International Business - Best Practices
By T J Madigan
What makes each country unique from each other is that they have their own standards to be followed in every aspect. International business practices are absolutely not an exemption to that especially, plenty of corporations are targeting to head to the global market to find more avenues for profit.
In the case of Bolivia, dubbed as a donkey sitting in a gold mine, it remains to be the poorest nation in the South American region because of the said high corruption levels. However, amidst the fiscal crisis they are experiencing, it is good to discover what are there international business practices to keep in pace with economic stability. Not to mention, they are rich in natural resources and is the second biggest producer of gas field after Venezuela.
Here are there international business practices divided into categories namely exporting, trade organizations, commercial policies, foreign investment and taxation.
Exporting is broken down into agents & distributors, import restrictions, import duties and documentation. Agents & distributors are required no legal obligations for emigrant firms to maintain local liaisons but there is representation needed when those emigrant firms make public bidding or branch operations. Import restrictions are anything that will impose health risks or threaten national security. Import duties include paying a tariff rate on non- capital goods from a percentage of 10- 17 based upon cost, insurance and freight. Documentation refers to the five legal papers that must be presented to the authorities such as sellers commercial invoice, inspection certificate, insurance policy, packing list and bill of lading.
Trade organizations are comprised of corporations, private companies and branches. Corporations can only legitimately exist when it can accomplish all the requirements of the Commercial Code. Private companies can easily be established when they have an execution of an incorporation deed and MECE registration. Branches must meet two prerequisites such as local representative and legal entity.
Commercial policies are one of the international business practices in Bolivia wherein the Central Bank functions an exchange sale market and sets conversation rates.
Foreign investments include restrictions and investments. Restrictions laid down are not that stringent as compared to others. As a matter of fact, foreign investors are given the same rights as with the domestic investors. Incentives given by the government is in collaboration with the International Monetary Fund, Inter- American Development Bank and World Bank. Together they commit to attract more asset ventures in the country.
Taxation is segregated into corporate taxes, personal income taxes and treaty taxes. Corporate taxes are calculated based on their net worth determined by the Tax Code. Personal income taxes are assessed on the sum salary earned. Treaty taxes refer to the agreement made known as the Andean Pact with Colombia, Ecuador, Peru and Venezuela as well as the signatory of the River Plate Basin Treaty with Argentina, Brazil, Paraguay and Uruguay.
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