Riga city authorities halted the construction of a new Maxima hypermarket April 11 due to residents complaints. Officials from Vilniaus Prekyba, Lithuania's largest retailer and the parent company of Maxima, have accused the city of protectionism.
Riga City Council spokeswoman Velta Purina said residents in the Plavnieki neighborhood, where construction of the store has already begun, complained about trees being removed. They also said they were not told about the project before it began.
Purina said the construction permit for the project was suspended until city officials could consult residents. The result may be improvements to the area around the store, including landscaping and children's play areas.
But Ignas Staskevicius, director general of Vilniaus Prekyba, said the city was simply trying to block the store's construction and restrict Lithuanian business in Latvia.
The Maxima hypermarket under construction, which is scheduled to be completed this fall, would be the second in Plavnieki, a residential Riga suburb. Vilniaus Prekyba earlier this year promised to build several more stores around the Latvian capital.
The opening of the first Maxima last month led to a sharp boost in revenues for Vilniaus Prekyba, which also operates 24 smaller T-Market stores throughout the country.
The stores are part of a trend in Latvia's retail market, which is increasingly being dominated by large, mostly foreign-owned supermarkets. Locally owned small- and medium-sized stores have been the victims, with several going out of business in Riga over the past year.
Vilniaus Prekyba officials say their company is being singled out.
"No other stores have these kinds of problems," said Kestutis Liutkus, spokesman for Vilniaus Prekyba in Latvia.
Riga city officials denied the accusations, saying simply that all the documents necessary for the construction permit - namely a poll of residents - had not been submitted.
A survey asking nearby residents before issuing a building permit was added to city building regulations in 1999.
"(In this case) it was probably overlooked by the responsible officials," she said.
The permit was issued April 10 and suspended the following day, said Purina.
"(The lack of a survey) has created misunderstandings," said Purina. "The construction site was fenced in just 10 meters from apartment buildings, so residents thought they would have a wall right in front of their windows."
Vilniaus Prekyba has promised to conduct the survey this week.
Liutkus said the company was not opposed to conducting the survey but didn't believe it's the only reason the permit was suspended.
Latvia's fall parliamentary elections, he said, might also be behind the decision. Discrimi-nation by the Latvian government against Lithuanian companies is also a factor, he said.
Latvia's Food and Veterinary Service earlier this year noted several health violations at Vilniaus Prekyba. Service officials said they would closely monitor the stores for further violations and increase border controls.