7. Investment promotion and facilitation

As highlighted in the OECD Policy Framework for Investment (OECD, 2015a), investment promotion and facilitation – if adequately designed and implemented – can be powerful means to attract investment and ensure its contribution to economic development. As such, countries worldwide decide to not only remove restrictions on foreign direct investment and provide high standards of protection to investors, but also to proactively promote and facilitate investment, or certain types of investment, to maximise the benefits to the host economy. Considering that Uruguay has removed most formal barriers to FDI (Chapter 4), and is characterised by a stable macroeconomic framework and high level of protection to investors (Chapters 2 and 5), it can benefit from active and well-designed investment promotion and facilitation policies to help attract and retain investment that can assist its transition towards more innovation, diversification and high-quality employment.

As will be shown in this chapter, Uruguay has a generally conducive business climate and has reformed its regulatory framework for investment promotion and facilitation over time. These reforms have resulted in a wide range of government support provided to firms and favourable business conditions. According to the most recent surveys, the majority of foreign investors are either satisfied or very satisfied with the overall investment climate (Figure 7.1). In addition, despite general instability in the neighbouring region, Uruguay has thus far not suffered any large-scale divestments; and nearly 50% of investors decided to reinvest their earnings in the last five years.1 Still, there is perception that relatively timid progress on administrative simplification can hamper opportunities for private investment. The medium-term challenge will be to continue the reforms, in particular addressing existing administrative bottlenecks, deepening regulatory reform and paying more attention to investment facilitation, while also streamlining and improving the oversight of existing regimes for investment incentives.

This chapter provides an overview of the current approach to investment promotion and facilitation in Uruguay, including the overall regulatory framework and institutional set-up, evaluation of the activities of the national Investment Promotion Agency (IPA), namely Uruguay XXI, and the scope for progress in the area of administrative simplification regulatory quality. It concludes with main findings and options for further reform.

The legal framework for investment promotion and facilitation in Uruguay is defined by the Law on Investments (Law 16.906) and its regulatory decrees (e.g. Decree 02.012 of 2012), Law on Special Economic Zones (Law 19.566 and 15.921 and Decree 454/988), Law on Industrial Parks (Law 17.547) and a series of special sectoral regimes, governed by different laws and decrees (Table 7.1). In particular, the Law on Investments, enacted in 1998 and reformed several times since then (2007, 2012 and 2018), outlines the overall goals of Uruguay’s investment policy2, sets out general principles of treatment of foreign investors,3 and lists specific sectors that can benefit from investment support and outlines relevant criteria and applicable procedures.

In addition, several strategic documents aim to provide a long-term strategic vision for the development of the Uruguayan economy and are of relevance for the formulation of investment policy and the internationalisation of Uruguayan firms, more generally. For example, Visión Uruguay 2050 and the associated national development strategy (Estrategia Nacional de Desarrollo al 2050) aim to provide a vision for socio-economic development over the next thirty years (Box 7.1).4 The plan, elaborated under the leadership of the Office of Budget and Planning (Oficina de Planeamiento y Presupuesto, OPP)and officially presented in August 2019, explicitly mentions the insertion into the global market as one of its key elements.5 Several strategic economic activities are listed in the plan, together with broad measures for their development: i.e. bio-economy, digital economy, forestry and wood sector, renewable energies, creative industries, tourism, food products, global services.6

Besides the overall umbrella of the development plan, there also exists a more detailed strategy devoted specifically to productive transformation and competitiveness (Plan Nacional de Transformación Productiva y Competitividad), developed by Transforma Uruguay (Sistema Nacional de Transformación Productiva y Competitividad), a special dedicated body created in 2017. The plan, which was first developed in 2017 and extended in 2019, covers the 2017-2021 period, and includes several objectives linked to investment promotion and facilitation as well as specific projects to achieve them, together with the respective implementing agencies and applicable timelines (Box 7.1).7 The plan also lists key economic sectors (food products, creative industries, forestry and wood sector, global services and logistics, life sciences, pharmaceuticals and tourism) and includes sectoral roadmaps for some of them.8 It was elaborated through a consultative process, involving different private and public institutions, and was subject to public consultation.9

The elaboration of these strategic documents can benefit FDI attraction policy in Uruguay for several reasons. First, it has involved consultations and consensus-building that can help define national priorities and the role of investment within it. For example, the exchanges about priority sectors could lead to a more focused and unified approach to prioritisation at the national level. By virtue of including many horizontal projects, the process can also help strengthen inter-institutional cooperation, including on investment attraction. Finally, this effort could help broaden the scope of investment promotion and facilitation in Uruguay, going beyond the provision of investment incentives. Yet, in order to achieve tangible results, the institutions responsible for its coordination should have sufficient political clout and convening capacity to involve different government bodies and other relevant stakeholders, as discussed in the section on coordination. In addition, a degree of continuity by incoming government is necessary to build on the identified projects and develop new horizontal activities.

As highlighted in the OECD Policy Framework for Investment (OECD, 2015a), investment promotion and facilitation policy is transversal by nature and involves different public and private actors. As such, the ability to coordinate effectively is one of important requirements of successful investment attraction policy. Uruguay has undertaken several steps in this direction, as part of the strategic planning described above.

For example, Law 19.472 of 2017 outlines the different actors in the area of productive transformation and competiveness (Figure 7.3) and provides a basis for inter-institutional cooperation. In particular, the Inter-ministerial Committee for Productive Transformation and Competitiveness (Gabinete Ministerial de Transformación Productiva y Competitividad), created in 2016, performs the overall oversight role and is supported by coordination teams composed of representatives of different Ministries and by the technical Secretariat (Secretaría de Transformación Productiva y Competitividad, or Transforma Uruguay). The role of the Committee is to provide the overall strategy and objectives, approve the national plan, set the guidelines, priorities and objectives for Transforma Uruguay, and evaluate its activities. Meanwhile, Transforma Uruguay and the coordination teams are in charge of articulating and coordinating specific projects and activities, overseeing the implementation of the Plan as well as monitoring and evaluation. Individual agencies are responsible for proposing and executing actions in the area of their responsibility and providing inputs for monitoring and evaluation.

