NAFTA: Mexican Trucking Program

Trucks on a HighwayPresident Trump’s plans to renegotiate the North American Free Trade Agreement (NAFTA) may also impact a controversial program that allows Mexican carriers to make long-haul deliveries in the U.S. 

As part of the NAFTA agreement, the U.S. and Mexico agreed to allow trucks from each country to carry goods across the border for deliveries anywhere inside each of their respective countries, but the program faced challenges from the get-go.  In 2007, the George W. Bush Administration launched a trial program to expand Mexico’s trucking operations beyond the border. However, the program ended in 2009 after Congress defunded the program following pressure from labor unions. 

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The Search for Returns on Argentine Renewables

Renewable Energy2017 will be a year of truth for Argentina’s ambitious renewable energy program (“RenovAR”), which launched in 2015 and set a mandatory renewable energy target of 20 percent by the end of 2025, with incremental targets every two years.   In addition to implementing positive reforms in the energy sector, the RenovAR program signifies an effort to overcome the country’s below-investment-grade credit rating, as well as fresh memories of Argentina’s sovereign default in 2001 and the bevy of protracted investor disputes that ensued.  To this end, the program incorporates features such as government-sponsored project financing, guarantees supported by multilateral institutions, fiscal incentives, and put options allowing project owners to short-circuit dispute resolution procedures in the event of key default scenarios.

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U.S. and Latin America Trade: Who could be affected by a shift in U.S. Trade Policies?

Political South America MapTrade policy has been at the top of President Donald Trump’s agenda since he began his campaign for the U.S. presidency.  Last month, he signed an Executive Order officially withdrawing the U.S. from the Trans-Pacific Partnership (TPP) agreement, a megaregional trade deal between the United States and eleven trading partners in the Asia-Pacific region.  President Trump’s actions effectively terminated the TPP deal, but only mark the beginning of a broader shift in U.S. trade policy that is expected to follow. 

President Trump’s trade policy priorities also include renegotiating the North American Free Trade Agreement (NAFTA), prioritizing bilateral trade deals, and reexamining other existing trade agreements that he believes have not sufficiently benefited U.S. businesses and workers.  The new administration’s free trade platform has left many Latin American countries wondering whether their trade agreements with the U.S. are next on the list. It is also prompting countries to refocus their own trade policies and pursue new trade opportunities, as evidenced Peru’s newly-commenced talks with India and Mexico’s plans to accelerate trade talks with the European Union.

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President Trump Withdraws US from Trans-Pacific Partnership; Action on NAFTA Renegotiation Expected

TTIP agreement written on signpost in mountains. Negotiations concept. Withdrawal concept.

On Monday, January 23, President Donald Trump signed a memorandum formally withdrawing the United States from the Trans-Pacific Partnership (TPP) agreement, following up on one of his biggest campaign promises.

The memorandum directs the U.S. Trade Representative to notify the other TPP parties and the Depository of the TPP that the United States will be withdrawing its signature from the agreement and exiting from the broader negotiating process.  President Trump also pledges that his administration will work with individual countries to negotiate bilateral trade deals in the future, and he directs the U.S. Trade Representative “to begin pursuing, wherever possible, bilateral trade negotiations to promote American industry, protect American workers, and raise American wages.” 

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Latin America Practice- Upcoming Events

January 31, 2017Paula A. Galhardo, Of Counsel at Squire Patton Boggs and a member of the firm’s Brazil Desk, will serve as a panelist discussing the topic of “The Spillovers from Operation Car Wash: What Are and How to Assess the Effects Brazil’s Crisis Is Having on your Risk and Compliance Efforts in Latin America” at the ACI’s 11th Houston Forum on the Foreign Corrupt Practices Act.

February 1, 2017Alvaro J. Mestre, Partner at Squire Patton Boggs and Chair of the firm’s Mexico Desk, will participate on a panel discussion on LNG and Power Markets in Latin America hosted by Squire Patton Boggs and Poten & Partners.

February 8, 2017Al Cardenas, Partner at Squire Patton Boggs and the Chair of the firm’s Latin America practice, will be speaking at the Forum on Latin America and the Caribbean’s Liberal Renaissance hosted by the Association of American Chambers of Commerce in Latin America and the Caribbean and the U.S. Chamber of Commerce.

