For our visitors at the 2013 Federal Bar Association (FBA) Annual Meeting and Convention taking place at the Caribe Hilton Hotel from September 26-28, Puerto Rico offers a highly attractive incentives package that includes a fixed corporate income tax rate – one of the lowest in comparison with any U.S. jurisdiction – various tax exemptions and special deductions, training expenses reimbursement and special tax treatment for pioneer activities.
The recently enacted Act 73 of May 28, 2008, known as “Economic Incentives for the Development of Puerto Rico Act,” makes industry operations in Puerto Rico highly profitable while stimulating additional economic development.
- 4% or 8% fixed income tax rate
- 2% or 12% withholding tax on royalty payments
- “Pioneer” industries are subject to an income tax rate of 1% or 0% in cases where the intangible property was created or developed in Puerto Rico
- Minimum combined tax rate of 3% if at least 50% of the exempt business shareholders are residents of Puerto Rico
- Minimum combined tax rate of 1% if a small or medium-size business (average gross income of $10 million or less during the previous three years)
The Tax Incentives – Act 73 also allows companies to take a tax credit on their corporate income tax return. Tax credits allow for:
- Job creation tax credit of $1,000, $2,500 or $5,000 depending on the physical location of the business operations
- 50% income tax credit of qualified R&D expenses
- 50% income tax credit for investment in machinery and equipment for the production of energy using renewable resources
- 25% income tax credit for the purchase of locally manufactured products
- Up to 10% credit to reduce the electric energy cost of the industrial exempt business
Municipal and Property Tax Incentives
- 90% exemption from personal and real property taxes
- 60% exemption from municipal license taxes (75% for small and medium-size businesses)
- 100% exemption from state and local sales and use tax on raw material
→ Source: Puerto Rico Industrial Development Company (PRIDCO)
Ease of Doing Business in Puerto Rico (U.S.):
This page summarizes Doing Business 2013 data for Puerto Rico. The first table lists the overall “Ease of Doing Business” rank (out of 185 economies) and the rankings by each topic. It also lists the economy’s distance to frontier (DTF) measure. The rest of the tables summarize the key indicators for each topic and benchmark against regional and high-income economy (OECD) averages.
→ Source: The World Bank, Doing Business Project
Top Legal Firms in Puerto Rico
Adsuar Muñiz Goyco Seda & Pérez-Ochoa, P.S.C.
Adsuar Muñiz Goyco Seda & Pérez-Ochoa, P.S.C. is a dynamic, full-service law firm that provides a wide range of comprehensive legal and business counseling services. The firm has a long-standing commitment to bringing cost-effective solutions to client matters.
They are proud to be one of the few full-service business law firms in Puerto Rico, and tailor their services to the needs of individual clients, regardless of whether they are individuals, closely-held family companies or Fortune 500 or Fortune 100 corporations. Focusing their firm’s collective knowledge, energy and resources solely onto business-related matters gives them the ability to resolve all types of legal issues facing their clients.
AMG lawyers are particularly recognized for having the breadth of knowledge and expertise to handle complex legal issues and resolve difficult problems in all areas of the law, in practices ranging from real estate transactions, tax, wills, trusts, inheritances, construction and antitrust, to class action litigation, distribution, commercial law, securities and corporate law, trade regulation, insurance, labor and employment law, collective bargaining agreements, pensions plans, and ERISA matters.
Ferraiuoli LLC (Ferraiuoli) is a thriving law firm that boasts a select staff of energetic and responsive attorneys, knowledgeable in a vast array of practice areas, such as corporate, environmental law, intellectual property, employee benefits, taxes, labor and employment matters, and civil and commercial litigation, located in the midst of the Golden Mile in San Juan, Puerto Rico.
Early on, Ferraiuoli’s members identified intellectual property and corporate law as its niche market and set out to build a full-service practice with the most qualified professionals available. This practice is what differentiates Ferraiuoli from other firms. Ferraiuoli has an extremely strong corporate practice, which has formed the firm’s other core business since its inception.
They offer their clients a wide spectrum of advice on areas that span their main departments: Corporate, Environmental, Intellectual Property, Taxes Labor and Litigation. Within the departments there are multiple practice groups that make Ferraiuoli a full service law firm.
Fiddler González & Rodríguez PSC
Fiddler, González & Rodríguez, P.S.C. is a full-service law firm with a well established practice encompassing nearly all areas of law. With over 70 attorneys, the Firm is one of the largest in the Caribbean and Latin America.
Fiddler is a dynamic, modern legal organization equipped with the resources and commitment to provide practical, result-oriented legal services tailored to their clients needs, and under competitive fee arrangements.
Fiddler is organized into three main anchor divisions, under which the various practice areas are grouped to better serve its clients. The firm’s anchor divisions are: Corporate Division, Labor and Employment Law Division and Litigation Division.
