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Resolution on Organic Statute of Organizational Management by Start-up Processes of the Superintendence for the Protection of Personal Data (SPDP)

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Resolution No. SPDP-SPDP-2024-0001-R introduces the Organic Statute of Organizational Management by Start-up Processes in the SPDP, hereinafter referred to as the “Statute”. This Resolution, effective as of August 2, 2024, establishes the basis for efficient and transparent management of the Institution.

What are the key aspects of the Statute?

Flexibility in Structure The Statute allows for future modifications in processes, products, and administrative units according to implementation and deconcentration needs. Process Management The SPDP will optimize its activities and resources, focusing on achieving its goals more efficiently and effectively. Managerial Positions The Quartermasters, General Coordinators and Directors are freely appointed and removable. Continuous Improvement Continuous evaluation and improvement of processes is promoted, ensuring adaptation to changes and the pursuit of excellence in management. Transparency Management by processes will facilitate access to information and accountability, strengthening institutional transparency. Demand for Services and Products The Financial Administrative Directorate shall submit a report detailing the services and products that the SPDP will need within 180 days. The corresponding authorities must approve this report.

What does the approval of the Statute imply?

Approval of the Statutes implies that the SPDP can perform its role as a technical supervisory, audit, intervention, and control body. This includes issuing decisions, monitoring compliance with the law, investigating complaints and applying sanctions in the event of non-compliance.

What is the organizational structure?

The organizational structure is divided into three processes:

  • Governing Processes: They are responsible for the direction and control of the institution, establishing guidelines, policies, and strategic plans.
  • Substantive Processes: They conduct the essential activities to provide services and fulfill the SPDP’s mission, such as the supervision, regulation, and control of the processing of personal data.
  • Adjective Processes: Provide support to the other processes, including legal advice, planning, and administrative and financial management.

In summary, the structure is divided as follows:

Type of Process Level Unit Responsible Governance Management Strategic Management Superintendent for the Protection of Personal Data Substantive Operational General Intendancy for Technological Innovation and Personal Data Security General General Intendant for Technological Innovation and Personal Data Security General Substantive Operational General Intendancy for the Regulation of Personal Data Protection General Intendant for the Regulation of Personal Data Protection Substantive Operational General Intendancy for Control and Sanctions General Intendant for Control and Sanctions Adjectives Advisory Directorate of Legal Advisory Services Director of Legal Advisory Services Adjectives Advisory Planning and Strategic Management Unit Planning and Strategic Management Specialist Adjectives Support Financial Administrative Management Financial Administrative Director

In conclusion, the approval of the Organic Statute of the Superintendence of Personal Data Protection marks a crucial milestone in data protection in Ecuador. From now on, the SPDP has the necessary structure and mechanisms to ensure compliance with the Organic Law on Personal Data Protection and its Regulations. This means that companies must comply, diligent and transparent in the handling of personal information, thus guaranteeing the privacy and security of the data of their clients, employees, and users.

 

Rafael-Serrano-abogados-ecuador

Rafael Serrano, Partner at CorralRosales
rserrano@corralrosales.com
+593 2 2544144

© CORRALROSALES 2024
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

Declaration and payment of self-withholdings applicable to Large Taxpayers

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Through Resolution NAC-DGERCGC24-00000030, the Internal Revenue Service regulated the declaration and payment of income tax self-withholdings applicable to large taxpayers:

  1. Self-Withholdings Declaration: Self-withholdings must be declared monthly using the “Minimum Advance Payment of Income Tax and Self-Withholdings of Large Taxpayers Form”. This form will be used from August to declare the amounts payable for the month of July.
  2. Outflow Tax (ISD) Credit Notes: Outflow Tax credit notes may be used to fully or partially offset the amount payable for self-withholdings applicable to large taxpayers settled monthly, within the validity period of such notes.
  3. Exception Credit Notes: Exception credit notes may be used to fully or partially offset the amount payable for self-withholdings applicable to large taxpayers settled monthly, within the validity period of such notes.

 

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

© CORRALROSALES 2024
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

SENADI protects widely recognised unregistered trademarks

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DETAILS

DATE: 03-07-2024

PROFESSIONALS INVOLVED IN THE ARTICLE:

–Andrea Miño

MEDIA:

– WTR

  • SENADI has declared the nullity of the mark SAVOY TORONTO on the ground that the application had been filed in bad faith
  • The applicant had full knowledge of the prestige of the SAVOY and TORONTO marks and of their original owner
  • The mark was applied for to take advantage of the original owner’s positioning and prestige

The Ecuadorian IP Office (SENADI), in a significant move that aligns local practice with Andean jurisprudence in recent prejudicial interpretations, has declared the nullity of a trademark that is widely recognised by consumers in different jurisdictions, and was registered in Ecuador by a party other than its legitimate owner. 

