Monthly Archives: April 2024

CorralRosales > 2024 > April

Customs Codes for applying 0% VAT rate and Excise Tax exemption on imports

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The Customs Authority (SENAE) issued Bulletin 71-2024 on April 12, informing foreign trade operators of the codes to be applied in the import of the following goods to avoid the payment of VAT and Excise Tax:

1.    Unmanned aerial vehicle (Drone)

Drones or unnamed aerial vehicles do not meet the definition of airplanes, light aircrafts, and helicopters; therefore, the import of this goods is not subject to Excise Tax.

When importing this type of goods, the release code 5779 must be included in the customs declaration.

2.    Animals for human consumption

The import of purebred breeding stock is taxed at 0% VAT rate when destined for human consumption at the end of their productive cycle, being slaughtered and commercialized as meat.

When importing this type of merchandise, the release code 0613 must be included in the customs declaration.

3.    Electric vehicles

The import of electric vehicles for private use, public transportation, and cargo is taxed at 0% VAT rate and is not subject to Excise Tax, provided they are duly homologated and registered by the National Transit Authority.

Electric vehicles are defined as those powered solely by electric energy sources and which battery charge uses exclusively this type of energy, producing zero direct polluting emissions. Those with self-generation systems with an internal combustion source, are not considered electric vehicles regardless of their configuration.

To apply the 0% VAT rate, the release code 0753 must be included in the customs declaration. And, to avoid the payment of Excise Tax, the code 5774 must be included.

If the releasing codes have not been registered during the import, the importer is entitled to request a refund of the amounts paid for these taxes.

In the following link you can review the complete text of the Bulletin: LINK

Andrea Moya, partner at CorralRosales
amoya@corralrosales.com
+593 2 2544144

 

Fernanda Inga, senior associate at CorralRosales
finga@corralrosales.com
+593 2 2544144

DISCLAIMER: The previous text has been prepared for informational purposes. CorralRosales is not responsible for any loss or damage caused as a result of having acted or stopped acting based on the information contained in this document. Any additional determined situation requires the specific opinion and concept of the firm.

 

CORRALROSALES

Regulations to the Mediation Center of the Attorney General’s Office

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By Resolution No. 036 of February 28, 2024, published in Official Registry 521 on March 19, 2024, the Attorney General of the State issued the new Regulations to the Mediation Center of the Attorney General’s Office (the “Regulations”).

The key points of the Regulations are summarized below:

1.    The Mediation Center (the “Center”) of the Attorney General’s Office (“PGE”) will exclusively provide its services for the resolution of conflicts between: (i) public entities; (ii) public and private entities; (iii) public entities and individuals; and (iv) private entities exercising public activities by delegation, concession, authorization, or financing, and entities or individuals.

2.    The Mediation Advisory Board (the “Board”) has been established. It will consist of the Attorney General of the State or his delegate, the Legal National Director of PGE, and the Center Director. The Attorney General of the State will chair the Board.

3.    The Board is empowered to issue: (i) interpretative resolutions of the Regulations, (ii) amendments to the Regulations, and (iii) guidelines, instructions, and manuals for the Center’s operation.

4.    PGE will only call upon external mediators when: (i) the case is exceptionally complex; (ii) the parties require assistance in understanding the conflict and its potential solutions due to the technical and specialized nature of the case; (iii) there is a high workload; or (iv) if there is only one mediator in any of the PGE offices and that mediator has recused himself.

5.    Legal advisors may accompany the parties during mediation hearings. However, the mediator has the discretion to determine how they will participate.

6.    Mediation is confidential unless the parties agree otherwise.

7.    The parties may agree to conduct all or part of the mediation process through electronic means.

8.    Mediation procedures will be limited to a maximum of two years, which can be extended up to 180 days upon the parties’ request and the Center Director’s approval.

9.    If the agreed amount is over US$5,000.00, the paying party must confirm that the funds used to fulfill the obligation are legal.

