Two years after having been presented at the Guatemalan Congress, the initiative to reform the Free Zones Law is still awaiting approval.
In 2016, initiative 5174 was presented to the Congress of the Republic, and has been debated in speeches made by deputies and in meetings of the Economic Cabinet of the Executive Power, none of which have resulted in its approval.
From January to July 2018, sales abroad from free zones in Costa Rica grew by 8%, well below the 12% increase registered in the first seven months of 2017.
According to data from the Foreign Trade Promotion Office (Procomer) between the first seven months of 2016 and the same period in 2017, exports of products in free zones went from $2.874 billion to $3.208 billion, representing an increase of 11.6%.
A modification has been made to the law to equalize the incentives received by the free zones that operate in Grecia, Valverde Vega, Naranjo, Palmares and San Ramón, with those outside of the Greater Metropolitan Area.
From a PAC Party bulletin:
April 3, 2018.The Legislative Assembly approved, in a second debate, the project to improve the conditions for the installation of free zones in the West Region of Alajuela (File No. 20,464).
The ICEFI states that the proposed reforms to the Free Zones Law in Guatemala encourage a public investment model based on tax privileges for specific groups of companies.
The Central American Institute of Fiscal Studies (Icefi) reiterates its arguments against continuing an obsolete and ineffective model of attracting public investment based on tax privileges for specific groups of companies and encourages the initiation of the discussion on a general investment law. For this reason, it does not recommend to the Congress of the Republic the approval of the reforms to the Law on Free Zones contained in the legal initiative with the registry number 5174.
With the modification of the Free Zones Law, it will now be possible to accumulate up to 25 samples which do not have a commercial value in a single declaration.
Jaime Campos, executive director of the Regulatory Improvement Organization, told Elmundo.sv that the reform "...'will help the investment climate in the country' because the reform introduces the concept of the 'accumulated goods declaration', which will allow imports or exports of up to 25 samples in a single declaration."
In Costa Rica an amendment to the regulations of the Free Trade Zone Law is under public consultation until November 25.
From a statement issued by PROCOMER:
In accordance with the provisions of articles 361 et seq. of the General Law of Public Administration, Law No. 6227 of May 2, 1978, in accordance with article 174 of the Code of Tax Rules and Procedures, Law No.
In Guatemala, only 141 of the 205 free zone companies that had to report their 2016 activities presented their reports, and half of them declared not having made any investment during the year.
"...As part of a budget regulation for last year, companies in free zones were required to send investment portfolio information with investment amounts, new jobs generated and wages paid in 2016.Only 141 out of 205 complied with the delivery of information, but almost half reported not making any investment or generating employment."
From January 2018 until 2022, there will be an annual increase of 8.25% in the wages of workers in free zone companies.
The agreement will be valid for five years and will come into effect from January 1, 2018.
Laprensa.com.ni reports that "...Currently the minimum wage in force in a free zone is US $180, and when the adjustment is applied next year it will go up to approximately US $195".
In Nicaragua, a banana processing and packaging plant has opened up in the free zone regime, with a capacity to process 3,500 cases per day.
The company Banano Líder is now one of the 264 companies operating in the country under the free zone incentive scheme.The new plant, located in La Paz Centro, León, has capacity to process 3,500 cases of the fruit per day.
In 2016 exports from the free zone regime fell by 4% compared to 2015, and those from companies covered under the maquila incentive law, fell by 6%.
The negative results in foreign sales of companies operating under one of the two incentive schemes is due in part to the departure of several companies from the free zone regime, having been affected by the Emergent Employment Act.
A simpler scheme for importing materials is one of the new features included in the new regulations announced to facilitate procedures for free zone companies.
The leaders of the Superior Council of Private Enterprise (COSEP) announced that the new technical circular for free zone companies will be in effect from February 1, and includes, among other things, adjustments to the time and costs incurred by companies when transporting goods.
Two companies in the food industry and one assembler of electrical panels have invested $11 million to start operating under the free zone regime in the country.
The companies are Caribbean International Foods, Inc., which is engaged in the preparation of bakery products, Industrias Romanina, S.A., which produces tomato sauces, and Quadrotek, S.A., which assembles electrical panels.The companies were founded with Spanish, Argentine and Jamaican capital.
Grupo Aristos has announced plans to invest $75 million over five years in the construction of two new industrial buildings and an office at the American Industrial Park.
The company expects to start construction of the new industrial buildings next year, once the paperwork and necessary permits have been completed.Edwin Escobar, executive director of American Industrial Park, told Elsalvador.com that"... although everything is moving along, it is not going at the speed they want, because 'time spent on red tape is too slow," explained the executive. "
The first stage of the project to develop a logistics center and free zone on 200 hectares in a section of Panama City airport will be tendered in six months.
The head of Tocumen S.A. told Laestrella.com.pa that"... the beginning of the bidding process is expected within six months, and the first stage will start with an investment of $15 million. 'The board of directors has already authorized us to start with the development of the urbinization to adapt 60 hectares for the concession and build the logistics craft'."
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