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Manage your Business Risks with Due Diligence in Guatemala

Manage your Business Risks with Due Diligence in Guatemala

When doing business in Guatemala, managing your business’ risks with due diligence practices is essential to its success and longevity.Language and/or cultural barriers, understanding the market and the way of handling businesses are challenges that foreign business owners face when expanding abroad. Buying existing companies or partnering with locals are key ways to reduce these challenges and get support navigating an unfamiliar market. However, it’s imperative to protect yourself when undertaking either of these processes by conducting thorough due diligence checks in Guatemala of the companies and people you will surround yourself with.Find out more about due diligence in Guatemala and how to manage your business risks. What is due diligence in Guatemala?  Due diligence refers to the process of thoroughly reviewing and analyzing available information of a company. Due diligence refers to the process of thoroughly reviewing and analyzing available information of a company. The focus of this analysis is primarily set on economic, legal, tax and financial circumstances of a company.  What is the purpose of due diligence?  The general purpose of due diligence is to conduct a risk assessment as part of the process of buying a company, hiring new staff or partnering with other organizations. However, conducting due diligence in Guatemala brings more advantages.The main objectives of a due diligence analysis are:  Reduction of information asymmetries between buyer and sellerEstablishing a basis of trust between buyer and seller through transparencyAnalysis of...

5 Tips for US Companies Doing Business in Guatemala

5 Tips for US Companies Doing Business in Guatemala

Find out benefits and opportunities for US Companies Doing Business in Guatemala. Guatemala's size and economic potential offers one of the best options for business expansion into Central America. Guatemala is the third-largest country in Central America, with just over 17 million inhabitants. Its main location for commercial activity is Guatemala City. The official currency of Guatemala is the Quetzal, and its strength offers a significant advantage when expanding into the country from abroad. It is important to have the option of diversifying investments and sources of income, and Guatemala offers key advantages to business. As a US company doing business in Guatemala, use these 5 tips to optimize your experience and achieve long term success. Around 70% of the population in the country is under 30 years old and in the last decades, the number of English speakers has increased significantly. 1. Find talented staff Guatemala is rich in cultural history and custom. The country's workforce is well-educated and open to new opportunities. The government holds a positive predisposition to collaborate with foreign businesses. In addition, it is important to take into account that a large proportion of Guatemalan nationals manage a fluent level of English. Around 70% of the population in the country is under 30 years old and in the last decades, the level of people speaking English has increased significantly. When hiring in Guatemala, rest assured in the availability of enthusiastic, qualified staff. Foreign employers who are not familiar with the local employment regulations...

Aspirations for Technology and Innovation in Guatemala Textile Industry

Aspirations for Technology and Innovation in Guatemala Textile Industry

Guatemala demonstrates strong aspirations for technology and innovation in the textile industry that expanding companies should take note of. The textile industry is responsible for transforming raw materials into a finished product, and is a crucial element of supply chains worldwide. In Guatemala, clothing manufacturing is popular and is looking to innovate. Guatemala profits from the Dominican Republic–Central American Free Trade Agreement, and could also benefit from the trade dispute between China and the USA. Many manufacturers are looking to move their production to more profitable locations. The demand for more sustainable production processes rises, and supply shortages from Asia and other parts of the world place Guatemala in an advantageous position. Now technology and innovation could help boost textile businesses in Guatemala to increase productivity. What are Guatemala’s aspirations? Key facts of Guatemala’s textile industry Did you know: There are about 169 apparel factories in Guatemala, most of them Korean-owned90% of production is exported to the USMost popular items of productions are cotton and synthetic knit tops, cotton woven and knit cotton trousers, pants, and shortsExports of textile companies reported an average annual growth of 2% between 2010 and 2019. New technology to lower cost and increase productivity Automation is one of the technologies and innovation to achieve aspiration in Guatemala's textile industry. In order to strengthen Guatemala’s competitiveness, the industry relies on the use of software and systems to improve operations....

What are the Types of Legal Entities in Guatemala?

What are the Types of Legal Entities in Guatemala?

