Doing Business 2018 Paraguay Economy Pro le of Paraguay Doing Business 2018 Indicators (in order of appearance in the document) Starting a business Procedures, time, cost and paid-in minimum capital to start a limited liability company Dealing with construction Procedures, time and cost to complete all formalities to build a warehouse and the quality control and permits safety mechanisms in the construction permitting system Getting electricity Procedures, time and cost to get connected to the electrical grid, the reliability of the electricity supply and the transparency of tariffs Registering property Procedures, time and cost to transfer a property and the quality of the land administration system Getting credit Movable collateral laws and credit information systems Protecting minority investors Minority shareholders’ rights in related-party transactions and in corporate governance Paying taxes Payments, time and total tax rate for a firm to comply with all tax regulations as well as post-filing processes Trading across borders Time and cost to export the product of comparative advantage and import auto parts Enforcing contracts Time and cost to resolve a commercial dispute and the quality of judicial processes Resolving insolvency Time, cost, outcome and recovery rate for a commercial insolvency and the strength of the legal framework for insolvency Labor market regulation Flexibility in employment regulation and aspects of job quality About Doing Business The Doing Business project provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the subnational and regional level. The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle. Doing Business captures several important dimensions of the regulatory environment as it applies to local rms. It provides quantitative indicators on regulation for starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Doing Business also measures features of labor market regulation. Although Doing Business does not present rankings of economies on the labor market regulation indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business, it does present the data for these indicators. By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time, Doing Business encourages economies to compete towards more e cient regulation; o ers measurable benchmarks for reform; and serves as a resource for academics, journalists, private sector researchers and others interested in the business climate of each economy. In addition, Doing Business o ers detailed subnational reports, which exhaustively cover business regulation and reform in di erent cities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region and with the 190 economies that Doing Business has ranked. The rst Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. This year’s report covers 11 indicator sets and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business, also collected data for the second largest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. The project has bene ted from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving the regulatory environment for business around the world. Page 2   for insolvency Doing Business Labor market 2018 regulation Paraguay Flexibility in employment regulation and aspects of job quality About Doing Business The Doing Business project provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the subnational and regional level. The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle. Doing Business captures several important dimensions of the regulatory environment as it applies to local rms. It provides quantitative indicators on regulation for starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Doing Business also measures features of labor market regulation. Although Doing Business does not present rankings of economies on the labor market regulation indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business, it does present the data for these indicators. By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time, Doing Business encourages economies to compete towards more e cient regulation; o ers measurable benchmarks for reform; and serves as a resource for academics, journalists, private sector researchers and others interested in the business climate of each economy. In addition, Doing Business o ers detailed subnational reports, which exhaustively cover business regulation and reform in di erent cities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region and with the 190 economies that Doing Business has ranked. The rst Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. This year’s report covers 11 indicator sets and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business, also collected data for the second largest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. The project has bene ted from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving the regulatory environment for business around the world. The distance to frontier (DTF) measure shows the distance of each economy to the “frontier,” which represents the best performance observed on each of the indicators across all economies in the Doing Business sample since 2005. An economy’s distance to frontier is re ected on a scale from 0 to 100, where 0 represents the lowest performance and 100 represents the frontier. The ease of doing business ranking ranges from 1 to 190. The ranking of 190 economies is determined by sorting the aggregate distance to frontier scores, rounded to two decimals. More about Doing Business (PDF, 5MB) Ease of Doing Business in Latin America & DB 2018 Rank Region 190 1 Caribbean Paraguay Income Category Upper middle income 108 DB 2018 Distance to Frontier (DTF) Population 6,725,308 0 100 GNI Per Capita (US$) 4,070 59.18 City Covered Asuncion DB 2018 Distance to Frontier (DTF) 0 100 71.22: Chile (Rank: 55) 59.18: Paraguay (Rank: 108) 58.66: Regional Average (Latin America & Caribbean) 58.11: Argentina (Rank: 117) 56.45: Brazil (Rank: 125) Page 3   aggregate distance to frontier scores, rounded to two decimals. More Doingabout 2018 (PDF, Doing Business Business 5MB) Paraguay Ease of Doing Business in Latin America & DB 2018 Rank Region 190 1 Caribbean Paraguay Income Category Upper middle income 108 DB 2018 Distance to Frontier (DTF) Population 6,725,308 0 100 GNI Per Capita (US$) 4,070 59.18 City Covered Asuncion DB 2018 Distance to Frontier (DTF) 0 100 71.22: Chile (Rank: 55) 59.18: Paraguay (Rank: 108) 58.66: Regional Average (Latin America & Caribbean) 58.11: Argentina (Rank: 117) 56.45: Brazil (Rank: 125) 50.18: Bolivia (Rank: 152) Note: The distance to frontier (DTF) measure shows the distance of each economy to the “frontier,” which represents the best performance observed on each of the indicators across all economies in the Doing Business sample since 2005. An economy’s distance to frontier is re ected on a scale from 0 to 100, where 0 represents the lowest performance and 100 represents the frontier. The ease of doing business ranking ranges from 1 to 190. Rankings on Doing Business topics - Paraguay 1 28 55 72 70 75 82 Rank 104 100 109 122 120 127 138 136 146 163 190 Starting Dealing Getting Registering Getting Protecting Paying Trading Enforcing Resolving a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Investors Borders Permits Distance to Frontier (DTF) on Doing Business topics - Paraguay 100 77.52 80 70.52 67.09 66.12 63.73 64.03 59.77 60 DTF 40.00 41.67 41.32 40 20 0 Starting Dealing Getting Registering Getting Protecting Paying Trading Enforcing Resolving a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Change:-0.03 Change:0.00 Change:0.00 Investors Change:0.00 Borders Change:0.00 Change:+0.62 Change:-0.01 Permits Change:0.00 Change:0.00 Change:+0.02 Starting a Business Page 4   a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Change:-0.03 Change:0.00 Change:0.00 Investors Change:0.00 Borders Change:0.00 Change:+0.62 Change:-0.01 Permits Change:0.00 Change:0.00 Doing Business 2018 Paraguay Change:+0.02 Starting a Business This topic measures the paid-in minimum capital requirement, number of procedures, time and cost for a small- to medium-sized limited liability company to start up and formally operate in economy’s largest business city. To make the data comparable across 190 economies, Doing Business uses a standardized business that is 100% domestically owned, has start-up capital equivalent to 10 times income per capita, engages in general industrial or commercial activities and employs between 10 and 50 people one month after the commencement of operations, all of whom are domestic nationals. Starting a Business considers two types of local limited liability companies that are identical in all aspects, except that one company is owned by 5 married women and the other by 5 married men. The distance to frontier score for each indicator is the average of the scores obtained for each of the component indicators. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to legally start and operate a To make the data comparable across economies, several assumptions company (number) about the business and the procedures are used. It is assumed that any required information is readily available and that the entrepreneur will pay Pre-registration (for example, name verification no bribes. or reservation, notarization) Registration in economy’s largest business city The business: - Is a limited liability company (or its legal equivalent). If there is more than Post-registration (for example, social security one type of limited liability company in the economy, the most common registration, company seal) among domestic rms is chosen. Information on the most common form is Obtaining approval from spouse to start business obtained from incorporation lawyers or the statistical o ce. or leave home to register company - Operates in the economy’s largest business city and the entire o ce Obtaining any gender-specific permission that space is approximately 929 square meters (10,000 square feet). For 11 can impact company registration, company economies the data are also collected for the second largest business city. operations and process of getting national - Is 100% domestically owned and has ve owners, none of whom is a legal identity card entity; and has a start-up capital of 10 times income per capita and has a Time required to complete each procedure turnover of at least 100 times income per capita. (calendar days) - Performs general industrial or commercial activities, such as the production or sale of goods or services to the public. The business does Does not include time spent gathering not perform foreign trade activities and does not handle products subject information to a special tax regime, for example, liquor or tobacco. It does not use Each procedure starts on a separate day (2 heavily polluting production processes. procedures cannot start on the same day) - Leases the commercial plant or o ces and is not a proprietor of real Procedures fully completed online are recorded estate and the amount of the annual lease for the o ce space is equivalent as ½ day to 1 times income per capita. Procedure is considered completed once final - Does not qualify for investment incentives or any special bene ts. document is received - Has at least 10 and up to 50 employees one month after the commencement of operations, all of whom are domestic nationals. No prior contact with officials - Has a company deed 10 pages long. Cost required to complete each procedure (% of The owners: income per capita) - Have reached the legal age of majority. If there is no legal age of majority, Official costs only, no bribes they are assumed to be 30 years old. No professional fees unless services required by - Are sane, competent, in good health and have no criminal record. law or commonly used in practice - Are married and the marriage is monogamous and registered with the authorities. Paid-in minimum capital (% of income per capita) - Where the answer di ers according to the legal system applicable to the Funds deposited in a bank or with third party woman or man in question (as may be the case in economies where there before registration or up to 3 months after is legal plurality), the answer used will be the one that applies to the incorporation majority of the population. Standardized Company Page 5   before registration or up to 3 months after is legal plurality), the answer used will be the one that applies to the incorporation majority of the population. Doing Business 2018 Paraguay Standardized Company Legal form Corporation (Sociedad Anónima or SA) Paid-in minimum capital requirement PYG 0 City Covered Asuncion Latin America & OECD high Indicator Paraguay Caribbean income Overall Best Performer Procedure – Men (number) 7 8.4 4.9 1.00 (New Zealand) Time – Men (days) 35 31.7 8.5 0.50 (New Zealand) Cost – Men (% of income per capita) 39.9 37.5 3.1 0.00 (United Kingdom) Procedure – Women (number) 7 8.5 4.9 1.00 (New Zealand) Time – Women (days) 35 31.8 8.5 0.50 (New Zealand) Cost – Women (% of income per capita) 39.9 37.5 3.1 0.00 (United Kingdom) Paid-in min. capital (% of income per capita) 0.0 2.1 8.7 0.00 (113 Economies) Figure – Starting a Business in Paraguay and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 89.55: Chile (Rank: 65) 78.09: Regional Average (Latin America & Caribbean) 77.52: Paraguay (Rank: 146) 75.15: Argentina (Rank: 157) 65.05: Brazil (Rank: 176) 62.95: Bolivia (Rank: 179) Note: The ranking of economies on the ease of starting a business is determined by sorting their distance to frontier scores for starting a business. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Starting a Business in Paraguay – Procedure, Time and Cost Time Cost 35 25 30 20 ost (% of income per capita) 25 Time (days) 15 20 15 10 10 Page 6   starting a business. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Paraguay Figure – Starting a Business in Paraguay – Procedure, Time and Cost Time Cost 35 25 30 20 Cost (% of income per capita) 25 Time (days) 15 20 15 10 10 5 5 0 0 1 2 3 4 5 *6 *7 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Details – Starting a Business in Paraguay – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Check the availability of the proposed company name 1 day no charge Agency : Commercial Registry Business entrepreneurs must verify the availability of the proposed company name. 2 Draft the company deeds, signed by an attorney 5 days 1 - 3% of the paid-in Agency : Attorney capital stock of the company Because company formation documents must comply with corporate laws and regulations, companies customarily resort to legal professionals. Registration and ling of applications (e.g., bylaws to the Treasury Attorney O ce, to the court, to the registries) must be signed by an attorney either as the founders’ agent or counsel. The organization of companies by attorneys acting through powers of attorney is also a common practice. The fee for this formality is about 1% to 3% of the company’s paid-in capital stock. Article 72 (1) of Law No. 1376/88 establishes the o cial legal fee for this task. 3 Notarize the company deeds 3 days 0.75% or 2% of the Agency : Notary Public paid-in capital stock of the company, Company deeds must be notarized. The public notary’s fee for notarizing depending on the company deeds is established in the Notary’s Fees Law. A licensed attorney capital usually drafts the bylaws but a licensed public notary notarizes the deed (the public deed is to be included in the notary’s protocol and registered at the public registries). Attorneys are not legally authorized to notarize or certify Page 7   documents. (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Doing Business 2018 Paraguay Details – Starting a Business in Paraguay – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Check the availability of the proposed company name 1 day no charge Agency : Commercial Registry Business entrepreneurs must verify the availability of the proposed company name. 2 Draft the company deeds, signed by an attorney 5 days 1 - 3% of the paid-in Agency : Attorney capital stock of the company Because company formation documents must comply with corporate laws and regulations, companies customarily resort to legal professionals. Registration and ling of applications (e.g., bylaws to the Treasury Attorney O ce, to the court, to the registries) must be signed by an attorney either as the founders’ agent or counsel. The organization of companies by attorneys acting through powers of attorney is also a common practice. The fee for this formality is about 1% to 3% of the company’s paid-in capital stock. Article 72 (1) of Law No. 1376/88 establishes the o cial legal fee for this task. 3 Notarize the company deeds 3 days 0.75% or 2% of the Agency : Notary Public paid-in capital stock of the company, Company deeds must be notarized. The public notary’s fee for notarizing depending on the company deeds is established in the Notary’s Fees Law. A licensed attorney capital usually drafts the bylaws but a licensed public notary notarizes the deed (the public deed is to be included in the notary’s protocol and registered at the public registries). Attorneys are not legally authorized to notarize or certify documents. 4 Buy and certify the company's books at the Commercial Registry 1 day 22 USD (Books) + Agency : Commercial Registry (Registro Público de Comercio) USD 6.56 (Authorization of The company's books must be acquired and certi ed by the Commercial books)+ 0.21 USD Registry. The cost to buy these books is approx. USD 22 for hardcover books (Employee in any bookstore. The books must be submitted to the Commercial Registry registration with to have all the pages sealed. On the rst page, a seal indicates how many Ministry of Labor and sealed pages the book contains and that it was registered, specifying the Justice) court order number, the date, and the name of the judge who rendered the order. The company must keep special commercial books at their registered o ce. The number of books and the accounting system to be used are left to the merchant’s discretion. At a minimum, however, a daily record of business transactions (daily record book) must be kept, and an accounting of current inventory must also be maintained in a separate book (inventory record book). Other books may be required for certain types of commercial activities according to law. Accounting books and documentation must be kept by a merchant for 5 years following the date that the last entry was made. All corresponding business receipts or vouchers must also be kept and maintained by the merchant during that 5-year time frame, to allow for auditing of the company’s books or records. A special request to use computer forms instead of books may be led with the court and the tax authority. Corporate Page 8   public registries). Attorneys are not legally authorized to notarize or certify Doing documents. Business 2018 Paraguay 4 Buy and certify the company's books at the Commercial Registry 1 day 22 USD (Books) + Agency : Commercial Registry (Registro Público de Comercio) USD 6.56 (Authorization of The company's books must be acquired and certi ed by the Commercial books)+ 0.21 USD Registry. The cost to buy these books is approx. USD 22 for hardcover books (Employee in any bookstore. The books must be submitted to the Commercial Registry registration with to have all the pages sealed. On the rst page, a seal indicates how many Ministry of Labor and sealed pages the book contains and that it was registered, specifying the Justice) court order number, the date, and the name of the judge who rendered the order. The company must keep special commercial books at their registered o ce. The number of books and the accounting system to be used are left to the merchant’s discretion. At a minimum, however, a daily record of business transactions (daily record book) must be kept, and an accounting of current inventory must also be maintained in a separate book (inventory record book). Other books may be required for certain types of commercial activities according to law. Accounting books and documentation must be kept by a merchant for 5 years following the date that the last entry was made. All corresponding business receipts or vouchers must also be kept and maintained by the merchant during that 5-year time frame, to allow for auditing of the company’s books or records. A special request to use computer forms instead of books may be led with the court and the tax authority. Corporate books are required to keep the records of the minutes of the board of directors and shareholders’ meetings, as well as the labor books pursuant to the Labor Code and regulations. Books must also be authorized and sealed by each corresponding agency (corporate, tax, labor, social security). 