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ABOUT BLOCKCHAIN DIGITALCITY

 

WHY SHOULD YOU INVEST IN THE BLOCKCHAIN DIGITALCITY PROJECT?

What measurable benefits would you receive by living and working in this viable, secure & prestigious ocean view - TAX EXEMPT - Investment Banking Community?

 

Developed in North Coast of the Dominican Republic, in the ocean front city of Puerto Plata and designed with Feng Shui energy flow to promote health, happiness, and abundance in your life. Only 30 Entrepreneurs are invited to join our TAX-EXEMPT Investment Banking  community.

 

Your investment and land acquisition in the BlockChain DigitalCity project includes the following benefits:

 

  • Free Trade Zone Financial Park offering financial companies from across the world 30 years tax free status.

  • Establishment of your own Investment Bank including your own SWIFT Code included.

  • Included is your private label e-wallet electronic payment system for your new Investment Bank.

  • Included is your ISIN number, or “ISIN”, or international securities identification number,  which is a 12 digit code consisting of numbers and letters that distinctly identify securities like stocks and bonds of your new Investment Bank.

  • 1 Ocean / Mountain view lot of 2,000 up to 4,000 sq. mt. each offered to international entrepreneurs.

  • Each ocean/mountain view lot offering exceptional privacy and 24/7 security.

  • Immigration to the Dominican Republic with full residence permit for your family included.

  • Diplomatic Passports for you, your wife and your children included.
  • No matter if you chose the Dominican Republic as your tax free business hub or your retirement spot, our experienced legal team will arrange all legal paperwork for you and your family members.

  • No Limits on Non Regulated Cryptocurrency for Offshore Trading from the Blockchain DigitalCity Free Trade Zone Financial Park

  • In the Dominican Republic, status of cryptocurrency was determined in the official explanation of the Central Bank of June 28, 2017. It states that the only legal means of payment in the country was and will be the national currency, and legalization of cryptocurrency will not be carried out. Citizens can carry out all transactions at their own risk, but they are not prohibited.

  • In other words, from the Blockchain DigitalCity project, all our clients can deal in Cryptocurrency across the world, because we are NOT dealing with any clients within the Dominican Republic.

  • We build your dream villa/office  on your very own 2,000 or 4,000 sq. mt. ocean / mountain view lot.

  • Master Plan and Villa Designs with Feng Shui design principles (Ba-Gua Map) which maximizes the flow of positive energy in your home, garden and office to enhance your life.

  • The goal of Feng Shui is to harmonize and align invisible energy forces that bind the universe, earth, and humanity together — known as qi (or chi). 

 

We offer creative financing solutions for your land acquisition. In addition, we can structure your villa development to be a 100% TAX DEDUCTIBLE CORPORATE EXPENSE!

Land Ownership offers secure, registered land title with a maximum of flexibility in terms of financing.

 The BlockChain DigitalCity Project is the

reasonable alternative to Government Restricted Freedoms.

U.S. BANCORP & CAPITAL TRUST invites global Entrepreneurs to enjoy the benefits of the BLOCKCHAIN DIGITALCITY PROJECT INCL. ITS OWN FREE TRADE ZONE FINANCIAL PARK located close to Puerto Plata Airport in the Dominican Republic.

 

 

U.S. BANCORP & CAPITAL TRUST has secured an ocean view land parcel of  100,000 square meters to be developed for only 22 Executive Villas including its own Free Trade Zone Financial Park & 100% Tax Free Executive Resort Community project, offering 0% Interest Free In-house Financing for your lot acquisition.

 

The BLOCKCHAIN DIGITALCITY® FREE TRADE ZONE FINANCIAL PARK development will cover an area of 100,000 square meters within BLOCKCHAIN DIGITALCITY® that includes unspoiled beaches and 30 years tax free living and working in Paradise.