In order to set up a business, it is important to understand the types of legal entities in Guatemala. Central America has become a place for foreign multinationals interested in doing business across North and South America. Central American countries have a lot to offer to foreign and local companies, such as tax benefits, special economic zones, and access to the Atlantic and Pacific Oceans. Guatemala maintains a number of free trade agreements for businesses to obtain certain benefits for the sale of products within the region. Expand into Guatemala by establishing a company with the right legal entity for your business. We give a general summary of the types of companies or legal entities in Guatemala that you can choose from to do business, and most essential elements of these. Types of Legal Entities in Guatemala A Limited Liability Company is known as Sociedad de Responsabilidad Limitada in Guatemala, and can be formed with up to 20 partners. There are several different types of legal entities in Guatemala to incorporate your company. Each legal entity offers different conditions and governance structures to suit varying business needs. The legal entity you choose will influence the amount of capital to invest, economic activities to be carried out, how many shareholders you will have, and other factors. The most common types of legal entities that are usually used to establish a company are included below. Limited Liability Company (Sociedad de Responsabilidad Limitada) The Limited Liability Company (LLC), or Sociedad de Responsabilidad Limitada in Guatemala can...

What are the Free Trade Agreements in Guatemala?

What are the Free Trade Agreements in Guatemala?

Guatemala is bolstered by free trade agreements with the United States, the European Union and other Central American countries. The diverse country is blessed by its strategic location, representing a natural bridge between North and South America. In addition, the country takes advantage of being located in the Eastern Standard Time (EST)  zone, which is congruent with key hubs of the lucrative North American market. Guatemala, therefore, meets the best preconditions for conducting trade and other economic activities with the United States, and other key players in the global market. We outline the most significant free trade agreements in Guatemala.  Guatemalan Free Trade Agreements Taiwanese exports to Guatemala include tobacco, seafood (shrimps and lobsters), copper articles, plastic materials, and some other. Taiwan-Guatemala free trade agreement The free trade agreement between Guatemala and Taiwan, enforced in 2006, is primarily based on the extension of free tariff treatments of agricultural exports. As part of that, Guatemala exports US$40 million in products to Taiwan and imports US$90 million.The main exports from Guatemala are sugar and coffee. In return, Taiwanese exports to Guatemala include tobacco, seafood (shrimps and lobsters), copper articles, plastic materials, and some other.Furthermore, the free trade agreement allows business people from Taiwan to invest in Guatemala and to extend their business operations to the United States and other countries in Central America. The latter is possible, as Guatemala is also a member of the Central American Free...

How to Register a Trademark in Guatemala

How to Register a Trademark in Guatemala

Find out how to register your trademark in Guatemala and protect your business’ unique signs. Plus understand the importance of conducting a thorough trademark search in Guatemala in order to ensure your distinctive signs are unique. When undertaking commercial or corporate activities in Latin America, consider obtaining exclusive rights to your intellectual property assets. This includes elements such as your product and service brands, distinctive signs (slogans and/or trade names). For business owners and executives in Guatemala, local legislation provides support to protect their intellectual assets and ensure that they profit from their innovations. In 2019, Guatemalan authorities approved over 10,000 trademark applications. Join this group of countries and secure your business by registering a trademark in Guatemala. Steps to register a trademark in Guatemala In 2019, Guatemalan authorities approved over 10,000 trademark applications. There are 6 general steps to register a trademark in Guatemala for your unique sign. This includes conducting a thorough trademark search in Guatemala's database to ensure your designs are unique. The public institution in charge of administering the trademark registration process in Guatemala is the Guatemalan Intellectual Property Registry (Registro de Propiedad Intelectual - RPI). 1. Engage with a local trademark specialist Please note that the trademark registration in Guatemala requires the advice of an active Guatemalan Lawyer and Notary. This person is responsible for signing, stamping and stamping the trademark registration...

How to Incorporate a Company in Guatemala

How to Incorporate a Company in Guatemala

Find out the steps to incorporate a company in Guatemala, a rising hotspot for expanding multinationals in Central America. Guatemala is the third largest country in Central America, with just over 108,000 square meters. The country possesses a richness in natural wealth, and is a valuable hub for international trade, with access to the Caribbean Sea and the Pacific Ocean. The country also has a land connection with economic giant Mexico and is connected with the rest of Central America through a cultural history that dates back to around 2000 BC. Guatemala’s connection between its seaports and container terminal presents clear international trade opportunities for businesses operating from for this country. Incorporating a company in Guatemala is therefore an important consideration to make when expanding to Central America. Steps to incorporate a company in Guatemala Generally, there are 6 key steps to incorporate your company in Guatemala. 1. Seek advice from local market entry and legal experts Before expanding a business, it’s important to establish a road map or market entry strategy. Before expanding a business, it’s important to establish a road map or market entry strategy. Seek advice from local legal and market entry experts to incorporate a company in Guatemala, in order to ensure you can set up and begin operations in full compliance with the law. These experts will help you choose the most appropriate pathway to expansion for your business needs. Appointing a legal representative Companies in Guatemala require a Legal Representative to act on their behalf on...

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