For an investment to be considered foreign, it must meet a minimum threshold level of foreign equity relative to the total value of the investment. For investments less than or equal to $25,000, the threshold is 15 percent. For investments between $25,000 and $125,000, the threshold is 20 percent. For investments greater than $125,000, the threshold is 30 percent. The central bank monitors all foreign direct investment involving foreign currency transactions.

Under the investment code, the generic incentive regime includes the following:

• VAT exemption for goods and services directly related to the investment; and
• Exemption from transfer taxes for real estate purchases directly related to the investment.

A second category of incentive regime offers, on a case-by-case basis by the approval of the National Investment Council, may include:

• Exemption from property taxes;
• Exemption from corporate income taxes;
• VAT exemption for goods and services directly related to the investment; and
• Exemption from transfer taxes for real estate purchases directly related to the investment.

In addition to the above-mentioned incentives, special incentives are also offered for investments in special development zones and for privileged investments that utilize environmentally friendly or energy saving technologies.

Special incentives may include:

• Partial or total state funding for infrastructure investments;
• Application of reduced customs duties on imported goods directly related to the investment;
• Exemption for ten years from the corporate income tax (IBS), Gross Income Taxes (IRG), flat rate payment (VF) and Tax of Professional Activity (TAP);
• Exemption for ten years from property taxes; and
• Additional incentives to improve or facilitate the investment, such as the carry-forward of losses and depreciation.

Additional incentives may be offered to companies whose production and investments are export-oriented.