Landowners in Latvia facing forced shared property arrangements will be eligible for state compensation to cover losses incurred during 2025 and 2026. The new Zemes likumiskās lietošanas maksas atlīdzināšanas likums (Land Statutory Use Fee Compensation Law), which entered into force on November 5, addresses financial discrepancies caused by the application of two different cadastral values.
Compensation for Dual Cadastral Value Losses
The need for this legislation stems from a 2025 change in the Real Estate State Cadastre Law, which introduced both “fiscal” and “universal” cadastral values. Fiscal value is used to calculate property taxes and other public payments, while universal value is intended to reflect current market conditions. In instances where the universal value—used to set the statutory land use fee—is lower than the fiscal value used for tax assessments, landowners can face situations where their tax burden exceeds the income they receive from building owners for the use of their land.
Did You Know? The legislation was developed to comply with a Constitutional Court ruling (case No. 2024-21-0103) from December 10, 2025, which determined that previous regulations failed to provide adequate compensation for landowners in forced shared property relationships.
Qualify for compensation with specific property conditions
To qualify for compensation, a landowner must hold property used by a building owner under statutory lease terms between January 1, 2025, and December 31, 2026. A claim is valid if the difference between the statutory use fee (calculated from the universal value) and the property tax (calculated from the fiscal value) results in a loss or a disproportionately low return, specifically where the gap is less than 2.5 percent of the land’s universal cadastral value.
Landowners must submit their applications to the State Land Service (VZD) between January 1, 2027, and June 30, 2027. The VZD will process claims based on information from the Real Estate State Cadastre Information System and the Land Register. Preliminary estimates suggest approximately 201 cases may be eligible, though authorities note this is an approximation due to a lack of precise data on the exact number and area of current forced shared property relations.
Expert Insight: This compensation mechanism reflects a broader shift toward balancing the rights of landowners and building owners. By providing a clear, albeit time-limited, path to recover costs, the state is attempting to mitigate the financial strain caused by the misalignment of fiscal and market-based land valuations.
Adopt amendments to the land statutory use regulation
Beyond the compensation law, the Saeima adopted amendments to the land statutory use regulation on June 13, which took effect on July 1. These changes maintain the statutory fee at four percent of the land’s cadastral value—with a minimum of 50 euros per year—but introduce a transition period for residential buildings through 2028. From 2029, fees for residential properties must align fully with current cadastral values.
To further reduce administrative burdens, building owners are now required to cover 15 euros annually toward the preparation and delivery of payment notices. If a payment is delayed, the building owner must reimburse the landowner 30 euros for collection costs. As of June 6, amendments to the Civil Procedure Law also allow landowners to recover unpaid statutory use fees through a simplified judicial warning process.
Find answers about expiration dates and funding sources
When does the compensation law expire?
The Zemes likumiskās lietošanas maksas atlīdzināšanas likums is set to lose its legal force on July 1, 2030.
How is the compensation funded?
Payments to eligible landowners will be disbursed from the state basic budget program titled “Funds for Unforeseen Events.”
Can landowners and building owners agree on different payment terms?
Yes, building owners and landowners may reach a mutual agreement on the amount of the statutory use fee or the costs associated with payment notices, provided it differs from the default statutory requirements.
Worth a look