5 Register the company at the Single Window (SUACE) 25 days see procedure Agency : Single Window (Sistema Uni cado de Apertura y Cierre de Empresas details - SUACE) Companies can be registered at each government agency or at SUACE (Sistema Uni cado de Apertura y Cierre de Empresas), the one-stop shop to register a company established in December 2006 by the Ministry of Industry and Commerce. Through SUACE, founders are able to comply with the following procedures to register a company with the relevant authorities: - Submit all documentation at the Single Window at SUACE for revision and approval. Once approved, the documents are scanned, and the information is uploaded to a single application form (formulario único). SUACE assigns an identi cation number that allows the founder to monitor the registration process through the Web site. - The bylaws and other company formation documents are submitted to the Treasury Attorney O ce (Abogacía del Tesoro) which reviews them and issues a registration and publication order. - An application for tax registration is submitted to a delegate of the Ministry of Finance (Ministerio de Hacienda). - An application for the taxpayer’s registry number (Registro Único de Contribuyentes, RUC) is submitted. - An application for the relevant Municipal licenses and permits (Patente de Comercio, Resolución y Certi cado de Licencia de Habilitación de Establecimiento) is submitted to the Municipality of Asunción for fee veri cation and assessment. The Municipality issues the licenses upon inspecting the site and approving the documentation. - An application for registration with Social Security Institute (Instituto de Previsión Social) is submitted. Page 9   - An application for registration with the Ministry of Justice and Labor the Labor Code and regulations. Books must also be authorized and sealed Doing by each corresponding Business agency (corporate, tax, labor, social security). 2018 Paraguay 5 Register the company at the Single Window (SUACE) 25 days see procedure Agency : Single Window (Sistema Uni cado de Apertura y Cierre de Empresas details - SUACE) Companies can be registered at each government agency or at SUACE (Sistema Uni cado de Apertura y Cierre de Empresas), the one-stop shop to register a company established in December 2006 by the Ministry of Industry and Commerce. Through SUACE, founders are able to comply with the following procedures to register a company with the relevant authorities: - Submit all documentation at the Single Window at SUACE for revision and approval. Once approved, the documents are scanned, and the information is uploaded to a single application form (formulario único). SUACE assigns an identi cation number that allows the founder to monitor the registration process through the Web site. - The bylaws and other company formation documents are submitted to the Treasury Attorney O ce (Abogacía del Tesoro) which reviews them and issues a registration and publication order. - An application for tax registration is submitted to a delegate of the Ministry of Finance (Ministerio de Hacienda). - An application for the taxpayer’s registry number (Registro Único de Contribuyentes, RUC) is submitted. - An application for the relevant Municipal licenses and permits (Patente de Comercio, Resolución y Certi cado de Licencia de Habilitación de Establecimiento) is submitted to the Municipality of Asunción for fee veri cation and assessment. The Municipality issues the licenses upon inspecting the site and approving the documentation. - An application for registration with Social Security Institute (Instituto de Previsión Social) is submitted. - An application for registration with the Ministry of Justice and Labor (Ministerio de Justicia y Trabajo) to start hiring employees is submitted. The costs are as follows: GRN 35,078 (Commercial Registry fee) + GRN 35,078 (Public Registries of Legal Entities and Associations) + GRN 5,000 (Application Form) + GRN 28,062 (Special Rate). 6 Publication of an extract of the bylaws in the O cial Gazette and a 4 days USD 19 Official newspaper (simultaneous with Gazette + USD 133 Agency : O cial Gazette previous newspaper procedure) The treasury attorney orders the publication of an extract of the bylaws in the O cial Gazette and another newspaper of wide circulation in the market in which the company is located. The extract is published for 3 consecutive business days. 7 Receive a site inspection from the Municipality to obtain a Business 2 days no charge License (simultaneous with Agency : Municipality procedure 5) Before conferring the business license, municipal inspectors perform an onsite inspection of the company’s main o ce to verify compliance with municipal ordinances. Applies to women only. Takes place simultaneously with previous procedure. Dealing with Construction Permits This topic tracks the procedures, time and cost to build a warehouse—including obtaining necessary the licenses and permits, Page 10   submitting all required noti cations, requesting and receiving all necessary inspections and obtaining utility connections. In Applies to women only. Takes place simultaneously with previous procedure. Doing Business 2018 Paraguay Dealing with Construction Permits This topic tracks the procedures, time and cost to build a warehouse—including obtaining necessary the licenses and permits, submitting all required noti cations, requesting and receiving all necessary inspections and obtaining utility connections. In addition, the Dealing with Construction Permits indicator measures the building quality control index, evaluating the quality of building regulations, the strength of quality control and safety mechanisms, liability and insurance regimes, and professional certi cation requirements. The most recent round of data collection was completed in June 2017. See the methodology for more information What the indicators measure Case study assumptions Procedures to legally build a warehouse (number) To make the data comparable across economies, several assumptions about the construction company, the warehouse project and the utility Submitting all relevant documents and obtaining connections are used. all necessary clearances, licenses, permits and certificates The construction company (BuildCo): Submitting all required notifications and - Is a limited liability company (or its legal equivalent) and operates in the receiving all necessary inspections economy’s largest business city. For 11 economies the data are also collected for the second largest business city. Obtaining utility connections for water and - Is 100% domestically and privately owned; has ve owners, none of whom sewerage is a legal entity. Has a licensed architect and a licensed engineer, both Registering and selling the warehouse after its registered with the local association of architects or engineers. BuildCo is completion not assumed to have any other employees who are technical or licensed Time required to complete each procedure experts, such as geological or topographical experts. (calendar days) - Owns the land on which the warehouse will be built and will sell the warehouse upon its completion. Does not include time spent gathering information The warehouse: Each procedure starts on a separate day— - Will be used for general storage activities, such as storage of books or though procedures that can be fully completed stationery. online are an exception to this rule - Will have two stories, both above ground, with a total constructed area of Procedure is considered completed once final approximately 1,300.6 square meters (14,000 square feet). Each oor will document is received be 3 meters (9 feet, 10 inches) high and will be located on a land plot of No prior contact with officials approximately 929 square meters (10,000 square feet) that is 100% owned by BuildCo, and the warehouse is valued at 50 times income per capita. Cost required to complete each procedure (% of - Will have complete architectural and technical plans prepared by a warehouse value) licensed architect. If preparation of the plans requires such steps as Official costs only, no bribes obtaining further documentation or getting prior approvals from external agencies, these are counted as procedures. Building quality control index (0-15) - Will take 30 weeks to construct (excluding all delays due to administrative Sum of the scores of six component indices: and regulatory requirements). Quality of building regulations (0-2) The water and sewerage connections: Quality control before construction (0-1) - Will be 150 meters (492 feet) from the existing water source and sewer Quality control during construction (0-3) tap. If there is no water delivery infrastructure in the economy, a borehole Quality control after construction (0-3) will be dug. If there is no sewerage infrastructure, a septic tank in the smallest size available will be installed or built. Liability and insurance regimes (0-2) - Will have an average water use of 662 liters (175 gallons) a day and an Professional certifications (0-4) average wastewater ow of 568 liters (150 gallons) a day. Will have a peak water use of 1,325 liters (350 gallons) a day and a peak wastewater ow of 1,136 liters (300 gallons) a day. - Will have a constant level of water demand and wastewater ow throughout the year; will be 1 inch in diameter for the water connection and 4 inches in diameter for the sewerage connection. Standardized Warehouse Page 11   and 4 inches in diameter for the sewerage connection. Doing Business 2018 Paraguay Standardized Warehouse Estimated value of warehouse PYG 1,095,409,383.40 City Covered Asuncion Latin America & OECD high Indicator Paraguay Caribbean income Overall Best Performer Procedures (number) 14 15.7 12.5 7.00 (Denmark) Time (days) 121 191.8 154.6 27.5 (Korea, Rep.) Cost (% of warehouse value) 1.6 3.2 1.6 0.10 (5 Economies) Building quality control index (0-15) 8.0 8.8 11.4 15.00 (3 Economies) Figure – Dealing with Construction Permits in Paraguay and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 80.28: Chile (Rank: 15) 70.52: Paraguay (Rank: 72) 63.59: Regional Average (Latin America & Caribbean) 55.56: Bolivia (Rank: 158) 49.83: Brazil (Rank: 170) 49.27: Argentina (Rank: 171) Note: The ranking of economies on the ease of dealing with construction permits is determined by sorting their distance to frontier scores for dealing with construction permits. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Dealing with Construction Permits in Paraguay – Procedure, Time and Cost Time Cost 120 0.7 0.6 100 Cost (% of warehouse value) 0.5 80 Time (days) 0.4 60 0.3 40 0.2 20 0.1 0 0 1 *2 *3 4 5 6 7 8 9 10 * 11 * 12 13 14 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Page 12   component indicators. Doing Business 2018 Paraguay Figure – Dealing with Construction Permits in Paraguay – Procedure, Time and Cost Time Cost 120 0.7 0.6 100 Cost (% of warehouse value) 0.5 80 Time (days) 0.4 60 0.3 40 0.2 20 0.1 0 0 1 *2 *3 4 5 6 7 8 9 10 * 11 * 12 13 14 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Dealing with Construction Permits in Paraguay and comparator economies – Measure of Quality 14 13.0 12 11.0 10 9.0 8.8 Index score 8.0 8 7.0 6 4 2 0 Paraguay Argentina Bolivia Brazil Chile Latin America & Caribbean Details – Dealing with Construction Permits in Paraguay – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Obtain results of geotechnical study / soil test 10 days USD 1,175 Agency : Private licensed company BuildCo will request a soil test for the structural calculations for the foundation. Contractors ask for a soil test to ensure that the foundation of the building is solid. The engineer must understand the suitability of the soil for the proposed construction work. It allows to build a solid foundation and avoid structures to be damaged or collapsed or leaned. This procedure is required by Ordenanza Municipal N. 26.04/90. 2 Request and obtain a no-objection certi cate (certi cado de no 10 days PYG 151,116 interdicción) duly notarized by a public notary Page 13   Agency : General Department of Public Registries (Dirección General de los Paraguay Argentina Bolivia Brazil Chile Latin America & Caribbean Doing Business 2018 Paraguay Details – Dealing with Construction Permits in Paraguay – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Obtain results of geotechnical study / soil test 10 days USD 1,175 Agency : Private licensed company BuildCo will request a soil test for the structural calculations for the foundation. Contractors ask for a soil test to ensure that the foundation of the building is solid. The engineer must understand the suitability of the soil for the proposed construction work. It allows to build a solid foundation and avoid structures to be damaged or collapsed or leaned. This procedure is required by Ordenanza Municipal N. 26.04/90. 2 Request and obtain a no-objection certi cate (certi cado de no 10 days PYG 151,116 interdicción) duly notarized by a public notary Agency : General Department of Public Registries (Dirección General de los Registros Públicos) The no-objection certi cate (certi cado de no interdicción) is a statement issued by public registries certifying that an individual (or legal entity) does not have any legal prohibition or restriction to sell or encumber a property. It is mandatory for all types of construction projects. The cost of the certi cate is equivalent to two daily wages (According to the Law 1307/87 -Notary Tarif Act). I. The minimum salary for 2014 is established at PYG 1824055, which implies a "jornal mínimo" of PYG 70156. 3 Obtain results of topographical study 7 days USD 725 Agency : Private licensed company A topographical study is conducted prior to construction to measure the levels on the speci c terrain. It is a general technical requirement when building a structure of this class. The results of a topographical study must be presented to the Municipality before obtaining the building permit. 4 Request and obtain calculation basis form and a davit 1 day no charge Agency : Municipality After the certi cate of no-objection is issued, BuildCo. can request and obtain calculation basis form and a davit. 5 Hold a pre-approval consultation with the Municipality about the 1 day PYG 611,000 project Agency : Municipality It is common practice in Asuncion to consult with the relevant department at the Municipality over the project drawings and designs before submitting the documents. 6 Request and obtain building permit 21 days PYG 4,536,513 Agency : Municipality The application must be accompanied by the following documents: • The property title • The identity card of the landowner • Proof of payment of municipal taxes (sewage service and garbage collection) • The builder’s identity card and a valid municipal registration or license • Three sets of plan copies signed by the responsible builder and the owner Page 14   the Municipality over the project drawings and designs before submitting Doing the documents. Business 2018 Paraguay 6 Request and obtain building permit 21 days PYG 4,536,513 Agency : Municipality The application must be accompanied by the following documents: • The property title • The identity card of the landowner • Proof of payment of municipal taxes (sewage service and garbage collection) • The builder’s identity card and a valid municipal registration or license • Three sets of plan copies signed by the responsible builder and the owner of the land • A structural calculation of the concrete structure signed by an engineer and the owner of the land • The construction work budget signed by the owner and the responsible builder • Fire prevention maps, if required The legal time limit is 30 days. Based on General Municipal Taxes Ordinance for 2013 (Ordenanza General de Tributos Municipales para 2013), the cost is calculated according to a fee schedule that takes into account materials and building types. For a warehouse such as the one described in the case study, the fee is 0.4% of the construction cost, which is set at PYG 871950 / sq. m. In addition, there is a xed fee of PYG 70,000 for studies of prevention systems and protection against re hazards. 20% of the municipal fee must be paid in advance when one is requesting the building permit, while the remaining 80% is paid once the building permit has been obtained. 7 Receive inspection by the Municipality 1 day no charge Agency : Municipality According to Municipal Regulation No. 26104/90 (Ordenanza Municipal 26104/90): • All inspections must be carried out within 2 to 5 business days, excluding the day of the request. The nal inspection should be undertaken in a time frame that varies from 15 to 20 days (Article 46). • If inspections are not carried out within the stated time frames, the applicant is entitled to le a claim before the relevant municipality. The municipality must then take the necessary steps so that the inspection is completed within 48 hours (Article 47). The site is inspected when the building permit application is led. In practice, however, there is not much follow-up, and a maximum of two inspections are done throughout the process (the initial and nal inspections). 8 Request nal project approval and nal inspection 1 day no charge Agency : Municipality The nal approval includes the architecture, structure and re prevention, and use restriction. The municipal inspector checks the site, after which a nal inspection certi cate is granted. Following the nal construction work inspection, BuildCo hands in the entire le to the Cadastre O ce for registration (Departamento de Catastro de la Municipalidad). 9 Receive nal inspection by municipal authorities 1 day no charge Agency : Municipality Page 15   inspection, BuildCo hands in the entire le to the Cadastre O ce for Business (Departamento Doing registration de Catastro de la Municipalidad). 2018 Paraguay 9 Receive nal inspection by municipal authorities 1 day no charge Agency : Municipality Once the nal approval is issued, BuildCo. can receive the nal inspection by municipal authorities. 10 Obtain nal approval (certi cado de terminación de trabajos) by 79 days no charge municipal authorities Agency : Municipality Upon the nal inspection request, BuillCo. receives the nal approval certi cate. Request and connect to sewage service 15 days PYG 1,195,200 11 Agency : Essap S.A Assuming a 0.75 inch water/sewage meter and a PVC pipeline on an asphalt- paved street, the cost is 40% of the minimum wage + PYG 100,800.00 per ml of branch sewer (average 8 ml). The following fees apply: • Hook-up fee: PYG 388,800.00 • Cost of work: PYG 806,400.00 Request and connect to potable water service 15 days PYG 528,000 12 Agency : Water Company In parallel with the sewage service, BuildCo. can also request the connection of water services. 