Your dream of owning your tax free residence

U.S. BANCORP & CAPITAL TRUST makes it easy to invest into this exclusive ocean & mountain view Investment Banking Community. Because we own everything we sell, our terms are extremely flexible so they can be customized to fit almost any budget… Big ocean and mountain view lots of 2,000 up to 4,000 square meters each in a beautiful Caribbean lifestyle setting. Fresh breeze all year round. Many tropical trees with stunning ocean and mountain views. Only 10 minutes from the town of Puerto Plata, Dominican Republic. The International Airport of Puerto Plata is only 20 minutes away by car or only 10 minutes via Helicopter for your convenience.

 

We offer only 22 ocean and mountain view lots for sale of 2,000 up to 4,000 sq. mt. each and owning your own piece of TAX EXEMPT Paradise has never been easier.  Since we purchase most of the properties in bulk, we can pass on these savings to our customers.  Our goal is to make the dream of land & tax exempt home ownership a reality by offering discount prices as well as affordable payments through flexible terms that fit your budget.

 

  • Discount Prices

  • Owner Financed

  • Fully Amortized Loans

  • NO Pre-Payment Penalties

  • NO Credit Check

  • Easy Monthly Payments if necessary.

 

It’s very important to us that our customers are satisfied and happy with the property that they purchase from us. We always want our customers to be 100% confident and we want the purchasing process to go as smoothly as possible.

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U.S. BANCORP makes owning a tax exempt villa

in the Caribbean possible

WE ESTABLISH YOUR OWN INVESTMENT BANK & CAPITAL TRUST IN THE BLOCKCHAIN DIGITALCITY® INTERNATIONAL FINANCE CENTER INCLUDING YOUR E-WALLET & CRYPTOCURRENCY ELECTRONIC PAYMENT SYSTEMS.

 

Our Services

 
Registrar of Companies office is responsible for registration of legal entities including Investment Banks &  Capital Trusts in the BlockChain Digital City Free Trade Zone Financial Park. It also has a key role in providing information on financial free zone entities.

 

The main functions of Registrar of Companies in the BlockChain Digital City are to:

 

  • incorporate/register and dissolve Financial Free Zone entities; 

  • examine and store Financial Free Zone entities information delivered under the applicable laws and regulations; and make this information available to the public. 

  • The role of the Registrar of Companies staff is to advise on, receive, review and process all applications submitted by prospective Financial Free Zone registrants seeking to establish a presence in the Financial Free Zone in accordance with the Companies Law, the General Partnership Law, the Limited Liability Partnerships Law, or Limited Partnership Law and Investment Banking and Trust Laws the implementing regulations applicable thereto.

Benefits of Setting up your Investment Bank in the BlockChain DigitalCity® Free Trade Zone Financial Park  

 

Institutions establishing in the BlockChain DigitalCity® can potentially gain from the following key benefits: 

  • 100 percent foreign ownership. 

  • Zero percent tax rate on income and profits for 30 years!

  • An extensive tax treaty network for DR incorporated entities. 

  • Freedom to repatriate capital and profits - without restrictions. 

  • Internationally accepted laws and regulatory processes. 

  • A world-class, independent, regulatory agency working alongside other financial regulatory agencies located in major global jurisdictions. 

  • A wholly transparent operating environment, complying with global best practices. 

  • A dollar denominated environment. 

  • An international stock exchange with primary and secondary listings of debt and equity instruments. 

  • A variety of legal vehicles that may be established with capital structuring flexibility. 

  • A pool of skilled professionals residing in DR and the region. 

  • A modern and efficient transport, communications and internet infrastructure. 

  • A responsive one - stop shop service for visas, work permits and other related requirements.

  • Low cost of living & low labor rates (Min. wage is only $1,50 per hour.) 

SPECIAL INCENTIVES FOR INTERNATIONAL FINANCIAL FREE ZONES

Under Law 480-08, companies in special free zones can offer all types of financial and support services to persons or entities outside the Dominican Republic without having to pay taxes for a 30-year period. Partners and shareholders of companies in financial free zones are exempted from paying taxed on the profits or dividends received.

 

International Financial Free Trade Zones are regulated and supervised by the National Council for International Financial Free Zones, which issues the permits allowing companies to operate within a particular free zone and enforces all applicable legislation.

