Paraguay introduces policies aimed at new Investors

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The Republic of Paraguay has an open trade policy for the attraction of foreign investors that want to get established in the country.

Article 107 of the National Constitution establishes that everybody has the right to work in his or her preferred licit economic activity, within a framework of equal opportunities.

At the same time, the Investment Law Nr. 117/91 establishes the following principles:

• Equality: Foreign investment receives the same treatment as a national one. Consequently, it is not admissible to impose neither conditions nor discriminatory or favorable treatment to national and or foreign investments.
• Property rights: National and foreign investors can acquire goods and real estate in Paraguay, with no other limitation than the ones established in the Constitution and national laws.
• Free exchange: This law guarantees the inflow and outflow of capitals, the remittance of dividends, interests, commissions, royalties for transfer of technology and others without restrictions. However, all foreign exchange transactions, remittances or transfers shall be subject to taxation as established by law.
• Freedom to hire investment insurance locally or abroad.
• Freedom of commerce: Freedom of commerce guarantees:
  • Freedom to produce and commercialize goods and services,
  • Free price-setting, with the exception of those goods and services which production and commercialization are regulated by law
  • Freedom to import and export goods and services, with the exception of those prohibited by law.

National and foreign investors shall benefit from these guarantees provided they comply with the Tax, Work and Social Security Regimes.

• Universality: Foreign investments are welcome in all sectors of the economy, with the exception of those included in specific local laws like: hydrocarbons sector, mining, telecommunications, forestry and others which require special permits, licenses or concessions granted by the local authority.
• Automaticity: With the exceptions aforementioned, foreign investors are authorized to invest in any other sector of the economy without needing prior authorization, unless the investment is subject to a special regime. In such case, the investor must follow the procedures established by such regime.

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Post available in: English