Author Archives: Berke Report

The Ministry of Environment and Sustainable Development (MADES) issued Resolution No. 047/2026, dated January 28, 2026, which formalized the operation of the National Mitigation Projects Registry, under the Carbon Markets Directorate.

This measure represents a critical step in the implementation of Law No. 7164/23 “On Carbon Credits,” establishing the mandatory registration requirement for all projects aimed at reducing, avoiding, capturing and/or absorbing the emission of greenhouse gases that have been developed or will be developed in Paraguay.

The creation of this registry not only aims for environmental protection but also seeks to promote transparency, competitiveness, and legal certainty for green investments. With this tool, Paraguay seeks to position itself as a relevant player in the global carbon market, guaranteeing the integrity of emission reductions (zero “double counting”), alignment with National Goals (NDCs), and the technical leadership of MADES as the validating body.

Relevant aspects of the resolution

· Obligated parties: Holders of carbon credit developed projects or projects at any stage of development (design, validation, verification, or certification) before administrators of international standards.

· Registration requirement: Projects must be formally registered with the Carbon Markets Directorate to ensure their traceability and compliance with national regulations.

· Fees: Registration is subject to a fee of around USD 2.500.

· Peremptory deadline: March 15, 2026, has been set as the deadline to regularize registrations of all projects that have already been developed in the past.

· Important: Failure to register within the stated deadline will result in fines and administrative sanctions in accordance with the applicable legal regime.

Our Recommendation

Given the technical and legal complexity involved in complying with mitigation standards, BKM | Berkemeyer recommends a thorough review of project documentation to ensure a smooth transition to the national registry.

Our team is available to coordinate registration processes and provide advice on the impact of this resolution on your operations.

For more details, you can access the official document here: MADES Resolution 047_National registry of mitigation projects

For further information, contact: Alexander Berkemeyer: alexander.berkemeyer@berke.com.py

International rating agency Standard & Poor’s (S&P) Global Ratings has upgraded Paraguay’s sovereign credit rating to BBB-/A-3, officially granting the country Investment Grade status with a stable outlook. This milestone reinforces the momentum started by Moody’s in 2024, fulfilling the double investment grade threshold required by major institutional funds for large-scale capital allocation. This endorsement marks a turning point: Paraguay is no longer an emerging promise but a mature, reliable, and predictable jurisdiction for Foreign Direct Investment (FDI).

This achievement is underpinned by a series of legal reforms that modernize the country’s regulatory and operational framework. Notable updates include the new Securities and Products Market Law (Law No. 7572/2025), which provides a unified and modernized framework under the supervision of the Central Bank of Paraguay, and the enactment of the Unified National Registry (RUN) to enhance legal certainty and efficiency regarding property rights. Furthermore, Paraguay has expanded its infrastructure pipeline through a modernized PPP regime that increases fiscal capacity for major works, and a robust legal architecture for carbon credits to facilitate access to sustainable finance.

From a fiscal standpoint, the new legislative package provides strategic tax advantages designed to optimize investors’ capital structures. These frameworks offer critical benefits, such as customs duty and VAT exemptions for capital goods under the new incentive regime (Law No. 7548/2025), a modernized Maquila system with a 1% single tax rate, and exemptions from Non-Resident Income Tax (INR) on external financing interests for high-impact investment projects.

At BKM | Berkemeyer, we support this historic milestone for Paraguay. We remain committed to providing comprehensive and strategic legal advice, transforming this favorable macroeconomic landscape into efficient, secure, and long-term sustainable investment structures. Investment Grade status is more than international recognition; it is a tangible opportunity to develop high-impact projects within a framework of maximum predictability.

On September 11, 2025, the Ministry of Industry and Commerce (MIC) issued Resolution No. 1052/25, which updates and strengthens the requirements and procedures for issuing the Foreign Investor Certificate (CIE) and repeals Resolution No. 236/19, dated February 14, 2019.

Obtaining the CIE is a prior and fundamental step for foreigners who are going to make investments in the country, to be able to access permanent residence in the Republic of Paraguay without the need first to manage temporary residence, a procedure provided for in our immigration regulations, for foreigners in general who seek to reside in the country.

