PICHARDO,
Have there been any reports written on the ,meetings that took place between the Government & Business Organisations? If so, would you be so kind as to list them so that we may read the views of (& presumably acceptance by) those business organisations that were consulted?
If the objective is to strengthen the companies who wish to export/import to an International level of security against legal claims etc (see highlighted & italicised above) would it not be simpler just to INSIST that all these companies should have Liability Insurance to the level of RD $30 Million? OKAY, I know the problem of getting money out of Insurance Companies in the event of a claim might prejudice the suggestion, but IF the Government is only interested in making the SA companies more 'SECURE' maybe they would underwrite any 'Liability' policy written & then argue the claim on behalf of the business/company concerned if the Insurance company fails in IT'S obligations?
Or maybe I am missing something that has not come to light yet? Making laws on behalf of companies who as yet have not been told the WHOLE scenario, seems a bit Arse about Face to me. I hope more will be forthcoming FOR the companies who have to comply with this law BEFORE it is signed off by The President!! ~ Grahame.
Bushbaby, the meetings took place several times and with much push from the private conglomerate of biz owners in the DR. They contended that removal of the tariffs and levied taxes upon industrialized goods, both to import and exports, would actually provide them with a greater facility to conduct their biz in both commercial situations.
That's to say the gov would take down those tariffs and levied taxes at the tune of billions in revenue it generates. The gov counter offered to agree to a framework that would do just that, but given the discordant rate of uncollected taxes and evasion within our internal framework; something was to be done to that respect, and something did get done about it.
As it stands, the new framework generated both under policy makers and general biz oversight, provides two things: One, it generates a recoverable revenue inflow to Rentas Internas whilst providing the internal financial institutions with much needed capital in order to provide a strong backing to the general market. Two, it allowed for the DR to remove certain dispositions which made it impossible to legally support or enforce an open market as it was in the DR. It meant that over 75% of the general biz in the DR would be falling into a category which rendered our commerce laws both ineffective and null in the international legal framework.
Once you open the doors, you can't just place hulk looking bouncers when you don't agree with some stuff coming in. The flow is uninterruptible once it begins. As such the DR needed to lay down the law within our internal biz model and further expand the articles within the legal bounds of international law to fit within ours.
AS one poster's opinion on the matter of the amount of money required for capitalization being ridiculously high compared to others in developed nations today; let's say that all of you still are pegged to the artificial value our currency is controlled at. The amount reflects the REAL value in correlation to other currencies and the effect it needs to be at, in order to be able to compete and conduct the general biz orders normal to in that field.
These values are not just taken from thin air; they're adjusted using the right economic tools and variants that affect it.
Like I said, there's a plus side to all of this to the general biz affected by the changes in the DR. Being able to solicit and bid in an international order is not something that a 10,000 pesos biz institution will get away with, come the reality that are the legal commerce minefields of the world...
Since you provided some examples, let me give you some shiners too:
Take a multi level corporation like Pollo Tropical (a US franchise based biz), where a potential investor/owner is required to handled a minimum amount of cash liquidity in order to be allowed to participate in the biz. That's if he can afford to open not one or three, but not less than five locations withinn his area, making the liquidity requirements even bigger as each multiplies as the total number of locations if agreed to.
Is that bad biz from the franchise owners? Not really!
It's pre-proofing the actual investor/owner to be at a set of minimum levels that can guarantee operations for short to mid term length of time in the worst of situations for all the locations in tandem!
Now take the changes applied by the new law regarding biz in the framework of financial woes that affect small to mid scale biz like these, and you do the math...
You're providing biz a cladding from short to mid term financial downturns, which could affect their ability to successfully open lines of credit, or short to mid term backing of major contracts. Simply put, biz will be able to avail themselves terms of credit and backing by financial institutions with relative success 99% of the time.
I know this makes no sense to you, when you view it as a mom and pops operation; but once the general market is open ended, the changes will be evident and impossible to ignore!
The type of biz affected by this retroactive move is best suited to protect the general intersts of the people in a world market that seldom takes prisoners when things go bad at any end... Call it an extra layer of protection to our citizens at the individual stage of general commerce laws.
Once we open the door all bets are off and biz will have to understand that there's only so much, legally, that the country can protect them from in the world market.
Biz too small to, make the change for now, do have options. It's not like you either shell out or shut down. That's why I tell you to seek legal advice on the matter before you make unfounded conclusions on behalf of your biz here.
As far the end game being published or not in the local media: You really think that telling these folks ahead of time would have anything positive of an outcome? Nobody likes to pay more taxes, and in the DR that goes beyond since a tremendous amount don't pay more than nil, zip, zero, nada!
Like I said, the opportunities that will open to these biz on the new law will be wide and ranging from the private sector to the public funded projects in the billions. Their inclusion later to participate on the local Bolsa de Valores, will allow profitable and strong small to medium operations, the opportunity to raise huge capital with a strong commitments to fiscal responsibility.
Unlike the SEC's way of handling their trade market, in the DR our stock runners will be backed by factual and corroborated fiscal data in real time.
If a company tries to hike the value of their stocks using fraud, it would be a matter of days to detection and their actives embargoed during a preliminary investigation.
I told you here on DR1 that huge changes are imminent in our country, for the better!