Honduras: A New Supreme Court and the Arrival of World Compliance Associationdumaslex
Two developments took place recently in Honduras, and both have the potential to positively impact investment conditions and empower corporations, with tools for better governance and, therefore, an improved overall outlook for business opportunities.
Initially, a new Supreme Court was appointed on February 17th, marking a significant step towards improving the country’s business environment and investment prospects, since the Court plays a crucial role in upholding the rule of law and ensuring that the legal system is fair, transparent, and efficient.
One of the new Supreme Court’s main benefits is restoring public trust, weakened by the previous administration’s lack of independence, accountability, and productivity. The new Court is much more diverse, politically, and ideologically, which offers hope for more independence from other branches of government, which is critical for attracting foreign capital.
Most Hondurans are optimistic about the potential for increased efficiency in the legal system with the new administration. Dumas Lex, through its Managing Partner’s article, presented several proposals to modernize the judicial system, including a complete diagnosis of its current situation, a new Judicial Selection Law to ensure the appointment of independent, competent, and capable Judges, Magistrates and court personnel, investment in new facilities, alternative dispute resolution in judicial procedures and digitalization of Court files and proceedings, amongst others. You can read the Spanish version at the following link: https://bit.ly/3xBsG8N
Since the Court has the power to hold public officials and institutions accountable for their actions, a new Court could also bring a renewed commitment to transparency, and accountability, promoting the rule of law, combating corruption, and ending impunity. This is particularly important for businesses, as they need to have confidence that the entire public system is fair and transparent and that their investments will be awarded adequate protection by the law, which is also essential for a stable and predictable legal environment that businesses can rely on.
In another positive development for Honduras, the local chapter of the World Compliance Association (WCA) recently announced it started operations in the country. WCA is a non-profit organization dedicated to promoting and improving compliance practices worldwide, aiming to support the implementation of global compliance standards for businesses and organizations, to help prevent fraud and corruption, protect consumer rights, and foster business integrity.
Honduras, like many other countries in the region, faces challenges related to compliance, including corruption, money laundering, and difficulties navigating complex regulatory requirements, especially for companies doing business in several jurisdictions. These challenges, if left unattended, can lead to a lack of trust and transparency in the business environment, which can hurt the country’s economic development.
Therefore, the arrival of WCA is a significant step towards improving the country’s business climate. The association will provide a framework for businesses and organizations to follow, ensuring that they operate legally and ethically. Increased compliance will help rebuild trust in the business community, essential for the country’s long-term economic growth.
WCA will also help promote a compliance culture in Honduras, so businesses and organizations will be expected to adhere to the law and act ethically and responsibly, ascertaining a robust moral culture. By doing so, they will build a positive reputation and attract more customers and investors.
In addition, the WCA will establish a global network of compliance professionals that will provide Honduran businesses and organizations with access to the latest compliance knowledge and best practices from around the world, especially those available on the WCA’s website. This will improve the quality and effectiveness of compliance policies in the country and reduce the risk of non-compliance. Furthermore, the WCA will provide training and certification programs for professionals in Honduras, creating a local network of specialists, who can ensure that businesses and organizations comply with the law and act ethically.
Amongst its first activities, WCA will sign agreements with several private sector organizations, including the Cortés Chamber of Commerce and several universities to promote compliance culture and methods amongst its members and to collaborate in webinars, meetings, and other activities geared towards compliance-related issues, with a strong focus on combating public and private corruption. Our Managing Partner is proud to be a founder and is currently serving as Vice President of WCA-Honduras.
Authors: Rodolfo Dumas (Managing Partner); Marlon Andino (Partner)