Lex Mundi in Latin America and the Caribbean Key Market Developments 2019 About Lex Mundi Lex Mundi, the world’s leading network of independent law firms, brings together the collaboration, knowledge and resources of 160 rigorously vetted, top-tier law firms in 100+ countries. Supported by client-focused methodologies, innovative technology, joint learning and training, member law firms collaborate seamlessly across borders, industries and markets to help clients manage complex cross-border legal risks, issues and opportunities. Through the Lex Mundi global service platform, member firms can deliver integrated and efficient solutions focused on real business results for clients. Lex Mundi member firms are among the most experienced and knowledgeable in the world. Recognized as leaders in their local markets, they have a comprehensive understanding of the culture, politics, government, law and history of their respective markets, and have strong connections to local decision- makers. Admittance is granted only to firms that meet rigorous selection criteria and maintaining membership requires a review every six years. Lex Mundi member firms work together fluidly and efficiently across borders, often in tight time frames. When the call comes in, they can mobilize cross-border teams with the combined local perspectives needed to quickly interpret your opportunities and challenges. Lex Mundi is World Ready, providing the insight, innovation, resources and cross-border collaboration you need to meet the challenges of doing business in virtually any market, virtually anywhere in the world. Lex Mundi – the law firms that know your markets. Find out more about Lex Mundi at: www.lexmundi.com 2 © Copyright 2019 Lex Mundi Lex Mundi in Latin America and the Caribbean Key Market Developments 2019 About This Publication This guide details the market outlook and key business and legal developments across jurisdictions in Latin America and the Caribbean. Lex Mundi member firms with deep local roots and extensive on-the- ground capability have provided this information to help in-house counsel as well as other corporate and financial decision makers stay apprised of important trends within industries, law and regulation, and transactional activity in an increasingly important region. The guide will be updated as additional submissions become available from Lex Mundi member firms. For the most up-to-date version and other Lex Mundi client resources, please visit the Resources and Insights page on the Lex Mundi website (www.lexmundi.com/lexmundi/resources.asp). For information about the Latin America and Caribbean region please contact Jorge Carrillo, Head of Business Development and Strategy, Latin America at [email protected]. 3 Contents Argentina 5 Aruba 10 The Bahamas 12 Barbados 18 Bolivia 23 Bonaire, St. Eustatius and Saba Islands – Caribbean Netherlands 29 Brazil 31 British Virgin Islands 46 Chile 52 Colombia 55 Costa Rica 61 Curaçao 64 Dominican Republic 67 Ecuador 74 El Salvador 79 Guatemala 84 Honduras 89 Mexico 91 Nicaragua 104 Panama 109 Paraguay 114 Peru 120 St. Maarten 126 Uruguay 129 USA, Puerto Rico 136 Venezuela 143 4 Argentina Prepared by Marval, O’Farrell & Mairal, Lex Mundi Member Firm for Argentina What to Expect in 2019 of GDP Although Argentina is currently facing difficult times, analysts forecast that USD $626,000 the economy will stabilize after the first quarter of 2019. The country has been experiencing high inflation and fluctuation of its currency. This crisis led to a bailout million by the IMF in 2018. Since then, the government has been working hard to meet the 43 million Fund’s fiscal targets to avoid recession. inhabitants, and Despite the economic contraction, and as politicians get prepared for this year’s 270 million in the October presidential elections, it is foreseen that there will be an export-led recovery. Many industries began 2019 with the announcement of foreign Mercosur. investments, in particular in the energy and infrastructure sectors, while agricultural production has been rising in the last quarter. Trends and Projects Mining Eighth largest Argentina is known worldwide for its geological resources. In the case of mining, the national government is focusing on lithium, which is mainly produced in the country in the world, province of Jujuy. In five years’ time Argentina aims to become the main worldwide 750,000 Km2 of supplier of this mineral, which is strategic at a global level. high Energy As the world’s second country with the largest gas reserve and the fourth for potential non-conventional hydrocarbons, Argentina’s energy industry is one of the most important. Nevertheless, renewable energies are increasing their presence in the mining areas, second country. The government is encouraging local and foreign investments in this industry by applying the RenovAR program.The government has established by law, reserve of shale gas intended and increasing thresholds of total renewable generated energy, with a and fourth of shale oil, goal of reaching 20 percent of total generation by 2025. worldwide. Regarding