The Latvian Parliament passed legislation last week requiring alcohol producers to use locally produced spirits in their production.
The amendments to the country's liquor laws have infuriated Latvia's largest alcohol producer Latvijas Balzams, which is owned by the Russian company Soyuzplodimport. All of the company's exports, including its production of Stolichnaya and Moskavskaya vodkas, are made with ingredients from Russia.
"We are not against an alcohol policy in general, but we are against sudden amendments which are aimed at decreasing Latvian export potentials and job opportunities," said Latvijas Balzams chief executive Juris Gulbis. "Latvijas Balzams calls for an alcohol policy which would regulate alcohol circulation in Latvia."
The new law states that only spirits made from local ingredients will be used as much as is admissible depending on production technology, quality requirements and international agreements between Latvia, the European Union, the Baltic Customs Union and the World Trade Organization. Russia is a member of none of those organizations.
"The adopted amendments will change the current situation in which production and especially exports are growing. One can feel the law was amended to restrict imports of Russian-made spirits," Gulbis said.
Latvijas Balzams recently hired 80 people in order to keep up with international demands, he said.
Gulbis said his company may not be able to fulfill their end of a long line of export orders if they can't use spirits from Russia. Jobs could be lost, he warned.
"According to international product certification, the fulfillment of these export orders already started must continue using spirits imported from Russia," said Gulbis. "Law changes make this an impossibility."
Although absent when the amendments were approved, Inese Birzniece of the Latvia's Way party, a member of the ruling coalition, said the Parliament should reconsider the amendments.
"I support a reconsideration of this paragraph (concerning local ingredients). I suggest the president (Vaira Vike-Freiberga) send this back to the Parliament," the lawmaker said.
She also pointed out that the way the law has been amended is confusing.
"We have to find out how this law coincides with other laws and international bilateral agreements," said Birzniece.
Gulbis said the law was highly subjective and open to varying interpretations.
"No competent institution has been appointed to evaluate the technology and quality criteria in order to make this final decision," he said.
Also included in the package of legislative amendments is a clause banning the retail sale of alcohol between 10 p.m. and 8 a.m., except in bars, restaurants, cafés and clubs and duty-free shops.
During debate in Parliament, MP Miroslavs Mitrofanovs said that the retail ban was both unnecessary and risky.
MP Peteris Apinis, a doctor, said that opposing the ban is "clearly lobbying for alcohol retailers. Banning alcohol sales at night is a first and important step in making Latvians drink less."
According to a World Health Organization report, Latvia is among Europe's leaders in alcohol consumption.