The institutions involved in the National System for Productive Transformation and Competitiveness are also relevant for the formulation of investment promotion and facilitation policy in Uruguay. In particular, all of the Ministries represented in the oversight Committee have specialised units or teams responsible for drafting decrees that can influence investment policy.10 Yet, the universe of actors responsible for investment attraction is somewhat different. On the one hand, it is narrower, as it involves agencies and government units most closely responsible for investment attraction and dealing directly with investors. In this context, the Ministry of Economy and Finance plays a critical role in setting the overall policy direction; and the Unit for Private Sector Support (Unidad del Apoyo al Sector Privado, UnASeP), responsible for managing investment incentives, and Uruguay XXI, the national investment and trade promotion agency are key implementing agencies. On the other hand, it is broader as it involves other actors, both public and private, relevant to different aspects of firm internationalisation decisions, such as free zone operators, chambers of commerce, the Customs administration, among others. Figure 7.2 illustrates this in a schematic fashion. Therefore, a tailored approach to coordinating activities related to internationalisation support (i.e. trade and investment promotion and facilitation) may be needed. The new authorities are currently evaluating the advantages and disadvantages of the current approach to strategic planning and policy coordination, including the role of Transforma Uruguay and other relevant institutions.

Regardless of the specific institutional set-up in this area, the critical component will be to ensure the continuity in the articulation and execution of key horizontal projects in the area of trade and investment policy (e.g. single window for investment or reduction of barriers in selected sectors and under certain institutions) and ensuring that the coordinating institution has the technical capacity to ensure day-to-day management and oversight of relevant activities as well as sufficient political capital to ensure whole-of-the-government approach and buy-in from different stakeholders for critical reforms.

As highlighted by various stakeholders in the process of this Review, a continuous long-term strategic focus on business internationalisation support is critical given Uruguay’s limited size and the resulting need to generate access to global markets. Stakeholders have argued that for several years that this has not been explicitly highlighted, which may have led to lesser degree of support and cross-agency coordination, but acknowledged recent efforts. If dully implemented and sustained, and supported by an effective coordination mechanism, the strategic planning could help create conditions for long-term focus and support. Its implementation may serve as an opportunity to broaden the scope of investment attraction in Uruguay, which has predominantly focused on provision of investment incentives, and allow the government to pay more attention to administrative and regulatory barriers hindering business activity.

Uruguay relies significantly on tax incentives to attract investment (Chapter 6). According to OECD estimates, tax incentives for investment accounted on average for 1.8% of Uruguay’s GDP in 2008-18.11 A recent study by ECLAC and Oxfam (2019) found an even higher estimate of 2.5% for 2017 (Figure 7.4), positioning Uruguay as the country with the highest fiscal cost of investment incentives in LAC. Besides their total cost, incentives are notable for the high number of different schemes available to investors (see Box 7.2 for an overview) and the share of investment they support (Figure 7.5).

Overall, the gradual evolution of investment support schemes in Uruguay (Figure 7.6) has helped the government align better the provision of investment incentives with the goals of sustainable development and improve the overall control (Chapter 6). Yet, this gradual approach has also led to a creation of an overlapping web of incentive schemes. In particular, individual decrees added various activities over time, resulting in an extensive list (Table 7.1).12 At times the government also introduced temporary measures, applying to a particular period or type of investment (e.g. in 2018 and 2019).13 New incentives have also tended to be introduced in pre-electoral periods (Figure 7.7). For example, between 1987 and 2019, twice are many sectoral regimes or other laws bestowing investment incentives have been adopted in the two years prior to elections than two years afterwards.14 These different steps have led to a fragmentation of the legal framework for investment incentives.

As a result of such changes, the support that an investor may receive in Uruguay depends on the exact timing, location and scheme used at the time of the application for investment support. This may reduce the transparency of the system and increase the probability of customised treatment of individual investors, potentially opening opportunities for politically-motivated allocation of state support and lobbying by selected groups, tilting the level playing field for business.15 Moreover, investors requesting incentives under sectoral regimes outside of the COMAP system do not have to comply with the eligibility matrix managed by the Ministry of Economy and Finance, which aims to link the goals of investment promotion with sustainable development, potentially introducing further asymmetries. Hence, as highlighted in Chapter 6, and in line with the OECD Policy Framework for Investment, several measures could be considered to further improve the transparency and efficiency of the investment incentives system in Uruguay and minimise its costs, in particular through streamlining of the various provisions in the key underlying laws and making a more frequent use of in-built sunset clauses.16

The recent discussions and consensus-building on priority activities conducted as part of the national strategic planning may help assist in the more defined approach towards specific economic activities supported by the government. Table 7.2 provides an overview of the various priority sectors featured in the strategic documents and of those targeted by the national investment promotion agency. For example, the Plan on Productive Transformation and Competitiveness outlines eight priority sectors – i.e. ICT, food, forestry, creative industries, logistics, global services, tourism, biotechnology and pharmaceutical industries – and includes sector-specific action plans with relevant support measures.17 The sectors featured on Uruguay XXI’s website features sectors that belong to the universe identified in the Plan.18 As such, the Plan may outline the scope for prioritisation and provide an additional basis for coordination among the bodies involved in investment promotion and facilitation. Still, it will be important to ensure that priority sectors of different agencies are aligned in practice, also over time.

National investment promotion agency – together with its foreign offices and regional partners – can be an important and relevant actor in the institutional landscape for investment promotion and facilitation. The economic literature shows that, by providing potential investors with information on local business conditions, regulations and providers, among others, IPAs help bridge information asymmetries and attract investment into the local economy (Alfaro and Charlton, 2007; Harding and Javorcik, 2011; 2012; 2013). In this context, the number of IPAs has increased substantially (OECD, 2018a; Volpe Martincus and Sztajerowska, 2019). In addition, over 60% of such agencies in LAC perform both investment and trade promotion functions.19 In the case of Uruguay, Uruguay XXI, the national investment and trade promotion agency, established in 1996, serves this dual function (with investment promotion mandate and function being added in 2009). As the agency participated in the OECD-IDB survey of IPAs in 32 OECD and 19 additional LAC countries (Box 7.3), this section highlights the main findings regarding its activities and characteristics vis-à-vis other agencies, highlighting recent achievements and suggesting possible areas for future reform.