13 Register the building with the Treasury Department (Cadastre O ce) 4 days PYG 11,000 Agency : Ministerio de Hacienda (Departamento de Catastro) Once the water connection is done, Buildco is ready to register the warehouse at the Treasury 14 Request and obtain authenticated photocopy of the registration 1 day PYG 20,000 notarized by a public notary Agency : Escribano Público (Public Notary) Registration of the warehouse will facilitate its sale and increase its value. This is a commonly practiced procedure. Takes place simultaneously with previous procedure. Details – Dealing with Construction Permits in Paraguay – Measure of Quality Answer Score Building quality control index (0-15) 8.0 Quality of building regulations index (0-2) 1.0 How accessible are building laws and regulations in your economy? (0-1) Available online; 1.0 Free of charge. Which requirements for obtaining a building permit are clearly speci ed in the building List of required 0.0 regulations or on any accessible website, brochure or pamphlet? (0-1) documents. Quality control before construction index (0-1) 1.0 Which third-party entities are required by law to verify that the building plans are in Licensed 1.0 Page 16   compliance with existing building regulations? (0-1) architect; Takes place simultaneously with previous procedure. Doing Business 2018 Paraguay Details – Dealing with Construction Permits in Paraguay – Measure of Quality Answer Score Building quality control index (0-15) 8.0 Quality of building regulations index (0-2) 1.0 How accessible are building laws and regulations in your economy? (0-1) Available online; 1.0 Free of charge. Which requirements for obtaining a building permit are clearly speci ed in the building List of required 0.0 regulations or on any accessible website, brochure or pamphlet? (0-1) documents. Quality control before construction index (0-1) 1.0 Which third-party entities are required by law to verify that the building plans are in Licensed 1.0 compliance with existing building regulations? (0-1) architect; Licensed engineer. Quality control during construction index (0-3) 0.0 What types of inspections (if any) are required by law to be carried out during Unscheduled 0.0 construction? (0-2) inspections. Do legally mandated inspections occur in practice during construction? (0-1) Mandatory 0.0 inspections are not always done in practice during construction. Quality control after construction index (0-3) 3.0 Is there a nal inspection required by law to verify that the building was built in Yes, nal 2.0 accordance with the approved plans and regulations? (0-2) inspection is done by government agency. Do legally mandated nal inspections occur in practice? (0-1) Final inspection 1.0 always occurs in practice. Liability and insurance regimes index (0-2) 1.0 Which parties (if any) are held liable by law for structural aws or problems in the Architect or 1.0 building once it is in use (Latent Defect Liability or Decennial Liability)? (0-1) engineer; Professional in charge of the supervision; Construction company; Owner or investor. Which parties (if any) are required by law to obtain an insurance policy to cover . 0.0 possible structural aws or problems in the building once it is in use (Latent Defect Liability Insurance or Decennial Insurance)? (0-1) Page 17   company; Owner Doing Business 2018 Paraguay or investor. Which parties (if any) are required by law to obtain an insurance policy to cover . 0.0 possible structural aws or problems in the building once it is in use (Latent Defect Liability Insurance or Decennial Insurance)? (0-1) Professional certi cations index (0-4) 2.0 What are the quali cation requirements for the professional responsible for verifying University 1.0 that the architectural plans or drawings are in compliance with existing building degree in regulations? (0-2) architecture or engineering; Being a registered architect or engineer. What are the quali cation requirements for the professional who supervises the University 1.0 construction on the ground? (0-2) degree in engineering, construction or construction management; Being a registered architect or engineer. Getting Electricity This topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly constructed warehouse. Additionally, the reliability of supply and transparency of tari s index measures reliability of supply, transparency of tari s and the price of electricity. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to obtain an electricity connection To make the data comparable across economies, several assumptions are (number) used. Submitting all relevant documents and obtaining The warehouse: all necessary clearances and permits - Is owned by a local entrepreneur and is used for storage of goods. Completing all required notifications and - Is located in the economy’s largest business city. For 11 economies the receiving all necessary inspections data are also collected for the second largest business city. Obtaining external installation works and possibly - Is located in an area where similar warehouses are typically located and is purchasing material for these works in an area with no physical constraints. For example, the property is not Concluding any necessary supply contract and near a railway. obtaining final supply - Is a new construction and is being connected to electricity for the rst time. Time required to complete each procedure - Has two stories with a total surface area of approximately 1,300.6 square (calendar days) meters (14,000 square feet). The plot of land on which it is built is 929 Is at least 1 calendar day square meters (10,000 square feet). Each procedure starts on a separate day Does not include time spent gathering The electricity connection: information - Is a permanent one with a three-phase, four-wire Y connection with a subscribed capacity of 140-kilo-volt-ampere (kVA) with a power factor of 1, Reflects the time spent in practice, with little when 1 kVA = 1 kilowatt (kW). follow-up and no prior contact with officials - Has a length of 150 meters. The connection is to either the low- or Page 18   Cost required to complete each procedure (% of medium-voltage distribution network and is either overhead or architect or engineer. Doing Business 2018 Paraguay Getting Electricity This topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly constructed warehouse. Additionally, the reliability of supply and transparency of tari s index measures reliability of supply, transparency of tari s and the price of electricity. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to obtain an electricity connection To make the data comparable across economies, several assumptions are (number) used. Submitting all relevant documents and obtaining The warehouse: all necessary clearances and permits - Is owned by a local entrepreneur and is used for storage of goods. Completing all required notifications and - Is located in the economy’s largest business city. For 11 economies the receiving all necessary inspections data are also collected for the second largest business city. Obtaining external installation works and possibly - Is located in an area where similar warehouses are typically located and is purchasing material for these works in an area with no physical constraints. For example, the property is not Concluding any necessary supply contract and near a railway. obtaining final supply - Is a new construction and is being connected to electricity for the rst time. Time required to complete each procedure - Has two stories with a total surface area of approximately 1,300.6 square (calendar days) meters (14,000 square feet). The plot of land on which it is built is 929 Is at least 1 calendar day square meters (10,000 square feet). Each procedure starts on a separate day Does not include time spent gathering The electricity connection: information - Is a permanent one with a three-phase, four-wire Y connection with a subscribed capacity of 140-kilo-volt-ampere (kVA) with a power factor of 1, Reflects the time spent in practice, with little when 1 kVA = 1 kilowatt (kW). follow-up and no prior contact with officials - Has a length of 150 meters. The connection is to either the low- or Cost required to complete each procedure (% of medium-voltage distribution network and is either overhead or income per capita) underground, whichever is more common in the area where the warehouse is located and requires works that involve the crossing of a 10- Official costs only, no bribes meter road (such as by excavation or overhead lines) but are all carried out Value added tax excluded on public land. There is no crossing of other owners’ private property The reliability of supply and transparency of because the warehouse has access to a road. tari s index (0-8) - Does not require work to install the internal wiring of the warehouse. This has already been completed up to and including the customer’s service Duration and frequency of power outages (0–3) panel or switchboard and the meter base. Tools to monitor power outages (0–1) Tools to restore power supply (0–1) The monthly consumption: Regulatory monitoring of utilities’ performance - It is assumed that the warehouse operates 30 days a month from 9:00 (0–1) a.m. to 5:00 p.m. (8 hours a day), with equipment utilized at 80% of capacity Financial deterrents limiting outages (0–1) on average and that there are no electricity cuts (assumed for simplicity reasons) and the monthly energy consumption is 26,880 kilowatt-hours Transparency and accessibility of tariffs (0–1) (kWh); hourly consumption is 112 kWh. Price of electricity (cents per kilowatt-hour)* - If multiple electricity suppliers exist, the warehouse is served by the Price based on monthly bill for commercial cheapest supplier. warehouse in case study - Tari s e ective in March of the current year are used for calculation of the price of electricity for the warehouse. Although March has 31 days, for * N o t e : Doing Business m e a s u r e s t h e p r i c e o f calculation purposes only 30 days are used. electricity, but it is not included in the distance to frontier score nor the ranking on the ease of getting electricity. Page 19   Standardized Connection frontier score nor the ranking on the ease of getting electricity. Doing Business 2018 Paraguay Standardized Connection Price of electricity (US cents per kWh) 7.1 Name of utility Administracion Nacional de Electricidad (ANDE) City Covered Asuncion Latin America & OECD high Indicator Paraguay Caribbean income Overall Best Performer Procedures (number) 5 5.5 4.7 2 (United Arab Emirates) Time (days) 67 66.0 79.1 10 (United Arab Emirates) Cost (% of income per capita) 161.6 927.4 63.0 0.00 (Japan) Reliability of supply and transparency of tariff 2 4.2 7.4 8.00 (28 Economies) index (0-8) Figure – Getting Electricity in Paraguay and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 82.49: Chile (Rank: 44) 82.46: Brazil (Rank: 45) 70.45: Regional Average (Latin America & Caribbean) 70.01: Argentina (Rank: 95) 68.18: Bolivia (Rank: 101) 67.09: Paraguay (Rank: 104) Note: The ranking of economies on the ease of getting electricity is determined by sorting their distance to frontier scores for getting electricity. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Getting Electricity in Paraguay – Procedure, Time and Cost Time Cost 160 60 140 Cost (% of income per capita) 50 120 100 Time (days) 40 80 30 60 20 40 10 Page 20   20 getting electricity. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Paraguay Figure – Getting Electricity in Paraguay – Procedure, Time and Cost Time Cost 160 60 140 Cost (% of income per capita) 50 120 100 Time (days) 40 80 30 60 20 40 10 20 0 0 1 2 *3 4 5 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Getting Electricity in Paraguay and comparator economies – Measure of Quality 7 6 6 6 5.4 5 5 4.2 Index score 4 3 2 2 1 0 Paraguay Argentina Bolivia Brazil Chile Latin America & Caribbean Details – Getting Electricity in Paraguay – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Request feasibility study by ANDE 25 calendar days PYG 0 Agency : Administracion Nacional de Electricidad (ANDE) The electrician of the customer rst submits a request for a feasibility study with ANDE and awaits the preparation of an estimate. No site inspection is necessary to prepare the feasibility study. The electrician has to be registered with ANDE. For connections of electricity loads > 100kVA ANDE requires that the electrician has to be of a quali cation level A or B. 5 di erent levels exist and A and B are the highest quali cation levels. Level A electricians are electrical engineers with a university education (ingenieros electricistas). Level B are civil engineer with a university education (ingenieros civiles) but also some electricians with technical educations but a Page 21   lot of practical experience with more sizeable connection works. Paraguay Argentina Bolivia Brazil Chile Latin America & Caribbean Doing Business 2018 Paraguay Details – Getting Electricity in Paraguay – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Request feasibility study by ANDE 25 calendar days PYG 0 Agency : Administracion Nacional de Electricidad (ANDE) The electrician of the customer rst submits a request for a feasibility study with ANDE and awaits the preparation of an estimate. No site inspection is necessary to prepare the feasibility study. The electrician has to be registered with ANDE. For connections of electricity loads > 100kVA ANDE requires that the electrician has to be of a quali cation level A or B. 5 di erent levels exist and A and B are the highest quali cation levels. Level A electricians are electrical engineers with a university education (ingenieros electricistas). Level B are civil engineer with a university education (ingenieros civiles) but also some electricians with technical educations but a lot of practical experience with more sizeable connection works. 2 Submit o cial service application to ANDE 21 calendar days PYG 5,792,210.25 Agency : Administracion Nacional de Electricidad (ANDE) Once the feasibility of the project has been established, the electrician submits the o cial application which has to include the following documents: • Application for service signed by the responsible electrician • Photocopy of the property title (only document that requires notarization) • Photocopy of the national identi cation form of the owner of the property. • Photocopy of the carnet of the responsible electrician. • Receipt of the payment for the connection. • Sketch of the location of the property. • Signature of the owner or his authorized person for the contract. • Receipt of the transformer purchase. • Certi cation of the successful testing of the transformer. • Certi cate specifying the transfer of property of the transformer. • The results of the feasibility study • Security Deposit in the amount of one month of future consumption. The deposit is returned without interest at the end of the contract. The supply contract is signed at the same time as the application is submitted. A work order is issued and the customer awaits the connection works. An internal wiring inspection is not necessary. The utility ensures that the internal wiring of the customer is in order by requesting the responsible electrician to sign the application for the connection. 3 Receive site inspection by ANDE 14 calendar days PYG 0 Agency : Administracion Nacional de Electricidad (ANDE) ANDE does an inspection of the client's warehouse to determine how the connection to the electricity network has to be done. 4 Purchase and install material for connection works 14 calendar days USD 5,500 Agency : Private rm The electrician buys the transformer and installs it. A direct connection to the low voltage grid is not possible because the load of 140kVA exceeds the allowed limit of 100kW. ANDE will prefer the installation of a dedicated transformer because the demand will represent the highest demand in the area and therefore determine the infrastructure needed. The customer pays for the transformer but will be reimbursed by ANDE for a total of 50% of the Page 22   ANDE does an inspection of the client's warehouse to determine how the Business to Doing connection the electricity 2018 Paraguay network has to be done. 4 Purchase and install material for connection works 14 calendar days USD 5,500 Agency : Private rm The electrician buys the transformer and installs it. A direct connection to the low voltage grid is not possible because the load of 140kVA exceeds the allowed limit of 100kW. ANDE will prefer the installation of a dedicated transformer because the demand will represent the highest demand in the area and therefore determine the infrastructure needed. The customer pays for the transformer but will be reimbursed by ANDE for a total of 50% of the cost via his monthly consumption bill. The ownership of the transformer is transferred to ANDE. Actual installation works are not more than one day. The transformer can be bought from specialized local dealers. They usually have them on stock. 5 Receive transformer inspection, connection works and meter 7 calendar days PYG 0 installation by ANDE Agency : Administracion Nacional de Electricidad (ANDE) The transformer and meter are installed in the same step and the electricity usually starts owing right away. There is no connection fee as such. Takes place simultaneously with previous procedure. Details – Getting Electricity in Paraguay – Measure of Quality Answer Reliability of supply and transparency of tari index (0-8) 2 Total duration and frequency of outages per customer a year (0-3) 0 System average interruption duration index (SAIDI) 41.0 System average interruption frequency index (SAIFI) 32.4 What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI 3.0 Mechanisms for monitoring outages (0-1) 0 Does the distribution utility use automated tools to monitor outages? No Mechanisms for restoring service (0-1) 1 Does the distribution utility use automated tools to restore service? Yes Regulatory monitoring (0-1) 0 Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on No reliability of supply? Financial deterrents aimed at limiting outages (0-1) 0 Does the utility either pay compensation to customers or face nes by the regulator (or both) if outages No exceed a certain cap? Communication of tari s and tari changes (0-1) 1 Are e ective tari s available online? Yes Page 23   Takes place simultaneously with previous procedure. Doing Business 2018 Paraguay Details – Getting Electricity in Paraguay – Measure of Quality Answer Reliability of supply and transparency of tari index (0-8) 2 Total duration and frequency of outages per customer a year (0-3) 0 System average interruption duration index (SAIDI) 41.0 System average interruption frequency index (SAIFI) 32.4 What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI 3.0 Mechanisms for monitoring outages (0-1) 0 Does the distribution utility use automated tools to monitor outages? No Mechanisms for restoring service (0-1) 1 Does the distribution utility use automated tools to restore service? Yes Regulatory monitoring (0-1) 0 Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on No reliability of supply? Financial deterrents aimed at limiting outages (0-1) 0 Does the utility either pay compensation to customers or face nes by the regulator (or both) if outages No exceed a certain cap? Communication of tari s and tari changes (0-1) 1 Are e ective tari s available online? Yes Link to the website, if available online http://www.ande.gov .py/docs/tarifas/PLIE GO21.pdf Are customers noti ed of a change in tari ahead of the billing cycle? Yes Note: If the duration and frequency of outages is 100 or less, the economy is eligible to score on the Reliability of supply and transparency of tari index. If the duration and frequency of outages is not available, or is over 100, the economy is not eligible to score on the index. If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Registering Property This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has ve dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Page 24   What the indicators measure Case study assumptions If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Doing Business 2018 Paraguay Registering Property This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has ve dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to legally transfer title on immovable To make the data comparable across economies, several assumptions property (number) about the parties to the transaction, the property and the procedures are used. Preregistration procedures (for example, checking for liens, notarizing sales agreement, The parties (buyer and seller): paying property transfer taxes) - Are limited liability companies (or the legal equivalent). Registration procedures in the economy's largest - Are located in the