Bolivia Market Entry

Bolivia Market Entry

Basic conditions for the use of Czech goods on the market

Subchapters:

  • Market entry
  • Forms and conditions of operation on the market
  • Marketing and Communications
  • Issues of intellectual property protection
  • Public procurement market
  • Payment terms, payment ethics and resolution of commercial disputes
  • Visas, fees, specific conditions of travel to the territory
  • Employment of citizens from the Czech Republic
  • Fairs and events

Market entry

It should be assumed that the Bolivian market is open and that the world’s major producers of goods and service providers are interested in it, despite its relatively small size. A subject on the market is replaced by a competitor if it, for some reason, limits its activities, therefore very quickly.

According to cheeroutdoor.com, large companies are represented in Bolivia directly by their own permanent representative or local representative, or affiliates based in La Paz, Santa Cruz or Cochabamba. The existence of a local representative is essential when applying for government contracts. The warehouse system does not work very well here, sales are carried out through our own consignment warehouse (cars, engineering production) either directly to the distribution network or through sales outlets. As Bolivia is landlocked, all goods are transported by air or through seaports in Chile, Argentina, Brazil and Peru. Seasonal weather effects can therefore affect land transport and favor air transport. Free trade and industrial zones can also be used to distribute goods.

Advertising is of great importance for sales promotion. The Bolivian consumer is used to it from radio, TV broadcasts and especially from the daily press.

Participation in a trade fair, a visit to the country as part of an official mission or a business trip to the territory is beneficial for understanding local ways of media presentation. Advertisements in the press, professional and lay, as well as other instruments of media influence, are common.

Consulting services can also be used to get ideas about business opportunities in Bolivia. More information can be obtained from the National Chamber of Consulting Services (Cámara Nacional de Consultoría – CANEC).

Bolivia is a signatory to the founding Agreement on the World Trade Organization (WTO). Within the framework of the WTO, it has signed a number of important agreements related to the conduct of business operations on an international scale, such as the Multilateral Agreements on Trade in Goods, the General Agreement on Services, the Agreement on the Legal Aspects of Intellectual Property in International Trade, the Agreement on the Testing Mechanism in International Trade, etc.

Within the framework of ALADI (Latin American Integration Association), it acceded to the Agreement on Preferential Tariff Rates for the States of the Region and to the Agreement on Market Opening. Bolivia uses the system of tariff preferences provided by the EU (GSP+). The provision of tariff preferences by the US under ATPDEA was stopped by the US in 2008.

The Bolivian trade system is based on a liberal model without the application of specific restrictive measures such as import permits, special licenses or value and volume restrictions. For goods of a specific nature (weapons, ammunition, poisonous substances, medicines, food, animals, historical and cultural objects, etc.), restrictions are applied resulting from the need to ensure the protection of health and safety of persons, artistic and cultural heritage and the security of the state.

Special restrictions apply to the following items:

– Agricultural products – since February 2008, Bolivia has imposed a tariff on the import of beef and poultry, wheat flour, corn, rice and vegetable oil, while banning the export of all these products except vegetable oil. Currently, the export of these products is allowed, but regulated by quotas.

– Used clothing – since January 2004, Bolivia has banned the import of certain types of used clothing and footwear.

– Used vehicles – since February 2014, Bolivia has introduced a special tax on the import of cars older than 5 years (up to 50%).

Except for special exceptions, prices are set based on market mechanisms. The main sector in which prices are regulated is the area of ​​fuels and fuels (for foreign customers, the price of fuel is higher than for citizens of Bolivia).

Municipal and municipal authorities regulate the prices of water and waste services. In the field of agricultural production, the state controls the prices of meat, sugar and some other crops. In particular, it oversees that the level of internal prices is “fair” and that the internal market is supplied preferentially, otherwise it decides to restrict exports.

Forms and conditions of operation on the market

Investors and/or foreign companies can decide, in accordance with the Commercial Code, what legal form the entity established by them will have:

– Joint stock company (SA)

– Limited Liability Company (SRL)

– Joint Venture (SC)

– Limited partnership

– Other companies

The conditions for the establishment of a joint-venture are laid down by Government Decree (Decreto Supremo) No. 22526 of 13/06/1990 and Law No. 1182 of 1990 (Investment Law). The legislation governing the establishment of a commercial company is quite complicated, and without the help of a local commercial lawyer or a specialized consulting firm, this process can be very expensive financially.

The company formation process usually takes 4-8 months. The company must have its status approved by a notary public and ensure publication in the local press. It is also necessary to obtain a permit to operate from the tax office, the Ministry of Economy and Finance, and also from the local municipal authority.