While ubiquitous, IPAs are far from being equal – they vary significantly in size and ways in which they perform their functions (OECD, 2018a; OECD, 2019; Volpe Martincus and Sztajerowska, 2019). This, in turn, can have implications for their effectiveness and impact in terms of investment attraction. For example, the size of the agency’s budget per capita together with its targeting intensity are associated with both higher levels of (per capita) FDI stock and the (per capita) number of foreign affiliates in the economy; while the level of institutional independence is associated with a higher number of foreign affiliates per capita (Volpe Martincus and Sztajerowska, 2019). Hence, on top of conducting detailed impact evaluations–which Uruguay XXI has done recently (and will be discussed later) – comparing the different institutional and operational aspects across agencies in different countries can help identify the individual agency’s relative strengths and weaknesses. For this purpose, Figure 7.8 summarises Uruguay XXI’s characteristics relative to its regional LAC and OECD peers on various dimensions, ranging from size to the degree of interaction with stakeholders, which are discussed next.

In general, Uruguay XXI is a highly independent agency that has undergone a number of institutional reforms and interacts with a large number of relevant stakeholders. With a total budget of USD 6.5 million in 2019, covering all of its different mandates, it is a relatively small agency compared to its OECD peers but it has a similar size to other IPAs in the region.20 The agency’s budget has also evolved over time, rising from about USD 60 thousand in 2007 to over USD 6 million in 2019 (Figure 7.9). The share of the agency’s budget dedicated to investment promotion has stayed broadly stable over time (at 10%) and, thanks to the creation of the aftercare unit, in line with the increases in the agency’s total budget.

The fact that other activities account for a large share of resources is closely linked to the agency’s dual function as both a trade and investment promotion organisation (TIPO). In particular, activities related to export promotion and the operation of the Single Window for Trade taken together account for as much of the agency’s total staff as investment promotion and aftercare activities (i.e. 30% of the total 90 employees in 2019, Figure 7.10). Other functions, such as competitive intelligence– i.e. gathering, analysing and disseminating information relevant to trade, investment and the overall business climate in the country – or the image-building and communications department support both types of activities, allowing the agency to benefit from internal synergies. It is also worth mentioning that the agency’s staff is highly educated and has relevant work experience: 80% of staff have a university degree and an even higher share have prior private sector experience. Perhaps unsurprisingly in this context, foreign investors that used Uruguay XXI services have shown high levels of satisfaction with the agency’s assistance, in particular in regards to the quality of information provided, installation assistance and aftercare.21

In terms of the institutional arrangement, Uruguay XXI is established as a public-private agency by Law 16.736 (Article 202). This status, which together with fully private agencies is more common in the LAC region than in OECD countries, allows the IPA greater independence, also enabling it to pay wages at a level similar to the private sector to attract qualified staff. All of the IPA’s budget comes from the Ministry of Economy and Finance. As with a majority of IPAs in the LAC region, Uruguay XXI also has a Board of Directors, which allows for the oversight of the agency’s actions and a representation of a broader group of stakeholders. For example, several Ministries are represented on the Board, in particular the Ministry of Foreign Affairs that serves as its President. The private sector and civil society representatives also jointly account for 45% of the agency’s Board.

It is worth noting that Uruguay XXI has no offices abroad – as most agencies in the LAC region – which differentiates it from its OECD peers that tend to have well developed foreign offices networks (Figure 7.11). To address this issue, Uruguay XXI has adopted creative strategies with the Ministry of Foreign Affairs in order to use existing facilities and staff of embassies and consulates abroad. For example, as part of the cooperation under a project supported by the Plan for Productive Transformation and Competitiveness, Uruguay XXI and the Ministry have signed an MOU and created a network of commercial attachés located in key embassies and consulates who obtain relevant training and materials to collaborate with the IPA to implement a market-specific action plan (so-called “Commercial Antennas” programme).22 Most recently, the agency has also developed a complementary “Business Developers” programme involving signing of contacts with private service providers to help with prospecting activities and contacts with investors abroad. Currently, European and North American markets are being prioritised.23

Uruguay XXI also interacts intensively with other government bodies, including the partner Ministries and other relevant agencies (e.g. Customs, Innovation institute, etc.), as well as representatives of the private sector and key ‘influencers’, among others. In fact, Uruguay XXI is among the top five LAC IPAs in terms of the number of different stakeholders with which it interacts, according to the OECD-IDB survey (2017). Potentially, this can be a powerful tool to overcome the agency’s limited size and, with time, it can also permit it to specialise more, leaving some activities to other government bodies. Indeed, IPAs whose strategies are more targeting-intensive collaborate with a broader range of entities (Volpe Martincus and Sztajerowska, 2019).24 This likely reflects the fact that defining and revising various multitier priorities and delivering properly tailored assistance to consistently identified beneficiary firms should be aligned with broader policy objectives, in general, and requires reaching consensus, coordinating, and cooperating with a larger set of stakeholders, in particular.

As a small agency, the IPA not only depends on cooperation and creative partnerships with other agencies. It also aims to ensure that its actions achieve the maximum possible effect with limited resources. As such, Uruguay XXI has invested heavily in robust monitoring and evaluation (M&E) systems, particularly in internal data collection and analysis, and has crafted external partnerships to evaluate the effectiveness of its actions.

As a first step for effective M&E, an IPA needs to know well what it does, how it does it, and how these actions translate into firm investment decisions over time. For this purpose, IPAs use a customer relationship management system (CRM), which allows the agency to have an institutional memory and an overview of its past activities. It allows, among others, tracking firms’ assistance, sources of investment leads, and the investor’s eventual decision to establish or not. Most IPAs in OECD and LAC have a CRM (about 80%) albeit their quality differs widely (Volpe Martincus and Sztajerowska, 2019). Uruguay XXI developed its tailor-made system, which a priori covers all units of the agency and activities with investors, and since its roll-out in 2017 is continuously working on improving its use by its staff and coverage, a common challenge across IPAs.25 In 2019, a business intelligence unit was introduced, which used both internal and external data sources, and allows for an easier and more automated process of tracking of IPA’s performance indicators.

In addition, Uruguay XXI has done impressive work to systematise the information on the firms it assists as well as all foreign-owned firms operating in the economy. This is a non-trivial ask and not systematically done by other agencies, despite its critical value for allowing to better target investment promotion efforts. Meanwhile, Uruguay XXI conducted a data-collection effort to create a census of foreign-owned enterprises located in the country, generating a unique source of data on the activities of foreign firms in the country (which was formerly not available). This work has, among other thing, identified what share of firms that decided to establish in Uruguay have been assisted by the agency, which increased from about 9% at the time when the agency started to promote investment to 26% in most recent years. The information gathered also serves as a very useful tool for the agency’s prospective work and looking for reinvestment opportunities. It has also served as a key input into the impact evaluation of agency’s activities undertaken by the IDB, which studied the effect of the agency’s assistance on the probability that the firm locates in the economy. Employing advanced econometric techniques, the study has found statistically significant impact (Volpe Martincus et al., 2019, see Box 7.4), confirming the effectiveness of agency’s interventions. Last but not least, to have a further source of qualitative information in terms of areas of particular focus, the agency has also started conducting a survey of foreign investors (as is done in many OECD countries) in order to measure the overall level of satisfaction as well as the individual factors that contribute to contentment or dissatisfaction of investors. Such surveys are a useful tool to support the IPA’s policy advocacy efforts, and have, in fact, been used in various places in this Review. In 2020, the agency is also planning to conduct targeted client-satisfaction surveys with investors assisted by the agency to obtain tailored feedback on specific activities.

