Best Acquisition / Leveraged Finance Lawyers in Havana

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Consultores y Abogados
Havana, Cuba

Founded in 2006
50 people in their team
Spanish
English
International Consultants and Lawyers was established as a Civil Society for Legal Services, by Public Deed dated November 8, 2005. Furthermore, on January 6, 2006, it was registered in the Commercial Registry of the Ministry of Justice, and in the National Office of Statistics and Information....
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About Acquisition / Leveraged Finance Law in Havana, Cuba

Acquisition and leveraged finance law in Havana, Cuba represents a niche but increasingly important area of legal practice. This field involves facilitating the funding required for company acquisitions, often utilizing leveraged finance structures. Leveraged finance generally entails borrowing funds to increase the potential return of an investment, which in this context, is typically the purchase of a business or stake in a business entity. Given Cuba's unique economic structure, which is dominated by state ownership with growing allowances for private and foreign investment, acquisition and leveraged finance transactions must follow specific regulatory procedures and obtain approvals from governmental bodies.

Why You May Need a Lawyer

Legal advice is crucial for anyone navigating acquisition or leveraged finance in Havana. Here are some situations where a lawyer’s assistance is indispensable:

  • Structuring and negotiating a business acquisition deal, especially one involving foreign investors or joint ventures.
  • Complying with Cuban foreign investment regulations, and obtaining necessary permits or authorizations.
  • Conducting due diligence on target companies, including verification of assets and obligations within the framework of Cuban law.
  • Drafting and reviewing financing agreements, security documents, and investment contracts to ensure compliance and minimize risks.
  • Advising on collateral and enforcement options, given the limitations under Cuba's property laws.
  • Resolving disputes that may arise during or after the acquisition and financing process.

Local Laws Overview

Acquisition and leveraged finance in Havana operates under a legal framework that blends civil law traditions with substantial state oversight. Key aspects to be aware of include:

  • The Foreign Investment Act (Law No. 118) regulates most foreign participation in Cuban businesses, requiring state approval for acquisitions and structuring of deals.
  • Most assets, particularly real estate, remain state-owned. This impacts security interests and available collateral for leveraged transactions.
  • Banks and lenders often need government consent to issue loans for acquisitions. There are restrictions on repatriation of profits and remittance of capital returns.
  • Cuban civil law governs contract formation and execution, emphasizing clear written agreements and notarization processes.
  • The legal framework restricts some leveraged finance instruments common elsewhere, such as floating charges or asset-based security interests.
  • Judicial enforcement of financial agreements may be more complex due to the limitations on property rights and a lack of international arbitration accessible for certain disputes.

Frequently Asked Questions

What is acquisition finance?

Acquisition finance refers to the funding obtained specifically to purchase a business or asset. In Cuba, this may involve both local and foreign lenders, and must adhere to strict regulatory procedures.

Is leveraged financing allowed for business acquisitions in Havana?

Yes, but within strict regulatory limits. The use of leverage typically requires government approvals, and available security for lenders is limited by state ownership of key assets.

Can foreign investors acquire companies in Havana?

Foreign investors can acquire stakes in Cuban businesses, mainly through joint ventures or international economic associations, subject to authorization under the Foreign Investment Act.

What role does the government play in acquisition and leveraged finance?

The government plays a central role as regulator and, frequently, as transaction party. Most transactions require approval from relevant ministries and compliance with investment laws.

Are there restrictions on the types of collateral used for financing?

Yes, Cuba restricts the types of assets that can be pledged as collateral. Given that most assets are state-owned, typical collateral structures may not be available.

How can legal due diligence be conducted in Cuba?

Due diligence often requires access to public records, government registries, and verification through state authorities. Local legal counsel can assist with navigating these processes.

Can profits from an acquired Cuban business be repatriated?

Repatriation of profits is subject to state controls and must comply with foreign investment regulations. Agreements typically specify the procedure and limitations.

What kind of contracts are used in acquisition finance transactions?

Cuban law emphasizes written and notarized contracts. Agreements must comply with local civil law and investment regulations, and may require official translations or state registration.

How are disputes resolved in acquisition or leveraged finance transactions?

Disputes are generally resolved in Cuban courts, unless the government agrees to international arbitration. Local legal counsel is recommended to navigate these proceedings.

Do lenders have effective remedies in case of loan defaults?

Remedies may be limited by the nature of available collateral and state control. Enforcement can be more complex than in other jurisdictions; thus, contracts should clearly spell out recovery rights.

Additional Resources

If you are seeking further information or require official documents, the following resources may be useful:

  • Ministry of Foreign Trade and Foreign Investment (MINCEX)
  • Cuban Chamber of Commerce
  • National Bank of Cuba
  • Local law firms specializing in commercial and foreign investment law
  • Official Gazette of the Republic of Cuba for current legislation
  • Cuban Ministry of Justice for company registry and public notary services

Next Steps

If you need legal assistance with acquisition or leveraged finance in Havana, consider the following steps:

  • Gather all relevant documentation relating to your intended transaction, including any preliminary agreements and information on the business or assets involved.
  • Consult with a Cuban attorney who has experience in acquisition finance and foreign investment law. Local expertise is essential given the country’s unique legal and regulatory frameworks.
  • Request a clear outline of potential risks and required approvals for your specific situation.
  • Review and understand all legal documents before signing, and ensure proper notarization and registration with local authorities.
  • Stay informed about national reforms and new regulations that may impact your transaction.

Legal counsel will be your guide throughout the process, helping you comply with local laws, structure an effective transaction, and protect your legal and financial interests in Havana’s evolving business landscape.

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Disclaimer:
The information provided on this page is for general informational purposes only and does not constitute legal advice. While we strive to ensure the accuracy and relevance of the content, legal information may change over time, and interpretations of the law can vary. You should always consult with a qualified legal professional for advice specific to your situation. We disclaim all liability for actions taken or not taken based on the content of this page. If you believe any information is incorrect or outdated, please contact us, and we will review and update it where appropriate.