Marketing and communication

Our products are exotic on the Bolivian market, and the Czech Republic is a completely unknown concept to many Bolivians. At the same time, advertising is ubiquitous and customers are used to it and respond to it.

The best advertising is the physical presentation of the product (where technically possible) using fairs.

A personal presentation by a representative of the manufacturer/authorized dealer is the most effective sales promotion. In this context, the Bolivian side also takes a much more positive view of the business operation if it knows its partner personally.

An unnecessary waste of funds can be considered a presentation by mail, attempts to sell at a distance, etc. In most cases, this correspondence ends up in the trash, or in the best case, in the file of deferred cases.

The most effective is television advertising, followed by billboards, daily newspapers, magazines, specialized or social magazines and also radio broadcasts (up to million inhabitants listen to the radio regularly). Promotional materials, catalogs, offers and other publications must always be in Spanish, English or another language mutation is not enough.

Issues of intellectual property protection

Compliance with intellectual property protection and international standards is low and insufficient. Although the Bolivian Criminal Code considers the violation of intellectual property protection to be a public offense, in practice this illegal activity is not prosecuted.

Video, music and software piracy in Bolivia is among the highest in Latin America – film piracy is 100%, and music piracy is 90%.

The Law on the Protection of Copyright (No. 1322 of 1992) protects literary, artistic, scientific and other works (e.g. also software) until the end of the author’s life and for a further 50 years. This law only protects the rights of Bolivian authors or authors with permanent residence in Bolivia. Foreign authors are protected by international conventions and agreements of which Bolivia is a member. Bolivia is, for example, among the member countries of the World Intellectual Property Organization (WIPO) and is a signatory to the Nice Agreement and the Paris, Bern and Geneva Conventions regarding the protection of intellectual property.

The national authority for the protection of intellectual property is the Servicio Nacional de Propiedad Intellectual (SENAPI). This office, for example, discusses applications for patents. Patents are protected in Bolivia for 20 years. Trademarks are registered for 10 years and their registration can be extended for the same period.

The Film and Video Projection Law (No. 1302 of 1991) includes elements of intellectual property protection and establishes the National Film Council (Corporación Nacional del Cine, CONACINE). All films and videos shown must be registered with CONACINE.

Public procurement market

State contracts represent a significant part of GDP. The central government, regional governments and state-owned enterprises have relatively significant needs in the purchase of machinery, means of transport, material and various services. By law, tenders are issued for public contracts. Information about the needs of the state sector is published in the official gazette La Gaceta, published by the Ministry of the Presidency, which is also one of the largest implementers of public projects in the country. This office also has the largest amount of funds available from the State Budget Act, which are used mainly for the fight against poverty, job creation, infrastructure, health and hygiene prevention, housing construction, educational process, but also for the fight against drug smuggling in the form of introduction alternative agricultural production on liquidated coca plantations.

In order to encourage local production, the conditions for the award of public contracts were changed in July 2007 when the Government adopted a new Decree No. 29190 of 11/07/2007. Another change took place in June 2009 based on the adoption of Government Decree No. 181 of 28. 6. 2009. The main change concerned the requirement that the government for projects up to 100,000 USD gave preference to small and medium-sized Bolivian firms and companies. The same system is applied to tenders from 100 thousand. USD to USD million. International tenders are announced for orders over USD million.

Participation in international tenders for state contracts is subject to the fulfillment of a number of conditions. In addition to registration in the register of suppliers for the state sector, these are mainly requirements of a technical and commercial nature. Local participants usually get preferential treatment compared to foreign companies. Special foreign tenders are announced by the Ministry of the Interior or the Ministry of Defense and relate to requirements for defense and security technology.

Payment terms, payment ethics and resolution of commercial disputes

There is a system of independent courts in the country, to which participants in any dispute, including those between business partners, can turn. There is also an appeal system up to the Supreme Court. However, a lot of bureaucracy and the necessary help of a local legal representative/consultant must be expected.

In November 2007, Bolivia was the first member country to withdraw from the International Center for Settlement of Investment Disputes (ICSID). Litigation in Bolivia is characterized by its protracted nature, and there is a noticeable problem not only with bureaucracy, but also with corruption.

All common payment instruments used in foreign trade are currently used in the commercial payment system. These are mainly different forms of letters of credit. It is possible to use a payment method called “documents against acceptance”. In uncertain cases, the method of accepting a promissory note signed by the client and endorsed by a good bank can also be used. For smaller shops, check payments are also used. The choice of payment method fully depends on the level of contact, or of trust between business partners and state authorities should not interfere in it.

