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Free zones were declared of national interest in Uruguay by Act N° 15.921 of December 10th 1987, with the purpose of promoting investments, exports and the regional international economic integration.
They are free commerce and industrialization zones, controlled and looked after by Uruguayan authorities and administered by the State and/or private entrepreneurs, who handle the installations.
The wide variety of possibilities and advantages that it gives to industry, commerce and international transit, as well as the financial and exchange freedom that exists in Uruguay make the free zones important distribution and fabrication centers.
Free zones are areas of Uruguayan territory, owned either privately or by the Government, enclosed and efficiently isolated where all kind of industrial, commercial and service activities -with the tax exemptions and other advantages we will later on analyze- are carried on. For example:
commercialization, deposit, storage, conditioning, selection, classification and fractionating, assembling, manipulating or mixing of merchandise or raw materials coming from Uruguay or other countries.
installation and operation of industries.
render of financial, computing, professional and other services to entities located in Uruguay or abroad.
The free trade zone companies are thought to exclusively develop the activities inherent to free zone users. Free zone users are those who have acquired the right to develop the aforementioned activities with tax exemptions and other advantages established by law.
The corporations can be direct or indirect users. The first one acquires the right to operate in the free zone by signing a contract with the operator of the zone, indirect users are those who acquire the right to operate in the free zone by means of a contract signed with a direct user. In both cases the contracts must be approved and registered before the Free Zone Direction.
The main advantages the free zone offers are:
total exemption of national taxes (net worth, income, VAT, etc.) on operations done by user entities.
total exoneration of import-export taxes on the entrance and exit of merchandise to and from the free zone.
the advantages mentioned simplify administrative aspects since they do not have to register as importer or exporter, not having to do previous deposits of taxes, etc.
State monopolies do not apply.
Promotional costs of certain services (energy, water, ports, etc.)
To these advantages we must add the general advantages that our country offers and that we have already mentioned, such as exchange freedom, free entrance and exit of capitals, etc. which apply to free zones.
The free trade zone companies seem very appropriate to develop commercial operations with other countries and -in this they differ from Financial Investment Companies- do not have limitations on their principal activity.
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