In a similar fashion, the agency has strengthened its collaboration with various external data providers and relevant agencies. For example, as part of an agreement with the Customs administration, the agency has access to daily firm-level data on imports and exports. It also obtains more aggregated data by sector on exports, jobs and sales from the Ministry of Economy and Finance (for the economy as a whole and the firms located in FEZs) as well as the Social Security Administration, among others. Finally, as part of a broader project on the impact of MNEs in the economy, the agency also managed to provide access to the IDB research staff to anonymised firm-level data from the Tax Office to better understand the nature of linkages between domestic- and foreign-owned firms. The various studies and the data analysis conducted through these exercises confirm Uruguay XXI’s impact on FDI attraction into the economy, controlling for all other relevant factors (Box 7.4).

Studies suggest that the impact of IPAs may be particularly strong when such agencies bridge information asymmetries, for example, by providing high-quality- and timely information to facilitate installation of firms or assisting them with administrative procedures (e.g. Volpe Martincus et al., 2019). This is also confirmed by existing surveys in Uruguay; for example, three quarters of surveyed foreign investors have particularly appreciated the provision of relevant information on the country, sectors and markets as well as related services by Uruguay XXI (Foreign Investors Survey, 2018). The level of their satisfaction with such information and related services has been particularly high. Therefore, investment facilitation assistance provided by the IPA, including aftercare services, may be particularly important. In this context, it is worth considering what investment facilitation services Uruguay XXI offers relative to other agencies and what recent reforms have been undertaken in this regard to reflect on options available in the future.

Figure 7.12 provides an overview of the share of IPAs that undertake particular investment facilitation and aftercare services in OECD and LAC. In particular, while some activities are undertaken equally frequently by OECD and LAC agencies (and across IPAs) – such as provision of assistance with project definition – other types of activities tend to be a differentiating factor. For example, the assistance with access to financing, cluster programmes and recruiting local staff are frequently provided to firms by OECD IPAs but less so by agencies in the region. In the case of Uruguay, before the aftercare unit was created in 2018, relatively little attention had been given to investment facilitation and aftercare.

In particular, while all activities related to project definition were being offered to investors by Uruguay XXI, such as providing information on local suppliers and clients, organising site visits, airport pick-ups and investor meetings with potential providers; and provides some assistance in dealing with administrative procedures mostly by liaising with the responsible government bodies to facilitate resolution of problems. This can be further facilitated with the planned creation of a single window for investment. In addition, in the area of aftercare, while the agency was tracking the expansion and reinvestment plans of firms as well as providing ad hoc support to individual investors, no structured trouble-shooting or other types of support of this type was available until the new specialised unit was created. Hence, the recent and ongoing strengthening of agency’s capacities in this area is a positive development and can boost its ability to further assist investors.

Meanwhile, this is an area where many IPAs in LAC are assisting investors, in particular in regards to business registration, obtaining licences and work permits. In addition, foreign investors in Uruguay have expressed a particular interest in obtaining these kind of services (Figure 7.13).26 Thus, the creation of the aftercare unit in Uruguay XXI is a potentially important step forward. On the one hand, it may allow the agency to be more proactive in its support provided to firms as the assigned account managers specialised in specific sectors continue developing their contacts and relationships in those industries.27 On the other hand, it can also further strengthen its policy advocacy function (Figure 7.14). Finally, the current plans on the establishment of the single window for investment, under the responsibility of Uruguay XXI (as outlined in the Plan for Productive Transformation) can help boost significantly the agency’s ability to assist firms’ in business establishment and obtain relevant permits, responding to the demand raised by investors themselves.28 It can also help advance the broader investment facilitation agenda in the country, which is one of the remaining challenges for doing business in Uruguay – discussed next.

As highlighted above and captured in the available business surveys, the ease of obtaining permits and broader regulatory quality appear to be remaining challenges to doing business in Uruguay. Performance in this area weighs on Uruguay’s position in cross-country rankings, such as the World Bank’s Doing Business or WEF’s Global Competitiveness Report, already mentioned in earlier chapters. While these types of rankings are mostly indicative, and should not be taken at face value, they may point to the general tendencies and areas of above-average and below-average performance.

In this context, one can observe, for example, that Uruguay’s ranking on WEF’s Index has not changed significantly over the past few years, oscillating around 76th place out of some 140 economies (Figure 7.15). Regarding the areas of strength, Uruguay has systematically scored above the regional average for the quality of institutions, political stability, control of corruption, transparency and accountability as well as the quality of infrastructure (WEF, 2012-2018).29 Meanwhile, bureaucratic procedures and restrictive regulations, on top of high tax costs, are highlighted as areas of potential attention in the WEF ranking (Figure 7.16, Panel A). These correspond to the areas raised as problematic by foreign investors operating in the country in the Foreign Investors’ Survey (2018) (Figure 7.16, Panel B). Potential areas of further attention by the government are also highlighted in the World Bank’s Doing Business ranking (Figure 7.17). In particular, Uruguay scores poorly in dealing with construction permits (155 out of 190 economies), registering property (115) and trading across borders (152) – the latter, however, being likely linked to the methodology of the Index itself – showing much higher scores in the area starting a business (65) or resolving insolvency (70). The areas where further progress could be achieved will be discussed below to highlight steps that can be taken and recent initiatives.

