The Próspera Governance Platform (PGP) operates as a common law jurisdiction, similar to the United States. In fact, a majority of the Roatán Common Law Code (RCLC), on which the PGP operates, was derived from U.S. common law restatements and model U.S. business codes with some important improvements to make Próspera a world class jurisdiction to do business.
The basic regulatory principles in Próspera are:
Screen for criminal and/or irresponsible actors at the front-end through background checks and a mandatory minimum insurance requirement; and
Based on the filtering process in, avoid prescriptive regulation in favor of self-regulation with clear lines of accountability and demonstrated financial capacity to make restitution. These basic regulatory principles ensure maximum freedom to innovate and catalyze economic development while supporting strengthened responsibility.
All Residents (natural persons and legal entities) are required to submit to a background check and also secure a minimum level of liability insurance. In addition, residents (both legal entities and natural persons) operating in regulated industries are required to make a regulatory election and secure regulated industry insurance.
If you are not operating in a regulated industry, you may simply operate under common law which allows you to operate with maximum freedom as long as you do not injure others.
It is important to note that all residents must comply with the following:
Regulatory Election
Residents (natural persons and legal entities) operating in a regulated industry face enhanced exposure to liability if they operate exclusively under common law liability principles. The liability exposure enhancement for exclusive common law operations in a Regulated Industry entails treble (3x) damages for injuries, as well as attorneys' fees and personal liability for owners, directors and officers (piercing the corporate veil). For this reason, most such "Regulated Industry Persons" prefer the safe harbor of making a regulatory election in addition to common law liability principles. This means they elect to operate under a designated prescriptive regulatory system, not only under the common law. The two options are:
Honduras or Best Practice Peer Country regulations.
Self-proposed and Próspera ZEDE-approved regulations.
Simply put, the Próspera Governance Platforms enables businesses to operate under any approved country's regulations, custom self-proposed regulation, or common law with enhanced liability.
Honduras or Best Practice Peer Country Regulations
This regulatory election enables residents to be regulated as if they were operating within the selected jurisdiction from a list of available countries. This may be a good choice if you have an existing entity in one of these jurisdictions or are already familiar with the regulations.
Self-proposed and Próspera ZEDE-Approved Regulations
This regulatory election enables residents to propose optimal regulations or select from previously approved regulations. The proposed regulations need to meet the standard of being at least as effective in guarding against the violation of legal rights as the other regulatory election options that exist. This is demonstrated through a Petition for Optimal Regulation filed with the Council of Trustees and Technical Secretary.
Common Law with Exposure to Treble (3x) Damages
Choosing to operate exclusively under common law standards in a Regulated Industry can lead to significant liability risks. If your operations wrongfully cause legally cognizable injury, you could be held liable for three times (3x) the consequential damages that are caused. This liability can pierce the corporate veil to the extent of the amount of your last year's salary or equity investment, whichever is greater. Therefore, being exclusively governed by the Roatán Common Law Code is only a prudent choice for those who operate in especially safe Regulated Industries, or who possess special expertise and prescience as to the requisites of avoiding the violation of legal rights of others and what is likely to be deemed reasonable care in their operations.
Compliance
Regulatory compliance in Próspera is handled differently than most places in the world. As a general rule, regulators in Próspera are insurance providers, not bureaucratic agencies. This is what enables Próspera to offer the largest selection of regulatory choice anywhere in the world.
Once a regulatory election has been made, residents must secure an endorsement to their baseline residency insurance, which is where additional regulatory compliance requirements come into play. This is known as a supplemental regulated industry insurance endorsement or a "supplemental regulatory insurance endorsement." The purpose of this insurance is to ensure financial capacity for restitution in case of any liability. The insurance includes procedures that allow for inspections, certifications, and compliance checks to ensure proper operation within the jurisdiction. The insurance also supports enforcement action if necessary.