Below, we present a comparative analysis of the previous regulation and the new regulation, highlighting the clear advantages of Resolution No. 1052/25.

Resolution No. 236/19 vs. Resolution No. 1052/25

Although both resolutions maintain the minimum investment of USD 70,000 or its equivalent in guaraníes and the generation of at least five (5) jobs, Resolution No. 1052/25 introduces innovations that will allow improvements in aspects related to the transparency of the investment, as well as in the agility of the process.

Resolution No. 1052/25 provides a more modern and expeditious legal framework for the promotion of foreign investment, through:

· Simplification and lower cost: One of the most significant advances is the digitization and simplification of the submission of the CIE application. While Resolution No. 236/19 required an Affidavit with the signature certified by the Notary Public, the new regulation establishes that the electronic application form, where the Business Plan is recorded, has the direct character of an affidavit. This measure eliminates a costly and cumbersome step for the investor.

· Short period for analysis: The issuance of the CIE is guaranteed within a maximum period of five (5) business days, so the new resolution will allow agility and predictability regarding the validation of the proposed investment. Although we consider the express lack of consequence on the lack of a pronouncement within the deadline to be a mistake, the mere establishment of the deadline, compared to the previous rule that did not have one, is a significant improvement.

· Binding Business Plan: The obligation to submit a detailed Business Plan (including type of company, ISIC classification, execution schedule, and investment breakdown) guarantees the Paraguayan State that the investment is transparent and verifiable. The fact that this plan is constituted

as a binding sworn declaration (when presented in the electronic form) reinforces the seriousness of the commitment assumed by the investor.

· Emphasis on subsequent control: The new control scheme ensures that the record is not a mere formal procedure, but implies a verifiable commitment. SUACE has the obligation to conduct periodic verifications of compliance with business plans, and the MIC can exercise subsequent audits to ensure the real economic impact. Although the new resolution does not expressly establish the measures that the SUACE can take in the event of a breach, it expressly grants it powers of control, which it previously lacked.

· Streamlining the change of status for temporary residents: An innovative procedure is incorporated, which allows the change of immigration status for foreigners who already have a temporary residence issued by the National Directorate of Migration, and who upon applying and obtaining the (CIE), can immediately update their status, to that of permanent resident investor, without the need to cancel the previous temporary residence. This represents a significant saving of procedures, time, and costs.

For more information, contact Carla Sosa: carla.sosa@berke.com.py and/or Nicolás Matías: nicolas.matias@berke.com.py

The recent regulatory update that governs Law N° 4457/2012, amended by Law N° 7444/2025 and developed through Decree N° 4535/2025, marks a turning point in the Paraguayan business ecosystem. For the first time, our country has a comprehensive framework that not only promotes the formalization of micro, small, and medium-sized enterprises (MSMEs), but also grants them unprecedented tax, labor, and financial advantages.

Tax Benefits: Tax Relief and Simplified Regime

The package of tax incentives is probably the most attractive point for the sector:

• Full tax exemption for qualification and registration services provided by Central Government Agencies and decentralized entities, applicable to microenterprises during the first three years after the issuance of the MSME Certificate.

• Discounts of 75% (micro) and 50% (small) from the fourth year onwards on fees and tariffs for services of the Central Government, decentralized entities, regional governments, and municipalities.

• Simplified accounting: microenterprises can record their activity through a daily book of income and expenses, eliminating the burden of complex financial statements.

These advantages are activated only when the company is correctly registered in the National MSME Registry (RENAMIPYMES) and keeps its basic obligations up to date with the National Directorate of Tax Revenues (DNIT).

Streamlining Procedures: Digitalization and Single Window

The Unified System for Opening and Closing Companies (SUACE) is consolidated as the central platform that allows:

• To incorporate, modify, or close companies online, integrating RUC, municipal licenses, and labor records.

• To interoperate with RENAMIPYMES to generate, at no additional cost, the MSME Certificate —official document that certifies the business category and enables the foreseen benefits—.