Background

The IP offices of the Andean Community member states, which play a pivotal role in safeguarding trademark rights, may declare – either ex officio or at the request of an interested party – the nullity of a trademark registration when it has been granted in contravention of the absolute or relative grounds set forth by the law. This includes the infringement of third-party rights, bad faith and unfair competition. 

In 2021 SENADI granted the registration of a trademark composed of two marks, SAVOY and TORONTO, in Class 30. These trademarks had been previously registered abroad and are fully recognised based on their business origin (Nestlé). The applicant purchased the original products in his own country and sold them in Ecuador under the trademark SAVOY TORONTO. He had been aware of the Toronto and Savoy products and their business origin for several decades, since they are widely known and favoured in several countries, including Venezuela (the applicant’s birthplace).

Decision

Community jurisprudence states that, to prove the existence of bad faith in trademark applications or registrations, the plaintiff must prove that the applicant/owner had prior knowledge of the trademark and demonstrate, at least, the existence of a contractual relationship between the parties. Although there was no contractual relationship in this case, the facts and evidence confirmed that the applicant had full knowledge of the prestige of the SAVOY and TORONTO trademarks and of their original owner. 

SENADI also analysed when the original trademark owner offered its products in Ecuador before the application. It concluded that the mark was applied for to take advantage of the owner’s positioning and prestige, and to obtain exclusive rights over the mark to prevent third parties (including the legitimate owner) from offering and marketing them in the Ecuadorian territory.

In Resolution No OCDI-2024-202 (26 March 2024), SENADI considered that the existence of bad faith had been established and issued a resolution declaring that the trademark was null. The original trademark owner had offered the Savoy and Toronto products since 2018, three years before registration was applied for.

In addition to the broad knowledge of the TORONTO and SAVOY trademarks recognised by SENADI, the resolution was also based on the fact that the marks identify a particular business origin (Nestlé).

Comment

SENADI, through Resolution No OCDI-2024-202, not only acknowledged but also underscored the severity of the trademark infringement in this case. SENADI found that the applicant sought to take undue and unjustified advantage of the prestige of Nestlé’s trademarks, qualifying the case as an act of unfair competition aiming to confuse consumers as to the origin of the products.

The resolution constitutes a strong precedent against actions that may damage trademark holders’ rights. Trademarks with a wide recognition may be registered by third parties seeking to obtain an undue advantage, which is contrary to good faith and competition.

Read the article in WTR here.

This article first appeared in WTR Daily, part of World Trademark Review, in (July 2024). For further information, please go to www.worldtrademarkreview.com.

Ruling 878-20-JP/24 – Maternity leave in cases of death of children

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On March 11, 2024, The Constitutional Court issued the ruling 878-20-JP/24, which analyzes the Maternity Leave in case of death of children, from which we highlight:

  • The Court analyzes the scope of maternity leave, with the premise that pregnant women have the right to prioritized protection and care of their integral health during pregnancy, childbirth and postpartum.
  • The postpartum or puerperium is the stage in which the body progressively recovers from the physical and psychological changes that have occurred, to return to its pre-pregnancy condition. This varies for each person.
  • The Court concludes that it is not appropriate to suspend maternity leave due to the death of the newborn child, based on the argument that the reason for the leave has disappeared ignoring the need for the woman’s recovery.
  • It argues that suspending maternity leave on the assumption that its sole purpose is to care for the children, would perpetuate the gender stereotype that assigns to women the role of primary caregiver in the family nucleus. And resolves that every working woman has the right to the full enjoyment of her maternity leave, despite the death of her child.

 

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

© CORRALROSALES 2024
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

Extension for Equality Plans registration

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On July 29, 2024, the Ministry of Labor issued the Ministerial Agreement No. MDT-2024-099, which extends the deadline for the registration of “Equality Plans” until July 31, 2025.

 

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

© CORRALROSALES 2024
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

Donation of equipment to the Police for applying tax benefits

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Through Official Letter DADM-MP-01, the Ministry of Home Affairs issued the “Donation Process Manual”, which regulates the process to donate equipment and supplies to the National Police and access the 150% additional deduction for the calculation of income tax.

Article 10 of the Internal Tax Regime Law provides an additional deduction of 150% on the taxable base of income tax for donations of equipment and supplies to the National Police, aimed at protecting public order.