February 8, 2017Paula A. Galhardo, Of Counsel at Squire Patton Boggs, will serve as a moderator at the Houston Bar Association’s International Law Section Brazil Round Table luncheon discussing “Opportunities and Challenges in Doing Business in Brazil (Despite Scandals).”

For additional information regarding any of these events, please visit our Events page. http://www.latlegal.com/events/

 

Strengthening Anti-Corruption Reform in Peru

Hand Rejecting MoneyDuring his political campaign, the newly elected President Pedro Pablo Kuczynski promised to tackle corruption arguing that it was one of the most important impediments to investment and growth in Peru. Using special legislative powers granted by Congress as a quick mechanism for the enactment of planned reforms, Kuczynski and his administration have already enacted 112 legislative decrees, including a number of significant anti-corruption measures.[1]

One significant measure geared towards the prevention of corrupt activities bars entities convicted of corruption from participating in government contracts.[2] Another measure created a body called the Autoridad Nacional de Transparencia y Acceso a la Información Pública (National Authority for Transparency and Access to Public Information), which, as its name suggests, is meant to increase government transparency and public access to information.[3] Also included in the reforms is the widely-publicized and long-touted “civil death” law, which precludes government officials convicted of corruption from employment in the public sector.[4]  The reforms are also intended to strengthen the independence and autonomy of prosecuting authorities, augment corporate liability for acts of corruption, and foster a culture of reporting corruption-related offenses.[5]

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Chile Expects That Strong Foreign Investment Interest In Energy Sector Will Continue Despite Challenges

solar-energyThis month, the National Energy Commission of Chile (CNE) is scheduled to hold a new power auction, creating competition for the supply of 4.200 GWh of annual power – more than the originally planned 3.800 GWh.

Chile’s most recent power auction made global headline news this past August by attracting 84 participants and resulting in a world record low price of US$29.1/MWh for the Granja Solar project in Chile’s Tarapaca region. The average awarded price in that auction was $47.59/MWh – a reduction of 63 percent from the average price per MWh in 2013 and 40 percent from the average price in 2014.

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What Colombia’s Peace Agreement Means for Foreign Investment

Economy_Investment_And_Saving_ConceptOn October 2, 2016, the world appeared stunned to learn that the Colombian people voted NO to a referendum to approve the Peace Agreement negotiated and signed by the Colombian Government and the Revolutionary Armed Forces of Colombia (the FARC). What many people may not know is that on November 30, 2016, Colombia’s Congress ratified a modified version of the Peace Agreement without a referendum vote. But what does Colombia’s Peace Agreement mean for investors?

As Colombia’s Ambassador to the U.S., Juan Carlos Pinzón, commented: “Colombia is already a popular place for foreign investment in South America, and there is no doubt that the peace agreement will make it even more attractive by bringing greater stability along with increased consumer confidence and national consumption.” He further explained that both “the government and the private sector will make large investments in the development of rural areas” and that “with this increased development will come expanded opportunities for foreign investment in areas that do not exist today.” Those in the private sector seem to agree.

Joaquin Idoyaga, Vice President of Legal & Compliance at SURA Asset Management (the No. 1 Pension Management firm in Latin America, as well as a major player in the region´s savings and investment sectors), explained:

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Dominican Republic: Two Decades of Legal Change in Favor of Foreign Investment

For approximately 16 years now, the Dominican Republic has been implementing a continued legal reform to adjust its legal framework to international standards, specifically aiming to attract foreign investors.

The legal reform includes enactment of new laws and treaties, amendments to existing laws and treaties and the issuance of updated interpretations of local statutes by courts. Among the most important achievements of the legal reform are the following:

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Investing in Cuba: what next?

Since Cuba and the United States agreed to reestablish relations in December 2014, foreign investors have navigated an uncertain path in the Caribbean island. The Cuban Government has been implementing a new legal framework to lure foreign investors by enacting a new foreign investment law and establishing the Special Economic Development Zone of Mariel (free trade zone), among other measures. Nevertheless, Cuba continues to be one of the most challenging markets to invest in.

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