How Act 20 and Act 22 Were Integrated Into Act 60

Why Puerto Rico Unified Its Incentives

Before 2019, incentives were scattered across many statutes with differing processes. Act 60 standardized application routes (ordinary, special, expedited), harmonized decree terms (generally 15 years), and centralized oversight through the DDEC Incentives Portal. The Code also clarified that a decree is a contract between the government and the beneficiary, enhancing predictability for planning and investment.

How Act 20 and Act 22 Fit Inside Act 60

Chapter 3 — Export Services (Former Act 20)

Act 60’s export-services program keeps Act 20’s core benefits—most notably a 4% fixed corporate rate on eligible exported services and dividend exemptions—administered by decree via the DDEC Incentives Portal. See the legal backbone in Act 60 and practitioner guidance at MZLS — Export of Services under Act 60.

Chapter 2 — Individual Resident Investor (Former Act 22)

Act 22’s residency-based benefits were recast as the Individual Resident Investor program under Act 60, preserving 100% exemptions on Puerto Rico–sourced interest, dividends, and (post-residency) capital gains, subject to bona fide residency rules in IRS Publication 570. Applications and compliance now run through DDEC within the unified code.

The “Certified Professional” (Defined by Act 60)

Under the expedited application track, Act 60 authorizes an Expedited Process when an applicant files a pre-eligibility report prepared by a Certified Professional. For this purpose, a Certified Professional is an attorney admitted by the Supreme Court of Puerto Rico or a licensed CPA who, for compensation, prepares pre-eligibility certificates, applications, or compliance reports, and is registered in the Certified Professionals Registry kept by DDEC. See the definition and expedited timeline in Act 60 (Expedited Process; Certified Professional).

Act 60 also contemplates a Compliance Professional to verify decree compliance every two years and issue a Certificate of Compliance, allowing continued enjoyment of benefits when requirements are met (also codified in Act 60). Applicants manage filings and follow-ups through the DDEC Incentives Portal.

Need practitioner-level support? See MZLS — Tax Incentives & Decrees for legal structuring, filings, and compliance

The “Qualified Promoter” (Defined by Act 60)

Act 60 also creates the Qualified Promoter to help attract New Businesses to Puerto Rico. A Qualified Promoter must meet education/experience criteria, apply to DDEC, and is listed in a public electronic registry. The Code sets eligibility limits and conflicts rules (e.g., cannot serve as the Certified Professional for the same New Business) and provides an incentive payable via Invest Puerto Rico based on taxes generated by the new operation. See Act 60 — Section 2034.01 (Qualified Promoter) and operational updates via InvestPR.

Practical Changes After Consolidation

Comparison: Before (Act 20/22) vs. After (Act 60)

1. Application

Before (Act 20/22): Separate, statute-specific processes.
After (Act 60): Unified routes through the DDEC Portal, with ordinary, special, and expedited options.

2. Decree Term

Before: Varied terms, often 15–20 years.
After: Standard 15-year term, with possible extensions.

3. Compliance

Before: Fragmented reporting and oversight.
After: Uniform reporting requirements, review by a Compliance Professional, and stronger revocation rules.

4. Private-Sector Role

Before: Informal advisers.
After: Formal roles established—Certified Professional (for filing and compliance) and Qualified Promoter (for business attraction), both defined under Act 60.

Key Takeaways

Act 60 integrated Act 20 and Act 22 into a single, rules-based framework with standardized decrees and oversight.
The Code formally defines the Certified Professional (expedited pre-eligibility, filings, compliance; DDEC registry) and the Compliance Professional (biennial verification). See Act 60 text.
The Qualified Promoter role is also established, with DDEC registration, conflict-of-interest limits, and incentives disbursed through InvestPR.
All new applicants operate under DDEC’s unified portal; legacy decrees remain valid until expiration.
For case-specific strategy and compliance, consult MZLS — Tax Incentives & Decrees.