5 Years of Latvia’s Social Enterprise Law: A Cornerstone of the Social Entrepreneurship Ecosystem

06. April, 2023


Agnese Frīdenberga

On the 1st of April, Latvia marked a significant milestone as it celebrated the fifth anniversary of the Social Enterprise Law, which came into force on the same date in 2016. This law has been instrumental in promoting the quality of life in society and facilitating the employment of individuals who are at risk of social exclusion. The aim of the law is to provide a legal framework that supports the development of social enterprises, which are businesses that prioritize social and environmental goals above profit.


One of the key features of the Social Enterprise Law is the establishment of criteria for obtaining social enterprise status. These criteria are based on a company’s primary objectives, which must be to achieve social, cultural, or environmental goals, rather than simply generating profit. To be eligible for social enterprise status, companies must meet these criteria and pass a review process conducted by the Latvian Social Entrepreneurship Association.

In addition to establishing the criteria for social enterprise status, the law also outlines the various ways in which the state supports social enterprises. For example, social enterprises are eligible for various tax exemptions and other financial incentives, such as grants and loans. This support has been crucial in enabling social enterprises to grow and expand their operations, thereby increasing their impact on society.

Since its enactment, the Social Enterprise Law has made significant contributions to the development of the social entrepreneurship sector in Latvia. It has created a more favorable business environment for social enterprises, encouraging the growth of these businesses and increasing their capacity to address social and environmental challenges. This law has also been instrumental in establishing the social entrepreneurship ecosystem in Latvia, which includes a network of organizations and institutions that support social enterprises.

The Social Enterprise Law has become one of the cornerstones of the social entrepreneurship ecosystem in Latvia. It has helped to create a vibrant and dynamic social entrepreneurship sector, which is increasingly recognized as an important driver of social and economic development. Moreover, the law has provided a framework for other countries to learn from and emulate as they seek to promote social entrepreneurship in their own jurisdictions.

In conclusion, the Social Enterprise Law has had a significant impact on the development of social entrepreneurship in Latvia. By providing a legal framework and state support for social enterprises, this law has created a more favorable business environment for companies that prioritize social and environmental goals. As Latvia celebrates the fifth anniversary of the law, it is clear that it has become one of the cornerstones of the social entrepreneurship ecosystem, playing a crucial role in promoting social and economic development in the country.


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