 

BLOCKCHAIN DIGITALCITY® is one of the few company in the Dominican Republic who has applied for this special license to operate as an International Financial Free Zone Park under Law 480-08.

YOUR BENEFITS

WE ESTABLISH YOUR VERY OWN INVESTMENT BANK & CAPITAL TRUST INCLUDING YOUR PRIVATE LABEL E-WALLET & CRYPTOCURRENCY DIGITAL PAYMENT SYSTEMS!

 

Have you have been thinking about establishing your own Investment Bank & Capital Trust without a lot of bureaucratic “red tape”, with electronic payment capabilities – and for a budget you can afford? You have done your research across the world, compared service providers only to discover that they are either too expensive or simply not worth your time?

 

Rest assured, we are highly specialized in establishing investment banks, credit unions & capital trusts for our clients across the world. BLOCKCHAIN  DIGITALCITY® is a licensed Financial Free Zone Park Operator, specialized in assisting entrepreneurs and businesses across the world with establishing their own licensed Investment Bank, Credit Union & Real Estate Trust or Capital Trusts as well as the establishment of capital protected private equity funds, including your very own E-wallet and Cryptocurrency PRIVATE LABEL digital payment systems.

 

We register financial entities for you and you operate your Investment  Bank and Capital Trust from within the BLOCKCHAIN DIGITALCITY® Financial Free Zone Park – 100% Tax Exempt for 30 years!

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This magnificent office tower features 12,000 square meters of office space, private board rooms for your important business meetings, an Asian Restaurant, and a highly modern Gym, and 24/7 security. On the 3rd and 4th floor you will discover four (4) stunning Penthouses of 667 square meters each and four (4) stunning Penthouses of 654 square meters each. Each Penthouse has private elevators to access your private roof terrace of 375 square meters each, offering you 360 degrees, breathtaking ocean and mountain views, luxury, tranquility  and total privacy.

BLOCKCHAIN DIGITALCITY MASTER PLAN

4,000 sq. mt. and 2,000 sq. mt.

Ocean View Lots

STEPS FOR LAND ACQUISITION

Below you’ll find a bit of information about the guarantees that we proudly offer to all our customers as well as the simple steps for buying an Ocean or Mountain view lot from us.

 

30 Day Money Back Satisfaction Guarantee

Anyone who purchases a 2,000 or 4,000 square meter lot from us gets our full 30 day money back satisfaction guarantee.

 

Cash Discounts

We always offer a discount of 10% if you can pay cash for your lot.

 

One Year Exchange Policy

Many of our customers can’t make the trip out to inspect the lot that they purchase right away. For this reason, we offer a full one year guarantee. If you purchase a lot from us sight unseen, you have a full year to make the trip to your property and inspect it. If you’re not happy with it for any reason when you see it, you can exchange it for another lot in PHASE 2 of the Blockchain DigitalCity project that we have available at the time. We’ll even transfer 100% of the equity that you’ve paid on the lot up to that point to the new property that you pick out.

 

10% Off for fast execution of contract

If you pay the lot off within the first 30 days after signing the Land Trust agreement with us, we’ll discount the lot price by 10%.

 

No Credit Checks

We NEVER do any credit checks when someone wants to purchase a lot from us. If you can produce the minimum down payment of 50% and you can pay the low monthly payments, you AUTOMATICALLY QUALIFY.

 

You Never Pay Any Interest

That’s right, the interest rate on all the lots that we sell is always 0%.

 

No Liens or Encumbrances

There are no liens or encumbrances on any of the lots that we sell. We sell them all free and clear and the property taxes are always paid up to date.

1. EASY BUYING PROCESS

Unlike the bank, we want the buying process to be as easy as possible for our customers. Below you’ll find the simple six steps that it takes to buy a lot from us.

 

Tell us which lot you would like to purchase.

 

Provide us with some basic information like your full name, your mailing address, your contact phone number, etc.

 

  • We mail out a packet that includes information about your lot and a Land Trust agreement for you to sign.

  • You sign the contract and mail it back to us with your down payment or full cash payment minus 10% discount

  • You mail in your payment each month.

