 | 2007 | 2006 |
Overall Score: | 37 | -- |
Regional Ranking: | 12th | -- |
Ranked last of countries reviewed for the 2007 Scorecard, the Dominican Republic shows the most room for improvement in creating a suitable business environment for venture capital and private equity investing. Aside from quality local accounting and use of international standards, the nation offers virtually no framework or incentives for the operation of a local VC/PE industry.
Strengths: The Dominican Republic’s Institute of Certified Public Accountants adopted international accounting standards in 1999, and international firms are present and competent.
Challenges: The business environment of the Dominican Republic presents serious obstacles to venture capital and private equity investment. The country scored the lowest possible score in two criteria: (1) lack of laws allowing for the formation and operation of VC/PE funds, and (2) perceived corruption. Other barriers contribute: local institutional investors are restricted from most equity investing, protection of intellectual property rights is poor, capital markets are underdeveloped, and the local judicial system is weak. Compared to the regional average for Latin America and the Caribbean, the process for resolving bankruptcies is slow and costly, and the recovery rate is low for claimants.
| Score | Change |
| Overall score | 37 | |
| Laws on VC/PE fund formation and operation | 0 | |
| Tax treatment of VC/PE funds & investments | 2 | |
| Protection of minority shareholder rights | 2 | |
| Restrictions on institutional investors investing in VC/PE | 1 | |
| Protection of intellectual property rights | 1 | |
| Bankruptcy procedures/creditors' rights/partner liability | 1 | |
| Capital markets development and feasibility of exits | 1 | |
| Registration/reserve requirements on inward investments | 2 | |
| Corporate governance requirements | 2 | |
| Strength of the judicial system | 1 | |
| Perceived corruption | 0 | |
| Quality of local accounting/use of international standards | 4 | |
Indicators are scored from 0-4 where 4=best score.
Overall score ranges from 0-100 where 100=best score. |
