Blockchain and other technologies related to distributed databases have been an issue subject to considerable discussion. Today, there are several industries looking into its related possibilities and new uses for blockchain are found every day. However, a question still remains: how could these technologies be used in the context of current Intellectual Property law and practice?

1. What is blockchain?

A blockchain is similar to a digital version of a ledger. This chain consists of several “blocks” of information linked through cryptography, meaning that it is protected against any intrusion or modification. One of its main features is decentralization, since it does not reside on a single computer nor is it managed by a particular organization. Rather, the system is made up of multiple computers around the world that verify the data entered and look for inconsistencies so that the system works optimally and independently.

One of the main functions of a blockchain is to provide traceability for a certain product. Traceability refers to the ability to monitor the evolution of a product in its different stages. This ability is of great interest to industries that require strong Intellectual Property protection, including the pharmaceutical, automotive, and luxury goods sectors. Additionally, this technology allows the creation of what are known as Non-Fungible Tokens (NFTs), which can be defined as a digital version of a certificate of authenticity embedded in the blockchain that can represent almost any real or intangible property, including works of art, music, videos, etc.

Initially, blockchain technology was created for the financial sector to track massive amounts of transactions. However, its application has spread to many areas, including copyrights. Here, we can imagine a cinematographic work that has several elements that are also are essential parts of a particular chain (script, production, credits, distribution, etc.). Usually, this information would be stored on shelves, but through blockchain, it can immediately and securely be recorded in your system. This makes it possible to verify exploitation rights in real time through an unalterable and immutable seal. In the case of, for example, a song, with its music and lyrics, the authorship of its components would not be lost despite any merging.

For all of these reasons, blockchain has become a tool with a major potential for protecting works and proving their authorship. However, national legislation neither recognizes nor regulates this technology, which is why any certificate generated through it is invalid in any public procedure, especially considering that digital certificates in Ecuador must be granted by an “Information Certification Entity” controlled by the National Telecommunications Council. This very fact runs contrary to the nature of blockchain, given that its main characteristic is decentralization, which means that its own users manage it and there is no government control (with the exception of what are known as “institutional blockchains,” which have not been addressed in this article).

Given the above, blockchain cannot be used in procedures with Ecuadorian public agencies in which on-site interactions and a lack of standardization make procedures slow and oftentimes prone to corruption. For blockchain to be used, laws need to be updated in way that recognizes new technologies, especially those that provide security and speediness when administering data and certificates.

2. Intellectual Property Rights and blockchain

According to commonly accepted legal principles, a blockchain-based product can be classified as intangible or incorporeal property, meaning that, while this asset cannot be discerned by the senses, it does have, regardless, a certain value.  A buyer can acquire Intellectual Property rights that are separate from those pertaining to the creator of the underlying work. This is exactly what happens with the purchase of a painting, a book, or a music CD: the buyer becomes the owner of a specific version without exercising any copyright.

This begs the question of who owns the copyright in the underlying work of the blockchain. The short answer is that the creator owns the rights to their work, unless otherwise agreed. For example, when someone buys a painting from an art gallery for their home, they are purchasing the physical painting itself. While they may put this work on display, they do not hold the underlying rights to reproduce, make derivative works of, or distribute copies of that painting.

In the United States, for example, the parties are free to agree on the terms and conditions that govern a transfer of rights to a product connected to the blockchain. However, it is common practice to find adhesion contracts that usually limit the annual income that the buyer can obtain from said asset (for example, the NBA’s “Top Shot” platform). In other cases, some companies will tend to agree to restrictive terms and conditions that prohibit any type of exploitation of the asset linked to the blockchain.

This brings us to address whether we can obtain patent protection when it comes to blockchain-supported products.

Regardless of the legal system, “machines” are usually patentable, while “abstract theorems” are not (understanding this to mean mathematical principles that do not provide a technical contribution). This is due to the fact that machines are usually specific products that improve our quality of life, while theorems tend to be scientific principles belonging to the collective. As such, it is understood that they cannot be subject to control or monopolization.

Under our system (Ecuador), any blockchain-supported product is considered a non-patentable idea provided that is governed by code and software. This is the usual form of operation, because for an idea to be patentable, there must be material elements  involved. Along these lines, Article 15.e from Andean Community Decision 486 expressly states that computer programs or software are not considered to be inventions. However, Article 4 of Decision 351, also from the Andean Community, provides that computer programs can be protected under copyright, and covers both the source code (human readable instructions) and object code (binaries) of programs. Accordingly, in Ecuador, a blockchain-supported product could be protected under copyright; however, it would not be patentable.