  • When the lot is paid off, we’ll mail you the deed.

That’s it! We’re very proud of our guarantees, discounts, and easy buying process! We hope that you’re able to find the perfect lot for your needs. Please feel free to contact us with any questions you might have.

 

Our Land Trust purchase process is quick, easy and straightforward:

 

Step 1:

After you have visited the property and/or completed your research to confirm that the land suits your needs, you may make the $500,000 down payment based on your official invoice which we will send to you.

 

Step 2:

In the ‘Special Instructions’ section please let us know if any of the following apply:

If you would like to pay the full purchase price in cash.

If you would like to close via an escrow / title company to receive title insurance; all closing costs are the responsibility of the buyer.

If you have any questions or would like to modify the contract terms, please let us know as soon as possible.

2. EASY BUYING PROCESS

Step 3:

Fill out your payment and contact information details in the Land Trust agreement, please keep in mind your welcome packet will be shipped to the address provided or via email.

 

Step 4:

Once your order has been placed you will receive a confirmation at the email address provided with our official invoice for the acquisition of your new ocean view lot in the Blockchain DigitalCity project.

 

Step 5:

If you are paying the full purchase price in cash:

We’ll send you a Land Trust agreement separately to sign as well as a request for vesting information to begin the deed transfer process.

 

If you are using our owner financing option (if available):

After we have received your deposit and processing fee, we will send you a “Standard Agreement of Sale” via AdobeSign to be signed and automatically returned. Once returned we will ship your welcome packet and set you up to make automatic electronic payments

 

Step 6:

If you are paying the full purchase price in cash:

Once the Land Trust agreement is signed, we’ll send you a notarized deed along with the recording of the land title in your company name with the appropriate Land department in Puerto Plata, once we receive the full purchase price.

 

If you are using an owner financing option (if available):

Once the terms of the signed Land Trust agreement and land contract are fulfilled (i.e., you pay off the amount owed), we’ll send you a notarized deed appropriate the recording of the land title in your company name with the appropriate Land department in Puerto Plata.

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WHY THE DOMINICAN REPUBLIC?

1. Dominican Republic Free Zones:

What is a Free Zone and why does such a place exist? 

 

The answer to this is quite simple.  Any intelligent and forward thinking government is one that wants to attract new business and hopefully create jobs for its citizens.  One way that some governments have done this, is to pass special legislation that permits the existence of what are known as  Duty Free Zones  or we could also say “Duty Free Business Parks”. 

 

These are special zones, campuses, industrial parks or compounds that offer a number of special benefits to the occupants.  Such places are certainly located within the borders of a particular country, but in a way, operate somewhat as sort of an autonomous facility.  In other words, such places are sort of business tax havens, allowing business owners to operate with limited regulation, restriction and taxation. 

 

The most obvious and direct benefit is of course that the business may operate and enjoy either 100% tax-free income or a greatly reduced tax rate of 5%, 10% or something similar - for a period of time, often 20 years or longer.  But aside from this, such zones may also permit certain types of businesses or operations, which may not be permitted otherwise inside the country, or which otherwise may require some sort of special licensing if operated inside the country (such as on-line casino operations or other kinds of operations).  

 

In short, the entire premise behind a free zone is that the business will be manufacturing and or marketing a product or service abroad.  In other words,  the conditions of having a business inside one of these special tax-free zones is that you will be selling the finished product outside of the country - or in the case of manufacturing, that you will be exporting what you make.


However, an interesting turn of events over the past 5 years especially has been an increase in service businesses who wish to take advantage of the tax benefits.  Travel agencies, call centers, order fulfillment, and other kinds of service businesses have now discovered they can still service customers just as easily from a free zone in the Caribbean, then they could if they were located in Florida, or someone else, as just an example. 

 

While many US companies have already outsourced these kind of functions or services to far away places such as India, a country like the Dominican Republic is closer in terms of distance, plus closer in terms of time zone issues.