While in the area of resolving insolvency30 and starting a business (the latter being analysed below), Uruguay has made important progress, several other areas may require government’s further attention. In particular, dealing with construction permits continues to be highlighted as problematic in the international rankings as well as by businesses consulted in this Review. In particular, the number of procedures and the time it takes to obtain construction permits remain above the OECD and LAC averages (Table 7.3). When one considers each step in the process, it is the request to obtain a report on fire risk from the National Fire Department (Dirección Nacional de Bomberos) that takes most time (i.e. 90 days on average in 2019, according to World Bank, 2019). The inspections by municipalities can also at times add additional delays to the process. This is not to say that no reforms were undertaken in this area: several amendments to the Building Code have been introduced to modernise the role of the fire brigades in the process and the introduction of an e-permit has helped reduce the number of procedures in place (from 30 in 2009 to 19 in 2019). Still, the average time it takes to obtain a construction permit (265 days) remains above OECD and LAC averages and investors report that both times and procedures can differ significantly in different parts of the country.

Registering property is another area where Uruguay scores relatively low. There has been some moderate progress over time: for example, procedures were streamlined by eliminating the requirement to obtain the municipality’s approval for property transfers in 2009. Rather than requiring a certificate for every transaction, the municipality instead checks a list of the properties subject to pre-emption rights and contacts only the parties concerned. Nonetheless, the time needed to register property has remained stable at 66 days, which is above the OECD and LAC averages (Table 7.4). Similarly, the associated cost in Uruguay (7% of the property value) is above that of comparison countries.

In this context, the government could consider developing specific projects to address the issues outlined above, for example as part of the Plan on Productive Transformation or related initiatives.

One area where the country’s score on Doing Business does not seem to capture adequately the full extent of Uruguay’s progress is the ease of trading across borders. Uruguay has introduced a series of important trade facilitation measures, which helped substantially improve the efficiency and predictability of its border procedures over time. For example, with the support of the IDB (through different programmes), the government has overhauled its Customs Code,31 undertaken a comprehensive modernisation programme of the Customs administration,32 established and expanded its Single Window for Trade (VUCE), and introduced a certification programme for Authorised Economic Operators (AEOs), offering certain users access to simplified customs procedures.33 Uruguay also ratified the WTO Trade Facilitation Agreement in 2016 (WTO, 2017).

In particular, as part of the Customs’ modernisation programme, an electronic customs declaration and risk-based inspection management system have been introduced, reducing substantially the share of goods inspected and the associated delays.34 The establishment and systematic expansion and evolution of the Single Window for Trade (VUCE) under the responsibility of Uruguay XXI, supported by the IDB, has also played an important role (see Box 7.5 and Figure 7.18). Today, it covers two thirds of all relevant documentation and integrates 24 different agencies35 According to the authorities, the programme has generated private sector saving of over USD 6.5 million by 2018, achieved through reduced waiting time, journeys and staff time involved in the processing of required documentation (WTO, 2018).36 In addition, 93% of its users described VUCE service as good or very good; and, according to the OECD Single Windows Indicators, Uruguay’s single window is one of the better performing ones in LAC, even if its coverage could be improved further (OECD, 2018b). The programme is currently undergoing an impact evaluation, supported by the IDB, that can shed light on further enhancements and provide lessons learned for the operationalisation of other one-stop shop solutions in the country.

All these various steps have led to a decrease in the average time spent by economic operators at the border. The average customs clearance time in Uruguay was eight hours in 2018.37 Users located in the SEZs and industrial parks as well as those benefiting from the AEO status also benefit from further simplified procedures and special facilities. In addition, Uruguay is also close to best performance on various aspects measured by the OECD Trade Facilitation indicators, notably automation of formalities, governance and impartiality, and involvement of the trade community (Figure 7.19). Still, the evaluation of VUCE can offer insights on possible improvements, for example in relation to its scope, inter-operability and in facilitating inter-agency cooperation.38 In addition, as average time spent at the border can vary substantially depending on the channel through which goods are processed (Volpe Martincus, 2016) and has been found to impact firms’ exports, this area requires the government’s continuous attention to ensure policy coherence. This is particularly important considering that new exporters tend to be subject to physical inspections relatively more frequently, and studies show that the effect can be so large as to cancel out the effect of trade promotion assistance provided by Uruguay XXI.39

Last but not least, through the Global Services Programme (Programa de Apoyo a los Servicios Globales de Exportación), approved in 2011 and implemented over several years with the support of the IDB to assist the development and internationalisation of key services sectors40 as well as other support measures (e.g. action plans within the Plan on Productive Transformation), the government is also aiming to facilitate trade in services that accounts for a large and growing share of Uruguay’s GDP and exports.

As far as starting a business is concerned, Uruguay has made important improvements in the past two decades. In particular, the implementation of an online platform for business registration “Business a Day” (Empresa en un Dia) has significantly shortened the time needed to start a company in Uruguay from 43 days in 2006 to 6.5 days in 2019 –below both the OECD and LAC averages (see Table 7.5). Yet, as mentioned earlier in this chapter, the application for various permits and undergoing administrative procedures is highlighted as problematic by business. In this context, the government has proposed the establishment of a Single Window for Investment (Ventanilla Única de Inversiones, VUI), under the responsibility of Uruguay XXI, as part of the Plan on Productive Transformation and Competitiveness.41

As a first stage of implementation of VUI, Uruguay XXI has launched a call for an expert to undertake a mapping exercise of such solutions in different countries to inform its own choice on the eventual design, coverage and location of the mechanism, which is a highly welcome development.42 Indeed, the existing evidence points to a high diversity in this type of solutions in different countries and points to non-trivial choices related to organisation, modes of operation and resource-allocation for such a mechanism (see Table 7.6 and World Bank, 2009). In addition, Uruguay’s own experience in establishing and expanding over time the coverage of VUCE, can also be serve as a key input into the reflection on the appropriate way forward. A mapping of the various administrative steps required by firms in different sectors will be required to consider which of those steps could eventually be undertaken by VUI. This is, turn, can be an occasion for a broader administrative simplification. If implemented appropriately, VUI could potentially facilitate establishment of new investment projects, going beyond the sheer business registration. The government is currently planned to launch VUI in 2020, with all major permits to be covered by 2022.

The quality of regulation has a significant influence on the climate for business and investment. Poorly designed or weakly applied regulations can slow business responsiveness, divert resources away from productive investments, hamper entry into markets, reduce job creation and generally discourage entrepreneurship (OECD, 2015a). In this context, the challenge for governments is, on one hand, to balance their need to use administrative procedures as a source of information and as a tool for implementing public policies, and on the other, to minimise the interferences implied by these requirements in terms of the resources required to comply with them (OECD, 2009). There are various tools at the disposal of the governments to reduce administrative burden as well as to improve the quality of new regulations. These include periodic reviews of the stock of regulations, simplifying administrative procedures and introducing e-government services on top of developing better rules on creating new regulations and oversight of regulatory processes. They are summarised in the OECD Recommendation on Regulatory Policy and Governance and are subject to the OECD Regulatory Policy Reviews (Box 7.6).