In contrast, the Anglo-Saxon legal system brings together both copyright and industrial property under the concept of Intellectual Property, which implies greater flexibility when it comes to negotiating rights. As a result, the owner of a work can lose control of it by giving up their copyright, since moral rights are not exercised together with economic rights. In other words, there are no limits to exploiting a work, unlike the copyright system (applicable in Ecuador), which is based on protecting the moral right of the work.

Walmart, for example, registered a patent in the United States on a blockchain-based online shopping optimization algorithm. This is an integrated payment system that helps the buyer to choose their products in greater detail. It also automatically distributes payments on the blockchain among Walmart employees or vendors who worked on a certain process. Under this example, a computer program can be protected as it has been proven to provide added value to a specific process whose results are perceptible to the outside world.

Another example of program protection that produces a noticeable technical effect is Bank of America’s patent No. 10,643,202, which involves a real-time transaction processing system based on blockchain. This system reduces the previously known time per transaction and its adoption could greatly enhance electronic commerce, especially for tools such as Apple Pay or Google Pay.

Consequently, most of the applications filed on blockchain patents come from the Anglo-Saxon system, especially from countries such as the United States, Canada, and England. Regardless, it is not easy to prove that a blockchain system is not part of common scientific knowledge, as there are several research papers and countless articles that explain the bases of its algorithm, including a publication by Satoshi Nakamoto, the presumed pseudonymous person or persons who is (are) recognized as having developed Bitcoin. Even so, numerous patents have been accepted in cases where the filed application directly links the code to a machine’s operation, presenting this set as an invention that improves existing technical qualities and solves a specific problem in an innovative way. This makes it possible to obtain greater probabilities of patenting a technological invention, unlike what occurs in Ecuador, where software is expressly excluded from patentability.

Conclusion

In conclusion, the task at hand is to review an outdated Andean standard that does not recognize new fields and opportunities arising from the digital environment. It would also be advisable to replace references to “computer programs” with “information technology programs” in order to clearly include mobile applications (apps) or Dapps (applications that run within a blockchain) within the scope of said standard.

Further, it seems like the absolute impossibility of patenting computer programs is inappropriate under certain circumstances. While such programs are automatically copyright-protected from the moment of their creation, certain programs do require patenting since an innovative solution is brought to the table.

Edgar Bustamante
Associate at CorralRosales
ebustamante@corralrosales.com

With the development of Neuroscience in recent years, human beings can influence their own nervous system, especially the brain.[1] Neuroscience, the branch of science dedicated to the study of the nervous system, has developed a range of technology known as neurotechnology. Neurotechnology consists of all tools and processes used to understand the functioning of the brain, as well as control or repair its functions.[2] The development of this disruptive technology has opened doors to a subject that has been rather overlooked within legal spheres related to the possible effects that this technology could have on the rights of individuals.

The development of neurotechnology could pose major risks to the rights of individuals, namely privacy, free will, health, and personal data. Within this context, countries like Chile have determined the need to debate possible regulations that would limit the impact of neurotechnology, establishing ethical principles for its use and creating new rights. This constitutes the first steps toward the creation of neuro-rights, which are based on traditionally recognized rights, coupled with their impact on the neurological field.

This article aims to describe the bases and guidelines to, in the future, develop legal regulations on the subject. We begin with a theoretical explanation of the concept of neuroscience and then go on to discuss the rights involved and how they may be impacted. Reference will then be made to the new neuro-rights discussed in the literature, presenting the regulatory proposal in Chile alongside its respective criticisms. Finally, we conclude that it is necessary to regulate and create opportunities for analysis and debate on developing regulations on neurotechnology.

Neuroscience and Neurotechnology

Neuroscience studies different aspects of brain functioning and the nervous system. There are various branches of science that study neuroscience from different fields. Examples include genetics, cellular biology, anatomy, and physiology. Neurotechnology analyzes the application of various tools to study brain functioning. Such tools seek to solve physical and psychological problems that could come to affect normal brain functioning or the normal functioning of other bodily organs.

An example of neurotechnology’s application is the use of “BCI,” or Brain Computer Interface, which may help people who suffer from various types of paralysis. BCIs record brain waves, which are interpreted by a system and then a command is sent to a machine that performs the corresponding operation.[3] BCIs improve the lives of people who suffer certain types of disabilities. The use of this technology can improve memory functions or even improve the mobility of individuals with physical disabilities.[4]

Alongside the benefits, these tools also present great risks to certain individual rights. Their misuse may affect individual rights such as freedom, privacy, data protection, and proper societal development. According to Spanish neurobiologist Rafael Yuste,[5] within 10 years we will be using neurotechnology to read and record brain activity. As a result, using neurotechnology to change brain activity necessarily requires an ethical development of this technology. 

