Search terms: Venezuela
Including: Scope of Regulation; Institutions and their Regulations; Superintendency of Banks; Emergency Regulation
Recent legislative developments include a resolution by the Superintendency of Banks and other Financial Institutions that changes the minimum capital requirement for loan and savings institutions.
According to the new Enabling Law the president may issue decrees that have the same force as those passed by the National Assembly. In the banking sector, changes are permitted regarding the development of small businesses, savings banks, the Economic and Social Development Bank and the External Commercial Bank.
This update discusses recent developments which include a new regulation on foreign exchange intermediation, and a new bill to overhaul the Venezuelan Investment Fund in order to encourage investment in low-income areas and improve the country's economic development.
The Venezuelan Bank Superintendency has issued a resolution contemplating new specifications for trust agreements to be executed by financial institutions. This resolution is intended to prevent institutions having to assume risks inherent in financial intermediation.
Venezuela's securities regulator has enacted new regulations to simplify the process of issuing, publicly offering and trading commercial papers.
Venezuela's securities regulator has approved the issuing and trading of innovative asset-backed securities by a Venezuelan bank on the Caracas Stock Exchange. The securities, referred to as 'emeralds', 'pearls' and 'rubies', are intended to increase daily volume on the stock exchange.
New rules have been formulated for the authorization of investment advisers. The regulations represent more transparency in investment advisory services.
New regulations stipulate that preferred shares and/or shares of different classes with different rights must be listed on a stock exchange unless the Securities Commission determines otherwise.
Including: Foreign Investments; Foreign Exchange; Price Controls; Labour Legislation; Privatization; Shareholder Agreements; Doing Business; Domiciliation
Generally there is no minimum capital or equity requirement for companies wishing to do business in Venezuela. The aim of non-regulation is to foster commercial activity in times of domestic economic stability.
A recent Supreme Court decision may affect the commercialization structures of many multinational manufacturing companies. The decision establishes that shareholders and officers of companies that distribute manufacturers' products are deemed to be employees of the manufacturer, rather than owners of independent businesses.
Including: Foreign Investments; Foreign Exchange; Price Controls; Labour Legislation; Privatization; Shareholder Agreements; Doing Business; Domiciliation
The most recent amendment of the Income Tax Law has resulted in a restructuring of investment vehicles in Venezuela. Foreign investors will have to find other corporate structures that will permit the economic feasibility of large infrastructure projects.
The trend in Venezuelan law in the last decade to give companies and individuals the chance to request confidential treatment for the information they give to administrative authorities could change because of a new constitutional provision.
The Pro-competition Superintendency has approved TIM International NV's sale to Telvenco of the shares of the corporate capital of Digitel (the third-largest mobile phone operator in Venezuela) and the merger of Digitel with regional telephony service providers Digicel, Infonet and Digital Celular.
The draft Law Against Monopolies, Oligopolies and Unfair Competition is undergoing a period of public consultation. It incorporates significant amendments to the Law to Promote and Protect Free Competition, which is currently in force, and the various previous draft competition laws that had been presented for consideration to the National Assembly in the last few years.
The Pro-competition Superintendency has held that an advertising campaign to launch a new brand of the main mobile telephony operator in Venezuela did not constitute an act of unfair competition. The decision confirms the superintendency's view that the mere simulation or imitation of an advertising initiative is not sufficient to prove unfair conduct.
The Pro-competition Superintendency has recently ruled on cartel practices by the two major Venezuelan television broadcasting companies. It found clear evidence of concerted conduct between the two broadcasters in the sale of advertising space in open television.
The Pro-competition Superintendency has announced that it is investigating several complaints received recently. Among these is a complaint filed by the National Chamber of Communication Centres against telephone company CANTV, alleging that CANTV abused its dominant market position and restricted free competition.
The National Telecommunications Commission has refused to approve the acquisition by CANTV of the shares owned by TIM International BV in Corporación Digital CA. The Pro-competition Superintendency had previously held that the transaction would restrict competition.
Including: Definitions; Procedures; Fiduciary Duties; Competing Offers; Higher Bids; Withdrawal of an Offer; Acceptance and Revocation; Proration; Notice of Offer Results; Settlement.
A resolution of the Venezuelan Securities Commission sets a precedent for the procedure to be followed by a controlling shareholder of a public company that is involved in a repurchase plan.
A recent decision of the Venezuelan Securities Commission is noteworthy in that when a controlling shareholder wishes to increase its equity in the controlled company, it must make a tender offer for at least 75% of the company's capital stock.
