Doing Business in Latin America IBA Latin American Regional Forum March 2016 Coordination Committee Costa Rica Batalla Salto Luna Juan Carlos Rocha BLP Philippi, Prietocarrizosa Ferrero DU &Uría Pacheco Coto David Gutiérrez BLP Ecuador Coronel & Pérez Abogados Luis Carlos Rodrigo Pérez Bustamante & Ponce Rodrigo Elías & Medrano Abogados El Salvador Arias BLP Participant Firms Mexico Argentina Basham Abogados A&F Allende Ferrante Abogados Goodrich, Riquelme y Asociados Estudio Beccar Varela Ramírez, Gutiérrez-Azpe, Rodriguez-Rivero y Hurtado SC Estudio Zang Bergel & Viñes Nicaragua Marval O’Farrel & Mairal BLP Bolivia Consortium Legal Bufete Aguirre Soc Civ Panama Moreno Baldivieso Arias Fabrega & Fabrega Brasil Fabrega Molino Mulino PinheiroNeto Advogados Peru TozziniFreire Advogados Estudio Echecopar – Member Firm of Baker & McKenzie Veirano Advogados International Velloza & Girotto Advogados Associados Philippi Prietocarrizosa Ferrero DU &Uria Chile Estudio Rodrigo, Elías & Medrano - Abogados Alessandri Abogados Uruguay Cariola Diez, Pérez-Cotapos Bado, Kuster, Zerbino & Rachetti Carey Ferrere Prieto & Cia Guyer & Regules Colombia Hugues & Hughes Brigard & Urrutia Sanguinetti & Asociados Gómez-Pinzón Zuleta Abogados Venezuela Lloreda Camacho & Co D’Empayre Reina Abogados Philippi Prietocarrizosa Ferrero DU &Uría Hoet Peláez Castillo y Duque Posse Herrera Ruiz Tinoco, Travieso, Planchart & Núñez Doing Business in Latin America MARCH 2016 Acknowledgements The Latin American Regional Forum (LARF) of the International Bar Association is proud to present this first Doing Business in Latin America guide, which covers main topics on 14 different jurisdictions in the region. This is the first publication of LARF intended to be updated every two years and feature coverage on all Latin American jurisdictions. We are thankful for the contributions from all participant firms, which made a tremendous effort not only to cover the legal aspects, but also to work together in the best interest of our legal community. We believe this publication is an important tool for both investors and the legal profession when approaching certain critical aspects in our jurisdictions. We also thank the International Bar Association for its continuing support to this initiative and encourage all members of the Latin American Regional Forum to contribute to the coming editions. Disclaimer This Doing Business in Latin America guide is a publication from the Latin American Regional Forum of the International Bar Association. This work is a product of the participant firms and therefore, the International Bar Association does not necessarily own each component of the content included in the work. The International Bar Association and the Latin American Regional Forum do not warrant that the use of the content contained in the work will not infringe on the rights of third parties. The risk of claims resulting from such infringement rests solely on the user of the materials contained there. The findings, interpretations, and conclusions expressed are the product of the work of the different participant firms in their jurisdictions and do not necessarily reflect the views of the other participant firms, their governments, the Coordination Committee or the International Bar Association. Neither the Coordination Committee nor the International Bar Association guarantees the accuracy of the data included in this work. The information included in the different maps, the boundaries, denominations, and other information shown in this handbook do not imply any judgement concerning the legal status of any territory or the endorsement or acceptance of such boundaries. The information included in the different chapters has informative purposes and cannot be considered as legal advice of any kind, therefore the participant firms are not held liable for any inaccuracy or the use of the information contained herein for investment purposes. Doing Business in Latin America MARCH 2016 Contents i. Argentina 5 A. Foreign investment 6 B. Offshore vehicle providers in Latin American countries 17 C. Development of ample/integrated capital markets and joint activities between Latin American countries 22 D. Rendering of public services 25 E. Real estate – limitations for private parties 28 ii. Bolivia 33 A. Foreign investment 34 B. Rendering of public services; treatment of foreign investment 37 C. Real estate 40 iii Brazil 45 A. Foreign investment in Chile 46 B. Rendering of public services 52 C. Real estate 59 D. Development of ample/integrated capital markets and joint activities between Latin American countries 64 E. Offshore vehicles providers in Latin American countries 66 iv. Chile 71 A. Foreign investment in Chile 72 B. Rendering of public services 77 C. Real estate 