periurban area of the economy’s largest business city. business citya. For 11 economies the data are also collected for the second largest Postregistration procedures (for example, filling business city. title with municipality) - Are 100% domestically and privately owned. Time required to complete each procedure - Have 50 employees each, all of whom are nationals. (calendar days) - Perform general commercial activities. Does not include time spent gathering information The property (fully owned by the seller): - Has a value of 50 times income per capita, which equals the sale price. Each procedure starts on a separate day - though - Is fully owned by the seller. procedures that can be fully completed online - Has no mortgages attached and has been under the same ownership for are an exception to this rule the past 10 years. Procedure is considered completed once final - Is registered in the land registry or cadastre, or both, and is free of title document is received disputes. No prior contact with officials - Is located in a periurban commercial zone, and no rezoning is required. Cost required to complete each procedure (% of - Consists of land and a building. The land area is 557.4 square meters property value) (6,000 square feet). A two-story warehouse of 929 square meters (10,000 square feet) is located on the land. The warehouse is 10 years old, is in Official costs only (such as administrative fees, good condition, has no heating system and complies with all safety duties and taxes). standards, building codes and legal requirements. The property, Value Added Tax, Capital Gains Tax and illicit consisting of land and building, will be transferred in its entirety. payments are excluded - Will not be subject to renovations or additional construction following the Quality of land administration index (0-30) purchase. - Has no trees, natural water sources, natural reserves or historical Reliability of infrastructure index (0-8) monuments of any kind. Transparency of information index (0–6) - Will not be used for special purposes, and no special permits, such as for Geographic coverage index (0–8) residential use, industrial plants, waste storage or certain types of agricultural activities, are required. Land dispute resolution index (0–8) - Has no occupants, and no other party holds a legal interest in it. Equal access to property rights index (-2–0) Standard Property Transfer Property value PYG 1,095,409,383.40 City Covered Asuncion Page 25   Latin America & OECD high Doing Business 2018 Paraguay Standard Property Transfer Property value PYG 1,095,409,383.40 City Covered Asuncion Latin America & OECD high Indicator Paraguay Caribbean income Overall Best Performer Procedures (number) 6 7.2 4.6 1.00 (4 Economies) Time (days) 46 63.3 22.3 1.00 (3 Economies) Cost (% of property value) 1.8 5.8 4.2 0.00 (5 Economies) Quality of the land administration index (0-30) 12.0 12.0 22.7 29.00 (Singapore) Figure – Registering Property in Paraguay and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 70.90: Chile (Rank: 61) 66.12: Paraguay (Rank: 75) 56.75: Argentina (Rank: 117) 55.36: Regional Average (Latin America & Caribbean) 52.60: Brazil (Rank: 131) 49.89: Bolivia (Rank: 144) Note: The ranking of economies on the ease of registering property is determined by sorting their distance to frontier scores for registering property. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Registering Property in Paraguay – Procedure, Time and Cost Time Cost 45 0.8 40 0.7 35 Cost (% of property value) 0.6 30 0.5 Time (days) 25 0.4 20 0.3 15 0.2 10 5 0.1 0 0 1 *2 *3 4 5 6 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Page 26   Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for registering property. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Paraguay Figure – Registering Property in Paraguay – Procedure, Time and Cost Time Cost 45 0.8 40 0.7 35 Cost (% of property value) 0.6 30 0.5 Time (days) 25 0.4 20 0.3 15 0.2 10 5 0.1 0 0 1 *2 *3 4 5 6 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Registering Property in Paraguay and comparator economies – Measure of Quality 16 13.5 13.8 14.0 14 12.0 12.0 12 Index score 10 8 7.0 6 4 2 0 Paraguay Argentina Bolivia Brazil Chile Latin America & Caribbean Details – Registering Property in Paraguay – Procedure, Time and Cost Time to No. Procedure Complete Associated Costs 1 Obtain tax clearance from the Municipality 20 days Gs 151,116 (2 Agency : Municipality (simultaneous "jornales") each with Procedures certificate (x 2). The notary obtains a tax clearance certi cate regarding the payment of Property 2 and 3) The value of Taxes and Special Urban Taxes at the Municipality. each jornal is Gs 75,558 2 Obtain a non-encumbrance certi cate ("Certi cado de libre gravamen o 8-12 days Gs 151,116 (2 condiciones de dominio") and a Certi cate on Free Disposability of Assets (simultaneous "jornales") per ("Certi cado de anotaciones personales") with procedures certificate Agency : Public Registry ("Direccion General de los Registros Publicos") 1 and 3) Page 27   Paraguay Argentina Bolivia Brazil Chile Latin America & Caribbean Doing Business 2018 Paraguay Details – Registering Property in Paraguay – Procedure, Time and Cost Time to No. Procedure Complete Associated Costs 1 Obtain tax clearance from the Municipality 20 days Gs 151,116 (2 Agency : Municipality (simultaneous "jornales") each with Procedures certificate (x 2). The notary obtains a tax clearance certi cate regarding the payment of Property 2 and 3) The value of Taxes and Special Urban Taxes at the Municipality. each jornal is Gs 75,558 2 Obtain a non-encumbrance certi cate ("Certi cado de libre gravamen o 8-12 days Gs 151,116 (2 condiciones de dominio") and a Certi cate on Free Disposability of Assets (simultaneous "jornales") per ("Certi cado de anotaciones personales") with procedures certificate Agency : Public Registry ("Direccion General de los Registros Publicos") 1 and 3) The notary obtains a certi cate of conditions of ownership (non-encumbrance certi cate) and a certi cate stating that the selling company has no inhibitions to sell the property (Certi cate on Free Disposability of Assets) at the General Direction of Public Registries. According to law 879/1981, it is mandatory for notaries to obtain a non encumbrance certi cate. The forms can be downloaded for free from the website of the Judiciary: http://ingresosjudiciales.csj.gov.py/LiquidacionesWeb/formulariosParticulares.seam The payment for the certi cate can be done online from the Judicial Branch's website through Web Banking. 3 Obtain a cadastre certi cate 10 days 151,116 (2 Agency : National Service of Cadastre ("Servicio nacional de catastro") (simultaneous jornales for each with Procedures certificate) According to the Ley de catastro (Law 125/91 "Establishing the New Tax System" 1 and 2) Arcile 64), it is mandatory for the notary to obtain a Certi cate of Cadastre (or Zoning Certi cate) from the National Service of Cadastre. Each parcel will require one certi cate ("cuenta corriente"). The notary fees include the cadastral certi cate fees and the certi cation established in Resolucion of Cadaster SNC 214/2016 4 Preparation and notarization of the transfer deed by a public notary 10 days Notary fees Agency : Public notary according to the following Once all the previous documents have been collected, a notary public prepares and schedule, (plus notarizes the transfer deed. As this is a transfer between two tax-registered 10% VAT): companies the notary will not retain the 1.5% VAT on the sale. Value of The documentation shall include: property (in Gs) : Notary fees (% of Company’s tax declarations of the previous year on VAT and corporate income property value) Certi cate of conditions of ownership - Below 1,000,000: 5 Certi cate of inhibition of seller minimum wages (jornales) Municipal tax clearance certi cate (obtained in Procedure 1) - From 1,000,001 Cadastre Certi cate (obtained in Procedure 3) to 50,000,000: 2.00% Page 28   Certi cate of payment of water and electricity services (jornales) Municipal tax clearance certi cate (obtained in Procedure 1) Doing Business 2018 Paraguay - From 1,000,001 Cadastre Certi cate (obtained in Procedure 3) to 50,000,000: 2.00% Certi cate of payment of water and electricity services - From Photocopy of buyer and seller’s ID 50,000,000 to 75,000,000: Property title 1.75% - From 75,000,000 to 100,000,000: 1.50% - From 100,000,000 to 150,000,000: 1.25% - From 150,000,000 to 200,000,000: 1.00% - Above 200,000,000: 0.75% As of 2006, the seller must also pay 1.5% of property value as VAT (5% VAT rate, applied to 30% of the value of the property= 1.5% of the value of the property) according to art. 7° of resolution 1421/05, regulating art. 91° of law 2421/04. 5 Payment of the Municipal Tax on transfers 1 day 0.3% of property Agency : Municipality of Asuncion price The Municipal Tax on transfers is paid (usually by the notary) at the Municipality after the contract has been notarized. In Asuncion, the tax is 0.3% of the property value. In other cities of the country it is 0.2%. The amount of the tax will be estimated according to the same principles applied to the Judiciary Fee. 6 Registration of the notarized documents at the Public Registry 15 days Gs 30,223 (Tasa Agency : Public Registry ("Direccion General de los Registros Publicos") especial de inscripcion por The notarized deed is recorded at the Directorate General of Public Records. Court finca o matricula, fees can be paid online at the authorized banks, payment is no longer performed in Page 29   0.4 jornales) + the Directorate General of Public Records. The documentation shall include: value. In other cities of the country it is 0.2%. The amount of the tax will be Doingestimated Business 2018 to according the same principles applied to the Judiciary Fee. Paraguay 6 Registration of the notarized documents at the Public Registry 15 days Gs 30,223 (Tasa Agency : Public Registry ("Direccion General de los Registros Publicos") especial de inscripcion por The notarized deed is recorded at the Directorate General of Public Records. Court finca o matricula, fees can be paid online at the authorized banks, payment is no longer performed in 0.4 jornales) + the Directorate General of Public Records. The documentation shall include: 0.74% of property value - The testimony or copy of the deed issued by a notary public (obtained in (Registration fee) procedure 4); - Municipal tax compliance certi cate issued by the Municipality of Asuncion. Payment of fees can be done online through Web Banking at the Judicial Branch's website: http://ingresosjudiciales.csj.gov.py/LiquidacionesWeb/home.seam Takes place simultaneously with previous procedure. Details – Registering Property in Paraguay – Measure of Quality Answer Score Quality of the land administration index (0-30) 12.0 Reliability of infrastructure index (0-8) 3.0 What is the institution in charge of immovable property registration? Dirección General de los Registros Publicos In what format are the majority of title or deed records kept in the largest business city Paper 0.0 —in a paper format or in a computerized format (scanned or fully digital)? Is there an electronic database for checking for encumbrances (liens, mortgages, No 0.0 restrictions and the like)? Institution in charge of the plans showing legal boundaries in the largest business city: Dirección Nacional de Catastro In what format are the majority of maps of land plots kept in the largest business city— Computer/Fully 2.0 in a paper format or in a computerized format (scanned or fully digital)? digital Is there an electronic database for recording boundaries, checking plans and providing Yes 1.0 cadastral information (geographic information system)? Is the information recorded by the immovable property registration agency and the Separate 0.0 cadastral or mapping agency kept in a single database, in di erent but linked databases databases or in separate databases? Do the immovable property registration agency and cadastral or mapping agency use No 0.0 the same identi cation number for properties? Transparency of information index (0–6) 1.0 Who is able to obtain information on land ownership at the agency in charge of Only 0.0 immovable property registration in the largest business city? intermediaries Page 30   and interested Takes place simultaneously with previous procedure. Doing Business 2018 Paraguay Details – Registering Property in Paraguay – Measure of Quality Answer Score Quality of the land administration index (0-30) 12.0 Reliability of infrastructure index (0-8) 3.0 What is the institution in charge of immovable property registration? Dirección General de los Registros Publicos In what format are the majority of title or deed records kept in the largest business city Paper 0.0 —in a paper format or in a computerized format (scanned or fully digital)? Is there an electronic database for checking for encumbrances (liens, mortgages, No 0.0 restrictions and the like)? Institution in charge of the plans showing legal boundaries in the largest business city: Dirección Nacional de Catastro In what format are the majority of maps of land plots kept in the largest business city— Computer/Fully 2.0 in a paper format or in a computerized format (scanned or fully digital)? digital Is there an electronic database for recording boundaries, checking plans and providing Yes 1.0 cadastral information (geographic information system)? Is the information recorded by the immovable property registration agency and the Separate 0.0 cadastral or mapping agency kept in a single database, in di erent but linked databases databases or in separate databases? Do the immovable property registration agency and cadastral or mapping agency use No 0.0 the same identi cation number for properties? Transparency of information index (0–6) 1.0 Who is able to obtain information on land ownership at the agency in charge of Only 0.0 immovable property registration in the largest business city? intermediaries and interested parties Is the list of documents that are required to complete any type of property transaction No 0.0 made publicly available–and if so, how? Link for online access: Is the applicable fee schedule for any property transaction at the agency in charge of No 0.0 immovable property registration in the largest business city made publicly available– and if so, how? Link for online access: Does the agency in charge of immovable property registration commit to delivering a No 0.0 legally binding document that proves property ownership within a speci c time frame– and if so, how does it communicate the service standard? Link for online access: Page 31   legally binding document that proves property ownership within a speci c time frame– and if Doing so, how does Business Paraguaythe service standard? it communicate 2018 Link for online access: Is there a speci c and separate mechanism for ling complaints about a problem that No 0.0 occurred at the agency in charge of immovable property registration? Contact information: Are there publicly available o cial statistics tracking the number of transactions at the No 0.0 immovable property registration agency? Number of property transfers in the largest business city in 2015: Who is able to consult maps of land plots in the largest business city? Anyone who 0.5 pays the o cial fee Is the applicable fee schedule for accessing maps of land plots made publicly available Yes, online 0.5 —and if so, how? Link for online access: http://www.catas tro.gov.py/aranc eles.html Does the cadastral or mapping agency commit to delivering an updated map within a No 0.0 speci c time frame—and if so, how does it communicate the service standard? Link for online access: Is there a speci c and separate mechanism for ling complaints about a problem that No 0.0 occurred at the cadastral or mapping agency? Contact information: Geographic coverage index (0–8) 2.0 Are all privately held land plots in the economy formally registered at the immovable No 0.0 property registry? Are all privately held land plots in the largest business city formally registered at the No 0.0 immovable property registry? Are all privately held land plots in the economy mapped? No 0.0 Are all privately held land plots in the largest business city mapped? Yes 2.0 Land dispute resolution index (0–8) 6.0 Does the law require that all property sale transactions be registered at the immovable Yes 1.5 property registry to make them opposable to third parties? Is the system of immovable property registration subject to a state or private Yes 0.5 guarantee? Is there a speci c compensation mechanism to cover for losses incurred by parties who No 0.0 engaged in good faith in a property transaction based on erroneous information certi ed by the immovable property registry? Does the legal system require a control of legality of the documents necessary for a Yes 0.5 property transaction (e.g., checking the compliance of contracts with requirements of the law)? Page 32   engaged in good faith in a property transaction based on erroneous information ed by the immovable certi Business Doing property registry? 2018 Paraguay Does the legal system require a control of legality of the documents necessary for a Yes 0.5 property transaction (e.g., checking the compliance of contracts with requirements of the law)? If yes, who is responsible for checking the legality of the documents? Notary. Does the legal system require veri cation of the identity of the parties to a property Yes 0.5 transaction? If yes, who is responsible for verifying the identity of the parties? Notary. Is there a national database to verify the accuracy of identity documents? Yes 1.0 For a standard land dispute between two local businesses over tenure rights of a Juzgado de property worth 50 times gross national income (GNI) per capita and located in the Primera largest business city, what court would be in charge of the case in the rst instance? Instancia en lo Civil y Comercial How long does it take on average to obtain a decision from the rst-instance court for Between 1 and 2 2.0 such a case (without appeal)? years Are there any statistics on the number of land disputes in the rst instance? No 0.0 Number of land disputes in the largest business city in 2015: Equal access to property rights index (-2–0) 0.0 Do unmarried men and unmarried women have equal ownership rights to property? Yes 0.0 Do married men and married women have equal ownership rights to property? Yes 0.0 Getting Credit This topic explores two sets of issues—the strength of credit reporting systems and the e ectiveness of collateral and bankruptcy laws in facilitating lending. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Strength of legal rights index (0–12) Doing Business assesses the sharing of credit information and the legal rights of borrowers and lenders with respect to secured transactions Rights of borrowers and lenders through through 2 sets of indicators. The depth of credit information index collateral laws (0-10) measures rules and practices a ecting the coverage, scope and Protection of secured creditors’ rights through accessibility of credit information available through a credit registry or a bankruptcy laws (0-2) credit bureau. The strength of legal rights index measures the degree to Depth of credit information index (0–8) which collateral and bankruptcy laws protect the rights of borrowers and lenders and thus facilitate lending. For each economy it is first determined Scope and accessibility of credit information whether a unitary secured transactions system exists. Then two case distributed by credit bureaus and credit scenarios, case A and case B, are used to determine how a nonpossessory registries (0-8) security interest is created, publicized and enforced according to the law. Credit bureau coverage (% of adults) Special emphasis is given to how the collateral registry operates (if Number of individuals and firms listed in largest registration of security interests is possible). The case scenarios involve a credit bureau as a percentage of adult population secured borrower, company ABC, and a secured lender, BizBank. Credit registry coverage (% of adults) In some economies the legal framework for secured transactions will allow Number of individuals and firms listed in credit only case A or case B (not both) to apply. Both cases examine the same set registry as a percentage of adult population of legal provisions relating to the use of movable collateral. Page 33   Do married men and married women have equal ownership rights to property? Yes 0.0 Doing Business 2018 Paraguay Getting Credit This topic explores two sets of issues—the strength of credit reporting systems and the e ectiveness of collateral and bankruptcy laws in facilitating lending. