Scroll Top

ACT 20

On January 17, 2012 Puerto Rico’s government enacted the Act No. 20 of 2012, also known as the “Export Services Act” to offer the necessary elements to create a World Class Service Center by providing tax credits and tax exemptions to business engaged in eligible activities in Puerto Rico.

Puerto Rico has a highly educated and professional labor force that can fulfill the labor market demands for the provision of export services.

The purpose of the Export Services Act (Act 20) is to develop Puerto Rico as an international export services center and diversify the drivers of economic growth by encouraging local service providers to expand their services to persons outside of Puerto Rico, and attract new businesses to Puerto Rico.

The Export Services Act applies with respect to any business with an office located in Puerto Rico that is engaged in the exportation of services to non-resident individuals and/or foreign entities.


  • Research and development.
  • Advertising and public relations.
  • Economic, environmental, technological, scientific, managerial, marketing, human resources, computer, and auditing consulting services.
  • Advice on issues related to any trade or business.
  • Creative Industries defined by law as those business with potential for creating jobs and wealth, mainly through the export of creative goods and services in the following sectors:
      • Design (graphic, industrial, fashion, and interior design)
      • Arts (music, visual arts, performing arts, and publishing)
      • Media (application, videogames, online media, digital, and multimedia content development)
      • Creative services (architecture and creative education).
  • Drafting of construction plans and engineering, architectural, and project management services.
  • Professional services such as legal, tax, and accounting services.
  • Centralized management services that include, but are not limited to, strategic direction, planning, distribution, logistics, and budgetary services performed in the headquarters or similar regional offices of an entity engaged in the rendering of such services. Furthermore, strategic and organizational planning processes, distribution, and logistics services rendered to persons outside of Puerto Rico shall also be eligible.
  • Electronic data processing centers.
  • Computer program development.
  • Voice and data telecommunications between persons located outside Puerto Rico.
  • Call centers.
  • Shared service centers that include, but are not limited to accounting, finance, tax, auditing, marketing, engineering, quality control, human resources, communications, electronic data processing, and other centralized management services.
  • Storage and distribution centers of companies engaged in the business of transportation of items and products that belong to third parties, known as “hubs”.
  • Educational and training services.
  • Hospital and laboratory services.
  • Investment banking and other financial services, including, but not limited to:
      • Asset management services
      • Alternative investment management
      • Management of activities related to private capital management
      • Management of hedge funds and high-risk funds
      • Management of pools of capital
      • Management of trusts that serve to turn different types of assets into stocks
      • Management services for escrow accounts, insofar as these services are provided to foreigners.
  • Commercial distribution and trading of products manufactured in Puerto Rico for jurisdictions outside of Puerto Rico.
  • Assembly, bottling, and packaging operations of products for export.
  • Marketing centers engaged primarily in providing, through leasing, service, or other type of fees, space and services such as: clerical, translation, and data processing services, communications, marketing, telemarketing, and other consulting services to businesses outside of Puerto Rico, including export and marketing companies, commercial attachés, government agencies responsible for foreign trade, exchange, and product and service exhibition centers.
  • Trading Companies; for this section, trading companies shall mean any entity that derives not less than eighty percent (80%) of its gross income from:
      • The purchase of products manufactured inside or outside of Puerto Rico and their resale for use, consumption, or disposition outside of Puerto Rico.
      • Commissions derived from the sale of products for use, consumption, or disposition outside of Puerto Rico; provided, that no part of the income derived from the sale or resale of products for use, consumption, or disposition in Puerto Rico shall be deemed to be industrial development income and that the income-producing property is not used for purposes other than those authorized by the decree.
  • Any other service that the Secretary, with the advice of the Secretary of the Treasury, determines that must be treated as an eligible service upon deeming it to be in the best interest and for the social and economic wellbeing of Puerto Rico, taking into account the demand that there may be for such services outside Puerto Rico, the total number of jobs to be created, its payroll, the investment that the proponent would make in Puerto Rico, or any other factor that warrants special consideration.


  • 4% maximum tax rate on income related to exportation of services
  • 100% exemption on income tax rate on dividends or profit distributions
  • 60% exemption on municipal license taxes
  • 90% exemption of real and property taxes
  • 20-year tax decree, renewable for an additional 10-year period
Useful Information