Colombian President Visits White House Days Before Trump Unveils New Budget – Now, Congress Reacts to Trump’s Budget Cuts

US and Colombia DealU.S. President Donald Trump welcomed Colombian President Juan Manuel Santos to the White House on Thursday, May 18, to discuss strengthening bilateral relations, including efforts to combat illegal narcotics. Entering the final year of his presidency with strong political headwinds, President Santos brought attention to this growing partnership, including in trade, saying during their joint press conference, “The number of Colombian businesses that are exporting to the United States has grown.  And we both believe that we can take greater advantage of those agreements in order to increase flows in both directions for the benefit both of the Colombian and American peoples.”

President Santos’ visit came just days before President Trump unveiled his Fiscal Year (FY) 2018 budget request calling for significant cuts to funding for the U.S. Department of State and other international agencies. The budget proposal called for $250 million in support for Colombia, a marked cut as compared to the $450 million President Obama pledged to help support Colombia’s efforts to implement the government’s peace accord with the Revolutionary Armed Forces of Colombia (“FARC”).

However, as the adage goes, “the President proposes, and Congress disposes.” While the President’s budget provides detailed information on his policy priorities, Congress is responsible for passing appropriations bills to fund government programs.

Continue Reading

President Trump Closes 100 Days in Office with Trade EOs, Debate of NAFTA Withdrawal

What's Next?Under pressure to make good on campaign promises as his first 100 days in office drew to a close, President Donald Trump considered a number of new trade-related actions last week, highlighting the importance of stakeholder engagement with his Administration on trade matters.

On Wednesday, April 26, reports emerged that President Trump was seriously considering withdrawing the US from NAFTA.  The action reportedly came as a surprise to many stakeholders, who were expecting trade developments ahead of President Trump 100th day in office but not NAFTA withdrawal.  President Trump ultimately decided to shelve the draft executive action following conversations with the leaders of Mexico and Canada, calls from Members of Congress, and outreach by private stakeholders, as well as meetings with his most senior advisors.

In remarks the following day, President Trump confirmed that he had been seriously considering withdrawing the US from NAFTA, reiterating his promise to pursue the strongest deal possible and pledging to terminate the agreement “if we do not reach a fair deal for all.”

On Saturday, April 29, President Trump went on to sign two trade-related Executive Orders (EO).

Continue Reading

The Future of the United States – Chile Bilateral Tax Treaty Remains Uncertain

Business HandshakeOn February 4, 2010, after more than a decade of negotiations, government officials from the United States and Chile executed the first bilateral income tax treaty (“Tax Treaty”) between the two countries. This event marked an important next step in economic cooperation; the United States-Chile Free Trade Agreement, which entered into force on January 1, 2004, had already significantly increased free trade by removing tariffs, reducing barriers, and providing necessary legal protections for investors from both countries. The Tax Treaty was designed to further encourage the stream of cross-border investments and widen the United States’ tax treaty network in Latin America beyond Mexico and Venezuela.

Continue Reading

Brazil: A Step Closer to Ending the Limitation on Foreign Capital Investments in Airlines

Business TravelBrazilian President Michel Temer will submit a bill to modify the Brazilian Aviation Code and allow foreign capital to own 100 percent of any Brazilian airline. If approved by Congress, the new ruling will end the existing 20 percent limitation. The measure comes as part of the Government’s strategy to boost tourism industry in the country. It is expected that removing the foreign capital restriction will allow more investments in aviation, thus increasing competitiveness and the availability of flights, which may reduce costs to the consumer.

The bill also purports to regulate the “electronic visa” for the United States, Canada, Australia and Japan, to facilitate entry of foreign visitors of those countries in Brazil.

When first announced, though, the executive government had intended to pass a provisional measure to effect these changes immediately upon publication. However, due to a previous settlement with Brazilian Senators in 2016, it was later decided by President Temer that a bill should be submitted for approval by Congress instead.

