Understanding Investment Law in the Dominican Republic: A Guide for Foreign Investors

This guide breaks down the key investment laws, tax incentives, and regulations that foreign investors should know before making their move.

Key Investment Laws Protecting Foreign Investors

The Dominican Republic offers one of the most investor-friendly legal frameworks in the Caribbean. Several laws ensure that foreign investors receive the same rights and protections as local investors.

1. Foreign Investment Law (Law 16-95)

• Foreign investors enjoy 100% ownership rights in most business sectors, including real estate and tourism.

• No restrictions on repatriation of profits, meaning investors can freely transfer funds abroad.

• Equal legal protections for foreign and local investors.

2. Law 158-01: Tourism Incentive Law

• 100% tax exemptions on income tax, import duties, and municipal taxes for tourism-related developments.

• Applies to hotels, resorts, eco-tourism projects, and mixed-use developments in designated tourism areas like Samaná.

• Tax benefits last up to 10 years, making real estate investment more profitable.

3. Real Estate Property Law (Law 108-05)

• Ensures clear title registration and legal protections for property buyers.

• Foreigners can purchase land and real estate without residency or special permits.

• Offers mechanisms to resolve disputes and protect investors from fraudulent transactions.

Tax Incentives for Investors

Investors in the Dominican Republic can benefit from these tax incentives to help help maximize ROI and reduce upfront costs.

✔ Income Tax Exemption: No income tax on profits for up to 10 years for tourism-related developments.

✔ Property Transfer Tax Exemption: No taxes when purchasing property under Law 158-01.

✔ Import Duty Exemption: No taxes on importing building materials, furniture, and equipment.

✔ VAT Exemption: Reduced costs on construction materials and supplies.

Steps to Investing in the Dominican Republic

If you're ready to invest, follow these key steps to ensure a smooth and secure transaction:

✅ Conduct Due Diligence

✅ Partner with a Local Attorney

✅ Register Your Investment

✅ Secure Tax Incentives 

✅ Finalize the Purchase