How correct is it that the Latvian gas company “Latvijas gāze” paid out several million euros in dividends to Russian state companies on its profits last summer? This question has been brought to court.

Energy prices soared around the world after Russia’s full-scale invasion of Ukraine. This helped energy companies, including Latvijas gāze, to make good profits. Coupled with the company’s retained earnings from previous years, Latvijas gāze could pay out a significant sum to its shareholders – almost €110 million.

Even two years after the outbreak of war, half of the company’s shares are owned by the Russian state energy giant Gazprom and Itera Latvija, effectively controlled by another Russian company, Rosneft.

“Latvijas gāze” did not name the exact amount paid to Russia as dividends last year. The company was not ready to explain its position in a face-to-face interview.

The payment of dividends by Latvijas gāze to Gazprom and Itera prompted the organization “Entrepreneurs for Peace” to develop an initiative that would impose a 90% tax on payments by any company to Russia. If this were applied, Russian companies would receive only a small share of the dividends earned here.

“Latvijas gāze” dividends raise a lot of questions

Jānis Taukačs, a lawyer representing Entrepreneurs for Peace, said: “The fact that dividends were paid certainly raised a lot of questions. And one of them was: why such a payout is something that we could not at least put the brakes on in some way, also seeing the experience of other countries like Germany and so on.”

The Court of Economic Affairs, which is currently examining the lawsuit brought by lawyer Kvēps against Latvijas gāze, did not comment further on the case. A decision is expected at the end of the month.

LETA news agency previously reported that Latvijas gāze’s net turnover last year was EUR 159.819 million, 4.4 times less than in 2022, when natural gas prices experienced a huge spike, and the company suffered a loss of EUR 56.911 million, compared to a profit the year before. “Latvijas gāze” turnover in 2022 was €702.604 million and its profit was €40.8 million.

Latvijas gāze’s largest shareholders are Russia’s Gazprom (34%), Rietumu banka (28.97%), Germany’s Uniper Ruhrgas International GmbH (18.26%) and Itera Latvija Ltd (16%).

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