The government of Uruguay has recently started taking steps to reduce the administrative burden in a more systematic fashion. For example, there is an ongoing ex post review of the stock of regulations with a view of their eventual simplification. In this context, Transforma Uruguay is undertaking two projects to map out all the administrative procedures under the responsibility of one ministry (Ministry of Industry) and all those affecting one sector (pharmaceutical sector). Once the pilot stage is concluded, the mapping process may be extended to regulations under the responsibility of other government bodies and to those affecting other sectors. This approach, gradual in nature, is indeed in line with best practices insofar as it allows for learning and adjustments as well as limiting costs associated with across-the-board review of the stock of regulations. Indeed, countries vary significantly in the use of ex post reviews of existing regulations (Figure 7.20), with Australia and United Kingdom being often quoted examples of best practices that may also serve as potential reference for Uruguay (OECD, 2018).43

Another approach that has been gaining ground in recent years is offsetting new regulations by reducing the existing ones (Trnka and Thuerer, 2019). While regulatory offsetting approaches (e.g. stock-flow linkage rules or net regulatory burden reduction targets) can provide a strong motivation for regulators to evaluate the worth of regulations in place, they need to be applied cautiously and after considering both costs and benefits of a regulation (OECD, forthcoming). For example, the Netherlands adopted quantitative targets for administrative burden reduction, while several countries adopted the “one-in, one-out” approach (e.g. United Kingdom, Germany and France).

Digitisation is another powerful tool at the hands of the government to automate certain processes and reduce the need for physical displacement to comply with regulations. In this context, progress in the use of e-services– including e-taxation, e-procurement, e-court, e-invoicing and others – as led by AGESIC (Agencia de Gobierno Electrónico y Sociedad de la Información y del Conocimiento) in Uruguay, and available on a dedicated website (www.gub.uy/tramites) – can facilitate administrative procedures and reduce territorial discrepancy in the application of regulations.44 It is important to remember that while digitisation principally facilitates access, the review and simplification of the underlying regulations can significantly reduce the administrative burden itself. It is, hence, encouraging that the government has started by mapping the applicable regulations to undertake the appropriate streamlining and offer digital services, both as part of the administrative simplification effort, thus-far led by Transforma Uruguay, and thanks to the plans to establish a single window for investment by Uruguay XXI.

Last but not least, while the individual initiatives aiming at simplifying and automating procedures, as those described above, can help improve firms’ interactions with public administration, a systematic approach to improving the overall process of creating new regulations is necessary to avoid accumulating burdensome regulations in the future. Progress in this regard is complex and requires several legal changes as well as improving the capacity and oversight of different regulatory bodies. Indeed, while Uruguay has made impressive progress on several aspects of World Bank’s World Governance Indicators45, notably control of corruption or voice and accountability, improving regulatory quality and government’s efficiency has been much more elusive (Figure 7.21).46

There are several tools at the government disposal that could help assist in the process of improving the overall regulatory quality in the country. Besides the use of ex post evaluation mentioned earlier, these include systematic use of stakeholder consultations and regulatory impact assessment (RIA) when developing new laws and regulations. They can help assess the intended and unintended consequences of proposed regulations and consider alternatives. Currently, there is no obligation to undertake ex ante RIA on proposed regulations in Uruguay. Meanwhile, RIAs is obligatory for all regulations in most OECD countries, as well as an increasing number of LAC countries (see Table 7.7).While several agencies have relevant mandates (e.g. AGESIC and OPP), there is also no single agency that is responsible for oversight of regulatory practices of all public institutions, including to provide required guidance and training. In fact, there appears to be some confusion as to what ex ante RIA is (see Box 7.7), and who would be responsible.

Considering that RIAs can allow the government to better control the inflow of new regulations, there might be value in adopting it as part of the process of strengthening the rules on creating new regulations and reflecting on the adequate institutional set-up for their oversight. Progress in this area may be particularly important for small and medium sized enterprises (SMEs), which tend to be disproportionally affected by the overtly burdensome administrative burdens (OECD, 2015a; OECD, 2009). It could be, hence, considered an important complementary measure to other actions taken by the government to proactively support SME development (see Box 7.8). Considering the weight of SMEs in the local economy (over 99% in terms of total number of firms and two-third of reported employment, OECD/CAF, 2019), reducing barriers to SMEs’ business activities through administrative reform can be a powerful lever to facilitate internationalisation and economic growth. The case of Mexico could provide inspiration. The amendment to the Federal Law of Administrative Procedure (LFPA) in 2000 established the Federal Commission for Regulatory Improvement (COFEMER) as the oversight body, and outlined the responsibilities of line ministries and tools for regulatory improvement, such as RIA; and further reforms were made in 2010 and 2012.47 More generally, undertaking an OECD Regulatory Policy Review can also help outline the available options.

As explained elsewhere in this Review, Uruguay displays high level of transparency in terms of public access to information and availability of applicable laws and regulations.48 Many public documents and laws and regulations are available on the websites of different institutions. Still, there is no transversal legal obligation to undertake public consultations on the proposed legislation.49 As such, practices vary from institution to institution and depending on the specific topic.50

Businesses have been regularly calling for more frequent consultations on draft regulations and laws. A crucial step towards improving the framework for consultations was taken in 2008 with the adoption of the Law on the Right of Access to Public Information (No. 18.381). The law provides for general access to public information, defined as all information held by a government entity unless considered classified. The law requires government agencies to make public their organisational charts, responsibilities, salaries, and budget allotment and to produce regular reports. Authorities effectively implemented the law; there were no public outreach activities to encourage its use. Uruguay is ranked 19th in the most recent Global Open Data Index (it was 13th in 2014), and fourth for Latin America. In addition, to ensure fair access of stakeholders to the government, over the past two decades Uruguay has created new procedures and institutional arrangements to accommodate a wider set of views and opinions. For example, the Consultative Committee on Corporate Development includes representatives of business as well as trade unions and academia (Box 7.9) and tripartite social dialogue has been institutionalised through the Economic and Social Council (Consejo Económico Social), established by the 1943 Constitution and reinforced by the 1966 Constitution.