According to the Manual, the donor must meet the following general requirements:

  1. Not be subject to legal prohibitions for contracting with the Government.
  2. Have an “active” status in the Single Taxpayer Registry.
  3. Be the owner, possessor, manufacturer, or buyer of the equipment and supplies to be donated.

The donation request must include the following documents:

  1. Declaration of the legality of funds in the format provided in the Manual.
  2. Letter of intent to donate, which should include the general data of the donor and the technical specifications of the equipment or supplies to be donated.

In the case of weapons, ammunition, explosives, and accessories, the corresponding permits must be attached, and the import documentation if applicable.

In the case of used equipment and supplies (tangible or intangible), a report must be attached that establishes the state of the used good, its conditions, and useful life.

 

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

© CORRALROSALES 2024
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

American Privacy Rights Act: a bill that promises a radical change for privacy in the United States

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Respect for the privacy of personal data has become particularly important in the digital era. Companies and governments collect and process information about our daily activities, which makes it essential to have rules that adequately protect the privacy of citizens.

A step towards data protection in the United States.

Although the United States does not have a specific federal law on data protection, an important step was taken on April 7, 2024[1], Republican Congress Cathy McMorris Rodgers and Democratic Senator Maria Cantwell, both from the state of Washington, introduced a federal privacy bill called the American Privacy Rights Act (APRA).

This bill creates a comprehensive regulatory framework for the protection of personal data in the United States. It is a significant step forward towards greater privacy protection for U.S. citizens.

Key aspects of APRA and its relationship with Ecuador.

APRA[2] addresses various aspects contained in most of the laws on the subject, including that of Ecuador, among them:

  1. Data Minimization: Limits the collection of personal data to the minimum necessary for the intended purpose.
  2. Transparency in privacy policies: Requires companies and suppliers to provide clear and accessible information about their data collection, use, and disclosure practices.
  3. Rights management: Grants individuals the right to access, rectify, and delete their personal data. In addition, the right to opt out of receiving targeted advertising.
  4. Designation of a Privacy or Data Security Officer: Establishes the obligation to designate an officer responsible for data security, who must be qualified and have the experience to perform the position effectively.

APRA news.

The APRA federal bill incorporates aspects related to artificial intelligence (AI) and data. These include:

  • Restricting the volume of data used in AI development: Applies the minimization principle to limit the amount of personal data used in the training and operation of AI systems.
  • Concept of “covered algorithms”[3]: Defines “covered algorithms” as any computational process that decides or facilitates human decision-making using data. This definition covers a wide range of AI systems, from the simplest to the most complex.
  • Obligations for entities using covered algorithms: Entities using covered algorithms will have multiple obligations, among which the most important are:
  1. Design evaluation: Evaluate the design of the algorithm to identify and reduce the risk of potential damage.
  2. Impact assessment: Evaluate the impact of the possible effects of the algorithm on individuals and society.
  3. Notice and opportunity to opt out: Provide the ability to opt out of the use of a covered algorithm if it is used to make “consequential decisions” (decisions that significantly affect an individual’s access to or enjoyment of essential goods or services).

Implications for Ecuador.

The enactment of APRA would have a significant impact in Ecuador, especially in the following aspects:

  1. Transborder data flow: It will facilitate the transfer of data between the United States and countries with equivalent data protection standards, such as Ecuador. This translates into:
  • Simplification of processes: Administrative and legal burdens are reduced for companies transferring data between the two countries.
  • Cost reduction: Costs associated with data transfer, such as implementing additional security measures, are minimized.
  1. International cooperation: It will allow international cooperation on data protection between the United States and other countries, including Ecuador. This will allow Ecuadorian authorities to:
  • Safer information sharing: Collaborate on investigations and data protection cases involving U.S. companies.

In conclusion, once approved, the APRA bill will represent a significant advance towards data protection in the United States and will have clear impacts in other countries, including Ecuador, as expressed in previous paragraphs.

[1]  https://energycommerce.house.gov/posts/committee-chairs-rodgers-cantwell-unveil-historic-draft-comprehensive-data-privacy-legislation

[2]https://d1dth6e84htgma.cloudfront.net/American_Privacy_Rights_Act_of_2024_Discussion_Draft_0ec8168a66.pdf

[3]  https://www.whitecase.com/insight-alert/proposed-american-privacy-rights-act-seeks-establish-comprehensive-national-framework

 

Thalía Ordoñez
Associate at CorralRosales
tordonez@corralrosales.com

Bitter victory: Delayed justice in the patent system in Ecuador

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Delayed Justice…

The Administrative Litigation Court ruled in our favor in a patent proceeding, correcting a mistake made by the local IP Office; we achieved protection, a victory, no doubt, but a bittersweet one.