Neurotechnology and Rights

As already mentioned, the development of neurotechnology could bring major benefits to human beings. However, if used incorrectly, neurotechnology could affect their rights. The rights to privacy, freedom of thought, no discrimination, and the right to protect personal data could be affected by the incorrect use of neurotechnology.

The creation of devices and tools arising from neurotechnology could lead to the creation of new rights. Ieca and Adorno have presented four new rights applicable to neuroscience: mental privacy, cognitive liberty, mental integrity, and the right to psychological continuity.[6]

Mental privacy is defined[7] as the right to protect what we think and feel. Humans’ most private and intimate possessions are those that reside in theire brains. Science, applying technological tools, will soon come to know what people think and feel, and eventually, be able to analyze and modify these thoughts and feelings.

Cognitive liberty goes hand in hand with mental self-determination. This right is comprised of two elements, (i) an individual’s right to freely use new technologies and (ii) the protection of individuals against the mandatory use of said technologies. This right is based in the freedom of individuals to choose whether to use these technologies.

The right to mental integrity has a broader meaning that goes beyond the traditional guarantee of mental and physical integrity as an expression of adequate health. Within the framework of neuro-rights, this right, refers to those devices and tools not causing any damage to the brain or brain activity, where no unauthorized modification occurs.

Finally, the right to psychological continuity means that through neurotechnology, no type of abuse, threat, or alteration to the mental activity of a person occurs that may affect the personality or personal identity of an individual.

Chile and Neuro-Rights

Chile is a pioneer in the regulation of neurotechnology, promoting two bills on the matter, called “Neuro-Rights Bills.” The first is a constitutional reform establishing that scientific and technological development must be in the service of the people. This reform was introduced through Law No. 21.383[8] which modifies article 19.1 of the Political Constitution of the Republic of Chile with the following text:

“Scientific and technological research shall be at the service of the people and shall maintain respect for life and physical and psychological integrity. The law shall regulate the requirements, conditions, and restrictions for scientific and technological use in people, and shall especially safeguard brain activity, as well as the information derived from it.”

In the amendment, the protection and safeguarding of brain activity during technological development is expressly included, creating the need for a regulatory framework in the event that technology affects normal functioning.

Additionally, a draft bill on the protection of neuro-rights and mental integrity[9] (the “Bill”), as well as the development and investigation of neurotechnology was presented. The Bill is intended to protect physical and psychological integrity of the people in the face of development and advancement of neurotechnology.

It is important to note that the Bill recognizes the freedom of people to use any system or type of neurotechnology. To this effect, a persons consent must be free, prior, and informed, as well as provided explicitly in writing. It may be revoked at any time.

The proposed amendments have not been free of controversy. Authors such as Zuñiga, Villanvicencio, and Salas[10] have openly criticized the creation of neuro-rights, noting that the risks of neurotechnology are already regulated by existing rights (privacy, freedom, data protection). For these authors, new threats can easily be regulated by allowing for an evolution of said rights, and as such, the constitutional amendment would have no legal grounds.

Conclusions

The ongoing development of neuroscience, and especially neurotechnology, will benefit human beings. Some tools, instruments, and procedures for the development of neurotechnology could cause risks to constitutionally recognized rights and international treaties. For the time being, it cannot be irrefutably determined that these risks or impacts require specific regulation for the creation or recognition of new rights. In any case, an academic debate on the impact of this technology and the need for regulation is key. Prior to developing new rights, an ethical and legal framework for the future of neurotechnology needs to be created; this is essential to ensure respect and protection of the rights and freedoms currently recognized.

[1] Yuste, R.; Genser, J.; Hermann, S., It´s Time for Neuro-Rights (2021), Horizons. https://www.perseus-strategies.com/wp-content/uploads/2021/03/Neuro-Rights-Horizons-Winter-2021.pdf 

[2] N.A., (2019). Iberdrola. Neurotecnología. Recuperadoi de: https://www.iberdrola.com/innovacion/neurotecnologia

[3] N.A., (2021). NeuroTech Edu. Intro to BCI. Retrieved from: http://learn.neurotechedu.com/introtobci/

[4] Jamil, N.; Palmer, J. (2020). Frontiers in Neuroscience. Neural Tech. Retrieved from: https://www.frontiersin.org/articles/10.3389/fnins.2020.00692/full