More generally, Uruguay has a multi-decade history of tripartite social dialogue, negotiation between employers and employees, and developments in labour and social protection. A catalogue of the different initiatives is also available online (Catálogo de Participación Ciudadana).51 Examples of public consultations include the Investment Law (Decree 455), the SEZ Law, the Social Housing Law (Ley de VIS), the Project Law on Innovative Procurement (Proyecto de Compras Públicas Innovadoras), and the National Plan for Productive Transformation and Competitiveness (Plan Nacional de Transformación Productiva y Competitividad) or establishing priorities for secondary education reform in 2015-17. Some examples also exist at the sub-regional level albeit with varying degrees of success in implementation.52

Overall, progress in systematising the procedures for prior consultation on all draft laws and regulations can help the government ensure that the different stakeholders, including investors have due access to the policy-makers, costs and benefits are dully assessed and alternatives are considered. Over time, the more systematic use of consultations and RIAs may help the government reduce the problem of a growing stock of burdensome administrative procedures over time.

Investment attraction is a transversal policy area that spans different activities and requires coordination of various public and private bodies. It aims not only to promote a country as an attractive business location but also aims to remove undue obstacles to investment activity and facilitate firms’ business decisions. In the past, the approach to investment attraction in Uruguay relied heavily on the provision of investment incentives (reviewed in Chapter 6). With time, the government has attempted to transition from a volume-based approach to investment attraction and an indiscriminate use of such incentives to a more refined model that takes into account the attributes of investment to be attracted and broader development and societal objectives.

This process is ongoing and will involve a gradual reengineering of the system, including through streamlining of current incentive schemes and reducing progressively reliance on special arrangements. Strong commitment to decreasing administrative burdens and undertaking a more systematic reform of the regulatory quality system on top of further pursuit of specific trade and investment facilitation efforts, could help the government move in that direction. The recent strategic planning initiatives and changes to the institutional set-up for investment attraction can assist in this process and help ensure that support for firms’ internationalisation, a prerogative in the country of limited size, remains high on the political agenda and is continued by future administrations.

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Notes

← 1. Information provided by Uruguay XXI as part of the Review.

← 2. Notably, it declare protection and promotion of investment by foreign and domestic firms as a matter of national interest (Article 1 of Law 16.906)

← 3. Among others, it establishes the principle of non-discrimination between foreign and domestic investors (Article 2); posits that foreign investment transactions do not require an additional prior approval or registration other than those required by domestic firms (Article 3); guarantees fair treatment of investment (Article 4) and their free transfer of capital (Article 5).

← 4. Both documents have been elaborated during 2015-2019, and further information can be found on the dedicated government’s website: www.estrategiadesarrollo2050.gub.uy

← 5. It is included under the pillar on sustainable productive transformation out of the two total of three (two others relating to social transformation and gender). Also, see a press release: www.opp.gub.uy/es/noticias/opp-presento-la-estrategia-de-desarrollo-2050

← 6. National Development Plan of Uruguay, p. 51-60.

← 7. All information regarding the plan can be found at: www.transformauruguay.gub.uy/es/plan-nacional

← 8. Dedicated roadmaps are available for the following sectors: food products, creative industries, forestry and wood sector, information and communications technologies (ICT) and logistics.

← 9. Consultations with different institutions and the public took place in September and October 2017 (see www.transformauruguay.gub.uy/es/detalle-de-contenido/proceso-de-consulta).

← 10. In addition, the Ministry of Transport and Works, in particular for all the legislation related to the national transport and logistics, is also relevant albeit not represented in the Committee.

← 11. Other studies, taking into account other forms of public support for investment (e.g. financial instruments and public budget) report a number exceeding 3% (Bértola, et al., 2014).

← 12. For example, while promoted activities are governed by the COMAP regime, some sector-specific schemes are fully independent (e.g. forestry); and the regime of FEZs and industrial parks are governed by separate Laws, the latter being currently under reform. Moreover, some sectors also benefit from dedicated Free Economic Zones (e.g. thematic ones dedicated to audio-visual, leisure and entertainment services and associated activities), and other forms of financial support (e.g. recently created fund for the audio-visual sector). See Chapter 6 for a more detailed description.

← 13. For example, see Decree 218/018 and the set of measures announced by the government on 9th September 2019, which includes support measures for 14 different sectors and activities. Further information available on the website of the Ministry of Economy and Finance: www.gub.uy/ministerio-economia-finanzas/comunicacion/noticias/paquete-medidas-estimulo-actividad-economica

← 14. The former number raises to seven if the electoral year is also counted. Besides sectoral decrees, the count includes laws pertaining to free zones, industrial parks and free ports.

← 15. Most recently, as part of negotiations with UPM, the largest investors in the country, regarding the opening of its second production plant in Uruguay, the government had to concede a creation of a dedicated free zone for the use of the company.

← 16. For example, the government could consider consolidating all tax-related provisions within the legal statutes from the incentives provide relief (e.g. income tax-, VAT, and customs law), and then amending the other existing laws and decrees to include references to those provisions in the relevant articles. Embedding such provisions in the Law will also reduce reliance on ad hoc decrees to provide additional incentives according to the political cycle fluctuations. Similarly, the government should consider bringing all companies under one single regime to avoid customised regimes provided to individual companies or groups of thereof. In addition, it could make a more systematic use of sunset clauses to avoid continuous expansion of the incentives system. Finally, continuous progress in monitoring and evaluation of the schemes can help the government review their adequacy and propose possible phase-outs or rationalisations.

← 17. For example, the action plan for audio-visual sector foresees a creation of fund to support local film production and a programme facilitating obtaining of financing for local projects. The action plans are available on the Transforma Uruguay’s website: www.transformauruguay.gub.uy/es/plan-nacional-1/plan-nacional-de-transformacion-productiva-y-competitividad

← 18. These are agribusiness, logistics (and infrastructure), and global services, while other available opportunities, e.g. in manufacturing, tourism and retail, are also listed. For more information, see Uruguay XX’s website: www.investinuruguay.uy/en/sectors

← 19. The earlier literature on the effects of trade promotion also finds a significant effect of export promotion on firm behaviour (e.g. Volpe Martincus and Carballo, 2010; Lederman et al., 2010)

← 20. In 2018, Uruguay XXI had a budget of USD 5.3 million while the median IPA in LAC region had a total budget of USD 5 million.

← 21. According to the survey of foreign investors conducted in 2018, 3%% of surveyed firms used some service of Uruguay XXI. Those firms have shown very high levels of satisfaction with services provided by the agency, i.e. about 90% and above.