2. Dominican Republic Free Zones:

Business owners that are located inside a free zone may import raw materials, equipment and products for their business 100% free of any type of import duty or taxation (or at a greatly reduced rate).  They may operate freely and enjoy 100% tax-free business income (or a greatly reduced rate), and may also be free to expatriate business profits.  In other words, even if currency exchange controls exist within the country where the free zone was located, being located inside a “free zone” means that your business is exempt from many local regulations or requirements.  The Dominican Republic has no currency controls in place, and the local currency may be converted into other currencies at will (or vice-versa) without restrictions.

 

Many countries such as the Cayman Islands, Jamaica, Panama, the Dominican Republic, and many others, all offer such free zone or tax free “business park” type of locations.  The costs to set up will of course vary from country to country, so it is important that we shopped around for the “best deal”.  As an example, some business owners have investigated the Cayman Islands and the Dominican Republic.  As a result, they have found the Dominican Republic to offer a cost structure, which was half of what it is in the Caymans.  But a number of factors, location being just one, will factor into your decision as to where you wish to locate. 

 

In terms of the Dominican Republic, we have already said that a business can enjoy 100% tax free business income or a very much reduced rate of taxation when operating inside a free zone, so this is something that is common no matter which free zone you use.  However, one important point is the length of time that is stated on your license.  For example, if you choose a free zone location close to Santo Domingo or Santiago, you obtain a twenty-year exemption with regards to income tax.  If however, you choose a location in a more rural area, or one where the government wants to encourage a company to use, then you may get a 25-year period or longer.  Also, where you locate and how much space you want to rent will be a factor as well.  Generally speaking about the Dominican Republic, you can expect to pay anywhere from US $7.00 and up per square foot per year.  If you require a larger space of say 10,000 square feet, you naturally can obtain a better per square foot price.  For the smaller spaces, of course the price is slightly higher.

 

What companies already operate inside or have products made in one or more Free Zones in the Dominican Republic?  Here is a very short list of names you might know:  Hanes Underwear, Levi Strauss, Verizon, Tonka Footwear, Timberland, Abott Hospital Supply, and Tyco.

 

3. Dominican Republic Free Zones:

According to the Statistics provided by the Dominican Republic National Free Zones Council, during the period of January through December 2014, 116 new businesses were approved for new operations in the various free zones located inside the country.  Total new jobs in the Dominican Republic created as a result were 18,492.   Total local investment of these new businesses  amounted to RD$8.9 Billion Pesos (about US$300 Million), of which resulted in US$113 Million of business turnover. 

 

Breakdown of the new businesses by sector type locating to a local free zone in the Dominican Republic is as follows:  33% Textiles, 15% Services (such as Travel Agencies, Advertising Agencies, etc.), 7% Telecommunications and Marketing (call centers, etc.)

 

 

History and origin

 

The Industrial Tax Free Zones began their development in the Dominican Republic in the year 1969 with the installation of an Industrial Tax free zone Park in the city of La Romana.

 

The first Industrial Park was encouraged by the transnational Gulf and Western Americas Corporation, which had been operating in the country fundamentally in the sugar production sector since 1967, year in which it acquired the Puerto Rico Sugar Company.

 

This first Industrial Free Zone Park established only one year after the proclamation of the Law 299 of ' Incentive and Industrial Protection'. This legislation established important incentives in terms of tax exoneration's for the companies that in the future established in the industrial tax free zones and dedicated their production to exports.

 

The second Industrial Free Zone Park created in 1972 with the patronage of the public sector via the Corporation of Industrial Promotion (CFI); a decentralized entity of the State that presently entrusted is with this administration and operation. This second Industrial Free Zone Park is located in the city of San Pedro of Macorís.

 

In 1973 a third, Industrial Free Zone Park established in the city of Santiago de los Caballeros, by the public sector but   in contrast to San Pedro of Macorís, the administration and operation charged to a non-profit corporation, chaired by experienced executives of the north region.

WHY THE DOMINICAN REPUBLIC?

 

Dominican Republic Free Zones:

 

At present, the Tax Free Zones of the Dominican Republic have turned into one of the most dynamic sectors of the economy and strategically embedded in the global supply chain.

