Latin America: What happened in 2019 and significant events in 2020

Latin American Law: Year in Review 2019 and Year to Come 2020 summarizes some of the major developments in Latin America last year, and a selection of key changes that we anticipate over the coming year. There are links to further reading, where available. Explore our overview of key developments below.

Key updates across


LatAm countries in 2019 and 2020

"2019 was a busy year in Latin America which saw a large number of legal and regulatory changes impacting our clients’ businesses. Our review summarizes a selection of these developments across Argentina, Brazil, Chile, Colombia, Mexico and Peru and looks ahead at what we expect to see over the coming year."

Matthew Poulter, Latin America Practice, New York

Matthew Poulter

Significant legal and regulatory events in 2019

Explore the tabs below to review the key developments you need to be aware of from 2019


FX Restrictions: In September 2019, and effective until December 31, 2019 foreign regulations were reinstated, (“FX Regulations”). Such FX Regulations establish requirements for local residents to have access to the local foreign exchange market for the payment of financial indebtedness in foreign currency, formation of offshore assets, payment of dividends, payment of imports of goods and services and, in certain cases, the obligation to enter and settle through local foreign exchange markets for the proceeds of financial indebtedness, among others. The FX Regulations have also established additional limitations on access to the local foreign exchange market by non-residents.

2019 Elections: The general presidential and congressional elections took place in October 2019. The presidential candidate Alberto Fernández was elected president with his running mate Cristina Fernández de Kirchner obtaining the highest percentage of votes, amounting to 48.1%, while the incumbent administration candidate Mauricio Macri, obtained 40.4% of the votes. With this result, the candidate representing the “Frente de Todos” political coalition became the newly elected president of Argentina.


Pension Reform: A Pension Law reform was recently passed by the Brazilian Congress. The reform raises the retirement age, increases workers’ pension contributions and reduces certain workers’ pensions benefits.

Telecom Law: In September 2019, the Brazilian Congress approved a new legal framework for the telecom sector. The new law was designed to encourage investment and attract foreign players by lifting the restrictions on asset sales and investing requirements on outdated technology and allowing companies to own outright telecom assets, such as cell phone towers and valuable real state, among others.

Economic Freedom Act: The bill came into force in September 2019 with the aim of streamlining relations between public authorities and private actors by guaranteeing freedom in the exercise of economic activity and acknowledging that state intervention must be subsidiary and exceptional. The Economic Freedom Act affects several legal areas: it amends, for example, the Civil Code, the Act of Business Corporations, the federal tax administration, and the Consolidation of Labour Laws.


Banking Law Reform: In January 2020, Law 21,130 was enacted which gives the Chilean General Banking Law new banking capital and reserves requirements, in accordance with the Basel III guidelines, among others. In addition, the new law aims to modernize the corporate governance and powers of the banking regulator, by merging the former Chilean Superintendency of Banks into the Chilean Financial Market Commission, which will now be the sole regulator for banks, securities and insurance.

Law No. 21,131 sets forth a 30-day term for payment of invoices: The law stipulates, among other matters, that invoices – issued by any type of entity – must be paid, as a general rule, within a maximum term of 30 days after being received. Although the original bill was intended only to amend the “Small Businesses Statute”, the approved law ended up as a generally applicable rule, including all entities that issue and/or receive invoices in Chile, regardless of their size.

Digital Transformation of the Administration: In November 2019, Law. 21,180 on Digital Transformation of the Administration was enacted with the purpose of initiating the process of digitalization and modernization of administrative procedures. Some of the most relevant innovations include mandatory electronic procedures and communications, the digitalisation of paper documents and the mandatory use of electronic signatures. The entry into force and gradual application of the new law shall be determined by regulations that must be issued within one year. However, the maximum period for its full application is within five years of its publication.


National Development Plan: Through Law 1,955, the Colombian National Government passed the National Development Plan (NPD) for the four-year term (2018 to 2022). The NPD sets guidelines for the country’s growth and development and determines the process to meet these goals. The current NPD’s main areas for action are: (i) promote legality by reducing criminal and drug related activities; (ii) encourage entrepreneurship and foreign investment; and (iii) fight for a reduction in inequality.
Tax Reform: In October 2019, Colombia’s National Government submitted to the Colombian Congress a new tax reform proposal, after the National Constitutional Court declared unconstitutional the prior proposal due to procedural errors in its approval. The new bill includes identical provisions to the ones approved by Congress in December 2018. The bill aims to increase income tax on high earners, cut business duties and create an additional tax on banks’ earnings.
Telecommunications Reform: A new Law on Information Technology and Communications was enacted to close the digital gap in the country by providing for an increase in Internet access in 70% of the territory in the next four years. Also, the new law increases to 20 years the term of concessions for use of the radio-electric spectrum, expecting a more effective auction for the 700, 1900 and 2500 Mhz bands. The law also eliminated the TV National Agency, giving the CRC (Comisión de Regulación de Comunicaciones) all the powers to regulate and supervise the communications sector, including public commercial television.
Anticorruption Legislation: The new law requires Colombian National Congress members to declare if they have a conflict of interest that may arise in the exercise of their functions. Likewise, the new law also requires Congress members to reveal information related to their family and spouse’s properties that could create a conflict of interest, and the revenues and expenses of the electoral campaign that promoted his or her election.