By centralizing information in real time —in coordination with the DNIT, Ministry of Labor (MTESS) and Social Security Institute (IPS)— the terms and costs of formalization are significantly reduced.

Access to Financing and Promotion Programs

Decree N° 4535/2025 introduces decisive tools to resolve the historical credit gap:

• FONAMIPYMES Trust, designed to grant operating capital and productive investment at preferential rates.

• Promotion of reciprocal guarantee companies, which facilitate endorsements before banks and cooperatives.

• Incentives for innovation: deductions and co-financing programs for technological or research projects, articulated with CONACYT and MITIC.

Labor Facilities and Social Security

The differentiated labor regime balances worker protection with the reality of emerging ventures:

• Fixed-term contracts of up to 36 months, with simplified registration procedures.

• Payment of up to 80% of the legal minimum wage during the first three years for microenterprises, reducing the initial payroll cost.

• Inclusion of the owner-employer in the health insurance and retirement of the IPS, promoting formality and social coverage.

5. Key points to maximize benefits

• Correct classification: number of employees and annual turnover determine the category (micro, small or medium) and, therefore, the scope of the incentives.

• Timely compliance: any tax or labor delinquency automatically suspends the benefits until its regularization.

• Annual renewal: the MSME Certificate is valid for 12 months and is renewed with the updating of data before RENAMIPYMES.

• Municipal synergy: the commercial patent may be subject to exemptions or discounts; it is advisable to verify the adhesion of the municipality and the documentary requirements.

• Training as a lifeline: the regulations allow to replace, for once, certain formal fines through certified courses —an option to avoid economic sanctions—.

How can BKM | BERKEMEYER help you?

Our multidisciplinary team, with leading practice in corporate, financial, tax and labor law, offers comprehensive support that includes:

• Eligibility diagnosis and corporate structuring to qualify as MSMEs without compromising future expansion plans.

• Complete management of the SUACE process, registration in RENAMIPYMES and obtaining the MSME Certificate.

• Negotiation and processing of FONAMIPYMES or private banking credit lines, including guarantee contracts and due diligence.

• Implementation of labor policies under the special regime: contracts, internal regulations and compliance audits before MTESS and IPS.

• Advice on public procurement, so that your company can access tenders with preferential treatment.

The MSME Law opens an unprecedented window to reduce costs, access capital and professionalize business management in Paraguay. However, each incentive requires precise steps and times, as well as meticulous legal and fiscal planning.

At BKM | BERKEMEYER we have the experience, legal knowledge and strategic vision necessary for your business to take full advantage of this new scenario.

For more information, please contact: Carla Sosa: carla.sosa@berke.com.py and/or Antonio Villa Berkemeyer: antonio.villa@berke.com.py and/or Luciano Antonelli: luciano.antonelli@berke.com.py

On Monday, September 8, 2025, three highly relevant regulations for the country’s productive and investment ecosystem were published in the Official Gazette of the Republic of Paraguay. These are Law N° 7546, “Which establishes the national policy for the production and assembly of electrical, electronic, electromechanical, and digital equipment,” Law N° 7547, “On the Maquila Regime,” and Law N° 7548, “Which establishes the new tax incentive regime for national and foreign investment.” These provisions constitute pillars of a state strategy aimed at attracting capital, generating formal employment, and positioning Paraguay as an industrial and logistics hub in the region.

Below is a summary of each law with a brief analysis of the provisions:

Law N° 7546, “Which establishes the national policy for the production and assembly of electrical, electronic, electromechanical, and digital equipment”

Law N° 7546 creates a specific regime for the manufacture and assembly of electrical, electronic, electromechanical, and digital equipment within Paraguayan territory.

Among the central axes of the law, the following stand out:

• Precise definition of eligible capital goods and materials.

• Tariff exemptions and VAT reduction for both the import and local acquisition of inputs and capital goods.

• Rules of compatibility and incompatibility with other tax incentives.

• Conditions of access and permanence that require: 20% of national added value, generation of formal employment, incorporation of efficient technologies, and technology transfer programs.

• Term of validity of the benefits: 20 years, extendable for an equal period.