 

At the end of 2012, there were 53 Free Zone Industrial parks, encompassing 584 companies, with a total employment population of approximately 135,000. Exports from the Free Zones reach a total amount of 5 Billion Dollars.

 

WHY HAVE WE CHOSEN THE DOMINICAN REPUBLIC?

 

  • Strategic geographic location in the heart of the Caribbean.

  • 1 hour and 45 minutes from Miami and Caracas, centrally located to both North and South markets of the Americas.

  • Political and social stability, the country characterized by a solid and lasting democracy, more than 45 years.

  • Efficient labor market and highly skilled labor force at competitive costs and high productivity.

  • Excellent treatment for foreign investment, with an attractive tax incentive program.

  • Modern port and airport infrastructure, with excellent sea and air transport services.

  • Excellent telecommunications systems, comparable with the most developed countries in the world.

  • Modern road network and freeways to facilitate the movement of goods from one point to another in the country.

  • Adequate Government support to foreign investment.

  • Preferential access to international markets through different trade schemes.

Tax Benefits for Free Zones in the Dominican Republic

 

Commercial free zones in the Dominican Republic operating under the aforementioned decree will benefit from a full (100%) exemption of duty regulations and import/export tax on items, as specified under Law 4315, issued on October 22, 1955.

 

Applicable exemptions include, but are not limited to:

  • Income tax as established under Law 5911 —issued on May 2, 1962— and its amendments, regarding stock companies;

  • Tax on the establishment of commercial associations or any subsequent increase on capital;

  • Any municipal taxes that may affect these activities;

  • Import taxes, tariffs, customs duties and any other related charges that may affect raw materials, equipment, construction materials, building parts and office equipment, among others, destined to building, setting up and operating within the free zone areas in the Dominican Republic;

  • Patent tax, tax over assets or equity, as well as the Tax on the Transfer of Industrialized Goods and Services (ITBIS);

  • Consular fees for imports destined towards free-zone operators or businesses;

  • Import tax.

Important Information Regarding Tax Obligations for Free Zones in the Dominican Republic

 

Commercial free zones operating in the Dominican Republic must provide a payment equal to 5% of all gross sales within the first five days of the month following the period of sales. This is established under Law 397, issued on January 2, 1969.

 

Due to the sustained growth of the tourism sector, which includes us as beneficiaries via the construction and operation of resorts throughout the nation, this modality and/or special free zone regime has found a niche to promote its evolution all around the country.

 

It’s also important to note that, since the local government has a plan to support sustainable development and promote every sector involved, the application of tax incentives and exemptions has permeated into other regulations, adding new elements to the equation in order to benefit visiting and non-resident tourists. These initiatives include a bill to refund the Tax on the Transfer of Industrialized Goods and Services (ITBIS), which was recently submitted to Congress for approval and its subsequent nationwide enforcement.

The Dominican Republic as investment jewel of the Caribbean

 

The Dominican Republic is the largest recipient of foreign direct investment in the Caribbean, with companies from around the world, including a significant number that are headquartered in the United States, the European Union, Canada, and Latin America especially in Brazil, Colombia, and Venezuela now participating in more and more mergers and acquisitions, financing transactions, and other kinds of investments in the Dominican Republic than ever before. The country is, indeed, the investment jewel of the Caribbean.

 

Promoting growth

 

There are many reasons for the country's explosive growth as a top investment destination in the region. Importantly, the Dominican Republic is one of the most stable and democratic countries in all of Latin America. Luis Abinader, the newly elected president, is an economist who has pledged to continue to improve the already-welcoming investment environment, as well as the day-to-day lives of all Dominicans.

 

Financing often is available for large Dominican projects through the World Bank and institutions such as the Multilateral Investment Guarantee Agency, the Overseas Private Investment Corporation, the European Investment Bank, and many other international banks, which have operated in the country for years and which know it well and trust it. Moreover, project finance is becoming increasingly common in the Dominican Republic, with lenders typically including commercial banks, multilaterals, and export credit agencies from the project sponsors' jurisdictions.

