Entrepreneurship Strengthening Law in Guatemala
Past October 3rd was approved by the Congress of the Republic of Guatemala the Decree-Law 20-18 that corresponds to the Entrepreneurship Strengthening Law, which was promoted by the Ministry of Economy as one of its plans for the reactivation of the local economy and support to the entrepreneurs’ projects that exist in Guatemala for the creation of new businessmen that generate more employment and seek the economic development of the country.
The Law has 39 articles and is divided in six chapters that talk about the objectives of this law, the definitions, the creation of the Entrepreneurship Strengthening Unit, training centers and reforms to the Commercial Code.
The law involves the creation of a new commercial enterprise called “SOCIETIES IN ENTREPRENEURSHIP” that has some simpler requirements, including the option of the creation of the Society with only one or more shareholders. In addition to the above, it establishes some tax incentives for all of those investors that invest in entrepreneurship projects, and establishes obligations like introducing entrepreneurship in education.
Likewise, the Decree-Law 20-2018 contemplates the creation of an ENTREPRENEURSHIP STRENGTHENING UNIT (department of the Ministry of Economy), that will be responsible of attracting new investors to start business in the country. According to chapter three of said agree, the referred unit will be in charge of “promoting the adequate conditions to attract investors to public and private agents that work to strengthen the entrepreneurial activities and promote the competitiveness and quality of the Entrepreneurships”.
Overall, this new law promotes entrepreneurship, the creation of more businesses and, with them, more jobs for Guatemalans. All the above also seeks somehow to minimize even the support for that informal businesses have the opportunity to develop and become in formal businesses with the aim of an incentive that seeks the economic strengthening of the country.
José Rosales Cano
Associate
García & Bodán
Guatemala