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Strength of legal rights index (0–12) Doing Business assesses the sharing of credit information and the legal rights of borrowers and lenders with respect to secured transactions Rights of borrowers and lenders through through 2 sets of indicators. The depth of credit information index collateral laws (0-10) measures rules and practices a ecting the coverage, scope and Protection of secured creditors’ rights through accessibility of credit information available through a credit registry or a bankruptcy laws (0-2) credit bureau. The strength of legal rights index measures the degree to Depth of credit information index (0–8) which collateral and bankruptcy laws protect the rights of borrowers and lenders and thus facilitate lending. For each economy it is first determined Scope and accessibility of credit information whether a unitary secured transactions system exists. Then two case distributed by credit bureaus and credit scenarios, case A and case B, are used to determine how a nonpossessory registries (0-8) security interest is created, publicized and enforced according to the law. Credit bureau coverage (% of adults) Special emphasis is given to how the collateral registry operates (if Number of individuals and firms listed in largest registration of security interests is possible). The case scenarios involve a credit bureau as a percentage of adult population secured borrower, company ABC, and a secured lender, BizBank. Credit registry coverage (% of adults) In some economies the legal framework for secured transactions will allow Number of individuals and firms listed in credit only case A or case B (not both) to apply. Both cases examine the same set registry as a percentage of adult population of legal provisions relating to the use of movable collateral. Several assumptions about the secured borrower (ABC) and lender (BizBank) are used: - ABC is a domestic limited liability company (or its legal equivalent). - ABC has up to 50 employees. - ABC has its headquarters and only base of operations in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city. - Both ABC and BizBank are 100% domestically owned. The case scenarios also involve assumptions. In case A, as collateral for the loan, ABC grants BizBank a nonpossessory security interest in one category of movable assets, for example, its machinery or its inventory. ABC wants to keep both possession and ownership of the collateral. In economies where the law does not allow nonpossessory security interests in movable property, ABC and BizBank use a fiduciary transfer-of-title arrangement (or a similar substitute for nonpossessory security interests). In case B, ABC grants BizBank a business charge, enterprise charge, floating charge or any charge that gives BizBank a security interest over ABC’s combined movable assets (or as much of ABC’s movable assets as possible). ABC keeps ownership and possession of the assets. Latin America & OECD high Indicator Paraguay Caribbean income Overall Best Performer Strength of legal rights index (0-12) 1 5.3 6.0 12.00 (4 Economies) Depth of credit information index (0-8) 7 4.8 6.6 8.00 (34 Economies) Page 34   Credit registry coverage (% of adults) 25.4 14.0 18.3 100.00 (3 Economies) possible). ABC keeps ownership and possession of the assets. Doing Business 2018 Paraguay Latin America & OECD high Indicator Paraguay Caribbean income Overall Best Performer Strength of legal rights index (0-12) 1 5.3 6.0 12.00 (4 Economies) Depth of credit information index (0-8) 7 4.8 6.6 8.00 (34 Economies) Credit registry coverage (% of adults) 25.4 14.0 18.3 100.00 (3 Economies) Credit bureau coverage (% of adults) 44.6 43.1 63.7 100.00 (23 Economies) Figure – Getting Credit in Paraguay and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 55.00: Argentina (Rank: 77) 50.94: Regional Average (Latin America & Caribbean) 50.00: Chile (Rank: 90) 45.00: Brazil (Rank: 105) 40.00: Paraguay (Rank: 122) 35.00: Bolivia (Rank: 133) Note: The ranking of economies on the ease of getting credit is determined by sorting their distance to frontier scores for getting credit. These scores are the distance to frontier score for the sum of the strength of legal rights index and the depth of credit information index. Figure – Legal Rights in Paraguay and comparator economies 6 5.3 5 4 4 Index score 3 3 2 2 1 1 0 0 Paraguay Argentina Bolivia Brazil Chile Latin America & Caribbean Details – Legal Rights in Paraguay Strength of legal rights index (0-12) 1 Does an integrated or uni ed legal framework for secured transactions that extends to the creation, publicity and No enforcement of functional equivalents to security interests in movable assets exist in the economy? Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without No requiring a speci c description of collateral? Page 35   Paraguay Argentina Bolivia Brazil Chile Latin America & Caribbean Doing Business 2018 Paraguay Details – Legal Rights in Paraguay Strength of legal rights index (0-12) 1 Does an integrated or uni ed legal framework for secured transactions that extends to the creation, publicity and No enforcement of functional equivalents to security interests in movable assets exist in the economy? Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without No requiring a speci c description of collateral? Does the law allow businesses to grant a non possessory security right in substantially all of its assets, without requiring No a speci c description of collateral? May a security right extend to future or after-acquired assets, and does it extend automatically to the products, proceeds No or replacements of the original assets? Is a general description of debts and obligations permitted in collateral agreements; can all types of debts and Yes obligations be secured between parties; and can the collateral agreement include a maximum amount for which the assets are encumbered? Is a collateral registry in operation for both incorporated and non-incorporated entities, that is uni ed geographically No and by asset type, with an electronic database indexed by debtor's name? Does a notice-based collateral registry exist in which all functional equivalents can be registered? No Does a modern collateral registry exist in which registrations, amendments, cancellations and searches can be No performed online by any interested third party? Are secured creditors paid rst (i.e. before tax claims and employee claims) when a debtor defaults outside an insolvency No procedure? Are secured creditors paid rst (i.e. before tax claims and employee claims) when a business is liquidated? No Are secured creditors subject to an automatic stay on enforcement when a debtor enters a court-supervised No reorganization procedure? Does the law protect secured creditors’ rights by providing clear grounds for relief from the stay and/or sets a time limit for it? Does the law allow parties to agree on out of court enforcement at the time a security interest is created? Does the law No allow the secured creditor to sell the collateral through public auction or private tender, as well as, for the secured creditor to keep the asset in satisfaction of the debt? Figure – Credit Information in Paraguay and comparator economies 10 8 8 7 7 7 Index score 6 6 4.8 4 2 0 Paraguay Argentina Bolivia Brazil Chile Latin America & Caribbean Details – Credit Information in Paraguay Page 36   0 Paraguay Doing Business 2018 Argentina Paraguay Bolivia Brazil Chile Latin America & Caribbean Details – Credit Information in Paraguay Credit Credit Depth of credit information index (0-8) bureau registry Score Are data on both firms and individuals distributed? Yes Yes 1 Are both positive and negative credit data distributed? No Yes 1 Are data from retailers or utility companies - in addition to data from banks and financial institutions - Yes No 1 distributed? Are at least 2 years of historical data distributed? (Credit bureaus and registries that distribute more No No 0 than 10 years of negative data or erase data on defaults as soon as they are repaid obtain a score of 0 for this component.) Are data on loan amounts below 1% of income per capita distributed? Yes Yes 1 By law, do borrowers have the right to access their data in the credit bureau or credit registry? Yes Yes 1 Can banks and financial institutions access borrowers’ credit information online (for example, Yes Yes 1 through an online platform, a system-to-system connection or both)? Are bureau or registry credit scores offered as a value-added service to help banks and financial Yes No 1 institutions assess the creditworthiness of borrowers? Score ("yes" to either public bureau or private registry) 7 Note: An economy receives a score of 1 if there is a "yes" to either bureau or registry. If the credit bureau or registry is not operational or covers less than 5% of the adult population, the total score on the depth of credit information index is 0. Coverage Credit bureau Credit registry Number of individuals 1,892,210 1,083,019 Number of firms 29,962 11,979 Total 1,922,172 1,094,998 Percentage of adult population 44.6 25.4 Protecting Minority Investors This topic measures the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain as well as shareholder rights, governance safeguards and corporate transparency requirements that reduce the risk of abuse. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Extent of disclosure index (0–10): Review and To make the data comparable across economies, a case study uses several approval requirements for related-party assumptions about the business and the transaction. transactions; Disclosure requirements for related-party transactions The business (Buyer): Extent of director liability index (0–10): Ability of - Is a publicly traded corporation listed on the economy’s most important minority shareholders to sue and hold interested stock exchange. If the number of publicly traded companies listed on that directors liable for prejudicial related-party exchange is less than 10, or if there is no stock exchange in the economy, it is assumed that Buyer is a large private company with multiple Page 37   transactions; Available legal remedies (damages, Percentage of adult population 44.6 25.4 Doing Business 2018 Paraguay Protecting Minority Investors This topic measures the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain as well as shareholder rights, governance safeguards and corporate transparency requirements that reduce the risk of abuse. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Extent of disclosure index (0–10): Review and To make the data comparable across economies, a case study uses several approval requirements for related-party assumptions about the business and the transaction. transactions; Disclosure requirements for related-party transactions The business (Buyer): Extent of director liability index (0–10): Ability of - Is a publicly traded corporation listed on the economy’s most important minority shareholders to sue and hold interested stock exchange. If the number of publicly traded companies listed on that directors liable for prejudicial related-party exchange is less than 10, or if there is no stock exchange in the economy, it transactions; Available legal remedies (damages, is assumed that Buyer is a large private company with multiple disgorgement of profits, fines, imprisonment, shareholders. rescission of the transaction) - Has a board of directors and a chief executive o cer (CEO) who may legally act on behalf of Buyer where permitted, even if this is not speci cally Ease of shareholder suits index (0–10): Access to required by law. internal corporate documents; Evidence - Has a supervisory board (applicable to economies with a two-tier board obtainable during trial and allocation of legal system) on which 60% of the shareholder-elected members have been expenses appointed by Mr. James, who is Buyer’s controlling shareholder and a Extent of conflict of interest regulation index member of Buyer’s board of directors. (0–10): Simple average of the extent of disclosure, - Has not adopted any bylaws or articles of association that di er from extent of director liability and ease of default minimum standards and does not follow any nonmandatory codes, shareholder indices principles, recommendations or guidelines relating to corporate Extent of shareholder rights index (0-10): governance. Shareholders’ rights and role in major corporate - Is a manufacturing company with its own distribution network. decisions Extent of ownership and control index (0-10): The transaction involves the following details: Governance safeguards protecting shareholders - Mr. James owns 60% of Buyer and elected two directors to Buyer’s ve- from undue board control and entrenchment member board. Extent of corporate transparency index (0-10): - Mr. James also owns 90% of Seller, a company that operates a chain of Corporate transparency on ownership stakes, retail hardware stores. Seller recently closed a large number of its stores. compensation, audits and financial prospects - Mr. James proposes that Buyer purchase Seller’s unused eet of trucks to expand Buyer’s distribution of its food products, a proposal to which Buyer Extent of shareholder governance index (0–10): agrees. The price is equal to 10% of Buyer’s assets and is higher than the Simple average of the extent of shareholders market value. rights, extent of ownership and control and - The proposed transaction is part of the company’s ordinary course of extent of corporate transparency indices business and is not outside the authority of the company. Strength of minority investor protection index - Buyer enters into the transaction. All required approvals are obtained, (0–10): Simple average of the extent of conflict of and all required disclosures made (that is, the transaction is not interest regulation and extent of shareholder fraudulent). governance indices - The transaction causes damages to Buyer. Shareholders sue Mr. James and the other parties that approved the transaction. Latin America & OECD high Indicator Paraguay Caribbean income Overall Best Performer Extent of conflict of interest regulation index (0- 5.7 5.3 6.4 9.3 (New Zealand) 10) Extent of shareholder governance index (0-10) 2.7 4.1 6.4 Page 38   9.00 (Kazakhstan) and the other parties that approved the transaction. Doing Business 2018 Paraguay Latin America & OECD high Indicator Paraguay Caribbean income Overall Best Performer Extent of conflict of interest regulation index (0- 5.7 5.3 6.4 9.3 (New Zealand) 10) Extent of shareholder governance index (0-10) 2.7 4.1 6.4 9.00 (Kazakhstan) Figure – Protecting Minority Investors in Paraguay and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 63.33: Argentina (Rank: 43) 63.33: Brazil (Rank: 43) 60.00: Chile (Rank: 57) 47.24: Regional Average (Latin America & Caribbean) 41.67: Paraguay (Rank: 138) 40.00: Bolivia (Rank: 146) Note: The ranking of economies on the strength of minority investor protections is determined by sorting their distance to frontier scores for protecting minority investors. These scores are the simple average of the distance to frontier scores for the extent of con ict of interest regulation index and the extent of shareholder governance index. Figure – Protecting Minority Investors in Paraguay and comparator economies – Measure of Quality Paraguay 2 5 6 3 3 6 Argentina 7 2 7 7 9 6 Bolivia 4 5 1 2 6 6 Brazil 8 8 5 6 7 4 Chile 2 6 8 4 9 7 OECD high income 7.3 5.6 6.5 5.2 6.3 7.4 Latin America & Caribbean 4.1 5.4 4.4 3.4 5.6 6.5 0 5 10 15 20 25 30 35 40 Sub-Indicator Score Extent of corporate transparency index (0­10) Extent of director liability index (0­10) Extent of disclosure index (0­10) Extent of ownership and control index (0­10) Extent of shareholder rights index (0­10) Ease of shareholder suits index (0­10) Details – Protecting Minority Investors in Paraguay – Measure of Quality Answer Score Page 39   Extent of ownership and control index (0­10) Extent of shareholder rights index (0­10) Ease of shareholder suits index (0­10) Doing Business 2018 Paraguay Details – Protecting Minority Investors in Paraguay – Measure of Quality Answer Score Extent of con ict of interest regulation index (0-10) 5.7 Extent of disclosure index (0-10) 6 Which corporate body is legally su cient to approve the Buyer-Seller transaction? (0-3) Board of 2.0 directors excluding interested members Must an external body review the terms of the transaction before it takes place? (0-1) No 0.0 Must Mr. James disclose his con ict of interest to the board of directors? (0-2) Existence of a 1.0 con ict without any speci cs Must Buyer disclose the transaction in published periodic lings (annual reports)? (0-2) Disclosure on 2.0 the transaction and on the con ict of interest Must Buyer immediately disclose the transaction to the public and/or shareholders? (0- Disclosure on 1.0 2) the transaction only Extent of director liability index (0-10) 5 Can shareholders representing 10% of Buyer's share capital sue directly or derivatively No 0.0 for the damage the transaction caused to Buyer? (0-1) Can shareholders hold the interested director liable for the damage the transaction Liable if negligent 1.0 caused to Buyer? (0-2) Can shareholders hold the other directors liable for the damage the transaction caused Liable if negligent 1.0 to Buyer (0-2) Must Mr. James pay damages for the harm caused to Buyer upon a successful claim by Yes 1.0 shareholders? (0-1) Must Mr. James repay pro ts made from the transaction upon a successful claim by No 0.0 shareholders? (0-1) Is Mr. James disquali ed or ned and imprisoned upon a successful claim by Yes 1.0 shareholders? (0-1) Can a court void the transaction upon a successful claim by shareholders? (0-2) Voidable if 1.0 negligently concluded Ease of shareholder suits index (0-10) 6 Before suing can shareholders representing 10% of Buyer's share capital inspect the No 0.0 transaction documents? (0-1) Can the plainti obtain any documents from the defendant and witnesses at trial? (0-3) Any relevant 3.0 Page 40   shareholder Ease ofBusiness Doing suits index 2018 (0-10) Paraguay 6 Before suing can shareholders representing 10% of Buyer's share capital inspect the No 0.0 transaction documents? (0-1) Can the plainti obtain any documents from the defendant and witnesses at trial? (0-3) Any relevant 3.0 document Can the plainti request categories of documents from the defendant without No 0.0 identifying speci c ones? (0-1) Can the plainti directly question the defendant and witnesses at trial? (0-2) Yes 2.0 Is the level of proof required for civil suits lower than that of criminal cases? (0-1) No 0.0 Can shareholder plainti s recover their legal expenses from the company? (0-2) Yes if successful 1.0 Extent of shareholder governance index (0-10) 2.7 Extent of shareholder rights index (0-10) 3 Does the sale of 51% of Buyer's assets require shareholder approval? No 0.0 Can shareholders representing 10% of Buyer's share capital call for a meeting of No 0.0 shareholders? Must Buyer obtain its shareholders’ approval every time it issues new shares? Yes 1.0 Do shareholders automatically receive preemption rights every time Buyer issues new No 0.0 shares? Must shareholders approve the election and dismissal of the external auditor? No 0.0 Are changes to the rights of a class of shares only possible if the holders of the a ected Yes 1.0 shares approve? Assuming that Buyer is a limited company, does the sale of 51% of its assets require No 0.0 