Other key factors

 

Other factors that in recent years have led, and continue to lead, to the multiple business and investment opportunities in the country include its enviable geographical location, legal framework, economic stability, and infrastructure.

 

The Dominican Republic is located in the centre of the Caribbean, which allows it to access the North, South, and Central American markets with relative ease, as well as to serve as a bridge between those markets and Europe to trade goods and services.

 

In recent years, the Dominican economy has been supported by a continuous process of regulatory modernization, with new laws in areas as diverse as energy, renewable energy, telecommunications, infrastructure, and finance, as well a new corporate law system and laws relating to specific industries, ranging from the country's securities markets to its film industry. These measures have been aimed at opening and commercially integrating the economy into international markets. Having recognized that the Dominican economy depends on international economic integration, the Dominican government for many years has opted to create and support a legal system that allows for sustained economic stability and growth as well as for freedom and security in the commercialization of goods and services to the economy's different participants.

 

Additionally, the Dominican Republic has a widespread, developed, and growing physical infrastructure that is adjusted to the requirements of a society focused on the production and commercialization of goods and services. The Dominican roadways are among the best and most up-to-date in the region, connecting practically all areas of the country. There are modern and efficient airport and port systems including eight international airports and a dozen significant seaports that are located close to key production centers'. The Dominican Republic's modern telecommunications system is one of the country's main competitive advantages.

Significant transactions

 

The breadth of recent mergers and acquisitions in the Dominican Republic is truly astounding, including transactions in the energy, tourism, cable, food, and healthcare industries. Six recent mergers and acquisitions clearly reflect the interest of leading international businesses and businesspeople in Dominican companies:

 

  • First, Brazil's largest brewer recently acquired an indirect majority interest in the Dominican brewer Cerveceria Nacional Dominicana for over $1 billion the largest acquisition as of that date to have ever taken place in the Dominican Republic.

  • Another Brazilian company recently acquired the leading Dominican supplier of optical equipment and services in the ophthalmic industry.

  • In the first leveraged buyout in the Dominican Republic, Advent International, the global private equity firm, recently acquired 100% of Aeropuertos Dominicanos Siglo XXI, the leading airport group in the Dominican Republic and one of the largest airport operators in Central America and the Caribbean.

  • In the hospitality field, Barceló Crestline Hotels acquired five Dominican hotels on the country's eastern and northern coasts.

  • In the consumer goods industry, Brazil's Companhia de Bebidas das Americas-AMBEV acquired the largest distributor and manufacturer of soft drinks and flavored beverages in the Dominican Republic.

  • And in the mining industry, Perilya, an Australian-based metals, mining, and exploration company, acquired the exploitation and exploration rights of various copper, silver, and gold mines located in Maimon in the Dominican Republic.

 

A closer look

 

Beginning over two decades ago, the Dominican Republic initiated the first wave of reforms to modernize the country's legal system and the economic framework under which businesses operate in the country. The government's goals were to promote the flow of foreign capital into the country, adapt the economy to international competition, and facilitate regional competition. This process is on-going, with a more recent second wave of reform that has continued to modernize the country's regulation of specific industries, such as the banking and monetary systems, while strengthening the rules relating to corporate governance, competition, and consumer protection.

 

For instance, the Dominican Republic's corporate law system has been significantly modernized and updated. For one thing, it now permits a greater variety of corporate vehicles from corporations and simplified companies to limited liability companies and small business enterprises. It also contains fewer regulatory requirements than before and provides greater flexibility for investors seeking to start new businesses in the country.

 

The principal reforms that have taken place recently include new laws with respect to industrial property, intellectual property including copyright, exports, the environment, fiscal and customs reform, trusts and the development of low cost real estate projects, and risk prevention in financial institutions. The country also amended its constitution recently to modernize the government's organizational structure as well as essential regulations.

 

Two new laws one regarding mortgages and one regarding the film industry illustrate how the country continues to make an effort to improve investment conditions and to attract new foreign investment.