10.    The parties may request to reopen a mediation process if it ended without agreement or with partial agreement.

11.    Mediation processes initiated before the Regulation’s effective date will continue under the previous regulation.

Mario Fernández, associate at CorralRosales
mfernandez@corralrosales.com
+593 2 2544144

DISCLAIMER: The previous text has been prepared for informational purposes. CorralRosales is not responsible for any loss or damage caused as a result of having acted or stopped acting based on the information contained in this document. Any additional determined situation requires the specific opinion and concept of the firm.

 

CORRALROSALES

Suspension of the working day

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On April 17, 2024, Executive Decree No. 226 was issued, which establishes:

1.    To suspend the working day for the public and private sector on April 18 and 19, 2024.

2.    That the public sector recovers its working day through an additional hour during the subsequent working days.

3.    That the private sector, by mutual agreement between the employer and the employee, determines how to execute the workday and compensate it.

Edmundo Ramos

Edmundo Ramos, partner at CorralRosales
eramos@corralrosales.com
+593 2 2544144

 

María Victoria Beltrán, associate at CorralRosales
mbeltran@corralrosales.com
+593 2 2544144

DISCLAIMER: The previous text has been prepared for informational purposes. CorralRosales is not responsible for any loss or damage caused as a result of having acted or stopped acting based on the information contained in this document. Any additional determined situation requires the specific opinion and concept of the firm.

 

CORRALROSALES

Regulations on the administrative visto bueno process

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On March 21, 2024, the Ministry of Labor issued Ministerial Agreement No. MDT-2024-041, published in Official Registry No. 526 of March 26, 2024, which regulates the administrative visto bueno process, of which we highlight the following:

– The parties may appear personally, or through their representative or procurator, accompanied by their legal counsel.

– The work suspension must be justified by the employer and approved by the labor inspector. If the suspension is granted, the employer will have a 48-hour period to consign.

– If the inspector denies the suspension, the employer must grant the employee a paid leave to exercise the right of defense.

– The labor inspector may request clarification of the notification place in person up to 2 times. With the notification, the defendant has 2 days to reply.

– If it is not possible to notify the employee in person, the employer must notify via a single press publication including an extract of the visto bueno that must be posted in several places in the workplace.

– Within 3 days of the visto bueno hearing, the inspector in charge will issue a duly reasoned decision.

– Provided that one of the parties is affected, they could appeal the decision within 3 days before the labor inspector. Once the appeal is lodged, the regional director of labor and public services must resolve the appeal within 10 days.

– The action to request a visto bueno by the employer against the employee is time-barred within 1 month.

– The procedure expires in 30 days, if it has not been resolved in the first instance, counted from the notification of the request for the visto bueno.

– Regarding cases of lack of probity and immoral conduct of the employee, as well as harassment at work, the period is calculated from the date on which the employer or his representative became aware of the facts that gave rise to the visto bueno.

– The lodging of a complaint or labor lawsuit, before or after the visto bueno has been submitted, is not a reason for the labor inspector to refrain from processing the visto bueno.

Edmundo Ramos

Edmundo Ramos, partner at CorralRosales
eramos@corralrosales.com
+593 2 2544144

 

María Victoria Beltrán, associate at CorralRosales
mbeltran@corralrosales.com
+593 2 2544144

DISCLAIMER: The previous text has been prepared for informational purposes. CorralRosales is not responsible for any loss or damage caused as a result of having acted or stopped acting based on the information contained in this document. Any additional determined situation requires the specific opinion and concept of the firm.

 

CORRALROSALES

Appointment of Data Protection Authority

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On March 28, 2024, the Council of Citizen Participation and Social Control (CPCCS) appointed Fabrizio Roberto Peralta Díaz as the Data Protection Authority for 2024-2029.