80 D. Development of ample/integrated capital markets and joint activities between Latin American countries 83 E. Offshore vehicles providers in Latin American countries 86 v Colombia 89 A. Foreign investment in Latin American countries 90 Doing Business in Latin America MARCH 2016 1 B. Rendering domestic public services 109 C. Real estate 112 D. Development of ample/integrated capital markets and joint activities between Latin American countries 114 vi. Costa Rica 121 A. Foreign investment 122 B. Rendering of public services 130 C. Real estate 132 D. Development of ample/integrated capital markets and joint activities between Latin American countries 137 E. Offshore vehicle providers in Latin American countries 139 vii. Ecuador 143 A. Foreign investment 144 B. Public services 149 C. Real estate 150 D. Development of ample/integrated capital markets and joint activities between Latin American countries 153 Viii. El Salvador 155 A. Foreign investment 156 B. Rendering of public services 160 C. Real estate 165 D. Development of integrated capital markets and joint activities between Latin American countries 169 E. Offshore vehicles providers in Latin American countries 170 ix. Mexico 173 A. Foreign investment 174 B. Rendering of public services 180 C. Real estate 182 D. Offshore vehicle providers in Latin American countries 185 2 Doing Business in Latin America MARCH 2016 x. Nicaragua 189 A. Foreign investment 190 B. Rendering of public services 199 C. Real estate 203 D. Development of ample/integrated capital markets and joint activities between Latin American countries 205 E. Offshore vehicles providers in Latin American countries 206 xi. Panama 207 A. Foreign investments 208 B. Rendering of public services 217 C. Real estate 219 D. Development of ample/integrated capital markets and joint activities between Latin American countries 222 E. Offshore vehicles providers in Latin American countries 223 xii. Peru 231 A. Foreign investment in Latin American countries 232 B. Rendering of public services 243 C. Real estate 245 D. Development of ample/integrated capital markets and joint activities between Latin American countries 248 xiii. Uruguay 251 A. Foreign investments 252 B. Public services 260 C. Real estate 263 D. Development of ample/integrated capital markets and joint activities between Latin American countries 264 E. Offshore vehicle providers in Latin American countries 265 xiv. Venezuela 269 A. Foreign investment in Latin American countries 270 B. Real estate 277 Doing Business in Latin America MARCH 2016 3 4 Doing Business in Latin America MARCH 2016 Argentina Doing Business in Latin America MARCH 2016 5 i. Argentina A. Foreign Investment i. Authorisations vs limitations or prohibitions A. ARGENTINE FOREIGN INVESTMENT REGIME In general terms, foreign investments in Argentina are regulated by a framework of international treaties and Argentine laws that establish, among others, the rules for choice of law and jurisdiction, legal treatment of foreign investors, monetary policy and foreign exchange. Particularly, foreign investments are governed by the Argentine Foreign Investments Law No. 21,382 which states, as a general principle, that foreign investors enjoy the same status and have the same rights that the Argentine Constitution affords to local investors. However, there are certain regulated areas that impose restrictions on foreign investors, such as antitrust regulations, foreign exchange matters, the broadcasting industry, or the acquisition of rural land. B. FREE CHOICE OF LAW AND JURISDICTION 1 Choice of law Argentine law generally permits parties to a contract to select the laws that will govern their agreements as long as some connection to the system of law that is chosen exists. Further, the choice of foreign law will only be valid to the extent that it does not contravene Argentine international public policy (orden público or public order). Typical public policy laws include criminal, tax, labour and bankruptcy law, as well as inheritance and family rules. Rights associated with real estate (such as in rem rights), the ability to acquire real estate and the formal requirements with regard to legal acts connected with real estate are all governed exclusively by local laws. The same principles apply with respect to movable property permanently located in Argentina. 2 Choice of jurisdiction Argentine courts have jurisdiction whenever: (1) the defendant is domiciled in Argentina; (2) the place for performance of any of the obligations is located in Argentina; or (3) Argentine courts have been chosen as the applicable forum (subject to certain restrictions). With respect to debtors domiciled abroad, local courts have jurisdiction only to the extent that the debtor has assets in Argentina, in which case