Manage Your Business Risks With Due Diligence in Bolivia

Due diligence in Bolivia is the best way to ensure the safety and security of your business operations in the country.

Future business executives should be aware of the challenges they may face when doing business in Bolivia, such as the local legislation, market behavior, and appropriate risk management.

Undertaking due diligence processes will significantly improve your ability to make informed decisions when doing business in Bolivia. These processes provide business owners with critical information about companies and partners, including an extensive analysis of financial, legal, labor information, or even environmental practices.

Understanding due diligence in Bolivia

Processes for due diligence in Bolivia for market entrants include in-depth investigations to analyze the profitability of expanding a new business. Collected information helps to evaluate the risks that executives may face. A local third party can carry out the appropriate market research to give comprehensive and knowledgeable feedback to the company.

Both parties can operate under a confidentiality and exclusivity agreement to undertake this work. With the information gathered from due diligence research, executives can understand potential strategies, liabilities and contingencies to enter the market.

Why is due diligence important in Bolivia?

Bolivia’s economy has grown considerably in the last few years due to the extraction and export of natural gas, silver, zinc, and soy. It is the fourth-largest natural gas producer and the eighth oil producer in Latin America.

Likewise, Bolivia has signed numerous trade agreements that attract thousands of foreign investors. However, there are still legal gaps that make it difficult to identify and penalize illegal activities known as “laundering of illegal profits.”

Although the country’s government is working on its legislation to ensure transparency within its industry, performing a due diligence process in Bolivia is the best way to safely invest in companies that comply with all the local law requirements.

Aspects to investigate

Performing a process of due diligence in Bolivia involves mainly the investigation of a company’s accounting and commercial departments to detect any internal deficiencies. Nevertheless, other aspects of due diligence include:

• Technological infrastructure
• Administration
• Labor
• Legal compliance
• Environmental practices.  

This process includes a detailed collection of official documents regarding shareholders, beneficiaries, and corporate structure. It also inquires if a company has been penalized before and the reasons behind this.  

Engage with local providers to undertake due diligence in Bolivia

If you are thinking of incorporating a company in Latin America, learn how our due diligence, investigation and other back-office services can be useful for successful operations in the Latin American region. We control, identify, and reduce risk by answering important questions you may have.

Biz Latin Hub offers a full range of professional market entry and back-office services, including company formation and legal representation in Latin America. Contact us to start your business in Bolivia.

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