This patent application was filed on January 23, 2006, under a political regime acting against patentability.

In the first instance, and within the absurdly long period it takes for the local IP Office to resolve a patent, patent protection was denied on February 9, 2012, to which we filed an administrative appeal with a new set of claims.

Contrary to the law and ignoring jurisprudential provisions, the IP Office considered that a new claim set could not be submitted in this instance and again denied protection using the same previous arguments, taking almost seven additional years.

We appealed judicially, trusting that the existing illegalities would be sufficient to correct the error and grant protection. This happened because we were fortunate enough to have competent Judges in the Court.

Unfortunately, the favorable ruling was issued when only three days of protection remained for the invention sought to be patented.

The question then arises: Is the justice obtained fair? Obviously not.

The need to press for the application of the accelerated patent system is now becoming imperative. Without patents, there is no development or investment. Once and for all, it is necessary to adopt the solutions already in the Law or compensate with additional protection time patents that, as in this case, have obtained protection three days before their expiration due to the absolute irresponsibility of the State. State that has also charged annuities for a non-existent right and the highest fees in Latin America for examination.

I consider this ruling a professional achievement. Reversing patent decisions in courts is not easy, but it is a failure of our country’s patent system. If we do not take these types of facts seriously and seek a correction that solves these problems at the root, we will continue, at best, obtaining unfair justice.

 

Eduardo Ríos
Partner at CorralRosales
eduardo@corralrosales.com

Amendments to the Public Procurement Law Regulations

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Through Executive Decree 333 of July 12, 2024, published in the Third Supplement of the Official Registry 600 on July 15, 2024, the Public Procurement Law Regulations (the “Regulations“) were amended.

The key amendments are summarized below:

  1. The contracting of Ecuador’s tourism promotion is included as a special regime. Under this regime, the following may be contracted: (i) supply and demand studies; (ii) advertising; (iii) organization, logistics, and assistance for events and fairs; (iv) creation of tourism promotion campaigns; and (v) promotion and positioning of the country brand (Marca País).
  2. A legal entity with its main office in the canton, province, or region where the contract will be executed is considered a local supplier.
  3. If the contractor is an obligated subject before the Financial and Economic Analysis Unit (UAFE), it must hold a Certificate of Compliance from the UAFE during the contractual execution phase.
  4. The study of technological disaggregation in works applies only when the reference budget is equal to or exceeds the amount resulting from multiplying the coefficient 0.00003 by the State’s initial budget for the corresponding fiscal year. For 2024, such amount is US$998,904.59.
  5. Public entities may acquire domestic and international airline tickets under any of the following mechanisms:
  6. Direct purchase from airlines.
  7. Direct purchase from airlines using business or corporate plans.
  8. Direct purchase through online ticket platforms.

Through travel agencies, if deemed appropriate for technical and operational reasons.

 

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

© CORRALROSALES 2024
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

Circular Economy

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The circular economy system seeks to keep materials in supply chains for as long as possible, in order to minimize product waste, promote sustainable use of natural resources, revalue waste and regenerate nature.

The circular economy emerges to replace the linear economy (take-make-waste), which is a production model that extracts virgin raw materials to manufacture products that eventually end up as waste.

Since 2021, Ecuador has enacted the Inclusive Circular Economy Law. This legislation establishes mechanisms for transitioning from a linear economy to an inclusive circular economy. It recognizes waste as a potential economic resource and aims to economically integrate waste pickers.

The transition to a circular economy is led by the Secretariats of Production and Environment through the National Inclusive Circular Economy System.

Extended producer responsibility

Extended Producer Responsibility (EPR) is a policy requiring producers or importers to manage a product throughout its entire life cycle, including the post-consumer stage. The Inclusive Circular Economy Law mandates the implementation of EPR schemes for designated priority products.

The collection, classification and recycling processes of EPR contribute significantly to material circularity, making it a pivotal tool that serves as a cornerstone of the circular economy.

In Ecuador, this policy has been implemented for over 10 years for specific products such as tires, batteries, electronic waste, medication waste, among others. The National Inclusive Circular Economy System must determine the priority products for the extended producer responsibility scheme.

 

Verónica Manrique, Junior Associate Lawyer at CorralRosales
veronica@corralrosales.com
+593 2 2544144

Felipe-Samaniego-abogados-ecuador

Felipe Samaniego, Partner at CorralRosales
felipe@corralrosales.com
+593 2 2544144

© CORRALROSALES 2024
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.

 

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