Goldman Antonetti & Córdova, LLC
For fifty years Goldman Antonetti & Cordova (GAC), now one of the largest law firms in the Commonwealth of Puerto Rico, has provided local, regional and international clients with legal counsel.
In response to the Commonwealth’s increasingly complex business and legal environments, they have organized the firm into four primary practice groups: corporate and banking law, labor and employment law, tax law, and litigation and trial practice. Their lawyers strive to provide every client with an efficient, precisely targeted legal solution designed to protect and promote the client’s interests. In order to achieve that objective, each attorney’s practice is limited to a few areas of law, while members of varied practice groups routinely coordinate their efforts to provide comprehensive services to clients with issues that involve various areas of law.
Indiano & Williams P.S.C.
Indiano & Williams, P.S.C., is a small firm specializing in practice before the Federal Court in Puerto Rico. The firm also handles litigation in the local courts of Puerto Rico. Indiano & Williams also features a respected appellate practice before the First Circuit Court of Appeals and the appellate courts of Puerto Rico.
The firm of Indiano & Williams represents a wide range of clients from Puerto Rico, the mainland United States and the rest of the world. The firm’s practice includes both plaintiff and defense work. On the plaintiff side, Indiano & Williams maintains a thriving subrogation practice, as well as a select array of federal general litigation actions, including medical malpractice, general diversity tort practice and other actions brought under federal law. The defense side of the firm’s practice is equally diverse, representing clients in a broad spectrum of disputes ranging from defenses of general negligence allegations to complex class action defenses. Indiano & Williams, P.S.C. also prides itself on its distinguished employment law practice.
Indiano & Williams, P.S.C. is committed to providing each client, whether an individual plaintiff or a multinational corporation, the individualized support that only a relatively small firm can offer. The attorneys of the Indiano & Williams family give each of our clients personal attention and work with the client to help develop a specialized litigation strategy in every case. And of course, through the accumulated experiences of the firm, we work with the greatest level of efficiency to help the client maximize returns while minimizing the hours spent in litigation. At Indiano & Williams, P.S.C., the needs of the client are always the driving consideration in any litigation strategy decision.
McConnell Valdés LLC
McConnell Valdés was founded in Puerto Rico by attorneys Herbert McConnell and Adolfo “Wally” Valdés in 1946, when Puerto Rico was embarked on an industrialization process that would bring to the island the giants of manufacturing, as well as creators of new industrial technologies. Many of these businesses were venturing outside of the United States for the first time.
What started as a law firm dedicated to representing financial institutions and manufacturers is now a full service law firm with practice areas covering virtually any aspect of business law in Puerto Rico. As the world and Puerto Rico change, and as the way businesses have become truly international and more reliant than ever on state-of-the-art technology, the firm also continues to evolve, developing new practice areas and meeting head-on the challenges presented in this rapidly changing environment.
The Firm is divided in six practice groups: Corporate, Real Estate & Finance, Environmental, Energy & Land Use, Labor & Employment Law, Litigation and Tax.
O’Neill & Borges LLC
O’Neill & Borges LLC is a full service law firm with over 80 attorneys located in San Juan, Puerto Rico. Their practice is organized into three departments: Corporate, Labor & Employment, and Litigation. The Corporate, Labor & Employment, and Litigation Departments are further subdivided into multiple Practice Areas, representing the wide range of legal services that are critical to the success of their clients, including bankruptcy, collective bargaining, commercial lending, commercial litigation, corporate tax, corporate and public finance, environmental and land use, intellectual property, labor & employment litigation, legislative and regulatory affairs, mergers and acquisitions, real estate, private equity and finance, and tourism and hospitality, among others.
Among their clients are leading business organizations, including several Fortune 500 companies, entrepreneurs, financial institutions, private equity firms, professional services firms, real estate owners and developers, public entities, educational and not-for-profit institutions, and individuals.
Pietrantoni Méndez & Alvarez LLC
With over 45 lawyers and offices in the heart of the business district of San Juan, Puerto Rico, Pietrantoni Méndez & Alvarez LLC is one of Puerto Rico’s leading commercial law firms. A full service, integrated firm, PMA is organized into four major practice groups – Corporate, Litigation, Taxes and Labor and Employment; and PMA has been successful in assembling a group of experienced and talented attorneys, that provide clients with top quality legal services in a wide variety of specialized practice areas, including administrative law, antitrust, asset-based finance, bankruptcy and creditor’s rights, civil and commercial litigation, commercial banking and financial services, commercial lending, corporate and public finance, distribution and franchising, employee benefits, environmental law and litigation, federal and local taxation, governmental affairs, insurance and health law, product liability litigation, intellectual property, investment companies, labor and employment, mergers and acquisitions, privatization, real estate development and financing, securities and capital markets regulation, telecommunications, and zoning law.