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Legal certainty in Latin America requires the fight against bureaucracy

Latin America is a favorable destination for foreign capital investments. For Spain, it is the second best, after Europe, for investment. Strengthening this potential zone implies reinforcing the legal security of these countries, so that all of them can offer regulations that protect and promote capital investment.

In order to achieve this, it is essential to eliminate bureaucratic hurdles which to a large extent limit and delay action in Latin American countries. This measure guarantees greater independence and specialization of the regulatory entities for investment activity, according to information gathered in a study carried out by the Spanish Association of Minority Shareholders of Listed Companies.

Legal certainty, aspects to consider

Respect for foreign investment and free trade principles are actions to be considered to increase legal certainty in Latin America, since this legal guarantee is equivalent to certainty. Therefore, the change in legislation in Latin American countries will boost the growth of foreign investment in these nations, according to experts.

Legal certainty is the certainty that the subjects of law have. that their legal situation can only be modified through previously established agreements. According to the definition offered by the Observatory of Multinationals in Latin America, transnational corporations, the governments of the countries where they have their headquarters and international financial institutions resort to the principle of legal certainty to defend business interests in the face of possible political changes, in order to guarantee a climate of stability and investor harmony.

Colombia, Chile, Peru, Mexico are some of the most attractive Latin American destinations for foreign investment. at the moment, as they offer broad legal certainty for investors, according to data compiled by IE Business School.

Over the last two decades, international investment in Latin America has increased considerably. Spain is one of the countries with the most capital invested in these lands and an estimated 76% of Spanish companies in Latin America have increased investment in the region since 2017.

Knowing and studying in depth the legal framework of each of these nations is a valuable tool for each company or enterprise interested in investing in these lands, taking into account the political aspects and needs of each one, so that in addition to having favorable legal frameworks, the investment is fruitful and with tangible results for the populations.

At ALAN ALDANA & ABOGADOS we have accompanied important companies that have successfully invested in Venezuela and Spain. If you wish to know our experience in this area contact us today here.

Sources consulted