member approval? Assuming that Buyer is a limited company, can members representing 10% call for a No 0.0 meeting of members? Assuming that Buyer is a limited company, must all members consent to add a new Yes 1.0 member? Assuming that Buyer is a limited company, must a member rst o er to sell their No 0.0 interest to the existing members before they can sell to non-members? Extent of ownership and control index (0-10) 3 Is it forbidden to appoint the same individual as CEO and chair of the board of No 0.0 directors? Must the board of directors include independent and nonexecutive board members? Yes 1.0 Can shareholders remove members of the board of directors without cause before the Yes 1.0 end of their term? Must the board of directors include a separate audit committee exclusively comprising No 0.0 board members? Must a potential acquirer make a tender o er to all shareholders upon acquiring 50% No 0.0 Page 41   of Buyer? Must the board of directors include a separate audit committee exclusively comprising No 0.0 board Doing members? Business 2018 Paraguay Must a potential acquirer make a tender o er to all shareholders upon acquiring 50% No 0.0 of Buyer? Must Buyer pay declared dividends within a maximum period set by law? No 0.0 Is a subsidiary prohibited from acquiring shares issued by its parent company? No 0.0 Assuming that Buyer is a limited company, must Buyer have a mechanism to resolve Yes 1.0 disagreements among members? Assuming that Buyer is a limited company, must a potential acquirer make a tender No 0.0 o er to all shareholders upon acquiring 50% of Buyer? Assuming that Buyer is a limited company, must Buyer distribute pro ts within a No 0.0 maximum period set by law? Extent of corporate transparency index (0-10) 2 Must Buyer disclose direct and indirect bene cial ownership stakes representing 5%? No 0.0 Must Buyer disclose information about board members’ primary employment and No 0.0 directorships in other companies? Must Buyer disclose the compensation of individual managers? No 0.0 Must a detailed notice of general meeting be sent 21 days before the meeting? No 0.0 Can shareholders representing 5% of Buyer’s share capital put items on the general Yes 1.0 meeting agenda? Must Buyer's annual nancial statements be audited by an external auditor? No 0.0 Must Buyer disclose its audit reports to the public? No 0.0 Assuming that Buyer is a limited company, must members meet at least once a year? No 0.0 Assuming that Buyer is a limited company, can members representing 5% put items on Yes 1.0 the meeting agenda? Assuming that Buyer is a limited company, must Buyer's annual nancial statements be No 0.0 audited by an external auditor? Paying Taxes This topic records the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as measures the administrative burden in paying taxes and contributions. The most recent round of data collection for the project was completed on June 30, 2017 covering for the Paying Taxes indicator calendar year 2016 (January 1, 2016 – December 31, 2016). Last year (Doing Business 2017) the scope of data collection was expanded to better understand the overall tax environment in an economy. The questionnaire was expanded to include new questions on post- ling processes: VAT refund and tax audit. The data shows where post ling processes and practices work e ciently and what drives the di erences in the overall tax compliance cost across economies. The new section covers both the legal framework and the administrative burden on businesses to comply with post ling processes. See the methodology for more information. What the indicators measure Case study assumptions Page 42   Tax payments for a manufacturing company in Using a case scenario, Doing Business records taxes and mandatory Assuming that Buyer is a limited company, must Buyer's annual nancial statements be No 0.0 audited by an external auditor? Doing Business 2018 Paraguay Paying Taxes This topic records the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as measures the administrative burden in paying taxes and contributions. The most recent round of data collection for the project was completed on June 30, 2017 covering for the Paying Taxes indicator calendar year 2016 (January 1, 2016 – December 31, 2016). Last year (Doing Business 2017) the scope of data collection was expanded to better understand the overall tax environment in an economy. The questionnaire was expanded to include new questions on post- ling processes: VAT refund and tax audit. The data shows where post ling processes and practices work e ciently and what drives the di erences in the overall tax compliance cost across economies. The new section covers both the legal framework and the administrative burden on businesses to comply with post ling processes. See the methodology for more information. What the indicators measure Case study assumptions Tax payments for a manufacturing company in Using a case scenario, Doing Business records taxes and mandatory 2016 (number per year adjusted for electronic and contributions a medium size company must pay in a year, and measures joint ling and payment) the administrative burden of paying taxes, contributions and dealing with post ling processes. Information is also compiled on frequency of ling Total number of taxes and contributions paid, and payments, time taken to comply with tax laws, time taken to comply including consumption taxes (value added tax, with the requirements of post ling processes and time waiting. sales tax or goods and service tax) Method and frequency of filing and payment To make data comparable across economies, several assumptions are used: Time required to comply with 3 major taxes - TaxpayerCo is a medium-size business that started operations on January (hours per year) 1, 2015. It produces ceramic flowerpots and sells them at retail. All taxes Collecting information, computing tax payable and contributions recorded are paid in the second year of operation Completing tax return, filing with agencies (calendar year 2016). Taxes and mandatory contributions are measured at all levels of government. Arranging payment or withholding Preparing separate tax accounting books, if The VAT refund process: required - In June 2016, TaxpayerCo. makes a large capital purchase: the value of the Total tax and contribution rate (% of pro t before machine is 65 times income per capita of the economy. Sales are equally all taxes) spread per month (1,050 times income per capita divided by 12) and cost of goods sold are equally expensed per month (875 times income per Profit or corporate income tax capita divided by 12). The machinery seller is registered for VAT and excess Social contributions, labor taxes paid by input VAT incurred in June will be fully recovered after four consecutive employer months if the VAT rate is the same for inputs, sales and the machine and Property and property transfer taxes the tax reporting period is every month. Input VAT will exceed Output VAT Dividend, capital gains, financial transactions in June 2016. taxes The corporate income tax audit process: Waste collection, vehicle, road and other taxes - An error in calculation of income tax liability (for example, use of incorrect Post ling Index tax depreciation rates, or incorrectly treating an expense as tax deductible) leads to an incorrect income tax return and a corporate income Time to comply with a VAT refund tax underpayment. TaxpayerCo. discovered the error and voluntarily Time to receive a VAT refund noti ed the tax authority. The value of the underpaid income tax liability is Time to comply with a corporate income tax audit 5% of the corporate income tax liability due. TaxpayerCo. submits corrected information after the deadline for submitting the annual tax Time to complete a corporate income tax audit return, but within the tax assessment period. Latin America & OECD high Indicator Paraguay Caribbean income Overall Best Performer Payments (number per year) 20 28.0 10.9 3 (Hong Kong SAR, China) Page 43   return, but within the tax assessment period. Doing Business 2018 Paraguay Latin America & OECD high Indicator Paraguay Caribbean income Overall Best Performer Payments (number per year) 20 28.0 10.9 3 (Hong Kong SAR, China) Time (hours per year) 378 332.1 160.7 55 (Luxembourg) Total tax and contribution rate (% of profit) 35.0 46.6 40.1 18.47% (32 Economies) Postfiling index (0-100) 46.56 47.50 83.45 99.38 (Estonia) Figure – Paying Taxes in Paraguay and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 76.17: Chile (Rank: 72) 63.73: Paraguay (Rank: 127) 60.16: Regional Average (Latin America & Caribbean) 49.34: Argentina (Rank: 169) 32.97: Brazil (Rank: 184) 21.62: Bolivia (Rank: 186) Note: The ranking of economies on the ease of paying taxes is determined by sorting their distance to frontier scores on the ease of paying taxes. These scores are the simple average of the distance to frontier scores for each of the four component indicators – number of tax payments. time, total tax rate and post ling index – with a threshold and a nonlinear transformation applied to one of the component indicators, the total tax rate. The nonlinear distance to frontier for the total tax rate is equal to the distance to frontier for the total tax rate to the power of 0.8. The threshold is de ned as the total tax rate at the 15th percentile of the overall distribution for all years included in the analysis up to and including Doing Business 2015, which is 26.1%. All economies with a total tax rate below this threshold receive the same score as the economy at the threshold. Figure – Paying Taxes in Paraguay and comparator economies – Measure of Quality 70 58.36 60 47.94 50.00 47.50 50 46.56 Index score 40 30 20 7.80 10 0 Paraguay Argentina Bolivia Brazil Chile Latin America & Caribbean Details – Paying Taxes in Paraguay Tax or mandatory Payments Notes on Time Statutory Total tax and contribution Notes contribution (number) Payments (hours) tax rate Tax base rate (% of profit) on TTR Employer paid - Social 12 96 16.5% gross 18.62 Page 44   security contributions salaries Doing Business 2018 Paraguay Figure – Paying Taxes in Paraguay and comparator economies – Measure of Quality 70 58.36 60 47.94 50.00 47.50 50 46.56 Index score 40 30 20 7.80 10 0 Paraguay Argentina Bolivia Brazil Chile Latin America & Caribbean Details – Paying Taxes in Paraguay Tax or mandatory Payments Notes on Time Statutory Total tax and contribution Notes contribution (number) Payments (hours) tax rate Tax base rate (% of profit) on TTR Employer paid - Social 12 96 16.5% gross 18.62 security contributions salaries Corporate income tax 1 online 138 10% taxable 9.62 profit Municipal duties 2 1% total 5.25 (variable) assets Property tax 1 1% property 1.48 value Stamp duty 1 0.00 Employee paid - Social 0 jointly 9% gross 0.00 withheld security contributions salaries Fuel tax 1 0.00 small amount Value added tax (VAT) 1 online 144 10% value 0.00 not added included Vehicle Tax 1 0.00 not included Totals 20 378 35.0 Details – Paying Taxes in Paraguay – Tax by Type Taxes by type Answer Profit tax (% of profit) 9.6 Labor tax and contributions (% of profit) 18.6 Other taxes (% of profit) 6.7 Page 45   Totals 20 378 35.0 Doing Business 2018 Paraguay Details – Paying Taxes in Paraguay – Tax by Type Taxes by type Answer Profit tax (% of profit) 9.6 Labor tax and contributions (% of profit) 18.6 Other taxes (% of profit) 6.7 Details – Paying Taxes in Paraguay – Measure of Quality Answer Score Post ling index (0-100) 46.56 VAT refunds Does VAT exist? Yes Does a VAT refund process exist per the case study? No Restrictions on VAT refund process Restricted to international traders Percentage of cases exposed to a VAT audit (%) Not applicable Is there a mandatory carry forward period? No Time to comply with VAT refund (hours) No VAT refund 0 per case study scenario Time to obtain a VAT refund (weeks) No VAT refund 0 per case study scenario Corporate income tax audits Does corporate income tax exist? Yes Percentage of cases exposed to a corporate income tax audit (%) 0% - 24% Time to comply with a corporate income tax audit (hours) 9.0 86.24 Time to complete a corporate income tax audit (weeks) No tax audit per 100 case study scenario Notes: Names of taxes have been standardized. For instance income tax, pro t tax, tax on company's income are all named corporate income tax in this table. The hours for VAT include all the VAT and sales taxes applicable. The hours for Social Security include all the hours for labor taxes and mandatory contributions in general. The post ling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a corporate income tax audit and time to complete a corporate income tax audit. N/A = Not applicable. Page 46   The post ling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a corporate income tax audit and time to complete a corporate income tax audit. Doing Business 2018 N/A = Not applicable. Paraguay Trading across Borders Doing Business records the time and cost associated with the logistical process of exporting and importing goods. Doing Business measures the time and cost (excluding tari s) associated with three sets of procedures—documentary compliance, border compliance and domestic transport—within the overall process of exporting or importing a shipment of goods. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Given the importance of trade digitalization, in Doing Business 2018, the Trading across Borders questionnaire included research questions on the availability and status of implementation of Electronic Data Interchange (EDI) and Single Window (SW) systems. With this information, Doing Business built a comprehensive dataset on the adoption and level of sophistication of electronic platforms in 190 economies. These data are not used to compute the distance to frontier score or ranking of the ease of doing business. The new dataset on EDI and SW systems is available here. What the indicators measure Case study assumptions Documentary compliance To make the data comparable across economies, a few assumptions are made about the traded goods and the transactions: Obtaining, preparing and submitting documents during transport, clearance, inspections and port Time: Time is measured in hours, and 1 day is 24 hours (for example, 22 or border handling in origin economy days are recorded as 22×24=528 hours). If customs clearance takes 7.5 Obtaining, preparing and submitting documents hours, the data are recorded as is. Alternatively, suppose documents are required by destination economy and any transit submitted to a customs agency at 8:00a.m., are processed overnight and economies can be picked up at 8:00a.m. the next day. The time for customs clearance Covers all documents required by law and in would be recorded as 24 hours because the actual procedure took 24 practice, including electronic submissions of hours. information Border compliance Cost: Insurance cost and informal payments for which no receipt is issued are excluded from the costs recorded. Costs are reported in U.S. dollars. Customs clearance and inspections Contributors are asked to convert local currency into U.S. dollars based on Inspections by other agencies (if applied to more the exchange rate prevailing on the day they answer the questionnaire. than 20% of shipments) Contributors are private sector experts in international trade logistics and Handling and inspections that take place at the are informed about exchange rates. economy’s port or border Assumptions of the case study: - For all 190 economies covered by Doing Domestic transport Business, it is assumed a shipment is in a warehouse in the largest Loading or unloading of the shipment at the business city of the exporting economy and travels to a warehouse in the warehouse or port/border largest business city of the importing economy. - It is assumed each Transport between warehouse and port/border economy imports 15 metric tons of containerized auto parts (HS 8708) Traffic delays and road police checks while from its natural import partner—the economy from which it imports the shipment is en route largest value (price times quantity) of auto parts. It is assumed each economy exports the product of its comparative advantage (de ned by the largest export value) to its natural export partner—the economy that is the largest purchaser of this product. Shipment value is assumed to be $50,000. - The mode of transport is the one most widely used for the chosen export or import product and the trading partner, as is the seaport, or land border crossing. - All electronic information submissions requested by any government agency in connection with the shipment are considered to be documents obtained, prepared and submitted during the export or import process. - A port or border is a place (seaport, airport or land border crossing) where merchandise can enter or leave an economy. - Relevant government agencies include customs, port authorities, road police, border guards, standardization agencies, ministries or departments of agriculture or industry, national security agencies and any other government authorities. Page 47   a corporate income tax audit and time to complete a corporate income tax audit. N/A = Not applicable. Doing Business 2018 Paraguay Trading across Borders Doing Business records the time and cost associated with the logistical process of exporting and importing goods. Doing Business measures the time and cost (excluding tari s) associated with three sets of procedures—documentary compliance, border compliance and domestic transport—within the overall process of exporting or importing a shipment of goods. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Given the importance of trade digitalization, in Doing Business 2018, the Trading across Borders questionnaire included research questions on the availability and status of implementation of Electronic Data Interchange (EDI) and Single Window (SW) systems. With this information, Doing Business built a comprehensive dataset on the adoption and level of sophistication of electronic platforms in 190 economies. These data are not used to compute the distance to frontier score or ranking of the ease of doing business. The new dataset on EDI and SW systems is available here. What the indicators measure Case study assumptions Documentary compliance To make the data comparable across economies, a few assumptions are made about the traded goods and the transactions: Obtaining, preparing and submitting documents during transport, clearance, inspections and port Time: Time is measured in hours, and 1 day is 24 hours (for example, 22 or border handling in origin economy days are recorded as 22×24=528 hours). If customs clearance takes 7.5 Obtaining, preparing and submitting documents hours, the data are recorded as is. Alternatively, suppose documents are required by destination economy and any transit submitted to a customs agency at 8:00a.m., are processed overnight and economies can be picked up at 8:00a.m. the next day. The time for customs clearance Covers all documents required by law and in would be recorded as 24 hours because the actual procedure took 24 practice, including electronic submissions of hours. information Border compliance Cost: Insurance cost and informal payments for which no receipt is issued are excluded from the costs recorded. Costs are reported in U.S. dollars. Customs clearance and inspections Contributors are asked to convert local currency into U.S. dollars based on Inspections by other agencies (if applied to more the exchange rate prevailing on the day they answer the questionnaire. than 20% of shipments) Contributors are private sector experts in international trade logistics and Handling and inspections that take place at the are informed about exchange rates. economy’s port or border Assumptions of the case study: - For all 190 economies covered by Doing Domestic transport Business, it is assumed a shipment is in a warehouse in the largest Loading or unloading of the shipment at the business city of the exporting economy and travels to a warehouse in the warehouse or port/border largest business city of the importing economy. - It is assumed each Transport between warehouse and port/border economy imports 15 metric tons of containerized auto parts (HS 8708) Traffic delays and road police checks while from its natural import partner—the economy from which it imports the shipment is en route largest value (price times quantity) of auto parts. It is assumed each economy exports the product of its comparative advantage (de ned by the largest export value) to its natural export partner—the economy that is the largest purchaser of this product. Shipment value is assumed to be $50,000. - The mode of transport is the one most widely used for the chosen export or import product and the trading partner, as is the seaport, or land border crossing. - All electronic information submissions requested by any government agency in connection with the shipment are considered to be documents obtained, prepared and submitted during the export or import process. - A port or border is a place (seaport, airport or land border crossing) where merchandise can enter or leave an economy. - Relevant government agencies include customs, port authorities, road police, border guards, standardization agencies, ministries or departments of agriculture or industry, national security agencies and any other government authorities. Page 48   of agriculture or industry, national security agencies and any other Doing Business 2018 Paraguay government authorities. Latin America & OECD high Indicator Paraguay Caribbean income Overall Best Performer Time to export: Border compliance (hours) 120 62.5 12.7 0 (17 Economies) Cost to export: Border compliance (USD) 815 526.5 149.9 0.00 (19 Economies) Time to export: Documentary compliance 24 53.3 2.4 1.0 (25 Economies) (hours) Cost to export: Documentary compliance (USD) 120 110.4 35.4 0.00 (19 Economies) Time to import: Border compliance (hours) 48 64.4 8.7 0.00 (21 Economies) Cost to import: Border compliance (USD) 500 684.0 111.6 0.00 (27 Economies) Time to import: Documentary compliance 36 79.9 3.5 1.0 (30 Economies) (hours) Cost to import: Documentary compliance (USD) 135 119.5 25.6 0.00 (30 Economies) Figure – Trading across Borders in Paraguay and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 80.56: Chile (Rank: 68) 71.59: Bolivia (Rank: 89) 68.71: Regional Average (Latin America & Caribbean) 65.36: Argentina (Rank: 116) 64.03: Paraguay (Rank: 120) 59.78: Brazil (Rank: 139) Note: The ranking of economies on the ease of trading across borders is determined by sorting their distance to frontier scores for trading across borders. These scores are the simple average of the distance to frontier scores for the time and cost for documentary compliance and border compliance to export and import (domestic transport is not used for calculating the ranking). Figure – Trading across Borders in Paraguay – Time and Cost Time Cost 140 900 815 120 800 120 700 100 600 Time (hours) Cost (USD) 500 80 500 60 400 48 36 300 40 24 135 200 120 20 100 0 0 Export - Border Compliance Export - Documentary Compliance Import - Border Compliance Import - Documentary CompliancePage 49   Doing Business 2018 Paraguay Figure – Trading across Borders in Paraguay – Time and Cost Time Cost 140 900 815 120 800 120 700 100 600 Time (hours) Cost (USD) 500 80 500 60 400 48 36 300 40 24 135 200 120 20 100 0 0 Export - Border Compliance Export - Documentary Compliance Import - Border Compliance Import - Documentary Compliance Details – Trading across Borders in Paraguay Characteristics Export Import Product HS 12 : Oil seeds and oleaginous fruits; miscellaneous grains, seeds and HS 8708: Parts and fruit; industrial or medicinal plants; straw and fodder accessories of motor vehicles Trade partner Germany Brazil Border Puerto Pilar port Ciudad del Este border crossing Distance (km) 370 337 Domestic 144 6 transport time (hours) Domestic 1000 800 transport cost (USD) Details – Trading across Borders in Paraguay – Components of Border Compliance Time to Complete Associated Costs (hours) (USD) Export: Clearance and inspections required by customs authorities 48.0 250.0 Export: Clearance and inspections required by agencies other than customs 24.0 80.0 Export: Port or border handling 48.0 485.0 Import: Clearance and inspections required by customs authorities 48.0 250.0 Import: Clearance and inspections required by agencies other than customs 0.0 0.0 Import: Port or border handling 48.0 250.0 Page 50   Details – Trading across Borders in Paraguay – Trade Documents (USD) Doing Business 2018 Paraguay Details – Trading across Borders in Paraguay – Components of Border Compliance Time to Complete Associated Costs (hours) (USD) Export: Clearance and inspections required by customs authorities 48.0 250.0 Export: Clearance and inspections required by agencies other than customs 24.0 80.0 Export: Port or border handling 48.0 485.0 Import: Clearance and inspections required by customs authorities 48.0 250.0 Import: Clearance and inspections required by agencies other than customs 0.0 0.0 Import: Port or border handling 48.0 250.0 Details – Trading across Borders in Paraguay – Trade Documents Export Import Phytosanitary Certificate Conocimiento de Transporte Terrestre Bill of Lading Commercial Invoice Commercial Invoice Consular Invoice Packing List Packing List Customs Export Declaration Customs Import Declaration Inspection Report Certificate of Origin Transit Document Inspection Report Foreign Exchange Authorization Tax Certificate Terminal Handling Receipts SOLAS certificate Enforcing Contracts The enforcing contracts indicator measures the time and cost for resolving a commercial dispute through a local rst-instance court, and the quality of judicial processes index, evaluating whether each economy has adopted a series of good practices that promote quality and e ciency in the court system. The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to enforce a contract through the The dispute in the case study involves the breach of a sales contract courts (calendar days) between 2 domestic businesses. The case study assumes that the court hears an expert on the quality of the goods in dispute. This distinguishes Time to file and serve the case the case from simple debt enforcement. Time for trial and to obtain the judgment To make the data comparable across economies, Doing Business uses Page 51   Time to enforce the judgment several assumptions about the case: SOLAS certificate Doing Business 2018 Paraguay Enforcing Contracts The enforcing contracts indicator measures the time and cost for resolving a commercial dispute through a local rst-instance court, and the quality of judicial processes index, evaluating whether each economy has adopted a series of good practices that promote quality and e ciency in the court system. The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to enforce a contract through the The dispute in the case study involves the breach of a sales contract courts (calendar days) between 2 domestic businesses. The case study assumes that the court hears an expert on the quality of the goods in dispute. This distinguishes Time to file and serve the case the case from simple debt enforcement. Time for trial and to obtain the judgment To make the data comparable across economies, Doing Business uses Time to enforce the judgment several assumptions about the case: Cost required to enforce a contract through the - The dispute concerns a lawful transaction between two businesses (Seller courts (% of claim) and Buyer), both located in the economy’s largest business city. For 11 Attorney fees economies the data are also collected for the second largest business city. - The buyer orders custom-made goods, then fails to pay. Court fees - The value of the dispute is 200% of the income per capita or the Enforcement fees equivalent in local currency of USD 5,000, whichever is greater. Quality of judicial processes index (0-18) - The seller sues the buyer before the court with jurisdiction over commercial cases worth 200% of income per capita or $5,000. Court structure and proceedings (-1-5) - The seller requests a pretrial attachment to secure the claim. Case management (0-6) - The dispute on the quality of the goods requires an expert opinion. Court automation (0-4) - The judge decides in favor of the seller; there is no appeal. Alternative dispute resolution (0-3) - The seller enforces the judgment through a public sale of the buyer’s movable assets. Standardized Case Claim value PYG 40,856,430.00 Court name Asuncion First Instance Civil and Commercial Court City Covered Asuncion Latin America & OECD high Indicator Paraguay Caribbean income Overall Best Performer Time (days) 606 767.1 577.8 164.00 (Singapore) Cost (% of claim value) 30.0 31.4 21.5 9.00 (Iceland) Quality of judicial processes index (0-18) 9.5 8.4 11.0 15.50 (Australia) Figure – Enforcing Contracts in Paraguay and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 66.00: Brazil (Rank: 47) 62.81: Chile (Rank: 56) 59.77: Paraguay (Rank: 70) Page 52   of judicial processes Quality Business Doing index (0-18) 2018 Paraguay 9.5 8.4 11.0 15.50 (Australia) Figure – Enforcing Contracts in Paraguay and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 66.00: Brazil (Rank: 47) 62.81: Chile (Rank: 56) 59.77: Paraguay (Rank: 70) 55.66: Argentina (Rank: 102) 54.65: Bolivia (Rank: 109) 53.13: Regional Average (Latin America & Caribbean) Note: The ranking of economies on the ease of enforcing contracts is determined by sorting their distance to frontier scores for enforcing contracts. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Enforcing Contracts in Paraguay – Time and Cost Time Cost 1200 35 31.4 995 30.0 28.6 30 1000 Cost (% of claim value) 25.0 22.5 22.0 767.1 21.5 25 800 731 Time (days) 591 577.8 606 20 600 480 15 400 10 200 5 0 0 Argentina Bolivia Brazil Chile Latin America & OECD high income Paraguay Caribbean Figure – Enforcing Contracts in Paraguay and comparator economies – Measure of Quality Paraguay 2.5 2 2 3 Argentina 2 4 1 4.5 Bolivia 2.5 1.5 0 1.5 Brazil 3 3 3 4.1 Chile 1.5 3.5 1 3 OECD high income 2.5 2.9 2 3.6 Latin America & Caribbean 2.4 2 0.9 3.5 0 2 4 6 8 10 12 Page 53   14 Argentina Bolivia Brazil Chile Latin America & OECD high income Paraguay Caribbean Doing Business 2018 Paraguay Figure – Enforcing Contracts in Paraguay and comparator economies – Measure of Quality Paraguay 2.5 2 2 3 Argentina 2 4 1 4.5 Bolivia 2.5 1.5 0 1.5 Brazil 3 3 3 4.1 Chile 1.5 3.5 1 3 OECD high income 2.5 2.9 2 3.6 Latin America & Caribbean 2.4 2 0.9 3.5 0 2 4 6 8 10 12 14 Sub-Indicator Score Alternative dispute resolution (0­3) Case management (0­6) Court automation (0­4) Court structure and proceedings (­1­5) Details – Enforcing Contracts in Paraguay Indicator Time (days) 606 Filing and service 30 Trial and judgment 466 Enforcement of judgment 110 Cost (% of claim value) 30.0 Attorney fees 20 Court fees 5.5 Enforcement fees 4.5 Quality of judicial processes index (0-18) 9.5 Court structure and proceedings (-1-5) 3.0 Case management (0-6) 2.0 Court automation (0-4) 2.0 Alternative dispute resolution (0-3) 2.5 Details – Enforcing Contracts in Paraguay – Measure of Quality Page 54   Alternative dispute resolution (0-3) 2.5 Doing Business 2018 Paraguay Details – Enforcing Contracts in Paraguay – Measure of Quality Answer Score Quality of judicial processes index (0-18) 9.5 Court structure and proceedings (-1-5) 3.0 1. Is there a court or division of a court dedicated solely to hearing commercial cases? No 0.0 2. Small claims court 1.0 2.a. Is there a small claims court or a fast-track procedure for small claims? Yes 2.b. If yes, is self-representation allowed? No 3. Is pretrial attachment available? Yes 1.0 4. Are new cases assigned randomly to judges? Yes, automatic 1.0 5. Does a woman's testimony carry the same evidentiary weight in court as a man's? Yes 0.0 Case management (0-6) 2.0 1. Time standards 0.5 1.a. Are there laws setting overall time standards for key court events in a civil case? Yes 1.b. If yes, are the time standards set for at least three court events? Yes 1.c. Are these time standards respected in more than 50% of cases? No 2. Adjournments 0.5 2.a. Does the law regulate the maximum number of adjournments that can be Yes granted? 2.b. Are adjournments limited to unforeseen and exceptional circumstances? Yes 2.c. If rules on adjournments exist, are they respected in more than 50% of cases? No 3. Can two of the following four reports be generated about the competent court: (i) Yes 1.0 time to disposition report; (ii) clearance rate report; (iii) age of pending cases report; and (iv) single case progress report? 4. Is a pretrial conference among the case management techniques used before the No 0.0 competent court? 5. Are there any electronic case management tools in place within the competent court No 0.0 for use by judges? 6. Are there any electronic case management tools in place within the competent court No 0.0 for use by lawyers? Court automation (0-4) 2.0 1. Can the initial complaint be led electronically through a dedicated platform within No 0.0 the competent court? 2. Is it possible to carry out service of process electronically for claims led before the No 0.0 competent court? Page 55   1. Can the initial complaint be led electronically through a dedicated platform within No 0.0 Businesscourt? the competent Doing 2018 Paraguay 2. Is it possible to carry out service of process electronically for claims led before the No 0.0 competent court? 3. Can court fees be paid electronically within the competent court? Yes 1.0 4. Publication of judgments 1.0 4.a Are judgments rendered in commercial cases at all levels made available to the Yes general public through publication in o cial gazettes, in newspapers or on the internet or court website? 4.b. Are judgments rendered in commercial cases at the appellate and supreme Yes court level made available to the general public through publication in o cial gazettes, in newspapers or on the internet or court website? Alternative dispute resolution (0-3) 2.5 1. Arbitration 1.5 1.a. Is domestic commercial arbitration governed by a consolidated law or Yes consolidated chapter or section of the applicable code of civil procedure encompassing substantially all its aspects? 1.b. Are there any commercial disputes—aside from those that deal with public No order or public policy—that cannot be submitted to arbitration? 1.c. Are valid arbitration clauses or agreements usually enforced by the courts? Yes 2. Mediation/Conciliation 1.0 2.a. Is voluntary mediation or conciliation available? Yes 2.b. Are mediation, conciliation or both governed by a consolidated law or Yes consolidated chapter or section of the applicable code of civil procedure encompassing substantially all their aspects? 2.c. Are there nancial incentives for parties to attempt mediation or conciliation (i.e., No if mediation or conciliation is successful, a refund of court ling fees, income tax credits or the like)? Resolving Insolvency Doing Business studies the time, cost and outcome of insolvency proceedings involving domestic legal entities. These variables are used to calculate the recovery rate, which is recorded as cents on the dollar recovered by secured creditors through reorganization, liquidation or debt enforcement (foreclosure or receivership) proceedings. To determine the present value of the amount recovered by creditors, Doing Business uses the lending rates from the International Monetary Fund, supplemented with data from central banks and the Economist Intelligence Unit. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to recover debt (years) To make the data on the time, cost and outcome comparable across economies, several assumptions about the business and the case are Measured in calendar years used: Appeals and requests for extension are included - A hotel located in the largest city (or cities) has 201 employees and 50 Cost required to recover debt (% of debtor’s estate) suppliers. The hotel experiences nancial di culties. Page 56   Measured as percentage of estate value - The value of the hotel is 100% of the income per capita or the equivalent if mediation or conciliation is successful, a refund of court ling fees, income tax credits or the like)? Doing Business 2018 Paraguay Resolving Insolvency Doing Business studies the time, cost and outcome of insolvency proceedings involving domestic legal entities. These variables are used to calculate the recovery rate, which is recorded as cents on the dollar recovered by secured creditors through reorganization, liquidation or debt enforcement (foreclosure or receivership) proceedings. To determine the present value of the amount recovered by creditors, Doing Business uses the lending rates from the International Monetary Fund, supplemented with data from central banks and the Economist Intelligence Unit. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to recover debt (years) To make the data on the time, cost and outcome comparable across economies, several assumptions about the business and the case are Measured in calendar years used: Appeals and requests for extension are included - A hotel located in the largest city (or cities) has 201 employees and 50 Cost required to recover debt (% of debtor’s estate) suppliers. The hotel experiences nancial di culties. Measured as percentage of estate value - The value of the hotel is 100% of the income per capita or the equivalent Court fees in local currency of USD 200,000, whichever is greater. - The hotel has a loan from a domestic bank, secured by a mortgage over Fees of insolvency administrators the hotel’s real estate. The hotel cannot pay back the loan, but makes Lawyers’ fees enough money to operate otherwise. Assessors’ and auctioneers’ fees In addition, Doing Business evaluates the adequacy and integrity of the Other related fees existing legal framework applicable to liquidation and reorganization Outcome proceedings through the strength of insolvency framework index. The index tests whether economies adopted internationally accepted good Whether business continues operating as a going practices in four areas: commencement of proceedings, management of concern or business assets are sold piecemeal debtor’s assets, reorganization proceedings and creditor participation. Recovery rate for creditors Measures the cents on the dollar recovered by secured creditors Outcome for the business (survival or not) determines the maximum value that can be recovered Official costs of the insolvency proceedings are deducted Depreciation of furniture is taken into account Present value of debt recovered Strength of insolvency framework index (0- 16) Sum of the scores of four component indices: Commencement of proceedings index (0-3) Management of debtor’s assets index (0-6) Reorganization proceedings index (0-3) Creditor participation index (0-4) Latin America & OECD high Indicator Paraguay Caribbean income Overall Best Performer Recovery rate (cents on the dollar) 21.6 30.8 71.2 93.1 (Norway) Time (years) 3.9 2.9 1.7 0.4 (Ireland) Page 57   Cost (% of estate) 9.0 16.8 9.1 1.00 (Norway) Creditor participation index (0-4) Doing Business 2018 Paraguay Latin America & OECD high Indicator Paraguay Caribbean income Overall Best Performer Recovery rate (cents on the dollar) 21.6 30.8 71.2 93.1 (Norway) Time (years) 3.9 2.9 1.7 0.4 (Ireland) Cost (% of estate) 9.0 16.8 9.1 1.00 (Norway) Outcome (0 as piecemeal sale and 1 as going 0 .. .. .. concern) Strength of insolvency framework index (0-16) 9.5 7.2 12.1 15.00 (6 Economies) Figure – Resolving Insolvency in Paraguay and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 59.47: Chile (Rank: 52) 47.46: Brazil (Rank: 80) 42.32: Bolivia (Rank: 99) 41.32: Paraguay (Rank: 100) 41.24: Argentina (Rank: 101) 38.95: Regional Average (Latin America & Caribbean) Note: The ranking of economies on the ease of resolving insolvency is determined by sorting their distance to frontier scores for resolving insolvency. These scores are the simple average of the distance to frontier scores for the recovery rate and the strength of insolvency framework index. Figure – Resolving Insolvency in Paraguay – Time and