The Dominican Republic has an attractive, growing economy, but the business environment can be challenging for those looking to expand in the country.
The International Monetary Fund (IMF) recently highlighted that the country's GDP grew by 4.6% in 2017, with a forecast of 5.5% in 2018. Meanwhile the unemployment rate has fallen to a near-historical low of 5.1%.
However, while the Dominican Republic is packed with potential, the World Bank ranks the country a lowly 99th for ease of doing business.
It is therefore important for companies operating in the Dominican Republic to keep up-to-date with the latest regulatory developments and make sure that they fully understand their obligations.
Having the right local support in place is crucial for those embarking on a business venture in the country.
Why has the New Law been introduced?
One of the newer requirements of the Dominican Republic tax system is Law No 155-17. On 1 June 2017, the Directorate General of Internal Revenue (DGII) put into effect the new Anti-Money Laundering and Terrorist Financing Act 155-17 ("New Law"), which overhauled the previous Anti-Money Laundering Act 72-02 from June 2002.
The New Law aims to regulate money laundering and terrorist financing activities more efficiently, and in line with the latest international guidelines. It will help the country to comply with international standards for fiscal transparency and the transmission of available information regarding economic agents, their activities and their beneficial owners.
It will also help the Dominican Republic to further open up access to foreign credit and fuel collaboration with international organisations. Companies operating in the country will have to evaluate and enhance their compliance efforts, reviewing their current programmes to make sure they include the right policies, procedures and controls.
What do you need to do?
It is now mandatory for all companies (both profit-making and not-for-profit organisations) to register their Ultimate Beneficial Owner (UBO).
A UBO is the person, or persons, who ultimately owns or controls a customer relationship, or the person on whose behalf a transaction is being conducted. UBO status also includes those persons who exercise ultimate effective control over a legal person or arrangement.
You will need to provide a copy of the ID - or a legalised copy of the passport if the UBO is a foreign person who is the UBO - along with the full name, address, and their...