The payment morale of local entities is usually not high and generally corresponds to general fiscal and payment discipline. Therefore, we can only recommend such instruments that ensure the Czech supplier/customer that in case of eventual problems that the local entity may get into through its own fault or through no fault of its own, the Czech company will not lose its financial resources.

Visas, fees, specific conditions for traveling to the territory

With effect from 1 October 2003, Bolivia canceled the visa requirement for tourist trips of citizens of the Czech Republic. This happened on the basis of Government Decree No. 27150 of 3/9/2003. Joint decision of the Ministry of Foreign Affairs and the Ministry of the Interior of Bolivia No. 2/2007 of 31/8/2007 established specific conditions for a visa-free stay for tourist purposes:

  • visa-free stay may not exceed 90 days per year
  • the stay cannot be extended
  • its purpose cannot be changed during the stay (applying for a temporary or long-term stay)
  • for a longer stay, you need to obtain a visa at the embassy of Bolivia (for the Czech Republic, the embassy of Bolivia is located in Vienna)

Before the trip, it is recommended to contact the embassy, ​​ask about the current situation in the country and in any case undergo voluntary online registration in the DROZD database, where the planned itinerary can be entered.

There is an airport tax of USD 25 for international flights from Bolivia, BOB 15 for domestic flights. Persons who have spent more than 3 months in Bolivia must pay the so-called departure tax, which amounts to 155 BOB. Currency exchange is not mandatory.

The Agreement on the abolition of the visa requirement for holders of diplomatic and official passports from 1991, which applies to holders of diplomatic and official passports of the Czech Republic and diplomatic and official passports of Bolivia, remains in force.

the permitted visa-free stay under this agreement is also 90 days. For a stay for purposes other than tourism, you need to obtain a so-called special visa (Visa de Objeto Determinado). This visa is only valid for 30 days and is used to apply for a temporary or long-term stay during this time. It can be extended twice, each time by a maximum of 30 days.

The condition for entering the territory of Bolivia is the fulfillment of the following requirements:

  • presentation of a valid travel document valid for at least 6 months
  • presentation of proof of vaccination against yellow fever (for selected areas of the Amazon)
  • submission of a return ticket or travel plan.

For a tourist stay in Bolivia longer than the permitted 90 days, a fine of 10 BOB must be paid for each day, for students it is 5 BOB.

When traveling by motor vehicle, upon entering Bolivia, you are required to present a valid driver’s license, vehicle technical certificate, and insurance with either a Bolivian or an international insurance company recognized in Bolivia.

In Bolivia, normal import restrictions apply to travelers, with the prohibition of importing raw food, more than 200 cigarettes and more than 1 liter of alcoholic beverages. International regulations apply to the import and export of animals and plants, i.e. that an international veterinary or phytosanitary certificate and, depending on the type of animal, also vaccination certificate. It is not possible to export species protected by law or listed on the endangered species list. The export/import of narcotics is prohibited. Also, original artefacts that are considered national cultural heritage may not be exported.

In terms of security conditions, Bolivia is a country with a relatively high street crime rate. All general safety rules apply to the stay, following which you can prevent robbery. The main safety principles are not to travel at night, only go out after dark in neighborhoods with increased security measures, do not carry too much cash, leave your luggage in a safe place and prefer simple and unpretentious clothes. In general, the most dangerous regions of Bolivia are the largest cities of La Paz, Santa Cruz and Cochabamba. In these cases, it is mainly petty crime such as pickpocketing. It is therefore necessary to pay extra attention to personal belongings, especially in frequented public places (marketplaces, etc.). It often happens that access roads to some areas of Bolivia are blocked by strikes.

Employment of citizens from the Czech Republic

For the employment of citizens of the Czech Republic in Bolivia, it is necessary that they have a working residence permit – i.e. relevant temporary or permanent residence permit.

Details can be obtained from the Bolivian Migration Office:

Ministerio de Gobierno (Ministry of the Interior)

Dirección General de Migración (Migration Office) Av. Camacho 1480 – Zona Central

La Paz, Bolivia

Fairs and events

Most of the important fairs are organized by three agencies: FEXPOCRUZ (for the fairs in the city of Santa Cruz), FEICOBOL (for most of the fairs in Cochabamba) and TECNOEVENTOS.