• Dual monitoring system (in situ and extra situ) and corrective measures that can be graduated up to the revocation of benefits.

Impact and opportunity assessment

1. Effective reduction of tax costs: the VAT taxable base is reduced to 15% for imports and local purchases of materials, and to 45% in the internal commercialization of finished products, increasing the operating margin.

2. Long-term legal certainty: the initial extension of 20 years, with the possibility of renewal, provides predictability for amortization plans of intensive investments in fixed capital.

3. Force majeure clauses: clearly define the assumptions and provide flexibility in the face of uncontrollable external events.

4. Protection against double taxation of special regimes: establishes incompatibilities to avoid overlaps, which simplifies tax planning, but clarifies that it is only compatible with the exemptions provided for in the Law on the Tax Incentive Regime for Investment of Capital of National and Foreign Origin.

5. Promotion of local productive chains: the requirement of 20% national added value stimulates the formation of suppliers and the transfer of know-how.

Law N° 7547, “On the Maquila Regime”

The new law repeals and replaces the 1997 regulations, comprehensively modernizing the maquila regime.

Some important aspects of the new provision are:

• Single Tax of 1% on the value added in Paraguay or on the amount of export invoicing, whichever is greater.

• Temporary admission without taxes of raw materials, intermediate goods, machinery, and equipment.

• The following modalities are maintained: pure maquila, by idle capacity, submaquila, and shelter modality.

• The Maquila of services is defined with better scope: regime by virtue of which a Maquiladora uses its installed capacity and its processes to provide services to another foreign company, incorporating national added value, within the framework of a Maquila Contract, through the use and exploitation of information and communication technologies or other remote means.

• The right to the refund of “VAT fiscal credit” for exporters is recognized, guaranteeing liquidity to companies that operate under the regime. With limitations for the “maquila of services”.

•Virtual operation: The transfer of goods temporarily imported or the product resulting from the production process, which takes place between maquila companies, is allowed in order to use them for the fulfillment of their respective programs. The aforementioned operations are equated in all their effects, requirements, and legal consequences to the temporary import Maquila, the temporary export Maquila, and the export Maquila.

• Maximum term of benefits: 20 years, with successive renewals.

• National Council of Export Maquila Industries (CNIME) as a coordinating technical entity and an Executive Secretariat with broad operational powers.

• Pure maquiladoras are allowed to sell to the domestic market up to 10% of the volume exported in the last year, after nationalization and payment of internal taxes.

• Escalated sanctioning procedure with fines, suspension, and cancellation.

Impact and opportunity assessment

1. Regionally competitive tax: the single tax of 1% consolidates Paraguay as one of the most attractive jurisdictions in Latin America for transformation processes for export.

2. Operational flexibility: the different modalities allow optimizing installed capacity and outsourcing productive phases (submaquila), reducing costs and production times.

3. Simplification and digitization: the mandatory computer system and the customs current account increase transparency and reduce procedures.

4. Stimulus to the logistics chain: temporary import of containers and equipment without tariffs speeds up inventory turnover.

5. Regulatory certainty: the term of 20 years and the possibility of extensions facilitate the financing of large-scale projects and the attraction of international credit lines.
   

Law N° 7548, “Which establishes the new tax incentive regime for national and foreign investment”

This regulation replaces the historical Law 60/90 and updates the incentives for productive investments.

Some of the main thematic axes of the new provision are:

• Exoneration of customs tax and VAT on the import of capital goods, raw materials, and inputs destined for the investment project, applied directly to the industrial, agricultural, or service production cycle, except for fees for services actually provided.

• VAT exemption on the local purchase of goods destined for the industrial or agricultural production cycle.

•Exoneration of VAT, in the first transfer of capital goods that have been imported or acquired from national manufacturers under this tax incentive regime. This exemption will apply exclusively when the transfer of ownership of said goods is carried out between the beneficiaries of this law.

• Exoneration of the Non-Resident Income Tax (INR) on interest from external financing and the IDU on dividends generated by projects whose investment is at least USD 13 million (updatable by CPI).

