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Special Rights and Guarantees for Foreign Investment - International Law Office

International Law Office

Company & Commercial - Nicaragua

Special Rights and Guarantees for Foreign Investment

March 05 2007

Private foreign investments enjoy the same rights and guarantees as those afforded to domestic investments (except those relating to national security and public health). Furthermore, the Foreign Investment Promotion Law(1) provides for the following special rights and guarantees for foreign investors and investments:

  • enjoy, use and own land related to their investment, unless it is declared of public use or social interest by the competent authority (in which case investors shall be compensated, as provided in Article 44 of the Constitution);

  • freely purchase, sell and convert foreign currency in circulation, as provided in the national monetary laws and regulations;

  • make transfers abroad related to their capital investment or resulting from the dissolution and liquidation or voluntary sale of their foreign investment;

  • remit any profits, dividends or profits generated in the national territory subsequent to the payment of the applicable taxes;

  • pay and remit payments for debts contracted abroad and accrued interest thereon, as well as royalties;

  • pay rent and technical assistance;

  • remit payments derived from any compensation for expropriation;

  • hold non-commercial risk insurance governed by the rules or provisions set forth in bilateral or multilateral treaties or conventions that are duly approved and ratified by Nicaragua;

  • have access to national arbitration panels or international arbitration, as provided in the international agreements approved and ratified by Nicaragua; and

  • benefit from double taxation agreements that have been approved and ratified by Nicaragua.

In order to benefit from these special rights and guarantees, foreign investors must register their investment with the Ministry of Economy, Industry and Trade. Investors must describe the nature and amount of their investment and other important information in the registration form. The ministry will review the application within 30 days and verify that it fulfils all necessary requirements; if so, it will approve and register the investment. Registrations are valid for one year; foreign investors must thus renew or update their registration every year to continue to enjoy the special rights and guarantees.

For further information on this topic please contact María Belinda Bendaña Talavera at Taboada & Asociados by telephone (+505 254 5454) or by fax (+505 254 5295) or by email (mbendana@consortiumlegal.com).


(1) 344/2000, published in Official Gazette 97 on May 24 2000.

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