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Print articleNew Law of Incentives for Public Private Partnerships and Foreign Investment
December, 2015 - Josemaria Bustamante, Alejandro Pérez Arellano
On December 18th was enacted the Organic
Law of Incentives for Public Private Partnerships and Foreign Investment. This
law is intended to promote synergies between the private and the public sector.
It is based in the principles of fiscal sustainability, Risk allocation, Value
for money, respect to interests and rights of the users, property rights and
social inclusion. All of the projects can be part of this regime, whether they
are new public works (construction, equipment, operation and maintenance) or existing
public works (rehabilitation).The areas which can be develop PPP projects are:
Infrastructure, urban development, ports and airports. On an exceptional basis
can be granted projects in public services. There are no subject of this lay
the projects that are related with strategic sectors (oil, electricity,
telecommunications and water) Regarding the tax incentives are highlight: Exemption
of the Income Tax for 10 years, since the first year of revenues related to the
operation. Exemption of the Tax on the Remittance of Currencies for 10 years,
for payments of imported goods related with the project, as well as the payment
of services, finance and profit distribution. Exemption in all of the taxes on
foreign trade. Furthermore, it grants legal stability, which extends to all
regulation issues that must be declared as essentials in the contracts.