Cost Time Cost 4.5 16.5 16.8 18 4.0 3.9 4 14.5 14.5 16 3.5 14 12.0 2.9 Cost (% of estate) Time (years) 3 12 2.4 9.1 2.5 9.0 10 2.0 2 1.8 1.7 8 1.5 6 1 4 0.5 2 0 0 Argentina Bolivia Brazil Chile Latin America & OECD high income Paraguay Caribbean Figure – Resolving Insolvency in Paraguay and comparator economies – Measure of Quality Paraguay 4 2.5 2 1 Page 58   Argentina 4 2.5 1 2 Argentina Bolivia Brazil Chile Latin America & OECD high income Paraguay Caribbean Doing Business 2018 Paraguay Figure – Resolving Insolvency in Paraguay and comparator economies – Measure of Quality Paraguay 4 2.5 2 1 Argentina 4 2.5 1 2 Bolivia 3 2.5 0 1 Brazil 5.5 2.5 3 2 Chile 4.5 2.5 3 2 OECD high income 5.4 2.8 2.3 1.9 Latin America & Caribbean 3.7 2.4 1.9 0.8 0 2 4 6 8 10 12 14 Sub-Indicator Score Management of debtor's assets index (0­6) Commencement of proceedings index (0­3) Creditor participation index (0­4) Reorganization proceedings index (0­3) Figure – Resolving Insolvency in Paraguay and comparator economies – Recovery Rate Recovery Rate (cents on the dollar) 45 40.9 40.8 40 35 30.8 30 25 21.6 21.5 20 15 12.7 10 5 0 Paraguay Argentina Bolivia Brazil Chile Latin America & Caribbean Details – Resolving Insolvency in Paraguay Indicator Answer Explanation Proceeding foreclosure BizBank will have 3 alternatives: i) Start a foreclosure proceeding, or ii) request Mirage’s insolvency and start a reorganization proceeding, or iii) Mirage or it creditors will request the company’s insolvency and start a liquidation proceeding. In practice, the BizBank would start foreclosure proceedings, as reorganization proceedings are rare in Paraguay and banks prefer to enforce its collateral and get paid through foreclosure procedure. Foreclosure proceedings are not normally converted into collective insolvency (liquidation or reorganization) proceedings. Outcome piecemeal sale Having chosen the option of initiating foreclosure proceedings, the hotel will cease operations and the property (assets) will be sold at public auction (assets will be sold piecemeal). Once the order for the auction is issued by the Court, a public auctioneer will be in charge of the management of the debtor’s assets. The public auctioneer is in charge of the Page 59   sale of such assets and distribute the proceeds of sale among the creditors according to the Paraguay Argentina Bolivia Brazil Chile Latin America & Caribbean Doing Business 2018 Paraguay Details – Resolving Insolvency in Paraguay Indicator Answer Explanation Proceeding foreclosure BizBank will have 3 alternatives: i) Start a foreclosure proceeding, or ii) request Mirage’s insolvency and start a reorganization proceeding, or iii) Mirage or it creditors will request the company’s insolvency and start a liquidation proceeding. In practice, the BizBank would start foreclosure proceedings, as reorganization proceedings are rare in Paraguay and banks prefer to enforce its collateral and get paid through foreclosure procedure. Foreclosure proceedings are not normally converted into collective insolvency (liquidation or reorganization) proceedings. Outcome piecemeal sale Having chosen the option of initiating foreclosure proceedings, the hotel will cease operations and the property (assets) will be sold at public auction (assets will be sold piecemeal). Once the order for the auction is issued by the Court, a public auctioneer will be in charge of the management of the debtor’s assets. The public auctioneer is in charge of the sale of such assets and distribute the proceeds of sale among the creditors according to the priority set forth by law. BizBank as a secured creditor will have priority with respect to other creditors. There is no possibility for the company to continue operating after the auction takes place. Time (in years) 3.9 The foreclosure procedure in in Paraguay will take approximately 4 years from the moment of the debtor's default until the debt is repaid to the secured creditor. It will take 1.5 years until the approval to initiate foreclosure is handed down by the Court including all required notifications and the debtor’s counter-claim. Henceforward, it is important to bear in mind that the debtor will file an appeal which will add at least an additional year until the appeal is decided. After that, it will take an additional year for the auction to take place (including the necessary time to appoint an auctioneer, the scheduling of the auction and the sale of the real estate). It will take around 6 months for the judge to approve the auction, the sale of the estate and the distribution of the remaining among unsecure creditors. Cost (% of 9.0 The cost for a foreclosure proceeding will amount to approximately 9% of the value of estate) Mirage’s estate. The main component of this expenditure would be the attorney’s fees, which would amount 7% of the value of Mirage’s estate). The rest of the cost (2%) is related to judicial and service fees, and fees related to the public auction. Recovery rate (cents on the 21.6 dollar) Details – Resolving Insolvency in Paraguay – Measure of Quality Answer Score Strength of insolvency framework index (0-16) 9.5 Commencement of proceedings index (0-3) 2.5 What procedures are available to a DEBTOR when commencing insolvency (a) Debtor may 1.0 proceedings? le for both liquidation and reorganization Does the insolvency framework allow a CREDITOR to le for insolvency of the debtor? (b) Yes, but a 0.5 creditor may le for liquidation only Page 60   dollar) Doing Business 2018 Paraguay Details – Resolving Insolvency in Paraguay – Measure of Quality Answer Score Strength of insolvency framework index (0-16) 9.5 Commencement of proceedings index (0-3) 2.5 What procedures are available to a DEBTOR when commencing insolvency (a) Debtor may 1.0 proceedings? le for both liquidation and reorganization Does the insolvency framework allow a CREDITOR to le for insolvency of the debtor? (b) Yes, but a 0.5 creditor may le for liquidation only What basis for commencement of the insolvency proceedings is allowed under the (a) Debtor is 1.0 insolvency framework? generally unable to pay its debts as they mature Management of debtor's assets index (0-6) 4.0 Does the insolvency framework allow the continuation of contracts supplying essential Yes 1.0 goods and services to the debtor? Does the insolvency framework allow the rejection by the debtor of overly burdensome Yes 1.0 contracts? Does the insolvency framework allow avoidance of preferential transactions? Yes 1.0 Does the insolvency framework allow avoidance of undervalued transactions? Yes 1.0 Does the insolvency framework provide for the possibility of the debtor obtaining credit No 0.0 after commencement of insolvency proceedings? Does the insolvency framework assign priority to post-commencement credit? (c) No priority is 0.0 assigned to post- commencement creditors Reorganization proceedings index (0-3) 1.0 Which creditors vote on the proposed reorganization plan? (c) Other 1.0 Does the insolvency framework require that dissenting creditors in reorganization No 0.0 receive at least as much as what they would obtain in a liquidation? Are the creditors devided into classes for the purposes of voting on the reorganization No 0.0 plan, does each class vote separately and are creditors in the same class treated equally? Creditor participation index (0-4) 2.0 Does the insolvency framework require approval by the creditors for selection or No 0.0 appointment of the insolvency representative? Does the insolvency framework require approval by the creditors for sale of substantial No 0.0 Page 61   Creditor Doing participation Business 2018 index (0-4) Paraguay 2.0 Does the insolvency framework require approval by the creditors for selection or No 0.0 appointment of the insolvency representative? Does the insolvency framework require approval by the creditors for sale of substantial No 0.0 assets of the debtor? Does the insolvency framework provide that a creditor has the right to request Yes 1.0 information from the insolvency representative? Does the insolvency framework provide that a creditor has the right to object to Yes 1.0 decisions accepting or rejecting creditors' claims? Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”. Labor Market Regulation Doing Business presents the data for the labor market regulation indicators in an annex. The report does not present rankings of economies on these indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business. Detailed data collected on labor market regulation are available on the Doing Business website (http://www.doingbusiness.org/data/exploretopics/labor-market-regulation). The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Hiring To make the data comparable across economies, several assumptions (i) whether xed-term contracts are prohibited for about the worker and the business are used. permanent tasks; (ii) maximum cumulative duration of xed-term contracts; (iii) length of the The worker: probationary period; (iv) minimum wage. - Is a cashier in a supermarket or grocery store, age 19, with one year of work experience. Working hours - Is a full-time employee. (i) maximum number of working days allowed per - Is not a member of the labor union, unless membership is mandatory. week; (ii) premiums for work: at night, on a weekly rest day and overtime; (iii) whether there are The business: restrictions on work at night, work on a weekly rest - Is a limited liability company (or the equivalent in the economy). day and for overtime work; (iv) whether nonpregnant - Operates a supermarket or grocery store in the economy’s largest and nonnursing women can work same night hours business city. For 11 economies the data are also collected for the second as men; (v) length of paid annual leave. largest business city. - Has 60 employees. Redundancy rules - Is subject to collective bargaining agreements if such agreements cover (i) whether redundancy can be basis for terminating more than 50% of the food retail sector and they apply even to rms that workers; (ii) whether employer needs to notify are not party to them. and/or get approval from third party to terminate 1 - Abides by every law and regulation but does not grant workers more redundant worker and a group of 9 redundant bene ts than those mandated by law, regulation or (if applicable) collective workers; (iii) whether law requires employer to bargaining agreements. reassign or retrain a worker before making worker redundant; (iv) whether priority rules apply for redundancies and reemployment. Redundancy cost (i) notice period for redundancy dismissal; (ii) severance payments due when terminating a redundant worker. Job quality (i) whether law mandates equal remuneration for Page 62   work of equal value and nondiscrimination based on the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”. Doing Business 2018 Paraguay Labor Market Regulation Doing Business presents the data for the labor market regulation indicators in an annex. The report does not present rankings of economies on these indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business. Detailed data collected on labor market regulation are available on the Doing Business website (http://www.doingbusiness.org/data/exploretopics/labor-market-regulation). The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Hiring To make the data comparable across economies, several assumptions (i) whether xed-term contracts are prohibited for about the worker and the business are used. permanent tasks; (ii) maximum cumulative duration of xed-term contracts; (iii) length of the The worker: probationary period; (iv) minimum wage. - Is a cashier in a supermarket or grocery store, age 19, with one year of work experience. Working hours - Is a full-time employee. (i) maximum number of working days allowed per - Is not a member of the labor union, unless membership is mandatory. week; (ii) premiums for work: at night, on a weekly rest day and overtime; (iii) whether there are The business: restrictions on work at night, work on a weekly rest - Is a limited liability company (or the equivalent in the economy). day and for overtime work; (iv) whether nonpregnant - Operates a supermarket or grocery store in the economy’s largest and nonnursing women can work same night hours business city. For 11 economies the data are also collected for the second as men; (v) length of paid annual leave. largest business city. - Has 60 employees. Redundancy rules - Is subject to collective bargaining agreements if such agreements cover (i) whether redundancy can be basis for terminating more than 50% of the food retail sector and they apply even to rms that workers; (ii) whether employer needs to notify are not party to them. and/or get approval from third party to terminate 1 - Abides by every law and regulation but does not grant workers more redundant worker and a group of 9 redundant bene ts than those mandated by law, regulation or (if applicable) collective workers; (iii) whether law requires employer to bargaining agreements. reassign or retrain a worker before making worker redundant; (iv) whether priority rules apply for redundancies and reemployment. Redundancy cost (i) notice period for redundancy dismissal; (ii) severance payments due when terminating a redundant worker. Job quality (i) whether law mandates equal remuneration for work of equal value and nondiscrimination based on gender in hiring; (ii) whether law mandates paid or unpaid maternity leave; (iii) length of paid maternity leave; (iv) whether employees on maternity leave receive 100% of wages; (v) availability of ve fully paid days of sick leave a year; (vi) eligibility requirements for unemployment protection. Details – Labor Market Regulation in Paraguay Answer Hiring Page 63   Fixed-term contracts prohibited for permanent tasks? Yes days of sick leave a year; (vi) eligibility requirements for unemployment protection. Doing Business 2018 Paraguay Details – Labor Market Regulation in Paraguay Answer Hiring Fixed-term contracts prohibited for permanent tasks? Yes Maximum length of a single xed-term contract (months) 12.0 Maximum length of xed-term contracts, including renewals (months) No Limit Minimum wage applicable to the worker assumed in the case study (US$/month) 365.0 Ratio of minimum wage to value added per worker 0.7 Maximum length of probationary period (months) 1.0 Working hours Standard workday 8.0 Maximum number of working days per week 6.0 Premium for night work (% of hourly pay) 30.0 Premium for work on weekly rest day (% of hourly pay) 100.0 Premium for overtime work (% of hourly pay) 50.0 Restrictions on night work? Yes Whether nonpregnant and nonnursing women can work the same night hours as men Yes Restrictions on weekly holiday? No Restrictions on overtime work? Yes Paid annual leave for a worker with 1 year of tenure (working days) 12.0 Paid annual leave for a worker with 5 years of tenure (working days) 18.0 Paid annual leave for a worker with 10 years of tenure (working days) 30.0 Paid annual leave (average for workers with 1, 5 and 10 years of tenure, in working days) 20.0 Redundancy rules Dismissal due to redundancy allowed by law? Yes Third-party noti cation if one worker is dismissed? Yes Third-party approval if one worker is dismissed? Yes Third-party noti cation if nine workers are dismissed? Yes Third-party approval if nine workers are dismissed? Yes Retraining or reassignment obligation before redundancy? No Page 64   Third-party Doing approval Business 2018 if nine workers are dismissed? Paraguay Yes Retraining or reassignment obligation before redundancy? No Priority rules for redundancies? No Priority rules for reemployment? Yes Redundancy cost Notice period for redundancy dismissal for a worker with 1 year of tenure 7.5 Notice period for redundancy dismissal for a worker with 5 years of tenure 10.0 Notice period for redundancy dismissal for a worker with 10 years of tenure 15.0 Notice period for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure) 10.8 Severance pay for redundancy dismissal for a worker with 1 year of tenure 2.1 Severance pay for redundancy dismissal for a worker with 5 years of tenure 10.7 Severance pay for redundancy dismissal for a worker with 10 years of tenure 42.9 Severance pay for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure) 18.6 Job quality Equal remuneration for work of equal value? Yes Gender nondiscrimination in hiring? No Paid or unpaid maternity leave mandated by law? Yes Minimum length of maternity leave (calendar days)? 126.0 Receive 100% of wages on maternity leave? No Five fully paid days of sick leave a year? Yes Unemployment protection after one year of employment? No Minimum contribution period for unemployment protection (months)? n.a. Business Reforms in Paraguay In the year ending June 1, 2017, 119 economies implemented 264 total reforms across the di erent areas measured by Doing Business. Doing Business has recorded more than 2,900 regulatory reforms making it easier to do business since 2004. Reforms inspired by Doing Business have been implemented by economies in all regions. The following are the reforms for Paraguay implemented since Doing Business 2008. = Doing Business reform making it easier to do business. = Change making it more di cult to do business. DB2018 Labor Market Regulation: Paraguay increased the mandatory the length of paid maternity leave DB2017 Getting Credit: Paraguay reduced access to credit information by limiting the distribution of historical data on borrowers. Trading across Borders: Paraguay made trading across borders easier by introducing a single window for exporting, which reduced the time required of border and documentary compliance. Page 65   Minimum contribution period for unemployment protection (months)? n.a. Doing Business 2018 Paraguay Business Reforms in Paraguay In the year ending June 1, 2017, 119 economies implemented 264 total reforms across the di erent areas measured by Doing Business. Doing Business has recorded more than 2,900 regulatory reforms making it easier to do business since 2004. Reforms inspired by Doing Business have been implemented by economies in all regions. The following are the reforms for Paraguay implemented since Doing Business 2008. = Doing Business reform making it easier to do business. = Change making it more di cult to do business. DB2018 Labor Market Regulation: Paraguay increased the mandatory the length of paid maternity leave DB2017 Getting Credit: Paraguay reduced access to credit information by limiting the distribution of historical data on borrowers. Trading across Borders: Paraguay made trading across borders easier by introducing a single window for exporting, which reduced the time required of border and documentary compliance. DB2014 Paying Taxes: Paraguay made paying taxes easier for companies by making electronic ling and payment mandatory for corporate income and value added taxes. DB2012 Dealing with Construction Permits: Paraguay made dealing with construction permits easier by implementing a risk-based approval system and a single window for obtaining construction permits. Getting Credit: Paraguay improved its credit information system by establishing an online platform for nancial institutions to exchange information with the public credit registry. Paying Taxes: Paraguay made paying taxes more burdensome for companies by introducing new tax declarations that must be led monthly. DB2011 Dealing with Construction Permits: Paraguay made dealing with construction permits easier by creating a new administrative structure and a better tracking system in the municipality of Asunción. DB2010 Trading across Borders: Paraguay reduced the time required for trading across borders by implementing an electronic single- window system for exports and improving the risk-based inspection system. DB2008 Starting a Business: Paraguay reduced the time required for starting a business by creating a one-stop shop and linking multiple agencies to it. Page 66   Starting a Business: Paraguay reduced the time required for starting a business by creating a one-stop shop and linking multiple agencies to it. Doing Business 2018 Paraguay Page 67