The Dominican Republic free trade zones is a solid and advantageous nearshoring option for International product manufacturing companies, and is now playing an increasingly important role given the current international trade clashes where high and shifting tariffs are shaping trade flows and markets.

Since the enactment of Free Zones Law 8-90 of 1990, the Dominican Republic has built a dynamic and diversified free zones and logistics sector cutting international transportation costs and delivery times to export destinations while favoring investors with 15 year renewable tax exemptions and no export taxes.

The Dominican Republic also benefits from Free Trade Agreements with the United States and Central America (DR-CAFTA), the European Union and the United Kingdom, as well as other partial free trade agreements with Panama and the Caribbean Community (Caricom), and others that are underway.

An interesting fact about the Dominican Free Zones sector is that it is a special tax free jurisdiction where approved manufacturing, logistics and services companies can interact, do business and enter into formal contracts with each other and with their international suppliers on a zero tax basis.

Approved Dominican free zones manufacturing companies are authorized to import, tax free, machinery and equipment to start (and also to expand) their operations, all the raw materials, inputs, parts, expendable materials and components needed for their production.

Dominican Free Zones can also purchase goods and services intended for their productive activities without VAT from local suppliers, by obtaining a so called ITBIS Exemption Card.

The Dominican Republic Peso is freely exchangeable and circulates along with the US Dollar and other currencies. Financial and Monetary Law of 2002 permits business transactions in foreign currency.

In sum, the Dominican free zones sector has become a centerpiece of the Dominican Republic economy and is a top free trade zones nearshoring destination, benefiting from its proximity to the United States and the Americas, providing investors with a very attractive tax free system and robust trade logistics.

Do you want more information about Nearshoring Opportunities in Dominican Free Zones? Contact Us.

ABOUT THE FIRM:

Our Firm assists free zone enterprises in the industrial manufacturing, logistics and technology services sectors to establish and expand their business in the Dominican Republic, obtain free zone & logistic center authorizations, execute contracts and manage relations with government agencies and institutions.

Our free zones consultants assist in the preparation of free zone operation permit applications, review and negotiation of leases, commercial terms and conditions, purchase and supply agreements, purchasing & developing real estate, tax free equipment & machinery and advising on applicable free zones and logistics centers matters, including, corporate, customs, labor, tax, social security laws, among others.

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ABOUT THE AUTHOR: Dr. Felipe Isa Castillo is a Partner leading the Foreign Investment, Real Estate & Tourism areas at Arthur & Castillo Law Firm and Attorneys in the Dominican Republic. He specializes in foreign investment, real estate and international business (International Legal Studies LLM in Georgetown University Law Center in Washington, D.C. & Masters in International E- Business in Universitat Pompeu Fabra in Barcelona) with more than 20 years of experience in Foreign Investment, Free Trade Zones, International Business and Cross Border Real Estate practice. Dr. Castillo is a Certified Bankruptcy Conciliator and Liquidator and Legal Interpreter.

Email: fcastillo@aclaw.com

 Disclaimer: This publication is not intended to provide legal advice or suggest a guaranteed outcome as individual situations will differ and the law may have changed since publication. For specific technical or legal advice on the information provided and related topics, please contact the author.

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