the privatization process during 1991-1993 proceeded at a slow
pace. The situation changed after creation of the Privatization Agency in
1994 which became solely responsible for implementing privatization.
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The
non-profit state-owned Latvian Privatization
Agency (LPA), established on April 22, 1994, is the main executor of
privatization of state-owned enterprises and state property in Latvia. It
is governed by the Supervisory Board appointed by the Cabinet of Ministers.
LPA is supposed to be liquidated after the privatization process is
completed. The Municipal Property Privatization Commissions (governed by
the Law On State and Municipal Property Privatization Commissions) are
responsible for privatization of municipal property.
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Latvia’s privatization scheme got off to a slow start --
http://www.imf.org/external/pubs/ft/fandd/2001/06/zile.htm
-- but by the end
of 2000, 97 percent of all state-owned enterprises and companies had been
put forward for privatization, and over 1500 privatization agreements had
been signed. The privatization process has recently gained momentum and enterprise privatization is
close to completion, but some large enterprises, such as Ventspils Nafta,
are still in state hands. The divestiture of the Latvian Shipping Company
(LASCO) is well underway. Previous attempts to sell LASCO fell through because of
disagreements over pricing and the Government's intention to keep the
golden share. The privatization of Latvijas Gaze has now been
completed.
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- The
divestiture of the remaining large state enterprises nears completion. In addition to the privatization
of Latvijas Gaza and LASCO (by end 2002), the Government intends to
complete the divestiture of Ventspils Nafta and Krajbanka in 2003.
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