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Legislative evolution in Dominican Republic.
Lic. Jacqueline Dhimes
Dhimes & Marra / attorneys at law

For decades, the Dominican Republic was regulated by out dated laws and obsolete dispositions that dated from the 1800’s and, in greater number, from the Dictator Rafael Leonidas Trujillo who ruled the country from 1930 to 1962.

During the 90’s, the legislature began the migration from this legal antiquity and new laws initiated the process of reforms to foment the investments and to equip the country with a more efficient legal framework.

During the Government of President Leonel Fernandez, dependent technical Commissions of the Executive branch are created to promote the creation, modification and adaptation of important legal pieces. These commissions of support to the reform of the State and justice worked towards the modernization of the governmental structures for the application of modern techniques applied to the commerce and the industry.

Without limitation or minimization of other important of legislation, the following compendium illustrates the previously expressed considerations about this process of evolution and legal reforms, which involved the Dominican Republic during recent years:

• During 1990, the Law the 8-90 on promotion for the Establishment of new Free Zones and the growth of the existing was approved. This Law provides the regime of the Free Zones of Exportation that are within geographic areas with a customs and exoneration regime of a 100% of the most important taxes of our tributary system. It has constituted an important source of jobs mainly in the area of the manufacture and at the present time as a result of this legislative advance and of its maintenance, the country counts on more of 52 free zones industrial parks that destine the production of goods and services to the foreign market generating important sources of uses for the Dominican population;

• During 1992, two important legal bodies were approved: a new Tributary Code which derogates the old fiscal structures that did not assure the fulfilment of tributary obligations and, which has been modified twice in order to fortify the new fiscal system and to increase the tax collections. The other important legal piece was the Labour Code that, although countermanded an old system, in our opinion constitutes a source of excessive protections of the workers’ rights that in most of occasions is translated in creation of inefficient jobs that affect Dominican enterprise dynamics.

• During 1994, - based on the Convention on the Children Rights approved by the General Assembly of the Nations United in 1989- Law 14-94, or Code for the Protection of Children, and Adolescents was published and are adopted new administrative and judicial structures to create the institutional bases and procedures to offer important integral protection to this unprotected segment of the population.

• In 1995, the Law of Foreign Investment introduced important new features to the previous system among which we can mention the elimination of old prohibited areas of investment and extending the spectrum of sectors for the installation of foreign companies or capitals, contributing to the fortification and the security of the investors. Also, old Executive Order 2245 prohibited the purchase of buildings by foreigners without the authorization of the Executive Authority was repealed, therefore citizens of other nationalities can acquire buildings without authorizations of the President of the Republic.

• In 1997 a new Electoral Law is approved along with the Law of Reformation of the Public Enterprise. This piece was the turn out of an arduous work and strong political and social will to change the legal form of the public enterprises. It was an attempt to privatize some public services and to eliminate the absolutist power of the State in companies of State Capital, to benefit the population by privatizing managements and improving the services.

• Law 153 of April 1998, on Telecommunications, derogates the old Law of 1966, regulating, under principles of competitiveness and harmony, the sector of the telecommunications, to contribute to the socioeconomic expansion of the nation and, to improve the services in benefit of the population. This Law combines efforts for the development of activities of the private sector and to promote the loyal, effective and sustainable competition in a market.

• Year 2000 was of importance for the industrial, artistic and literary creators: Law 20-00 on Industrial Property protects the creators of distinguishing signs - commercial trade names, logotypes, slogans- and places the country in the vanguard of the legislations of this type and, observing the Conventions and International Treaties on industrial property. Also, the new Law of Protection to the Rights of Author was approved and includes new mechanisms against the usurpation practices, falsification, reproduction, imitation and other actions that attempt against the intellectual creations of the authors. Another important Law was the 64-00, General Law of Environment and Natural Resources that protect and guarantee the conservation of the ecosystems and other elements that allows the population to express its complaints on the commercial and industrial establishments without adequate mechanisms for the protection of the flora and fauna that in many occasions cause direct damages not only to the ecosystem but to the population also.

• Year 2001 was dominated by the Reforms of the Health Sector and Social Security. After a long process initiated during the Government of President Leonel Fernandez with the auspices of the World Bank and the Inter-American Development Bank, the General Law of Health and the Law that creates the New Dominican System of Social Security was passed. Both laws sustained the autonomic principles and state decentralization which pursue the fortification of the governing roles of the authorities and to separate the functions of benefit of services of health and protection of the risks of oldness, incapacity, disease and survival, etcetera.

• Another important Law issued in 2001 was the General Law of Electricity, which revolutionizes the electrical sector when organizing the generation, distribution, sale and provision of electrical energy, and creating new regulatory structures of the sector that was dominated during many decades by the company of state capital denominated Dominican Corporation of Electricity (CDE). This legal piece of historical importance and object of ample and sounded debates by all the sectors of the economy and the governments, at the present time has received greater use with the relations with foreign private companies distributors of energy.

• In 2002, the Law of Mercantile Registry was approved and modifies the procedures of publicity for the incorporation and operations of commercial societies, establishing the obligatory registry before the Chambers of Commerce and Production of the different jurisdictions. The same year, Law 1-02 entered into force on Disloyal Practices of Commerce and Measures of Safeguard (Antidumping).

• Recently, the new Monetary and Financial Code reorganized the banking structures and of the different organizations that take part in the financial intermediation and, fortify the role of regulation or rectory of the state organisms in charge of the application of the Code approved. This Code was the result of a true battle of more than 10 years between practically all the sectors of the economy. Also it was promulgated September 11, 2002, new Law of Insurances and Finances of the Dominican Republic that countermanded the old regime that dated from the 1971 and which was not agreed with the new systems of protection of damages arisen in modern times.

The evolutionary process continues. The population and the different groups and enterprise and social associations continue promoting the elaboration of proposals and modifications to avoid curtailing this evolutionary process initiated, tending to equip and to maintain to the Dominican Republic updated with modern and effective legal instruments to stimulate the economy and the security in the investments.