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OPPORTUNITIES FOR FOREIGN INVESTMENT IN CUBA
What is the legal framework for foreign investment in Cuba?
The Cuban government acknowledges the role played by foreign investment flows in
contributing to the economic sustainable development of the country. Therefore we have
defined a new Policy to attract foreign investment.
The definition of the Policy for Foreign Investment is one of the most important strategic
actions within the process of implementing the Economic and Social Policy Guidelines of the
Party and the Revolution.
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Law No. 118 “Law of Foreign Investment” (was approved in Extraordinary Session of the
National Assembly of the Peoples’ Power of March 29th of 2014).
Decree No. 313 "For Special Development Zone of Mariel ".
Supplementary Regulations.
The provisions contained in this Act comprise the guarantees offered to investors, the sectors
targeted for foreign investments and the modalities these could adopt as well as the system
for its negotiation and approval. They also establish the banking, export, import, labor,
taxation, stocks, insurance and financial information and registration systems; the rules
concerning environmental protection, the rational use of natural resources, the protection of
scientific and technological innovation as well as the control measures on foreign investments
and the conflict resolution system.
What are the general principles of foreign investment in Cuba?
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It aims to export sectors and import substitution. Promoting modernization, infrastructure
development and technological change pattern.
It is promoted on the basis of a broad and diversified portfolio of projects
We encourage the development of integrated projects that generate productive linkages.
Cuban Majority share in business related to the extraction of natural resources, public
services, development of biotechnology, wholesale trade and tourism.
companies with 100% foreign capital for investment and development complex industrial
infrastructure are promoted.
We encourage investment in the field of renewable energies contribute to changing the
country's energy matrix.
What legal forms can the foreign investment adopt?
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Joint enterprise - Joint ventures (share capital).
International Economic Partnership Agreements (contracts of productive administration
and services). International economic association contracts including, among others,
contracts for hotel management, production or services, contracts to provide professional
services, risk contracts to explore nonrenewable natural resources, for construction and
agricultural production
Enterprises with 100% foreign capital; i.e. totally foreign capital companies.
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Why to invest in Cuba?
With the passing of the new Law and its complementary norms a favorable business climate
has been set up in Cuba.
Cuba as a destination for foreign investment is distinguished by:
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Formulation of sectorial policies for identifying investment opportunities with foreign capital
that permits access to the Cuban market and its consumers.
Secure and transparent legal framework.
Political, social and legal stability.
Geographical location in the center of an expanding market.
Climate of safety for foreign personnel and public safety in general.
High indicators for education, social security and health of the population.
Highly qualified workforce.
International agreements signed by Cuba with the Latin American Integration Association
(ALADI), the Caribbean Community (CARICOM), the Bolivarian Alliance for the Peoples of
Our America (ALBA), the Common Market of the South (MERCOSUR), the European
Union (EU), the World Trade Organization (WTO).
Governmental policy that prioritizes research and technological innovation.
Promotional institutions at the service of investors with qualified personnel.
Basic infrastructure throughout the country: communications networks; over 20 airports;
ports admitting deep-draft vessels; over 95% of national territory with electrical power; rail
and highway communication.
What attractive taxes does Cuba offer to the foreign investors?
Besides previous advantages, we have to added the tax incentives and these invite foreign
investors to choose Cuba as investment territory.
• On the utilities: 0% for the first eight years and exceptionally for longer. Subsequently, 15%
discount. 0% by way of reinvestment of profits. This may reach 50% in the case of the
exploitation of natural resources.
• For the use of the workforce: Exempt
• Contribution to local development: 0% during the payback
• Sales or services: 0% for the first year of operations, then a 50% relative to tax under the
Tax Act.
• Personal income: Free
• For the use or exploitation of natural resources and environmental conservation: 50% bonus
during the investment period.
• Customs by means and equipment for investment: Exempt during the investment process.
What are the main sectors for investment in Cuba?
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Agricultural Forestry and Food Sector
Sugar Industry Sector
Industrial Sector
Tourism Sector
Energy Sector
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Mining
Transportation Sector
Pharmaceutical and Biotechnological Industry Sector
Health Sector
Construction Sector
In conformity with the modalities established in this Act, investments in real state shall be
authorized and the ownership of the real state or other property rights shall be obtained.
The investments in real estate referred to can be destined to:
– Housing and buildings, either for private or tourist related purposes;
– Housing or offices of foreign juridical persons; or
– Real estate development for tourist purposes.
Foreign investment may be authorized in all sectors except those dealing with the
health and education of the population and the armed forces institutions, with the
exception of their business systems.
What is the Special Economic Development Zone of Mariel?
The Special Economic Development Zone of Mariel is a project directed to encourage the
nation’s sustainable economic development by attracting foreign investment, technological
innovation and industrial concentration while at the same time ensuring environmental
protection.
It covers an area of 465.4 square kilometers (180 sq. mi.), 45 Km. (28 mi.) west of Havana.
It has been conceived as an integral and harmonic whole connected with the rest of the
economy. The Zone promotes and protects enterprises, industrial, agricultural, metalmechanical and tourism projects and all types of activities permitted by Cuban law that use
clean technologies and produce added value goods and services based on knowledge and
innovation, encouraging the creation of quality employment that intellectually develops human
capital within an environment of safety and good professional practices.
The Special Economic Development Zone of Mariel will be a touchstone for technological
development in the region, a magnet to attract foreign capital and it will become a place that
will provide for the growth of cutting-edge manufacturing and services that are permanently
connected to the Cuban economy.
Some of its objectives are:
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Attract foreign investment
Achieve industrial development that permits generating exports and promotes the
replacement of imports
Promote the transfer of cutting-edge technology, know-how and managerial skills
Generate new sources of employment and long term financing
Develop infrastructures and services that allow providing an efficacious and efficient
business platform, thereby contributing to the success of the investments being
established there
www.zedmariel.com
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What are the steps to making an investment in Cuba?
1. Identification of the project of interest and Cuban partner.
2. Negotiation of the project between the parties.
3. Presentation of the project to the Ministry of Foreign Trade and Investment, MINCEX.
4. Presentation by the MINCEX to approval by the Council of State and Council of Ministers
and the Ministry of Tourism sector dependency, modality and investment properties.
5. Approved investment, within 30 days, the notary public documents are issued and the
business fits into the commercial register.
Cuba offers a portfolio composed Opportunities 246 projects with a total investment of 8,700
million USD and expected to be updated annually.
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