PARAGUAY LAW AND PRACTICE Contributed by: Manuel Arias, Carla Sosa, Martin Carlevaro, Milena Sljivich, Alexander Berkemeyer and Antonio Villa Berkemeyer, BKM - Berkemeyer
6. Antitrust/Competition 6.1 Applicable Regulator and Process Overview Paraguay instated a merger control regime in 2013. Transactions Caught by the Merger Control Rules A transaction is caught by the merger control rules if it brings about a change of control resulting from: • the merger of two or more previously independent undertakings or parts of undertakings; • the acquisition of control (total, partial, direct or indirect) of one or more national or foreign per - sons (individuals or legal entities) by other national or foreign persons (individuals or legal entities), whether the control has been acquired through the purchase of shares, assets, agreements or con - tracts, or by any other means; and/or • the creation of a common legal entity that perma - nently performs the functions of an autonomous Not all concentration transactions caught by the merger control rules have to be filed with the local antitrust agency (CONACOM) – only concentrations that meet at least one of the following two thresholds must be filed. • If the transaction results in the acquisition or increase of a market share equal to or greater than 45% of the national (ie, Paraguayan) market of a specific product or service, or of a geographic mar - ket defined within it. • If the global gross turnover in the Republic of Paraguay of all of the parties to the concentration (including the economic groups of each – ie, the acquirer and the target’s parents and affiliates), in the last accounting year, exceeds a total of 100,000 local minimum monthly wages, which is equivalent to about USD35.5 million. Deadlines for Filing economic entity. Filing Thresholds The merger control notification must be filed within ten business days, counted from the day following the written conclusion of the agreement, the announce -
• the right to operate on the stock exchange is exclusive and non-transferable to brokerage firms. In terms of foreign investments and securities regula - tions in Paraguay, foreign investors and the compa - nies in which they participate enjoy the same rights, guarantees and obligations as domestic investors, as established by Law 117/91. However, when invest - ing through the securities market, they must comply with the specific regulatory requirements applicable to these investments, as outlined in the new Capital Markets Law (which applies equally to local investors). For example, foreign investors must provide broker - age firms with the necessary documentation to reg - ister as clients. They are also obliged to register and report significant transactions. 5.3 Investment Funds The new Capital Markets and Products Law consti - tutes a paradigm shift, creating a unified and coherent framework for investment funds and securities based on the following fundamental pillars: • it unifies prior separate legislation, expanding its scope to include “securities and products” and their derivatives; • it recognises financial innovation like distributed ledger technology (DLT) for securities; • it integrates regimes for funds and post-trade infra - structure; and • it strengthens corporate governance, transparency and enforcement, to reinforce minority shareholder safeguards. If a foreign investor structured as an investment fund wishes to make investment offerings in Paraguay, the collective investment entity must be authorised by the SIV for this purpose, in accordance with the new Capital Markets Law. However, if the investor only intends to invest in Paraguay in assets or securities listed on the local stock exchange as an institutional investor or through a local fund, the foreign fund must comply with all applicable regulations for investors in general (eg, submitting all necessary documentation to become a client of a brokerage firm, adhering to tax regulations and providing information related to its ultimate beneficial owners).
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