Governor García Padilla signs bill supporting SMEs

June 11, 2014 – La Fortaleza, San Juan, Puerto Rico - As part of the celebration of “Small and Medium Retailer Week”, Governor Alejandro García Padilla signed a new law that supports microenterprises, small and medium size merchants, fulfilling his commitment to this sector of the island’s economy.

The law supports SMEs by strengthening the policy of reserving part of government purchases to local businesses; encouraging the integration of professional and new entrepreneurs; giving priority to SMEs in discretionary public funds to subsidize payroll for new jobs or existing ones, and providing an accelerated permitting process.

"This bill is for SMEs what the Law of Incentives for Economic Development and previous industrial incentive laws were for manufacturing in Puerto Rico. That's how important it is. The country is undergoing the biggest transformation in its recent history," said the Governor in his statement in an event held at the Capitol Rotunda hosted by the Speaker of the House, Jaime Perello - author of the bill.

He also acknowledged the importance of small and medium businesses in the Agenda for Economic Recovery, the administration plan to move forward the economy.

Garcia Padilla observed that 95 percent of companies in Puerto Rico are SMEs with fewer than 50 employees. They are responsible for a quarter of the jobs on the island and nearly half of those generated by private enterprise.

Therefore, the chief executive stressed that “the path to sustainable economic development will necessarily have to include SMEs. Encouraging SMEs is to boost local production and wealth creation that circulates and remains in the country.”

The new Support for Microenterprise, Small and Medium Merchant Act amends the Commonwealth of Puerto Rico’s Procurement Reserve Act to increase it to 20% and similarly, the Law of Security in Employment is amended to establish a reserve of 60% for SMEs when granting subsidies provided by the Act to the private sector.

As for the granting of permits, the legislation seeks to ensure that the economic activity of SMEs does not halts because of matters relating to obtaining governmental authorizations. To achieve this goal, the Permit Process Reform Act of Puerto Rico was amended to make possible the granting of permits for conditional or temporary activities that pose no risk to health, the environment or security, and conforms to the zoning requirements.

The law also creates a board to support for micro, small and medium retailers and facilitates the requirement of regional economic impact studies for specific projects.

“Our economic recovery is tied to the recovery of our SMEs. Today we fulfill one of the commitments made to our small and medium enterprises and reaffirm our willingness to help them prosper and create wealth and jobs for Puerto Rico,” said the Governor, who was also accompanied by the President of the House’s Committee on Small and Medium Business, Commerce, Industry and Telecommunications, Javier Aponte; Enid Monge, president of the United Retailers; and Secretary of State David Bernier.