•Exoneration of customs tax and VAT on the import of capital goods for investment projects destined for large-scale tourism and entertainment services, provided that the investment is at least USD 20 million.

• General term of benefits: 20 years, with the possibility of partial renewals according to new investments.

• Investment Council as a technical evaluation body; Executive Secretariat in the Ministry of Industry and Commerce.

• Legal terms: opinion of the Investment Council in 60 days and bi-ministerial resolution (MIC–MEF) in 15 days.

• Possibility of complementing investments, transferring capital goods, whether imported or produced by national manufacturers, between beneficiaries of the regime who have Biministerial resolutions, without the transferring beneficiary having to pay the taxes originally exempted at the time of import or acquisition.

•Possibility of establishing a guarantee trust with the capital goods that enjoy tax benefits to finance their current investment projects.

• Strict monitoring mechanisms and staggered revocation in the event of non-compliance.

Impact and opportunity assessment

1. Expansion of the tax umbrella: the scope of exemptions includes income and financing taxes, improving the internal rate of return (IRR) of high capex projects.

2. Innovative financing instruments: the guarantee trust allows incentivized assets to be monetized without losing the benefits, facilitating project structuring.

3. Technological and sector neutrality: unlike specific regimes, it allows the incorporation of large-scale industrial, agricultural, service and tourism investments.

4. Compatibility with other regimes: coherence with Law No. 7546 and the Maquila regime is maintained, making it possible to structure hybrid projects.

5. Automatic updating of amounts: avoids obsolescence of minimum investment amounts and maintains competitiveness over time.

Recommendations for entrepreneurs and investors

• Eligibility Due Diligence: analyze supply chains, the proportion of local added value, and the possibility of simultaneously taking advantage of the incentives of Laws No. 7546 and 7547, or adhering to the general regime of Law No. 7548.

• Early financial structuring: evaluate the use of international financing to access INR exemption and implement trust structures to maximize capital efficiency.

• Comprehensive tax planning: model comparative tax burden scenarios under the different regimes, considering incompatibilities and asset maintenance requirements.

• Compliance management and reporting: design internal control systems that facilitate the presentation of periodic information and mitigate revocation risks.

• Monitoring of amount updates: closely monitor IPC adjustments to determine the optimal time to present new projects or expansions.

What do the new Laws leave us?

This normative triad reinforces the country’s strategy of fiscal competitiveness, legal certainty and capital attraction. Law No. 7546 creates a niche with incentives for technology manufacturing; Law No. 7547 modernizes and expands the Maquila regime, maintaining a single tax of 1%, while Law No. 7548 updates the general framework of incentives, extending exemptions to income and external financing.

The synergy between these laws positions Paraguay as a preferential location for nearshoring, relocation of value chains, and development of brownfield and greenfield projects. Entrepreneurs and investors who plan their operations with a comprehensive vision of these regimes will be able to optimize their cost structure, access international markets with competitive advantages, and contribute to the country’s sustainable economic development.

The BKM | BERKEMEYER team is available to delve into any regulatory, tax or corporate aspect related to these new provisions and to support our clients in the successful structuring and execution of their investment projects.

For more information, please contact Luciano Antonelli: luciano.antonelli@berke.com.py and/or Antonio Villa Berkemeyer: antonio.villa@berke.com.py

The National Congress has sanctioned and submitted to the Executive Branch for publication the bill “Establishing the National Policy for the Production and Assembly of Electrical, Electronic, Electromechanical, and Digital Equipment.” This regulation represents a decisive step towards attracting investments and boosting the technology industry in Paraguay, with unprecedented tax benefits and clear rules of application.

Key aspects of the law

• Tax benefits: Exemption from tariffs on the import of capital goods, materials, and supplies. Reduced taxable base for VAT on import and commercialization (15% and 45% respectively).

• Conditions for access: Increased national production, generation of formal employment, and at least 20% of national added value.

• Term of validity: The incentives are granted for 20 years, renewable.

• Control and monitoring: The Ministry of Industry and Commerce, together with the MEF, will be in charge of monitoring and supervision.