During the presentation of his work plan, Mr. Peralta highlighted his experience in data protection and proposed the following:

i.    Implement an educational vision in the Authority.

ii.    Generate inter-institutional relations by creating awareness of administrative, legal, and technical security measures related to data protection.

iii.    Create technical dependencies responsible for registration, policy planning, and sanctions.

iv.    Promote prevention, protection, and transparency as fundamental principles.

v.    Ensure the appropriate use of resources under the Transparency and Access to Information Law.

The CPCCS must submit the resolution designating the Data Protection Authority to the Legislative for his possession.

 

DISCLAIMER: The previous text has been prepared for informational purposes. CorralRosales is not responsible for any loss or damage caused as a result of having acted or stopped acting based on the information contained in this document. Any additional determined situation requires the specific opinion and concept of the firm.

 

CORRALROSALES

VAT – List of construction supplies

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Through Resolution NAC-DGERCGC24-000000013 issued on March 28, 2024, the Tax Authority established the following list of construction supplies that are subject to a 5% Value Added Tax rate, if transferred locally:

Category Subcategory Reinforcement steel bar Reinforced corrugated AS42 steel rods with diameters of 8mm, 10mm, and 12mm. Construction aggregates Clay
Sand
Lime
Limestone
Aggregates Concrete Ready-mix concrete Binder material Cement and its derivatives
Cement residue Recyclable metallic materials Ferrous scrap Mortar Mortar Cement precursors Clinker
Pozzolan
Gypsum Prefabricated concrete and clay products Paving Stone
Block
Bricks
Prefabricated concrete products

The VAT paid on the local acquisition or importation of goods or services for the production and/or commercialization of construction materials subject to a 5% VAT rate, and which has not been offset, may be recorded as a deductible expense in the fiscal year in which the VAT payment was made.

 

DISCLAIMER: The previous text has been prepared for informational purposes. CorralRosales is not responsible for any loss or damage caused as a result of having acted or stopped acting based on the information contained in this document. Any additional determined situation requires the specific opinion and concept of the firm.

 

CORRALROSALES

Reduction of working hours in the tourism sector

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On February 29, 2024, the Ministry of Labor, through Ministerial Agreement No. MDT-2024-030 published in the Official Gazette of March 14, 2024, issued the guidelines for the application of Article 47.1 of the Labor Code, regarding the reduction of working hours in the tourism sector:

  •  Decrease in working hours:

Employers in the tourism sector; register as such; prior agreement between employer and worker, may request authorization to decrease the working hours, for a period that may not exceed 6 months, whether this is consecutive or up to two separate periods.

Authorization will be granted in in the following cases:

  1. Force majeure.
  2. Reduction of income.
  3. Verification of losses.
  • Procedure:

To obtain approval on the reduction of working hours, the following documents must be submitted:

  1. Petition, addressed to the regional director of labor and public service, including the reasons justifying the reduction.
  2. Working day reduction agreement signed with the employees.
  3. Austerity plan.
  4. List of the employees and their salaries.
  5. Copies of the RUC and certificate of compliance of social security obligations.
  6. Certificate of tourism registration.
  • Remuneration and registration:

Employees’ wages will be calculated in proportion to the effective working hours. Dividends may only be distributed to the shareholders if the employees are previously paid for the reduced hours.

Social security contributions will be paid on the full 8-hour workday.

The employer shall be responsible for registering in the SUT within 15 days, the reduction in working hours and the period of application.

  • Termination of the labor relationship and indemnities:

If the employer terminates the relationship, prior to the expiration of the term agreed in the contract, unilaterally, during the period of suspension of the working day, the employee will be entitled to the payment of the indemnity provided in art. 188 of the Labor Code. The bonuses and indemnities shall be calculated on the last remuneration received by the employee prior to the reduction of the working day.

 

DISCLAIMER: The previous text has been prepared for informational purposes. CorralRosales is not responsible for any loss or damage caused as a result of having acted or stopped acting based on the information contained in this document. Any additional determined situation requires the specific opinion and concept of the firm.

 

CORRALROSALES