Including: Definitions; Procedures; Fiduciary Duties; Competing Offers; Higher Bids; Withdrawal of an Offer; Acceptance and Revocation; Proration; Notice of Offer Results; Settlement
Venezuela's securities regulator has enacted new regulations on public tender offers, broadening the scope of previous rules. The new regulations pertain to tender offers for shares and other rights, as well as takeovers of public companies.
Including: Tax Rates; New Guidelines and Legislation.
The amended Value Added Tax (VAT) Law has expanded the list of services that are subject to VAT to include leases or similar contracts on immovable assets for non-residential purposes. The requirements for qualifying as a VAT taxpayer have also been abolished.
There have been a number of recent legislative changes, including the expiry of the tax on bank debits and the issuance of procedures for processing VAT refunds.
A new type of document will now be recognized as being valid and binding: a data message with an electronic signature, which must be certified with an electronic certificate issued by an accredited certification service provider.
The Venezuelan Chamber of Electronic Commerce has drafted a law to give digital signatures in online contracts the same legal effect as handwritten signatures. The law is part of a general trend towards prioritization of the Internet and e-commerce.
A new joint system for the protection of industrial property has been agreed by member countries of the Andean Community Commission, in order to guard against unauthorized use and registration of certain distinctive signs.
A new practice adopted by NIC.VE - the entity responsible for domain name registrations - ensures that domain names are now registered on a first-come, first-served basis.
Decree 825 states that access to, and use of, the Internet is to be a priority for the cultural, economic and social development of Venezuela. All ministries are to undertake the execution of this policy, under the direction of the Ministries of Education, Infrastructure and Science & Technology.
The Social Chamber of the Supreme Court has ruled that where a case involves contractor activities that are the same as (or similar to) those of a contracting party, and for which the latter cannot evidence that the contractor’s activities are not of a similar nature, then the contracting party is jointly and severally liable for all the contractor's obligations towards its employees.
In a recent decision the Social Chamber of the Supreme Tribunal of Justice established that high-ranking employees are not protected by the regime laid down in Article 112 of the labour legislation. In a case where the employer dismissed a high-ranking employee without cause, the court ruled that it could not order reinstatement of the employee or payment of his unpaid salary.
The Constitutional Chamber of the Supreme Court has ruled that an employer's failure to renew the contract of an employee following her period of maternity leave violated Article 76 of the Venezuelan Constitution. In such circumstances the employee is protected by maternity statute.
A recently published law approves the treaty executed between Venezuela and China on cooperation for long-term financing. The treaty establishes that representatives from China will grant a line of credit to Venezuela to a maximum of $10 billion and Rmb70 billion. The Venezuelan representatives will pay for the line of credit through the sale of crude.
Only two consortia presented offers to participate in the incorporation of mixed companies that will develop the fields subject to the Carabobo Project bidding process. As such, the consortia were awarded the blocks for which they bid. The process has progressed rapidly and the National Assembly recently approved the incorporation of two mixed companies and established the main conditions for their incorporation.
The government has announced that the national interconnected power system is beyond its capacity and certain measures must be imposed in order to reduce power use. The measures include a compulsory 20% power reduction, regulated opening and working hours, scheduled electricity cuts and a ban on the use of incandescent or halogen lamps and light bulbs in advertisements.
Companies that are participating in the Carabobo Project bidding procedure (a project that involves upstream activities in the Orinoco Basin to produce extra heavy crude and its transport and upgrading) were recently invited to attend a meeting with the Ministry of the Popular Power for Energy and Petroleum. The purpose of the meeting was to reactivate the project, which was put on hold in June 2009.
The new Organic Law for the Development of Petrochemical Activities was published recently. The law imposes important restrictions on a sector that until now was fully open to foreign or national private investment. As a result of the law, new projects in this area cannot be carried out by entities that are not mixed companies with a state participation of at least 50%.
The organic law that reserves to the state the goods and services linked with hydrocarbon primary activities recently entered into force. As a result, the assets and services of oil service contractors that are required to carry out primary activities will be owned or carried out only by the state, PDVSA and its affiliates, and mixed companies controlled by the state. The possible impact of this law on private companies could be significant.
Including: Constitutional Provisions; Environmental Law; Land Use Law; Environmental Penal Law; Major Decrees; Liability; Jurisdiction.
