For several years, a scheme was in place that allowed third-country nationals to apply for temporary 5-year residency permits if they bought property above a specified value. Permits could also be obtained by making a large bank deposit or investing significant capital in a Latvian-registered business. But property investment was by far the most popular route to a permit for people mainly from Russia and other former CIS countries.
However, rules have gradually been tightened and the size of investment required has increased. The effects of this are now clearly seen with the number of applications for such permits decreasing sharply.
According to the Office of Citizenship and Migration Affairs (PMLP) data, in the period of 1 January 2016 until to 25 April this year, 205 applications from third-country nationals under the pay-for-permit scheme were received. For comparison, at the height of the scheme's popularity in 2014, 2,250 applications were received in the year.
In addition, many holders of existing residence permits have not renewed their applications -- which now also requires payment of hefty additional fees and a Latvian language test after five years.
This is probably due to the fact that maintaining a property in Latvia is no longer cost-effective suggested the PMLP's Maira Roze. "Every month we pass information to the relevant department about those foreigners whose residence permit is about to lapse during the next three months," Roze said.
Another factor is a concerted effort by the authorities and law enforcement to clamp down on criminal activity. Latvia won an unwelcome reputation as a money-laundering center that it is beginning to shake off, and as a place where figures linked to the Russian underworld liked to live and vacation.
But now, thanks partly to increased funding and a desire to clean up Latvia's image security institutions are now more closely examining temporary residence permit applicants.
"The competent authorities are actively investigating repeat residence permit applicants, as they too were allocated additional resources for these activities. Therefore, they were able to increase their capacity. In many cases extensions require quite a lot of interviews and also refusals, even though people have had a residence permit in the previous five years," says Rose.
And the simple fact that people must be in Latvia to undergo an interview and file paperwork must help to weed out those who, once they have obtained a residence permit, use it to simply set up elsewhere in the European Union.
More serious concerns about an individual's background are handled by the Security Police, who have refused permission to reside to 30 foreigners and have revoked permission to another 11 who were already holding residence permits, reports Latvian Radio's Fridrihsone.
In around half of the cases this was due to the risk of counter-intelligence, that is, because the Security Police's opinion, the applicant was likely to be involved with the special services of a foreign power: in other words, a spy.