Auxadi concluded the second Madrid edition of LATAM Days on June 23, its event aimed at chief financial officers (CFOs) planning to expand their businesses into the Latin American region. Throughout the day, Nebrija University’s Campus of Arts and Communication hosted an event featuring more than 30 speakers across 10 panel discussions.

Immersion in LATAM Days

The opening speech by Víctor Salamanca, CEO of Auxadi, together with presentations by Gonzalo Solana (Nebrija University) and Raúl Mínguez (Spanish Chamber of Commerce), officially opened LATAM Days Madrid. The firm’s CEO began by stating that “Spain is one of the leading investors in the region” and that “Madrid is positioned as a strategic hub to connect investment flows between Europe and Latin America”.

Next, the Director of the Nebrija Chair of Business Internationalization highlighted an increase in “more sophisticated goods exports” in the field of technology from the Iberian countries.

Raúl Mínguez then referred to the Mercosur trade agreement. He also stressed the bilateral relationship between Europe and Latin America: “Around 91% of the countries in Ibero-America already have a trade agreement with the European Union in force or in the pipeline”.

Oversight, control and national authorities

The speakers on the ‘Setting-up in LATAM’ panel outlined the different ways to enter the market: through an Employer of Record (EOR) and third parties; by opening a branch office; or by establishing a wholly owned subsidiary within the multinational group. Héctor Hermosillo, from EY, considered that “sometimes having an Employer of Record is a temporary solution”.

Bernardo Gutiérrez, from Ontier, identified several key factors for Spanish investment in Latin America: humility, motivation and a clear purpose. Meanwhile, Narciso Casado, Chief of Staff to the Presidency and Director of the Ibero-America Relations Department at CEOE, expressed his confidence that “public-private cooperation” will “materialise”.

Tax rates, cash pooling and foreign exchange regime

Adolfo Zunzunegui, from EY, identified an “operational shift” driven by five trends: more aggressive tax audits; the implementation of OECD standards; increased scrutiny of intra-group services; revenue collection pressures; and greater corporate transparency. Manrique Blen, from Auxadi, added Miami as another strategic hub: “Many clients structure their operations from Miami; it is an extremely strong gateway”.

The ‘Cash Pooling’ panel concluded that the concept of real-time has become essential. Alejandro Valenzuela, from Kyriba, stressed: “I need visibility into how my cash flows operate: how volatile my bank balances have been; which currencies I have operated in; and what level of risk I have been exposed to”.

To conclude the panel, José García, from Biton, outlined three barriers to building a cash pooling structure: operational, economic and technological.

From the perspective of foreign exchange specialists, David Ruiz (ABANCA) believes it is essential to “know, know and know” the company you are working with. “You have to make them understand the urgency and importance of implementing that hedging policy and assuming that cost”, he commented regarding professional advisory services.

Challenges in LATAM and connections with Europe

The general consensus at LATAM Days was that Latin American markets “are countries with very different labour, tax, regulatory and cultural frameworks”, as explained by Raquel Flórez, from Freshfields.

The route from Latin America into Spain via Madrid is gaining momentum because Latin American private wealth is seeking opportunities in real estate, according to Lucía Goy, from Gentile Law. She also noted growth in the “hospitality sector”. Jorge del Castillo, from Cases & Lacambra, referred to the region’s ongoing political and economic changes, citing Peru’s and Colombia’s elections; “a highly significant judicial reform in Mexico that has completely changed the system for appointing judges”; and “the removal of Maduro by the USA”.

Regarding ‘Free Trade Zones’, Ana María Romero, from CINDE, highlighted the advantages offered by Costa Rica: “0% tax incentives, mainly on corporate income tax”. The business park model was represented by Ultrapark, which provides a “network of suppliers to ensure proper maintenance of the entire infrastructure” in order to deliver “a high-quality service to clients”. Ramón Pendones, from Gensler, noted that “companies are now looking for connections with outdoor areas, green spaces and wellness”.

Francisco J. Iniesto, from ÉCIJA, warned that “Colombia and Argentina have not incorporated this technical assistance clause”, meaning that “they could turn this grey area into an intra-group service”. Finally, David Vilches, from Uría Menéndez, explained that Mexico “has more fully embraced the OECD guidelines”, while Peru “is seeking accession and is making a strong effort to ensure that its tax audits, reviews and inspections increasingly align with international standards”.

LATAM Days: an event for CFOs

LATAM Days Madrid proved to be a successful event for chief financial officers with business interests in Latin America, a region that brings together numerous jurisdictions alongside globally recognised and pioneering industries. Auxadi held the second Spanish edition of the event in partnership with Nebrija University to promote the international expansion of Spanish businesses.

About Auxadi

With 26 subsidiaries across Europe, the United States, and Latin America, Auxadi is today the leading Spanish accounting firm serving multinational companies and real estate investment funds. Through its technology-driven approach and strong client-focused culture, Auxadi acts as an extension of its clients’ finance departments worldwide, providing accounting, tax, payroll, transfer pricing, and corporate legal services.

Its proprietary MySPV technology platform, more than 300 employees, and over 1,700 clients have positioned Auxadi as a benchmark in the tech-enabled services sector, not only in Spain but internationally.

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Auxadi Corporate