Legislation for Foreign Investment Statutes in Countries in the Americas
Comparative Study
1. Legal bases for foreign investment
Objective: Indicate if there is a Foreign Investment Statute and describe it. In the paragraphs below, indicate the legal rank of the norms contained in the Statute, i.e., regulations for expropriation fall under which rank?
1.1 Constitutional
1.2 Legal
1.3 Administrative
The institute "INVESTSUR" has to be approved by the National Assembly for its legal status.
2. Concept and subject of foreign investment
Objective: It is essential that both the investor and the nature of the investment be identified, so as to determine to which activity and to whom the regulations will be applied. This is also essential at the international level, especially in case of dispute and arbitration.
2.1 Is foreign investment in your country legally defined or conceptualized?
In Suriname foreign investment is still conceptualized.
2.2 Are there registered records or mechanisms to clearly identify both the foreign investor and the nature of the investment?
There is an institute, "INVESTSUR", to clearly identify both the foreign investor and the concept of the instrument.
2.3 Is it possible for a natural person to resort to the foreign investment legislation?
For natural persons it is also possible to resort to foreign investment regulations.
2.4 Is it possible for a citizen or resident to resort to the foreign investment regime?
For a citizen or resident it is possible to resort to foreign investment, as long as they can keep themselves to the regulations and rules written in the investment law.
2.5 Can a recipient company funded with both domestic and foreign capital resort to foreign investment regulations? Is this subject to restrictions?
In some cases it is possible for such companies to resort to foreign regulations and of course it is subject to restrictions.
2.6 Is there a time limit for a foreign investor to be considered as such?
2.7 Are restrictions imposed on the executive body or other staff of an enterprise. Are there nationality quotas? Under what conditions can the executives or other staff hired abroad send their earnings to their country of residence?
Actually there are no restrictions on the executive body or other staff of an enterprise but under some circumstances (such as the devolution of funds, the payment of bills for management, technical assistance, know-how, licenses etc), a request for the enforcement of the facility that arranges the transfer of foreign exchange has to be presented two months before the transfer. This facility is considered to be accepted, if the decision is not given within the above-mentioned period.
3. Scope of foreign investment activities
Objective: Define the legal scope of foreign investment in your country, as well as their conditions and limitations.
3.1 Describe the regulating principles of economic activity in your country.
In Suriname, the National Assembly is the highest organ of the country. As soon as an economic activity which doesn't take place on a regular basis is exploited, the National Assembly has to make a decision about it.
a) Describe how economic freedom is guaranteed.
Everyone and anyone is free to exploit economic activities, as long as all the subjects mentioned in the investment law are taken into account and of course considering the environment.
b) Is the principle of economic nondiscrimination guaranteed? Describe how.
See 3.1 point a).
c) Public and private enterprises (local and foreign): do they compete on equal terms, or does the State have higher benefits?
There is an equal treatment of local and foreign investors, but it is not further specified.
3.2 Indicate the scope of foreign investment, i.e., does it include movable and immovable property, assets, concessions, claims to money, intellectual property, industrial property, leasing, technology, etc.
The scope of foreign investment includes indeed movable and immovable property, assets, concessions (such as forestry, training in environmental issues and all the beside mentioned subjects).
3.3 Reserved sectors
There are restrictions to foreign investment in the following sectors: the electricity company (EBS), the telecommunications sector (TELESUR), the water company (SWM), the gas company (OGANE). The above mentioned companies completely fall under the supervision of the Government of Suriname.
a) Indicate the sectors or economic activities reserved exclusively for the state in your country. Explain the regulations pertinent to these areas.
b) Indicate the sectors or economic activities in which only foreign investment is excluded, restricted or limited in your country. Explain in what consists said exclusion, restriction or limitation.
In the investment law there is no an article that briefly describes the international reciprocity in the legislation of Suriname.
d) Is foreign investment subject to performance requirements?
Not specified
e) Can foreign investors take part in the privatization processes of your country?
At this moment the privatization issue is just brought into discussion, so there is no legislation in force now.
4. Rights and protection of foreign investment
Objective: Identify the type of treatment granted foreign investment i.e.: its rights, protection and incentives.
4.1 Treatment granted to the foreign investor and the investment
a) National treatment or Most-Favored-Nation clause ? (Refer to paragraphs 3.1 and 3.3).
No.
4.2 Protection of Property
a) Constitutional or legal grounds that may lead to expropriation of, or limitations to property.
b) How is compensation determined? Which value is it based on? How is it settled?
There is a time limit of two months the investor has for presenting a request for the remittance derived from foreign investment before he can start with his remittances.
c) Can the authorities take possession of expropriated assets prior to paying compensation?
d) Is property of both corporal and incorporeal assets equally guaranteed?
4.3 Transfers of investment, remittances of capital and benefits
a) Under what conditions may investments in the form of foreign exchange, capital goods, technology, associated credits, etc., be brought into the country? Are there specific regulations for each item?
In the investment law there is an article in which is stated that a request for the granting of a written license has to be sent to the Minister of Finance for the import of goods and services and the transfer of foreign exchange.
b) Are there restrictions to the remittances of capital, benefits, debt service, or other remittances derived from foreign investment?
There is a time limit of two months the investor has for presenting a request for the remittance derived from foreign investment before he can start with his remittances.
c) Are there different kinds of exchange rates? To which does the foreign investor have access?
There are two kinds of exchange rates, these are the exchange rate of the custom house and the exchange rate of the Central Bank of Suriname. The foreign investor has access to the exchange rate of the Central Bank of Suriname. At this moment the exchange rate is: US$ 1.-=Sf 425 - (Four hundred and twenty five Suriname guilders for one American dollar).
4.4 Taxes and incentives to foreign investment.
a) Explain briefly the taxes that foreign investments are subject to.
Import taxes.
b) Are there special tax rules for foreign investment?
No.
c) Has your country signed agreements with other countries in the Americas to avoid double taxation? If yes, list those countries.
There are no special agreements signed with other countries in the Americas to avoid Double Taxation.
d) Are there other incentives to foreign investment, such as access to domestic credit, investment insurance, industrial parks, customs exemptions, etc.?
5. Dispute settlement
Objective: Because Bilateral Investment Treaties (BITs) will be part of another study, only an overview of the subject is required here.
5.1 Domestic settlements: Can the foreign investor resort to the same procedures as the national investor? Are there special forms of appeal available to foreign investors? Please describe.
Yes.
5.2 International settlements: Is your country a member of ICSID or other international arbitration mechanisms on the subject of investment?
No
5.3 Has your country signed BITs with other countries in the Americas? What is the present status of said agreements, i.e., approved, ratified, in effect?
No
5.4 Where in the juridical hierarchy of your country are international treaties and specifically the Investment Protection Agreements? Analyze your response in relation to the Constitution and domestic laws.
5.5 Do said agreements have "direct effect", that is to say, can they be invoked by the parties directly before the Courts and then applied to the case in question? If not, under what circumstances can they be invoked and applied?
6. National authorities
Objective: To identify the agencies in charge of foreign investment, their organization and functions.
6.1 Is foreign investment handled by specially appointed offices in your country? What is their hierarchical status? How are their actions integrated? What are their main attributions?
At this moment there is no specific institute but the Government is planning on a body to promote the investments.