The World of Business

Belize boasts a favorable business environment, with few regulatory restrictions and little red tape.

Belize is home to one of the best telephone systems in the region, with a cutting-edge fiber-optics network. Belize Telecommunications Limited offers telephone communication between Belize and the United States and Canada. Direct dial service is available globally. Cellular and paging services are also available. Unfortunately, international calls are expensive. Belize Telecommunications, Ltd also offers direct Internet service.

Belize is a very informal country and has a laid-back life-style where formal attire is rarely necessary.

The Minister of Natural Resources regulates land ownership by foreigners in excess of 0.5 acre in a town or 10 acres in the country. The Minister of Natural Resources will issue a license in the case that a satisfactory development plan is presented or is in existence. If a property is being sub-divided for sale, the Minister of Natural Resources must issue a subdivision permit. It is possible to lease land with an option to buy from the Government of Belize if the planned development described at the time of the application is completed. Land in general has a (1%) tax on the unimproved value of the land. The cost to transfer a title to real property is 10% of the value for Stamp Duty and is typically shared by the buyer and seller. There is also a token fee for registration. Attorney fees are additional.

Belize has preferential market access for many products to Europe based upon LOME IV, Canada based upon CARIBCAN, the USA under CB II, and the Caribbean under CARICOM.

The decision to establish a new organization dedicated to facilitating Belize’s participation in the Caricom Single Market and Economy (CSME) was announced by the Government in August 2004. This organization will be known as the National Accreditation Council of Belize.

Belize has a fairly good professional infrastructure and ranks high in terms of efficiency, low cost and lack of legal jargon. However, it is still behind the most sophisticated venues, such as the Cayman Islands, in terms of the availability of offshore financial products and in-country support professionals. This situation is improving rapidly.

According to the Exchange Control Regulations, Chapter 43 of the Laws of Belize (1980) only the Central Bank and authorized dealers and depositories may deal in foreign currency and an authorized dealer or the Central Bank must issue a foreign exchange permit. The Central Bank must also grant permission in order to secure a loan from outside Belize that involves a foreign currency and to service repayment of foreign debt. It is easy, however, for genuine, approved enterprises to secure the necessary transactions for these transactions.

To facilitate the repatriation of dividends, profits and so forth, foreign investors must register any investments made in Belize with the Central Bank.

Only authorized dealers and authorized depositories are permitted to retain any foreign currency in their possession without the consent of the Central Bank.

It is possible to open foreign exchange accounts at local banks with the consent of the Central Bank.

The following criteria is used by the Government of Belize to judge foreign investments:

• produces employment opportunities;

• uses of indigenous raw materials as efficiently as possible;

• earns foreign exchange;

• leads to increased production;

• introduces state-of-the-art technology;

• improves local management skills;

• promotes greater efficiency through competition;

• varies the economic base;

• facilitates access to foreign markets;

• is environmentally friendly.

It is possible to receive longer-term incentives for the location of industries in the less-developed rural areas of the country and for export-oriented projects or projects using technology not previously introduced into Belize. The government is partial to joint venture and partnership investments, but does allow one hundred percent foreign ownership of an enterprise.

The Development Finance Corporation (DFC) was created "to strengthen and expand the Belizean economy consistent with the macro-economic policies of the Government of Belize, by providing high quality, efficient implementation and management of Development Financing and related services on a financially viable or agency basis ensuring self-sustainability".

The DFC\'s main objective is to invest in Belizean companies, through the provision of loans the purchase of shares. It is mainly interested in companies that are majority-controlled by Belizeans; however, it also lends to foreign-owned Belizean companies. Furthermore, the DFC will provide factory shells for rent at its Industrial Estates at Ladyville (Belize District) and San Andres (Corozal District).

The following legislation outlines investment incentive:

• Fiscal Incentive Act, No. 6 of 1990;

• International Business and Public Investment Companies (IBC) Act 1990;

• Mines and Mineral Act 1988;

• Export Processing Zone (EPZ) Act 1990;

• Commercial Free Zone (CFZ) Act 1994.

• FISCAL INCENTIVES ACT 1990

Tax holidays and duty exemptions are offered under the Fiscal Incentive Act, No. 6 of 1990. These holidays are usually offered for five years and may be extended for up to another ten years. In the case of agricultural investment, these holidays may be extended for up to 25 years. A provision that the Minister for Economic Development may review a company’s operations and renew the tax-holiday period for a further term of up to ten years if said company makes an application and provides a “fit and proper” case.

Every company that has been granted an Approved Enterprise Order (Development Concession) to import into Belize, free of import duty and revenue replacement duty, a wide range of industrial machinery, construction materials and raw materials may take advantage of duty exemptions. Exemptions are usually given for 15 years, with a 10-year extension.

The terms of incentives are a Cabinet level decision and companies applying under the Act are required to be incorporated in Belize and applications have to be accompanied by:

• list of items requested for duty exemptions;

• a copy of Memorandum and Articles of Association;

• copy of Certificate of Incorporation;

• banker\'s reference on the bank\'s official letter-head;

• proforma profitability statement up to the second year of full production;

• land tenure deed;

• details of local inputs.

Application fees are dependent on the level of proposed investment and vary as follows:

• Investment between $250,000 and $500,000, fee $5,000.00;

• Investment between $500,000 and $750,000, fee $6,000.00;

• Investment over $750,000, fee $7,000.00