The Cuban economic scenario has undergone several changes. The Cuban government has promoted the development of the private sector in recent years, with the approval of the SME Law (Ley de PYME in Spanish) and the opening of new investment opportunities. The market for products and services on the island has been constantly evolving with the entry of new forms of business ownership.
This transformation has been gradual and respectful of the legal structure that must precede any major change in the country. For this reason, Cuba has a legal system for businesses that ensures that every step is taken in accordance with the law and that there is solidity in decision-making.
The creation or incorporation of companies in Cuba is an example of the legal regulations in the Cuban business environment. Through a series of laws and decrees that constitute the legal framework for business in the country, the government maintains security in the business environment.
Types of companies that can exist in Cuba
- State-owned enterprises: State-owned and managed under a centralized management system.
- Joint Ventures: These are companies where Cuban and foreign capital are combined to create a new legal entity.
- Private companies: These are companies owned by Cuban individuals or legal entities.
Note 1: within the group of micro, small and medium-sized enterprises (MSMEs), there are also mergers between public and private management, with companies jointly managed by these actors.
Legal framework for regulating Cuban companies
The Ministry of Economy and Planning (MEP) is the state body responsible for planning and controlling economic activity, including businesses. On the other hand, there is a system of laws that regulate the changes that occur in this area:
- Code of Commerce: Defines the types of companies, their rights and obligations, and establishes the rules for signing commercial contracts.
- Foreign Investment Law: Regulates foreign investment in Cuba and defines the types of joint ventures allowed.
- Law on Small and Medium Enterprises (SME): Approved in 2021, regulates the establishment and operation of SMEs.
Note 2: the country updates its administration through decrees-laws and resolutions issued periodically, in addition to changes in these laws.
Cuban company registration
The incorporation of a company in Cuba requires its registration in the Commercial Registry, which is administered by the General Directorate of Registries and Notaries of the Ministry of Justice. The process requires the submission of a series of documents, including the company’s articles of incorporation, the deed of incorporation, contracts between the partners and their identification documents.
Tax payments
All companies participate in the Cuban tax system. Each company is taxed according to its nature and the amount of its profits. The timely payment of taxes in accordance with the law is a guarantee of security and stability for the company in the eyes of the Cuban State. This is one of the most important laws regulating Cuban companies.
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