The  RSE  Supervisory Board has supported the recommendations developed

by  the Management Board with regard to Free list issuers after January

1, 2004. The RSE has decided not to dissolve Free list and retain it at

the  RSE.  Pursuant  to  the  amendments to the RSE Enforcement Note on

Securities  Lists, there will not be any quantitative criteria for Free

list issuers. This means that any public joint stock company registered

in  Latvia  will be able to list on the RSE irrespective of the size of

share  capital,  capitalisation, profitability, number of shareholders,

number of public shares, or any other criteria. The provision that each

Latvia-registered stock exchange should maintain a list of this type is

included in the new "Financial Instrument Market Law".



As  a  part of strategic movement from quantity to quality, in 2001 the

RSE  announced  on  the intention to close Free list from 2004. The RSE

was  and  still is pursuing the objective to offer high quality issuers

to  the  market  that  would  be  observing  the  interests of minority

shareholders  and  corporate  governance  principles.  The  dissolution

deadline was set:



1)       Pursuant  to  the  provisions  of  the  law  "On  Securities",

stipulating  that  the  majority shareholders who have obtained control

interest  in  the  company  as  a  result of privatisation, had a grace

period  ending  on  September  26, 2003, with regard to mandatory share

buyout offer;



2)     Most of Free list companies had a control interest holder on the

said date.  This allowed minority shareholders to freely transfer their

shares  in  a  regulated  market  environment, and till the moment when

control interest holder announces share buyout offer.



Unfortunately,   the  sub-optimal  buyout  results  evidence  that  the

majority  shareholders  do not care for minority shareholders, and they

seek  every  opportunity  to avoid the obligation to express the buyout

offer.  Considering  an  earlier resolution by the RSE Management Board

regarding  dissolution  of  Free  list,  a  large  number of investors,

including  those  who  participated  in  public privatisation offer for

privatisation  certificates,  found  themselves  in  a  disadvantageous

situation.  In contrast to the shareholders of Official and Second list

issuers,  Free  list minority shareholders, in fact, in future would be

deprived of the possibility to transfer their shares.



In  order  to  protect  the interests of minority shareholders, the RSE

discussed   the   situation  with  the  Financial  and  Capital  Market

Commission,  banks  and  brokerage  companies,  and  reached  a  common

understanding  how  to  resolve  the issue. The tools have already been

included in the draft "Financial Instrument Market Law". The amendments

stipulate  that  all  regulated market places in Latvia have to provide

listing without any quantitative criteria.



The  present  Free  list companies, in order to continue their listing,

have to sign an agreement with the RSE by the end of the year. The rest

of Free list companies will be delisted starting with January 1, 2004.



Supervisory  Board  meeting  also  approved  the  amendments to the RSE

Enforcement  Note  on  Fees for Services Provided by the RSE, providing

for  introducing  annual  listing  fee  LVL 5,000. The fee has been set

proceeding  from  the  costs  arising  from  the  share  quotation  and

servicing.



Guntars Kokorevičs, President of the Riga Stock Exchange, says: "Though

it was clear already in 2001 that the provisions of the law will not be

sufficient  to protect the interests of minority shareholders, however,

we  were  not  prepared  that  majority  shareholders would neglect the

interests  of  minority  shareholders  to  such  extent. The holders of

control  interest in public companies have to be aware that obtaining a

half  of  the  company  shares  is  not a reason for disposing with the

entire  company  at own discretion, and for neglecting the interests of

minority  shareholders. In fact, the fee collected by the RSE is rather

the cost of the infrastructure the company is offering its shareholders

to  freely  transfer  shares,  than a fee to the exchange. If a company

happens  to  be  a  public  company,  it  has  to  take care of all its

shareholders - and not the holder of control interest only."



Irrespective  of  the amendments introduced to the RSE regulations, the

RSE  would  still  like  not to associate itself with most of Free list

companies:  we  believe  these  are  the consequences of privatisation.

Considering  our  responsibility  for  the  processes  going on in this

market,  we  could  not  stay aloof because of the tens of thousands of

people  who  bought  the  shares  in  public  privatisation  offers for

privatisation  certificates.  We hope that, in long-term, a part of the

companies  will be willing and able to qualify for Second list, whereas

the  remaining  Free  list companies will exit from public market after

fully meeting their commitments to minority shareholders.



We  would  also  like  to  add  that such list without any quantitative

requirements  is  clearly in contradiction with the RSE strategic goals

concerning  a  transparent  and  open  market,  as  well as with the EU

directives that regulate capital markets."



For more information, please contact:

Krista Grintale

Corporate Communications Director

Riga Stock Exchange/Latvian Central Depository

Phone: +371 7212431



Riga  Stock  Exchange  is part of HEX Integrated Markets, a division of

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