PUERTO RICO Law and Practice Contributed by: Antonio J Santos and Donald E Hull, Pietrantoni Mendez & Alvarez LLC
The inspector who is required to submit monthly reports to the owner and inform the owner of any non-compliance issues. Depending on the cir - cumstances, the inspector may also be required to notify non-compliance issues to the OMP, file a complaint against the project at the OMP, or request the stay of the construction work from a court with jurisdiction, among other things. At the conclusion of construction, the inspec - tor must submit a certification to the OMP to the effect that the completed project complies with the requirements of the applicable permit or approval. The OMP may initiate enforcement action against a person or entity found to be in violation of applicable land use and zoning requirements or permits. There are two mechanisms through which the enforcement process may be initiated: • the filing of a complaint by a third party; or • the commencement of an investigation by the OMP. The complaint may be filed by any member of the public or by any other government agency. An investigation is then commenced. If the investigation indicates that violations exist, the agency may: • issue an administrative order requiring the cessation of unauthorised activities, imposing administrative fines, or taking other regulatory actions to address the non-compliance; or • seek an injunction in court to revoke the viola - tor’s permits, order the cessation of unauthor - ised activities, or demolish structures, among other things. The OMP may also refer the matter to other agencies with jurisdiction, depending on the nature of the violations.
The OMP is also empowered to conduct physi - cal inspections, based on an inspection pro - gramme, of any properties subject to decisions, permits or authorisations issued by the agency in order to assess compliance and issue reports of their findings. 5. Investment Vehicles 5.1 Types of Entities Available to Investors to Hold Real Estate Assets The most common forms of ownership vehi - cle for commercial real estate assets in Puerto Rico are the corporation and the limited liability company. Puerto Rico does have legislation that allows for the establishment of REITs (further details of which can be found in 5.3 REITS ). 5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity Corporations and limited liability companies are constituted by registering their organisa - tional documents with the Department of State of Puerto Rico. Registration fees are USD150 in the case of corporations and USD250 in the case of limited liability companies. Forms for the obtention of an employer identification number and election of the tax treatment for such entities are typically filed with the corresponding taxing authorities simultaneously with their formation with the corresponding taxing authorities. Other governmental filings may be necessary, depend - ing on the particular business activities in which such entities will engage. 5.3 REITs Puerto Rico does have legislation that allows for the establishment of REITs, which provide important tax benefits; however, owing to restric - tive income and ownership tests, this vehicle has not been widely used in Puerto Rico. A REIT,
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