Bolivia’s Compliance Conundrum: Companies Struggle to Meet Financial Regulations
In Bolivia, corporate governance is still evolving, presenting a significant challenge for companies to comply with financial regulations. A recent study revealed that only a small percentage of businesses have dedicated compliance departments, leaving the task largely to legal departments and their analysts.
The Absence of Specific Regulation
The lack of a specific regulation for compliance in Bolivia is a major hurdle. Although the Criminal System Code attempted to introduce criminal liability for legal persons and their representatives in 2017, the effort ultimately failed.
Enforcement Framework
However, Bolivia’s laws provide a framework for enforcement. The Tax Code, “Marcelo Quiroga Santa Cruz” Law of Fight Against Corruption, Illicit Enrichment and Wealth Investigation, Financial Services Law, among others, impose criminal, civil, and administrative sanctions on companies that fail to comply with regulations.
Sanctions
These sanctions can be severe, ranging from:
- Temporary suspension of business licenses
- Revocation of operating permits
- Administrative penalties, such as:
- Suspension or prohibition of certain activities
Consequences of Non-Compliance
While companies cannot currently be held criminally liable in Bolivia, non-compliance by management and representatives can still result in criminal penalties. In practice, this has led to a focus on internal and external regulation compliance, with many organizations implementing risk and crime prevention measures to avoid non-compliance.
Expertise from Rigoberto Paredes & Asociados
As one of the leading law firms in Bolivia, Rigoberto Paredes & Asociados has extensive experience in providing compliance services. Our team is well-versed in:
- Preventing risks
- Developing policies to ensure regulatory compliance
- Investigating non-compliance
- Assessing an organization’s overall compliance with regulations across various sectors and industries
Prioritizing Compliance
In a country where corporate governance is still evolving, it is crucial for businesses to prioritize compliance to avoid legal consequences and maintain a positive reputation. As the regulatory landscape continues to evolve in Bolivia, companies must adapt and implement effective compliance strategies to stay ahead of the game.
By prioritizing compliance, organizations can minimize the risk of non-compliance, protect their reputation, and ensure long-term success in Bolivia’s dynamic business environment.