Fiscal implications of the new regulations

From a fiscal point of view, the law generates a new special regime that must be coordinated with Law N° 6380/2019 and with the new Investment Incentive Regime, a regulation that was approved with the bill under analysis and that is currently ready for publication.

Three elements stand out that potential beneficiaries should consider:

• Compatibility of benefits: Not all regimes can be accumulated.

• Permanence requirements: Non-compliance may lead to the revocation and return of the exempted taxes.

• Strategic planning: The design of investment projects must contemplate the tax, financial, and labor impact.

Impact on the business sector

This law represents an opportunity for manufacturers and assemblers of technological equipment, as it allows the reduction of costs in import and commercialization, which increases competitiveness in the face of international markets.

At BKM | Berkemeyer, we have a multidisciplinary team of tax attorneys and corporate advisors ready to assist your company in the design, presentation, and management of investment projects under this new regime.

For more information, please contact Luciano Antonelli: luciano.antonelli@berke.com.py

The National Congress has approved the bill on Tax Incentives for National and Foreign Investment, which will replace Law No. 60/90 when enacted. The regime modernizes investment promotion, with clear and competitive rules to attract national and foreign capital.

The law seeks to:

• Increase the production of goods and services.

• Generate permanent, quality jobs.

• Incorporate technologies that optimize resources and improve efficiency.

• Develop local suppliers and integrate national added value.

• Promote the growth of MSMEs.

Tax benefits will apply to strategic sectors, in line with the country’s sustainable development goals.

Specific benefits

The law establishes a set of advantages that significantly reduce the cost of capital and increase the return on investments:

• Exemption from customs duties on the import of capital goods, raw materials, and supplies intended for the investment project, applied directly to the industrial, agricultural, or service production cycle, except for fees for services actually rendered.

• Exemption from VAT on the import and local purchase of goods intended for the industrial or agricultural production cycle.

• Exemption from VAT on the first sale of capital goods that have been imported or acquired from national manufacturers under this tax incentive regime. This exemption will apply exclusively when the transfer of ownership of said goods is made between the beneficiaries of this law.

• Exemption from NRI on interest, commissions, and surcharges remitted abroad for loans used to finance the investment project, granted by banks, financial institutions, or other credit institutions with international experience. It will apply when the investment is at least USD 13,000,000.

• Exemption from IDU on dividends, profits, and returns from projects under the regime, for 10 years from their first generation, provided that the investment is at least USD 13,000,000. For non-residents, it only applies if the investment does not come from territories with low or no taxation, or if the IDU is not recognized as a tax credit in the country of origin. The exemption only covers profits derived from the project and, in the case of pre-existing production chains, will be applied proportionally to the new investment.

• Exemption from customs duties and VAT on the import of capital goods for investment projects aimed at large-scale tourism and entertainment services, provided that the investment is at least USD 20,000,000.

• The legal deadlines are: opinion from the Investment Council in 60 days and bi-ministerial resolution (MIC–MEF) in 15 days.

Innovations compared to the previous regime

While Law 60/90 offered general benefits, the new regulations introduce substantial improvements:

• Conditions benefits on the Environmental Impact Statement, which ensures sustainability.

• Incorporates the possibility of renewing benefits within the initial 20 years and complementing them with new stages of investment.

• Expressly regulates the transfer of pre-operational benefits and capital goods between beneficiaries.

• Establishes permanent monitoring and inspection mechanisms, with periodic reports in the form of a sworn statement.

Expected impact

The new framework reinforces Paraguay as a regional investment hub, offering greater legal certainty and a reduction in the cost of capital. A multiplier effect is projected in formal employment, attraction of technology, and strengthening of local value chains. For international investors, the exemption from taxes on dividends and financing interest represents a clear comparative advantage over neighboring regimes.

Conclusion and call to action

The approval of this law marks a milestone in Paraguayan economic policy. A window of opportunity opens for industrial, logistics, technological, and tourism projects.

From BKM, as specialized advisors in tax planning and structuring of investment projects, we are ready to accompany you in the eligibility diagnosis, financial modeling, and regulatory compliance.

For more information, please contact Luciano Antonelli: luciano.antonelli@berke.com.py