Constitutional Amendments: The new Mexican Congress passed a number of Constitutional amendments in line with the new social policies adopted by the recently elected president, Andrés Manuel López Obrador. The most significant amendments include the domain extinction to secure assets arising from criminal activities, the creation of the National Guard force and the tax reforms currently under discussion with the Mexican Congress.
Pension Funds Reform: The bill provides for a higher degree of flexibility in the investment rules of pension funds.
Fintech Regulations: The regulations provide rules for the operation of electronic payments, cryptocurrency, crowd-funding mechanisms and electronic financial advice in Mexico.
Austerity: In November 2019, the Mexican Congress passed the General Austerity Law, which provides a general framework for how governmental spending will be conducted by the new administration. Ancillary legislation and amendments are estimated to be approved within the first quarter of 2020.


Political Developments – Constitutional Crisis: In September 2019, the current president of Peru, Martin Vizcarra, ordered the dissolution of the Peruvian Congress and called for congressional elections, invoking a presidential power granted by Peru’s constitution. In October 2019, Peru’s Constitutional Tribunal agreed to hear a lawsuit presented by the President of the dissolved Peruvian Congress to determine whether President Martin Vizcarra exceeded his powers by dissolving Congress. Subject to the Constitutional Tribunal’s legality determination, legislative elections are scheduled for January 26, 2020 to elect a new congress. Until such time, the President of Peru may approve legislation without the approval of Congress, through urgency decrees.

Tax Reform: In May 2019, the Peruvian National Government approved the parameters for the application of the anti-tax evasion regulations. These parameters included a list of tax evasion practices to sanction and deter the continuance of such actions. Likewise, these parameters provide for the possibility of releasing responsibility of a corporate director in tax-evasion cases as long as such director leaves notice of disagreeing with the approval of the company's tax plan.

Infrastructure Projects: In October 2019, the much-awaited expansion project of the new Jorge Chavez International Airport began. It is expected that after the US$1.5bn expansion, the new airport will increase its capacity threefold, serving over 35 million passengers per year.

Antitrust: In November 2019, the Peruvian President approved the new merger control regime of the Peruvian anti-trust agency 'The National Institute for the Defense of Competition and Intellectual Property' ("INDECOPI"). With this new regime, the INDECOPI will be empowered to review and authorize corporate mergers that exceed a determined sale value. The new regulation will be in force for five years and have a nine-month wait-period before it comes into force.

Significant legal and regulatory events in 2020

Explore the tabs below to review the key developments you need to be aware of in 2020


New Administration: The new administration, led by the President-elect Alberto Fernández, will take office on December 10, 2019. Even though the details of how his campaign promises will be implemented are still unclear, and the details of the economic plan to be adopted have not been disclosed yet, the President-elect intends to, among other things, initiate an external debt restructuring process with the goal of alleviating the current economic crisis and resuming the growth of the national economy, boost the development of unconventional oil and gas resources through the Vaca Muerta formation and reduce the inflation rate. It is expected that during its first months after taking office, the new administration will submit a series of bills to the Argentinian National Congress with the purpose of boosting economic growth. The high level of uncertainty of economic variables, the general lack of stability in terms of inflation and the unknown influence the new administration will have over the Argentinian National Congress to build consensus, could affect the President-elect’s ability to plan ahead and make strategic decisions.


Reform Package: The government announced its intention to implement wide-ranging reforms, aimed at cutting spending and reducing the size of the federal government. The proposals include the privatization of state-owned companies; freeing up government funds to pay down public debt; easing budget restrictions to lower mandatory spending; and cut public sector employee salaries, hours and benefits and job stability for new hires.
Crypto-currencies Regulation: In May 2019, Brazil’s Chamber of Deputies President, Rodrigo Maia, ordered the creation of a special commission to discuss cryptocurrency regulation. Moreover, Brazilian senator Flavio Arns introduced a bill that addresses the legal regime of cryptoassets. Faced with the growing threat of hackers in Brazil, debating the issue is seen as part of the fight against drug trafficking, money laundering, and internet rights violations.


New Constitution: Since October 2019, Chile has witnessed social disorder which started following an increase in the cost of public transport. The social unrest led to a number of actions by the Chilean National Government and the Chilean Congressmen, that ended in the execution of the Acuerdo por la Paz Social y nueva Constitución" (Agreement for the Social Peace and new Constitution). This calls for a public referendum in April 2020 that will decide the need for a new Constitution.

