The Social Enterprise Law was adopted by the Parliament on 12 October, 2017 and came into force on 1 April, 2018. The purpose of this Law is to improve the life quality and to promote employment for groups at risk of social exclusion, through creation of an economic environment supportive to social enterprises. The Law creates the legal framework by providing both the criteria for obtaining the status of a social enterprise and the rules for state support for this type of entrepreneurship.
A social enterprise as defined in the Law is a limited liability company which has been granted the status of a social enterprise in accordance with the procedures laid down in the Law and which conducts an economic activity creating a positive social impact (e.g., provision of social services, formation of an inclusive civil society, promotion of education, support for science, protection and preservation of the environment, animal protection, or ensuring of cultural diversity). In accordance with generally accepted international practice, a social enterprise is a business whose main aim is not profit, but rather a social impact. It operates in market conditions, in an innovative manner characteristic of entrepreneurship, manufacturing goods or offering services.
The Commission for Social Enterprises is established to provide a motivated opinion to the Ministry of Welfare on the compliance of the applicant with the status of a social enterprise.
A decision to grant the status of a social enterprise is taken by the Ministry of Welfare. The Register of Social Enterprises is maintained by the Ministry of Welfare and published on its website.
In 2016, the Ministry of Welfare started implementing the ESF co-funded project “Support for Social Entrepreneurship”. The purpose of the project was to identify and verify the optimal solutions for creation and development of social enterprises, including the support to work integration. The project included such activities as awareness raising measures about the social enterprises, their importance and possible contribution to economic growth and society, as well as the development of a support system for social enterprises and the promotion of social start-ups. Between 2016 and 2023, the state invested almost 17 million euros in social entrepreneurship. During this period, "Development Finance Institution Altum" has concluded 204 grant agreements with social enterprises for the total amount of 12.2 million euros.
Project for the period 2024-2029 stipulates support for social enterprises and the social entrepreneurship in general. 12 million euros has been earmarked for this purpose. The support programme will be implemented by the Ministry of Welfare in collaboration with Altum. Support measures are planned in three parts: consultative and informative support; outreach and education events; and social enterprise support instruments, including grants, consultations on writing a business plan, and compensations of state social insurance contributions for employed persons with a physical or mental disability. The grants are intended for setting up and for developing the social business. The maximum amount of the grant is 40 000 euros for setting up the business, and 200 000 euros for developing the business.
The Social Entrepreneurship Association of Latvia is a non-governmental organization. It was founded in 2015, by organizations, enterprises, and individuals to promote social entrepreneurship in Latvia. More information on the website of the Social Entrepreneurship Association of Latvia.
Legislation - for more information on eligibility criteria for social enterprises, the role of the Ministry of Welfare and the Commission for Social Enterprises, the Register of Social Enterprises, conditions, limitations and supervision of social enterprises, target groups, support activities – see the Social Enterprise Law and Regulations.