The Venezuelan legal system is open to foreign direct investment in keeping with the worldwide tendency in this regard. To mention just one example, pursuant to Article 301 of the Constitution, no discrimination is allowed between local and foreign investors.
No prior authorization is required to invest in the country and red tape is limited to registration of the capital invested. These principles are to be found in Andean Community Decisions 291 and 293 and are set forth in further detail in Decree 2095.
Other provisions include recognition of the principle of fair and equitable treatment and the most-favored-nation clause, the latter stemming from agreements for the promotion and protection of investments signed by the Venezuelan Republic.
Another important incentive for businesses is to be found in the Legal Stability Contracts provided for in the Investment Promotion and Protection Act (LPPI in Spanish) and its Regulations. These instruments provide guarantees for application of special export-promotion systems, national taxation, and special incentives over a term not to exceed ten years.
Legal enviroment