MONTE CARMELO – October 2015 Important Update

October 22, 2015 3 comments

I have been working with Monte Carmelo in Vieques for many years.  The same goes for Villa Borinquen and Bravos de Boston.  While all three areas overall share similar backgrounds, circumstances and issues, Monte Carmelo has always demonstrated to be a breed of its own.  Monte Carmelo has always been seen as the “black sheep” of the family.

Apparently, all that is about to change very rapidly.

The Puerto Rico Housing Department (“PRHD”) is in charge of Monte Carmelo.  Historically, PRHD was also responsible for Villa Borinquen and Bravos de Boston, until the Municipality of Vieques acquired all the rights over those two areas.  Monte Carmelo remained with the PRHD.

The Municipality of Vieques has always been more effective in moving the title process forward, with many titles having been recognized in both Villa Borinquen and Bravos de Boston.  Since 2008 my law firm has been involved in many transactions for both these areas, many of them already completed at the Puerto Rico Property Registry.  In the event you are wondering, by “completed” I mean: “the title formally reviewed, accepted and recorded as final by the Puerto Rico Property Registry.”

That has not been the case for Monte Carmelo, mostly because PRHD could not get its act together.

Nevertheless, for the past few months the PRHD has been actively pursuing the required information to complete closings which would result in completed titles.  While bureaucracy always plays a part when working with most government agencies, PRHD is becoming increasingly effective at managing their resources and may be on the verge of granting the first series of titles in Monte Carmelo.

The first titles to come through would be those for permanent residents of Vieques.  These has been the category of transactions that PRHD has been (reportedly) focusing on.  Nevertheless, just a couple of months ago, we were able to finally create the correct environment for other categories of properties and applicants to be considered and accordingly began some motion forward.  The category which is now moving to the front of the line, are those properties which are currently being used for residential purposes regardless if the person is a permanent resident or not.

I believe PRHD is moving in the correct direction.  While I wish they would do so at a much faster pace, it appears that we are headed into a very busy Christmas Season.

Please let me know if you have any questions or suggestions on the above.

Very truly yours,

Santiago F. Lampón

Title Clearing in Puerto Rico – A brief introduction

October 21, 2015 Leave a comment

I recently had the grateful experience of meeting and helping key executives of one of the biggest and most successful title clearing companies in the United States.  They have a series of clients that have entered the Puerto Rico market, which in turn have placed them in the unexpected but also interesting position of having to become trained in how the title clearing process works in Puerto Rico.

Now, title clearing for us has two variables.  On the one hand, is the task of making sure that a title is in perfect condition to be properly and securely transferred to a new owner.  This also means that the registration of the title is such, that the property can be successfully used to as a guarantee for a loan.  The other face of this coin, is the clearing of the title after a loan has been paid of completely.  This action is what nowadays I am referring to as the “lien release” process.

In Puerto Rico we use other expressions or names to refer to this two actions.

When dealing with a title that is not clear, the action of “clearing” the title we refer to it in Spanish as “cleaning” the title or “título limpio.”  On the other hand, when we are referring to releasing a property form a lien, we referred to it as “freeing” the property which is the translation from the Spanish “liberando” which means “setting free.”

In sum, we may become confused by different words or by becoming lost in translation.  Nevertheless, at the end of the road the end result we can deliver to you is the same; we may just need to reference some dictionaries along the way.

Very truly yours,

Santiago F. Lampón

Categories: Uncategorized

Taxes for Professional Services as a Legal Professional

October 7, 2015 Leave a comment

I have posted some notes on this subject, and today I am providing a summary.

Legal services including notary services, are not being taxed. This means that, for now, whenever a legal service is paid for, no tax would be added.

On the other hand, any service delivered by a lawyer or law firm which is not tied to the license as such, IS taxable at the rate of 4% until March of 2016 when the rate increases.  An example of this would be filing documents at the property tax agency.  Such a task is not limited to lawyers and could be performed by any individual trained on the subject.  This would be a taxable service.

Now, a notary performing a closing is clearly a legal service and is not taxable.


Santiago F. Lampón

Categories: Uncategorized


September 29, 2015 Leave a comment

The Puerto Rico Bar Association just announced, that the Puerto Rico Legislative Branch approved amendments to the Sales Tax Law (“IVU”), specifically the B2B segment, to exempt all legal services from the tax.

If signed into law by the Governor of Puerto Rico, all legal services including notary services would be exempt.

I will keep you posted.


Santiago F. Lampón

Categories: Uncategorized

“Sales Tax” for professional services – October 1st is the date

September 28, 2015 Leave a comment

To all business owners out there, a reminder that October 1, 2014 marks the activation of the sales tax for most professional services, and as of the date of this writing it includes legal services.  While a strong effort is being carried forward to exclude legal services from the sales tax by September 30th, it is not clear if those efforts would be succesful.

Other than lawyers, most professionals are mandated to begin collecting sales tax as of October 1st at the rate of 4%.

It this post comes as a surprise to you and you own some type of business in Puerto Rico or which delivers to others in the island, then yo need to move quickly to understand how the above may impact your business and your tax liability.


Santiago F. Lampón

Categories: Uncategorized

Sales Tax (“IVU”) for Professional Services – October 1, 2015 is the deadline

September 15, 2015 Leave a comment

If you are in business in Puerto Rico, or if your business is located outside of Puerto Rico but delivers services in Puerto Rico, you most likely know about what I am going to cover here.  Nerverthelss, I decided to publish this brief note since this tax also affects legal services, including notary services.

Throughout my publications I communicate that I am a lawyer and a notary.  I also repeadtedly state that only a lawyer admitted to practice law in Puerto Rico can become a notary, and that only a notary can perform a real estate closing in Puerto Rico.

Begining October 1, 2015, professional services has been added to the category of products or services which pay what it is normally known as “sales tax” including lawyers and notaries.  The tax rate will be 4% trhough February 29, 2016, and it will jump to 10% begining March 1, 2016.  Some categories of services may immediately qualify for a higher tax bracket, but you need to check with your tax expert on this.

There are very few exceptions to the general rule.

Overall, contracts executed before October 1st would not be charged the taxes even if the execution of the contract will be happening after October 1st.  For example, if the parties to a closing hire a notary before October 1st for a closing scheduled for sometime after October 1st, no taxes would be levied on the services.  If the notary is engaged after October 1st for a closing happening sometime thereafter, the tax would be 4%.  if the notary is engaged after February 29, 2016, the tax would be 10%.

Please consult with your accountant, CPA or tax lawyer if you have any issues with professional services rendered in Puerto Rico, including professionals who do not reside in Puerto Rico but who deliver services to individuals or businesses in Puerto Rico.


Santiago F. Lampón

POSSESSION – A short but VERY important note

September 5, 2015 Leave a comment

Possession may be known as “50% of the law” or something like that; but always be weary of the other 50% which is ordinarily unknown.

If you are in “possession” of land in Puerto Rico, it is best for you if it is an ACTIVE possession: you do not want to be blindsided by the other 50%.


Santiago F. Lampón


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