← 22. For more information and progress in the implementation of the project, see the Transforma Urugay’s relevant website on the Plan on Productive Transformation and Competitiveness: www.transformauruguay.gub.uy/es/visualizador-de-proyecto-detalle?id=39

← 23. For further information, see Uruguay XXI website: www.uruguayxxi.gub.uy/en/who-we-are/llamados-licitaciones/business-developer-abroad/

← 24. Once the country size and level of development are controlled for, the number of entities the IPA cooperates increases with its targeting-intensity (Volpe Martincus and Sztajerowska, 2019).

← 25. For example, to assist in this task, the unit responsible for competitive intelligence has developed a guide for staff on how to use the system and encouraged junior staff to assist more senior staff members in providing the required detail.

← 26. For example, Foreign Investors Survey (2018) shows that investors value, and consider as highly important, not only the provision of information on the regulatory framework but also the agency’s help with procedures and advocating for improvements in the regulatory framework (i.e. policy advocacy).

← 27. For example, in 2017, the share of companies proactively approached by the agency, rather than assisted at the request of the company or a lead transferred from other parts of the government or third parties, was 33%; it has increased to 40% in 2018.

← 28. As part of the plan, the government is aiming to provide a fully digital single window for investment, managed by Uruguay XXI in cooperation with AGESIC and other relevant government bodies, which should be operational by 2020 and have the majority of permits integrated by 2022. For more information, see the government’s website: www.transformauruguay.gub.uy/es/proyectos-por-areas-de-interes/clima-de-negocios

← 29. For example, in 2018, Uruguay ranked among top 25 most corruption-free countries (Transparency International, 2018). In terms of scope for improvement, labour market efficiency is one of the areas where Uruguay scored the lowest in the 2018 Global Competitiveness Report, ranking 121st out of 161 economies.

← 30. The Act governing the insolvency regime in Uruguay has balanced business reorganisation and debtors’ rights, which have been the pillars of the traditional Uruguayan insolvency regime, with newer international trends seeking more efficient proceedings and creditor protections. Overall, the recovery rate has been relatively high and stable over time.

← 31. The new Customs Code (CAROU, Law No. 19.276 of 2014) formalised a series of trade facilitation measures, including the AEO programme and binding consultations and advanced rulings by the Customs administration on the applicable customs regulations.

← 32. See DNA (2007) and WTO (2018) for a further discussion its elements.

← 33. Being an AEO allowing certain users to benefit from simplified customs procedures and other facilities if they are approved by the Customs administration as complaint with certain requirements. For the official definition and further information, see Article 7 of the WTO Agreement on Trade Facilitation or the website of the World Customs Organisation (www.wcoomd.org). As of 2018, Uruguay had 50 AEOs certified covering different types of users.

← 34. The release of goods that pass through the green channel is authorised immediately. Goods that pass through the amber channel are subject to document checks and, in general, the average clearance time is 0.8 days; while goods that pass through the red channel and are subject to document checks and/or physical inspection, have an average clearance time of 1.7 days (WTO, 2018).

← 35. For more information, please consult VUCE’s website: www.vuce.gub.uy.

← 36. The programme has been estimated to generate a saving of more than 400 000 man-hours of low-value tasks and a saving of about USD22 per procedure conducted in VUCE (WTO, 2018: 19).

← 37. The customs clearance time is measured between the request of the verification channel and the release of the goods by customs. The data is based on information provided by the authorities.

← 38. The creation of the Inter-ministerial Committee for Trade Facilitation and the creation and increased coverage of VUCE over time go in that direction (Decree 252/15 and 156/2017).

← 39. Volpe Martincus (2016), using data for 2002-2011, finds that if shipments outside of the green channel had been authorised to leave customs within one day, exports would have been 5.9% larger; and note that this gain corresponds to more than six times the annual budget allocated to Uruguay’s national customs agency (DNA) and more than 100 times the annual budget of Uruguay XXI’s. In addition, according to estimates in Volpe Martincus (2016), average 16% (57%) of new (all) exporting firms supported by Uruguay XXI had transactions inspected over 2010–2015, and evidence suggests that the positive impact of trade promotion assistance on firms’ exports was weakened enough as to not even be significant in Uruguay.

← 40. See the IDB’s website for the initial project description and all the documentation related to monitoring and evaluation: www.iadb.org/es/project/UR-l1060. The programme has now been absorbed by, and this work continues through, the newly-created aftercare unit within Uruguay XXI.

← 41. For further information on the project, see www.transformauruguay.gub.uy/es/proyectos-por-areas-de-interes/clima-de-negocios

← 42. The information is available on Uruguay XXI’s website: www.uruguayxxi.gub.uy/es/quienes-somos/llamados-licitaciones/llamado-consultor-senior-ventanilla-unica-de-inversiones

← 43. In most countries, such reviews are undertaken on an ad hoc basis, while some countries introduced an obligation of periodic reviews of such type, including through the use of sunset clauses in the regulations themselves. Only 26% systematically require periodic ex post evaluation for existing primary laws and 21% for subordinate regulations (OECD, 2018c)

← 44. Data provided by the government authorities as part of this Review.

← 45. Data available at: www.databank.worldbank.org/Source/worldwide-governance-indicators. See Kaufmann et al. (2010) for the description of the methodology.

← 46. For example, the country is close to the levels of regulatory quality encountered in Peru and Costa Rica, nearly 70th percentile rank globally, but it fairs far behind Chile (that close to 90th percentile) and more high-income economies.

← 47. For example, the reforms allowed for a distinction between regulations that are expected to have moderate- and high impacts. An online tool – the Regulatory Impact Calculator – was developed to enable regulators to assess their proposed regulation at an early stage of the process. The RIA Manual was further modified to introduce additional types of RIAs, to focus on competition impact analysis, risk analysis, or a combination of both. Finally, COFEMER was empowered to request an ex post RIA to ministries and decentralised bodies that issued technical standards accompanied by high-risk RIAs (OECD, 2015b).

← 48. This is regulated by Law 18.381 of 2008 and Decree 232/010 of 2010.

← 49. This information is based on the answers provided by the government as part of this Review.

← 50. For example, when regulation is deemed to have environmental impact, Law 16.466 of 1994 obliges a Ministry in question to publish the regulation in advance with the view of interested parties being able to submit comments and suggestions.

← 51. It is available on the dedicated portal: www.catalogo-participacionciudadana.portal.gub.uy.

← 52. For example, in Montevideo, the city budget has been prepared through an inclusive process since 2009.

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