PARAGUAY: OPEN FOR BUSINESS

In a Spanish language press release dated April 1st, 2008, Sudameris Bank SAECA announced that its major shareholder, the Irish Abbeyfield Group, had acquired the remaining shares in Sudameris Bank (Paraguay) that were held by Sudameris S.A., a French subsidiary of the Italian banking group Intesa San Paolo SpA.

This makes Abbeyfield the holder of 98.01% of shares in the Paraguayan company Sudameris Bank SAECA, and completes Intesa’s withdrawal from South America after many years, a process started in 2003 when Intesa decided to concentrate on the emerging markets of Central Europe.

Paraguay does not have an offshore banking industry and it is not generally attractive for non-resident foreigners to open bank accounts in Paraguay. However there are two reasons why you might wish to do so:

1.  When applying for official residence, it is a requirement (unless you own property) that you deposit US$ 5000 or equivalent in an account in your name at a Paraguayan bank.

2.  If you want to hold Guarani (PYG) as an investment, you will need a bank account in Paraguay, as banks in other countries do not offer accounts in Paraguayan currency.

In either of these cases, it is possible for a foreigner to open an account in a Paraguayan bank, but it is difficult. The main obstacle is guidance sent out a few years ago by the Paraguayan Central Bank which specifically prohibits the local banks from opening accounts for persons who do not have a Paraguayan cedula.

The only bank we have found that has a solution to this problem is the Banco Nacional de Fomento, a state-owned bank. They will open a type of savings account called a Caja de Ahorro for non-residents. To open the account you will need to show up in person at their head office equipped with a bank reference and a copy of your passport. You will need to speak some Spanish, and you will need to supply a local address in Paraguay. It is not possible to open accounts in advance by correspondence.

Below is a list of the documents typically required if you want to apply for Permanent Residence in the Republic of Paraguay.

Don’t be put off, the process is really not as difficult as it seems.

You could in theory deal with the immigration processing yourself, if you have plenty of time and patience. However, it is customary to hire a law firm or maybe a paralegal (known in Paraguay as a gestor) to handle matters for you. These people are experienced at what they do and generally help you move through the bureaucracy much more smoothly.

The information below was supplied by the Paraguayan Consulate in London, UK.