The Bill on Solid Waste and Residues has been drafted to address disparities between the primary and secondary legislation on this issue. The bill provides for fees, subsidies and financial resources, as well penalties for actions or omissions as appropriate. Administrative liability will not exclude liability under civil or criminal law.
A recent Environment Ministry resolution establishes the requirements that individuals or corporations (whether public or private) must meet in order to register with the Registry for Activities Liable to Degrade the Environment and obtain an authorization from the ministry to handle hazardous substances, materials and waste.
The main purpose of the Environmental Conservation Bill is to boost the role played by the state in protecting the environment. Under the bill, the state must take into account environmental considerations when drawing up plans, programmes, projects and processes concerning domestic economic development.
Decree 2,014 creates a permanent national committee on environmental technical standards. Its purpose is to coordinate and maintain a process for the examination, preparation, review and updating of such standards, in order to ensure sustainable development and an improved quality of life for the population of Venezuela.
The Metropolitan Ordinance on a System for Handling Non-hazardous Waste Services aims to conserve natural resources and minimize adverse environmental impact. The provisions cover the performance of all activities involved in non-hazardous waste management, such as inspection, handling, supervision, control and examination.
The National Assembly has issued a statement (Official Gazette 37,457 of June 4 2002) declaring the importance of environmental matters and the necessity of timely, efficient and effective answers to environmental problems, particularly through the participation of parliamentary bodies.
Including: Antitrust Regulations; Foreign Licensing Regulations.
The government has issued the first of several regulations establishing a new currency control regime to be administered by the Commission for the Administration of Foreign Exchange. The commission will determine the types of goods and services that will be considered priority items for importation. Unfortunately, the services of most franchisees are not expected to be categorized as such.
This update outlines the various crimes, their elements and the applicable sanctions for 'crimes against ownership' as defined in the Law against Computer-Related Crimes.
IT crimes under the Law against Computer-Related Crimes comprise improperly accessing IT systems, importing, manufacturing, distributing, selling or using equipment for the purpose of sabotaging IT systems and computer espionage, among other things.
The new Law against Computer-Related Crime outlines conduct that is considered to be 'computer crime' with the aim of protecting systems that use information technologies, and preventing and punishing crimes committed against (or through the use of) such systems.
In a startling decision the minister of trade recently ignored the popularity of the HUGO BOSS name in the Venezuelan market and ruled in favour of a pirate company. The decision may be appealed before the Supreme Court.
Including: Patents; Trademarks; Copyright.
The introduction of the third exchange control regime in 20 years has increased the prospect of lengthy delays and bureaucratic obstacles in effecting obligatory payments under licence agreements. Licensors will now face the quandary of whether to terminate or suspend their licence agreements due to the likelihood that any payments due will be delayed by several months at best.
According to the Regulations on Non-profit Community Radio and Open Television Services, the National Telecommunications Commission will oversee and control the provision of community radio and open television services, with jurisdiction to review periodically the content of programmes that are broadcast and issue its findings with respect to them.
Including: Revenue Securitization; Economic Conditions; Cancellation of Licences and Permits; Use of Local Services or Goods; Foreclosure of Assets; Dispute Resolution; Currency Exchange Regulations; Restrictions
Recently the validity of the Law for the Promotion and Protection of Investments was challenged. The law gives national and offshore investments a guarantee that the tax terms and incentives granted at the time of investment will not change, notwithstanding any legal changes to the domestic taxation system.
A ruling by the Supreme Justice Tribunal concerning municipal taxation of a telecommunications project confirms that the imposition of taxation should be limited to certain key economic areas.
The Venezuelan government has adopted a new legal regime to regulate its gas industry. It is hoped that the new Organic Law on Gas Hydrocarbons will foster the development of the country's gas industry through private project finance. This update examines the government's new policy.
Including: The Law; Background; Scope of the Law; Prices and Rates; Services; Concessions; Rights of Way; Interconnection; Certification; Taxes; Use of Satellites; Universal Service; Telecommunications Development; Violations and Sanctions.
A resolution concerning the elements that may be incorporated in telecommunications licences has been issued. Each element allows its holder to engage in all of the activities necessary to install and establish telecommunications equipment and infrastructure, including connections to render each service.
Including: The New Law; Background; Scope of the Law; Prices and Rates; Services; Concessions; Rights of Way; Interconnection; Certification; Taxes; Use of Satellites; Universal Service; Telecommunications Development; Violations and Sanctions
A new Telecommunications Law came into force on June 13 2000. It promotes foreign investment and competition, and it sets out a number of consumer rights.