 

Mortgages/Housing and/or Free Trade Zone Park Developments under the Dominican Trust Laws

 

The new mortgage law is helping the country's mortgage market develop while providing significant opportunities for investors and a boost to the country's efforts to expand its housing stock. Under the law, a trust or LAND TRUST may be established for any legal purpose or objective, including for "real estate investment" or "real estate development," (such as the BLOCKCHAIN DIGITALCITY® Free Trade Zone Park Development) the primary objective of which is investing in real estate projects in various stages of design and construction. The law also recognizes a trust for the public offering of securities, which has the primary goal of backing up public offerings of securities made by the trustee, with the trust property as security for the debt. Another important kind of trust is a collateral trust, which is designed to secure compliance with certain obligations by the settlor for the benefit of a third party or third parties.

 

Significantly, under the new Dominican law, all property and rights that are part of a trust constitute a separate and independent estate, separate from the settlor's property and separate from any other trust property that the trustee of the trust also is managing. Also, as might be expected, creditors of a beneficiary of a trust may not seek to enforce their claims against trust property, except that they can pursue revenues and profits generated by the trust that the trustee is required to deliver to the beneficiary. By the same token, creditors of a settlor may not seek to enforce their claims against property transferred by the settlor to a trust unless their claims relate to the transfer of the property to the trust. A trust's creditors are permitted to enforce their claims against trust property, and trust property can be pursued where the trust has been fraudulently created.

 

As the new Dominican law recognizes, a trust may issue securities. Moreover, the law specifically authorizes a trust to issue securities to raise funds for mortgage financing for Dominican housing and the Dominican construction industry. The kinds of securities that a trust may issue include mortgage notes, mortgage bonds, mortgage certificates, mortgage participation agreements, endorsable or non-endorsable mortgage loans, participations in closed investment funds and mutual or open funds, trust securities, and mortgage-backed securities.

The new Dominican law authorizes mortgage insurance to provide coverage for mortgage loan losses as a result of default by a debtor. Financial institutions, in their discretion, may insure all or part of their mortgage loans with this type of insurance. Similarly, financial institutions may obtain private insurance to cover financial losses generated as a result of a default by a debtor or debtors. These policies may be bought from insurance companies that are authorized to operate in the Dominican Republic.

 

The process of securitization of a mortgage loan portfolio is subject to the provisions of the Dominican Republic's Securities Exchange Law and, where applicable, the provisions of the country's Monetary and Financial Law. There are minimum capital requirements for securitization companies. Financial institutions may participate in securitization transactions and may purchase these kinds of securities without the need to obtain regulatory approval where a transaction meets certain conditions.

 

The new Dominican law also contains special provisions relating to the development of low-cost housing through public-private partnerships, which the Dominican government believes can help solve the country's housing problems. To benefit from the incentives created by the new law, the low-cost housing projects must be duly authorized by the National Housing Institute.

 

The new law also provides that low-cost housing projects may be developed with investments from both the Dominican government and the private sector through the creation of a trust for purposes of its construction. The law provides that the real estate property contributed to a trust for that construction may be subject to a conventional mortgage in favour of the entities financing the project.

Finally, the law creates a special foreclosure procedure available to creditors, such as local or foreign financial institutions, securitization companies, and trustees, as long as the mortgage has been granted by a contract and regardless of the kind or nature of the debt that is secured. The foreclosure process is commenced with a formal request for payment, which is carried out pursuant to the terms and conditions specified in the law.

 

The new Dominican law creates a market for securitized mortgages that will significantly enhance the country's housing and construction industries while offering institutional investors an important investment opportunity.

 

 

 

Territoriality Dominican tax law is primarily territorial

 

In principle, the Dominican Republic only collects taxes on income from Dominican sources. Thus, on the one hand, all income derived from work or business activities in the Dominican Republic is taxable, no matter if the person is Dominican, a resident or nonresident foreigner, a Dominican business entity or a foreign company with or without a branch office in the country. 

 

On the other hand, income derived from work done outside of the Dominican Republic such as from operating in our BLOCKCHAIN DIGITALCITY® Free Trade Zone Park is not taxable, even if received by Dominican nationals or companies, foreign individuals residing in the Dominican Republic or foreign companies with branches in the country.

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