Banking Reform: A number of the new provisions of the new General Banking Law are subject to the issuance of specific regulations by the Chilean Financial Market Commission. Consequently, the Chilean Financial Market Commission submitted for public comments a set of regulations, including the rules that banks shall observe to determine their effective patrimony.

Tax Reform: As announced last year, the tax reform process in Chile will continue in 2020 and is expected to result in a decrease of the corporate tax rate (mirroring that of other OECD countries) and an integration of the individual, corporate and foreign tax systems. Nonetheless, the social explosion and the several agreements entered into regarding the social demands, may convey a different outcome in this matter.

Pension Reform: As anticipated last year, President Piñera sent a bill to Congress containing proposed reforms to the pension fund system, which originally included a gradual increase in the level of mandatory savings. Developments after the social unrest may cause the originally proposed bill to be changed during the course of the discussion in Congress.

Close-Out Netting in derivatives transactions: Central Bank of Chile proposes new regulations: After the effectiveness of the General Banking Law, the Chilean Central Bank was granted new powers to regulate the netting when one of the parties is a Chilean institutional investor (including banks and insurance companies).This new regulation proposed by the Central Bank includes general terms and conditions that the derivative agreements shall need to meet to qualify for close-out netting purposes, ruling that the parties of a derivative agreement will be empowered to agree that the close-out netting provisions of their respective agreements may become effective as a consequence of the occurrence of specific critical situations.


Pension Reform: During the first half of 2020, it is expected that Congress will debate the bill to amend the pensions regulation submitted by the National Colombian Government. The main points of the reform include (i) increasing the monthly payments that citizens perform; (ii) modifying existing pension regimes; and (iii) expanding the coverage of pensions.

Reform to General Royalties System: The Colombian National Government is continuing its efforts to approve a constitutional amendment that modifies the General Royalties System. The purpose is to increase allocation of royalties (from mining and oil and gas production) to the poorest municipalities with greater unsatisfied basic needs. The Government expects more than 700 municipalities will benefit from this reform.

Labor Reform: The Colombian National Government has announced its intention to reform the labor system. Some of the proposals include: (i) flexible or hourly hiring in order to reduce informality and increase the contribution to social security proportionally to the time worked; (ii) minimum salary differing by regions; (iii) differential salary for younger people; and (iv) reduction of working hours from 48 to 36.


Health and Social Security: One of the most notable items in the agenda of the new administration is the creation of the Institute of Health for Welfare, which purports to grant universal access to social security and the free delivery of medicines to all citizens.
Anticorruption and Austerity: It is expected that new rules and policies towards corruption fighting will be enacted during 2020. Moreover, governmental spending is projected to be toughened through a series of bureaucratic counterweights and Presidential controls to be included in the ancillary legislation to the General Austerity Law.
2020 Elections and Mid-Term Election Race: State elections will be held in two states for governors and local congresses during June 2020. In late 2020, political parties will start the race for the Federal Congress mid-term elections. Given the newly implemented policies and the controversial legislative works, a fierce fight between the controlling party and the opposition is anticipated.


Mining: The Peruvian National Government announced its intention to reform the current mining law, which has been in force for over 25 years. It is expected that the new law will establish advanced royalty payments in favor of regional governments. However, as announced during 2019, no substantial mining related tax changes are expected from the new regulation.

Crowdfunding: It is expected that a new crowdfunding bill will be presented before the new Congress in 2020. The new regulation will allow entities that wish to operate as financial participation platforms to request a license from the Peruvian Superintendence of the Securities Market and become subject to its regulations. Likewise, entities that are currently supervised by the Peruvian Superintendence of Banking will be able to operate financial participation platforms through its subsidiaries.

Antitrust: In June 2019, the Peruvian Cabinet of Ministers (Presidencia del Consejo de Ministros) published a draft bill for the creation of a single administrative review instance for anti-trust matters (thus replacing the current two-instance administrative appeal system). It is expected that the bill will be submitted before Congress in 2020 for approval.

Medicinal Cannabis Regulations: In October 2017, the Peruvian Congress passed Law No. 30681 providing for the use of medicinal cannabis in Peru. Certain aspects of the new law were regulated by the Peruvian National Government through Supreme Decree No. Nº 005-2019-SA. However, some regulatory procedures and details for the implementation of the law were left out by the Peruvian National Government, such as the procedures to grant licenses. Consequently, even though some international cannabis companies have recently begun to arrive in Peru, the cannabis industry has not been able to start operations. It is expected that in 2020 the remaining details will be approved.

Infrastructure: In November 2019, the Peruvian Minister of Transportation announced that since the pre-investment studies for Lines 3 and 4 of the Lima Metro System were concluded, the concession process for the construction of the lines will begin. Individually, it is expected that Line 3 will require a US$5.7bn investment and Line 4 will require a US$4.4bn investment.

Explore our Year in Review 2019 and Year to Come 2020 series across 20+ jurisdictions and a number of topics.

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