Foreign Ownership Regulations in Paraguay

Published on September 29, 2025 and written by Cyril Jarnias

Paraguay, a landlocked country in the heart of South America, is increasingly attracting foreign investors through its economic opportunities and favorable regulatory framework. In this article, we will explore in detail foreign ownership regulations in Paraguay, a country distinguished by its openness to international capital.

A Welcoming Legal Framework for Foreign Investors

Paraguay stands out for its liberal policy regarding foreign investments. Unlike many countries, it imposes very few restrictions on non-resident investors looking to acquire real estate or establish businesses within its territory.

Key takeaways:

– Foreigners enjoy the same rights as Paraguayan citizens regarding property ownership. – There are no limitations on the percentage of foreign ownership in Paraguayan companies. – Foreign investors can own 100% of shares in a local company. – Purchase of agricultural land by foreigners is permitted, with certain restrictions in border areas.

This open approach aims to stimulate the national economy by attracting foreign capital and promoting development in key sectors.

Simplified Formalities: A Fast and Efficient Approval Process

The Paraguayan government has implemented simplified procedures to facilitate foreign investors’ entry into its market. The approval process for property acquisition or business creation is generally quick and transparent.

Main steps:

1. Obtaining a tax identification number (RUC) from the Subsecretaría de Estado de Tributación. 2. Company registration with the Public Registry of Commerce. 3. Obtaining necessary licenses and permits according to the business sector. 4. For real estate purchases, registration with the Property Registry.

Average timeframes:

– Business creation: 2 to 4 weeks – Property acquisition: 1 to 2 months (including legal verifications)

It’s important to note that although the process is relatively simple, it’s highly recommended to engage a local attorney or specialized firm to ensure compliance with all current regulations.

Rights and Responsibilities: What Every Foreign Investor Should Know

When investing in Paraguay, foreigners enjoy numerous benefits but must also comply with certain legal and tax obligations.

Main rights:

– Equal treatment with domestic investors – Freedom to repatriate profits and capital – Protection against expropriation without fair compensation – Access to tax incentives and free trade zones

Essential obligations:

– Compliance with Paraguayan laws and regulations – Payment of taxes and fees (corporate tax rates among the lowest in Latin America) – Annual declaration of income and assets – Compliance with current environmental and social standards

It’s crucial for every foreign investor to fully understand these rights and obligations to operate legally and fully benefit from the opportunities offered by the Paraguayan market.

Expert Tips for Successful Investment in Paraguay

To maximize your success chances as a foreign investor in Paraguay, here are some key recommendations:

1. Conduct thorough due diligence: Before any investment, ensure you fully understand the local market, specific regulations in your business sector, and potential risks.

2. Build a trusted local team: Surround yourself with local experts (attorneys, accountants, consultants) who are well-versed in the nuances of the Paraguayan market and can effectively guide you.

3. Master the language: Although English is increasingly used in business, proficiency in Spanish (and ideally Guarani) will be a major asset for your negotiations and relationships with local authorities.

4. Leverage tax incentives: Inform yourself about the numerous tax benefits offered to foreign investors, particularly under the Maquila law or free trade zones.

5. Respect local culture: Take time to understand and respect Paraguayan customs and business practices to establish lasting relationships with your local partners.

Promising sectors for foreign investors:

• Agribusiness
• Renewable energy
• Information technology
• Tourism
• Infrastructure

In conclusion, Paraguay presents a particularly favorable environment for foreign investors, with a flexible regulatory framework, simplified procedures, and numerous tax benefits. Although challenges persist, particularly in terms of infrastructure and bureaucracy, the opportunities offered by this growing market are substantial for savvy investors.