FERIA INTERNACIONAL DE COCHABAMBA 2022

Focus: general focus

Date: 16-27. June 2022

Venue: Recinto Ferial de Alalay

FIFBO (Bolivia International Franchise Fair)

Focus: franchising and licensing

Deadline: September 2022

Venue: Feria Exposición de Santa Cruz

FexpoHealth

Focus: healthcare

Date: 4.-7. August 2022

Venue: Recinto Ferial de Alalay

FESTIVAL GASTRONOMICO DE COCHABAMBA 2022

Focus: gastronomy

Date: 8-11. September 2022

Venue: Recinto Ferial de Alalay

EXPOCRUZ 2022

Focus: industry, agriculture, construction – general fair

Deadline: 16-26. September 2022

Venue: Feria de Exposición de Santa Cruz (note The most important international fair)

EXPO ALIMENTA 2022

Focus: food, drinks and others

Date: 20-23 October 2022

Venue: Recinto Ferial de Alalay

SOBRE RUEDA

Focus: automotive industry, bicycles, etc.

Date: 2.-6.11. 2022

Venue: Recinto Ferial de Alalay

CONSTRUCTION-INDUSTRIA EXPO

Focus: construction and industry

Date: 17-20 November 2022

Venue: Recinto Ferial de Alalay

FERIA PARA MUJERES Y BEBÉS

Focus: equipment for maternity and children

Deadline: December 2022

Venue: Recinto Ferial de Alalay

 

Practical telephone numbers (emergency services, police, firemen, information lines, etc.)

The international phone code for Bolivia is +591

– Police: 110

– Firefighters: 119

– First aid: 118

– Red Cross: 00591-2-2202930 – 103, 104, 105 106, 108, 114

– El Alto Airport: 00591-2-2157300

– Santa Cruz Airport: 00591-3-338-5000

– Cochabamba Airport: 00591-4-412-0400

Hospital in La Paz:

– Clínica 6 de Agosto: 00591-2-2430321

– Clínica Alemana: 00591-2-2433676, 2432155

– Clínica de Especilidades y Accidentes Trauma Klinik SA: 00591-2-2246275, 2244884

Important web links and contacts

– Portal of the presidential office: www.presidencia.gob.bo

– Bolivian Government Portal: www.bolivia.gob.bo

– Bolivian Chamber of Deputies: www.diputados.bo/

– Portal of the Bolivian Judiciary: www.organojudicial.gob.bo/

– Supreme Court: http://tsj.bo/

– Constitutional Court: www.tcpbolivia.bo/tcp/

– Supreme Electoral Court: www.oep.org.bo

– Supreme Audit Office: www.contraloria.gob.bo/portal

– Supreme Prosecutor’s Office: www.fiscalia.gob.bo

– Office of the Ombudsman: www.defensoria.gob.bo

– Bolivian Council for the Protection of LP, Democracy and Development: www.derechoshumanosbolivia.org

– Central Bank of Bolivia: www.bcb.gob.bo

– National Bank (Banco Nacional): www.bnb.com.bo

– Tax Service Office: www.impuestos.gob.bo

– Financial System Control Office: www.asfi.gob.bo/

– National Regional Development Fund: www.fndr.gob.bo/es

– National Statistical Office: www.ine.gob.bo

– National Customs Office: www.aduana.gob.bo

– National Meteorological and Hydrological Office: www.senamhi.gob.bo

– Office for Economic and Social Policy Analysis: www.udape.gob.bo

– National Veterinary Administration: www.senasag.gob.bo

– La Razón newspaper: www.la-razon.com

– El Diario newspaper: www.eldiario.net

– La Prensa newspaper: www.laprensa.com.bo

– Migration Police Directorate: www.migracion.gob.bo

– Directorate of Civil Aviation: www.dgac.gob.bo

– Bolivian State Oil Company: www.ypfb.gob.bo

– Bolivian Institute of Foreign Trade: www.ibce.org.bo

– Commercial register: www.fundempresa.org.bo

– Tourist information about Bolivia: www.bolivia.travel

– List of Bolivian companies: www.miguiabolivia.com

– Bolivian National Chamber of Commerce: www.cnc.bo

– National Chamber of Industry: www.bolivia-industry.com/aldia.php

– Confederation of Private Entrepreneurs of Bolivia: www.cepb.org.bo

– National Chamber of Exporters of Bolivia: www.caneb.org.bo

– Chamber of Industry, Commerce, Services and Tourism in Santa Cruz: www.cainco.org.bo

– Association of Private Banks of Bolivia: www.asoban.bo

– Bolivian Chamber of Hydrocarbons: www.cbh.org.bo

– Bolivian Chamber of Construction Industry: www.cadecolp.com

– Bolivian Forestry Chamber: www.cfb.org.bo

Bolivia Market Entry