Chile Seen Friendliest for PE

Chile is considered the most friendly to private equity and venture capital in LatAm and the Caribbean, an honor it has held for 4 consecutive years, according to the latest study by the Latin American Venture Capital Association (Lavca). However, Chile’s score of 76 out of 100 reflects a 2-notch drop compared to 2008’s scorecard, while Colombia jumps 4 notches to 57, showing the most improvement. Peru rose 1 notch to 50 and Brazil, which is in second place after Chile, saw no change to its score of 75. Besides Chile, Uruguay, Panama and Trinidad & Tobago also showed modest declines of 2 points. Lavca says the reduction reflects the global slowdown’s impact on local capital markets. The countries with the most pronounced fall, of 4 points or more, are Argentina, El Salvador, and the Dominican Republic. Some of the factors the Lavca scorecard considers are laws on PE/VC fund formation and operation, tax treatment of funds and protection of minority shareholder rights.