A case brought against the rules on the cancellation of mandatory purchase rights granted to merchant


A case has been brought before the Constitutional Court “On Compliance of Paragraph 41 and Sub-paragraph 60.2 of the Cabinet of Ministers Regulation of 2 September 2020 No. 560 “Regulations on Electricity Generation Using Renewable Energy Sources, as well as on the Procedure for Price Determination and Supervision” (in the version in force until 31 March 2022) with the first three sentences of Article 105 of the Constitution of the Republic of Latvia”.

The applicant requests the Constitutional Court to declare the Contested Provisions incompatible with Article 1 and the first three sentences of Article 105 of the Constitution of the Republic of Latvia, as well as invalid in respect of the applicant as from 20 April 2021.

It appears from the application and the documents attached to it that in 2009 the applicant was granted the right to sell the electricity produced under the mandatory purchase obligation. The applicant had not submitted a report on the operation of the power plant in 2020 by 1 March 2021. Therefore, by decisions of 20 April 2021, the State Office for Construction Control, on the basis of the Contested Provisions, revoked the above-mentioned rights and ordered the applicant to repay all state aid for the sale of electricity produced under the mandatory purchase obligation for the period from 1 January 2020.

According to the applicant, the fact that, without notice and without an individual assessment of the infringement, it had its mandatory procurement rights revoked and was ordered to repay the state aid received by the public merchant. Thus, the Contested Provisions infringe the principle of protection of legitimate expectations included in Article 1 of the Constitution and infringe the right to property included in the first three sentences of Article 105 of the Constitution.

The Constitutional Court invited the institution that had issued the contested act – the Cabinet of Ministers – to submit to the Constitutional Court, by 23 October 2023, a written reply setting out the facts of the case and providing legal substantiation.

The deadline for preparing the case is 23 January 2023. The Court shall decide on the procedure and date for hearing the case after the case is prepared.

Linked case: 2023-35-03