Ecuador Elects New President

Ecuador FlagOn April 2, 2017, Ecuador held its second round of presidential elections, in which the governing party, Alianza País’s (AP) candidate, former Vice President Lenin Moreno, has been declared the winner. According to the National Electoral Council of Ecuador (CNE), AP obtained 51.16 percent of the vote, as compared to 48.84 percent that went to his challenger, former banker Guillermo Lasso of the Conservative Movement (CREO).

Continue Reading

Peru Flooding Spurs Infrastructure Investments

Peru FloodsPeru was recently pummeled by heavy rains, flooding and disastrous landslides, which destroyed buildings, bridges and roads. In Peru’s bustling capital Lima, heavy flooding clogged a water treatment plant, forcing a shut-down restricting the availability of running water and prompting water rationing across many regions of the city.

Natural disasters are nothing new in Peru, and repeat events — driven in part by the El Nino phenomenon — are a certainty.  Infrastructure investment has been a longtime theme of President Pedro Pablo Kuczynski’s political platform, and recent events underscored the immediate need to make such investments a top priority.  Peru’s government already announced a $240 million investment in the badly-affected infrastructure of the country’s northern coast.  In addition, some Peruvian politicians are even calling for the cancellation of the 2019 Pan American Games in order to shift available funds towards rebuilding.  The pressure for immediate and sweeping investment in the country’s infrastructure is rising.

Continue Reading

Entry into force of Law No. 42-08 on Defense of Competition in the Dominican Republic: Immediate Practical Consequences

Fish BaitOn January 16th, 2008, the Dominican Republic enacted Law No. 42-08 for the Defense of Competition (“Law No. 42-08”), which is of public policy nature and seeks to promote free competition and sanction unfair practices in the Dominican market. The entry into force of Law No. 42-08, however, was conditioned on the appointment of the Directive Committee and the Executive Director of the National Commission for the Defense of Competition, respectively, pursuant to Article 67 of the law.

The Directive Committee was sworn into office on January 29th, 2011, and just recently, on January 6th, 2017, the Executive Branch[1] appointed the Executive Director of the National Commission for the Defense of Competition. Hence, the legal requirements for the full entry into force of the law are complete.

The immediate consequences resulting from the application of Law No. 42-08 include:

Continue Reading

Brazil’s Provisional Measure 752/16: New Arbitration Rules on Public Partnership Programs

Provisional Measure 752/16 (“MP 752/16”) established new rules for the Road Constructionextension and rebid of airport, highway and rail concessions under the Investment Partnership Program (“PPI”). A major feature of this provisional measure is the possibility of extension of highway and rail concessions without a new tender, pursuant to the existing concessionaire’s commitment of making further investments and improvements.

Continue Reading

Latin America Practice- March Events

March 10, 2017Rebekah J. Poston, Partner at Squire Patton Boggs, will participate on a panel discussion on Ethical and Compliance Dilemmas Presented in Cuba at the Andrea School of Business at Barry University in Miami Shores. The panel discussion will be part of a day long program titled: “Doing Business in Cuba: Legal, Ethical and Compliance Challenges” hosted by Barry University and the Miami-Dade County Commission on Ethics and Public Trust. For program information, click here.

March 23-24, 2017Al Cardenas, Partner at Squire Patton Boggs and the Chair of the firm’s Latin America practice, will be speaking at the 1st Expanded Board Meeting by The Latin American Business Council (“CEAL”) that will be held in Antigua, Guatemala. The event is titled: “Macro tendencias Globales y la relación con los Estados Unidos: Oportunidades y Desafíos para un crecimiento inclusive.” For additional information regarding this event, click here.

The Court Rulings That Changed Agency and Distributorship Law in the Dominican Republic

Dominican Republic National FlagIn the last decade, Dominican Judges have adopted a new interpretation of certain provisions of the Dominican Agency Law 173 of 1966, a law which is considered of public policy and very protective of local agents and distributors. Particularly, the courts’ have changed their interpretation of the law on exclusivity of distribution agreements and competent jurisdiction to hear Law 173 cases.

Continue Reading