shale oil and gas, companies such as Vista Oil & Gas and Petronas have recently announced investments in the Vaca Muerta region, in the province of Neuquén. Infrastructure Argentina launched Public-Private Partnership contracts bids mid-2018 for road First world country projects totaling around 7,000 kilometers. By the end of the year, the government included a new framework in the 2019 Budget Bill to generate further investments exporter by setting out a more transparent and practical process. of soybean oil and Anti-Corruption and Compliance second soybean flour. Argentina has passed new regulations on anti-corruption and compliance programs. Second producer in Brazil’s Lava Jato Scandal and Argentina’s Notebooks Case have also had a strong impact in the region. As a result, more transparency is being seen in infrastructure lemons and limes. Third and other major government projects, which is expected to make investments in exporter of corn. these areas more attractive for foreign investors. 5 Argentina Corporate The fluctuation of the currency has boosted the interest of foreign companies to invest in Argentina. This condition and the government’s policies place Argentina as one of the most attractive Latin American countries in M&A investments for 2019. Legislative News February 2019 “Regulation of the procedure for the request of refund of taxes paid in excess by beneficiaries of the fiscal stability provided by Law 24.196”. Published on 02/27/2019. By Leonardo G. Rodríguez and Fernando M. Vaquero Through Joint Resolution No. 4428/2019, issued on 02/26/2019 by the Argentine Tax Authority (“AFIP”) and the Secretariat of Mining Policy, a procedure was regulated so that the mining undertakings that are beneficiaries of the fiscal stability established by theLaw of Mining Investments, and have born a higher tax and/or tariff burden than the corresponding one, can request the credit or refund of the sums paid in excess. January 2019 Resolution No. 6/2019 of the Secretariat of Mining Policy of the Ministry of Production and Labor Published on 01/31/2019. This Resolution approves the procedure and the conditions for the use of benefits regarding Income Tax established by Law No. 24,196 of Mining Investments. It is created to simplify the procedure to a single regulatory body that leads to the facility, speed, transparency and modernization for the use of the benefits regarding Income Tax established by Law No. 24,196 of Mining Investments. Resolution No. 9/2019 of the Secretariat of Mining Policy of the Ministry of Production and Labor Published on 01/31/2019. This Resolution approves the procedure to access the fiscal stability benefit in accordance with Article 8 of Law No. 24,196 of Mining Investments, in accordance with the Annex attached in Resolution 9/2019. The application for the fiscal stability benefit may only be requested by those registered in the Mining Investment Law Register. According to Article 5 of the above-mentioned Annex, the fiscal stability obtained by a mining development will include new mineral resources or mineral reserves in addition to those declared in the original feasibility study, which are incorporated during the production stage. The Application Authority will issue the certificate of fiscal stability in accordance with Article 10 of Law N° 24.196 of Mining Investments, for each jurisdiction involved. Resolution No. 9/2019 provides for the Feasibility Study Formulation Guide. This measure will be applicable to the procedures that are in progress on the date of its entry into force. November 2018 RenovAr Round 3 • The Secretariat of Energy issued Resolution No. 100/2018 launching the third round of the RenovAr program. • RenovAr Round 3 will be for a maximum capacity of 400 MW distributed by technology, region and province. Technology will be divided as follows: (i) wind/solar photovoltaic 350 MW; (ii) biomass 25 MW; (iii) biogas 10 MW; (iv) waste landfill biogas 5 MW; and (v) small hydro 10 MW. Wind and solar photovoltaic will also be distributed among different geographical regions. Prepared by Marval, O’Farrell & Mairal, Lex Mundi Member Firm for Argentina 6 Argentina Open Access Implementation in Railway Transport The Argentine Executive implemented Law No. 27,132 to advance the execution of “open access” in cargo and passenger rail transportation. Amendments to the Argentine Public Administration Procurement Framework Decree No. 963/2018 adjusted certain aspects regarding the Regulation of the Argentine Public Procurement Framework that had become outdated since the last administrative reorganization. Changes to PPP Contracts’ Framework The Argentine Congress passed the 2019 Budget Bill, which includes several amendments related to the PPP Contracts Framework. Moreover, the Argentine Executive introduced amendments to the executive decree implementing PPP Law No. 27,328. Regulation of Distributed Generation Law No. 27,424 The Argentine Government approved the regulation of Distributed Generation Law No. 27,424 that introduces the Distributed Energy Generation Incentive Program.