[5] Arancibia, F., (2022). Rafael Yuste, neurobiólogo precursor del proyecto BRAIN: “Hay una línea roja que no se debe cruzar: el cerebro no se toca, es la esencia del ser humano” Retrieved from: https://interferencia.cl/articulos/rafael-yuste-neurobiologo-precursor-del-proyecto-brain-hay-una-linea-roja-que-no-se-debe

[6] Ienca, M. Y Andorno, R. (2021) Hacia nuevos derechos humanos en la era de la neurociencia y la neurotecnología.  Retrieved from: https://www.redalyc.org/journal/3400/340067606006/html/#redalyc_340067606006_ref12

[7] Maldonado, P., (2019), Neuroderechos: la discusión por la privacidad mental y el control del cerebro ya está aquí. Universidad de Chile. Retrieved from:  https://www.uchile.cl/noticias/156392/neuroderechos-la-discusion-por-la-privacidad-mental

[8] Law 21.383

[9] Senado República de Chile. Boletín 13828-19. Retrieved from: https://www.senado.cl/appsenado/templates/tramitacion/index.php?boletin_ini=13828-19

[10] Zuñiga, A; Villavicencio, L; Salas, R. (2020). ¿Neuroderechos? Razón para no legislar. Ciper. Retrieved from: https://www.ciperchile.cl/2020/12/11/neuroderechos-razones-para-no-legislar/

Pablo Dent y Rafael Serrano
Associates at CorralRosales
pdent@corralrosales.com – rserrano@corralrosales.com

CorralRosales’ international legal alliance, TAGLaw®, has again been recognized by Chambers & Partners as “Elite” for 2022—the highest ranking awarded to legal networks and alliances. This is the ninth time TAGLaw has received the distinguished “Elite” designation since Chambers & Partners began ranking legal networks and alliances in 2013.

TAGLaw was also invited provide the introduction to this year’s rankings guide: “GLOBAL LAW FIRM NETWORKS: An Introduction to Global Market Leaders”. In the introduction, TAGLaw discusses the challenges faced by law firms in 2021 and what the future holds for firms, alliances, and networks. 

“We are honored to be named an “Elite” international legal network/alliance for the ninth year and to contribute our thoughts to the annual introduction for the third time.” said Richard Attisha, President & CEO of TAGLaw and TAG Alliances. “Over the years, Chambers & Partners has continually acknowledged both the reputation of our global alliance and our individual member firms and their lawyers. This prestigious recognition is truly a testament to the quality of our member firms, illustrated by their prominence in their local markets and by their ability to deliver outstanding client service.”

In selecting networks and alliances for their “Elite” status, Chambers & Partners pays particular attention to the quality of the member firms, their global reach, and the value that the alliance provides to its member firms. TAGLaw, with a global footprint in over 90 countries, has over 160 leading firms providing legal services to companies ranging from the Fortune 5000 and leading SMEs to high-net-worth individuals. More than 100 of TAGLaw’s member firms have received individual rankings and award recognitions from Chambers & Partners. With expertise in dozens of practice areas and countless industry sectors, TAGLaw offers a substantial capability to its members’ clients. This capability is expanded by TAGLaw’s unique relationship with its sister alliances of accounting firms (TIAG®) and strategic partners (TAG-SP®), which together provide exceptional multidisciplinary service and a competitive advantage to businesses that cross geographical borders. 

About TAG Alliances®

TAG Alliances is comprised of three divisions: TAGLaw®, TIAG® (The International Accounting Group), and TAG-SP®. TAGLaw is an international alliance of more than 160 independent law firms. TIAG is an international alliance of more than 115 independent accounting firms. TAG-SP is a complementary association of strategic business partners. Collectively, TAG Alliances members provide legal, accounting, financial and business support services on a worldwide scale. With approximately 17,000 professionals in over 290 member firms, and more than 750 offices in over 105 countries, members of the TAG Alliances serve tens of thousands of clients from all industry and commercial sectors. TAG Alliances is consistently recognized as one of the Top 10 alliances of accounting & legal alliances in the world.

Learn more at www.TAGAlliances.com.

The National Intellectual Rights Service (hereinafter, “SENADI”), when deciding an opposition against the application for the mark DASH in class 11, considered that the applied-for mark was unregistrable since there was a risk of confusion for consumers due to the prior existence of the opposing party’s trademark DASH in Class 09.

SENADI also considered that attempting to register a mark identical to another that is already on the market could be considered an act of unfair competition. This argument is usually rejected in most cases, so its acceptance in in this case is a rare event and undoubtedly will serve as a reference for future cases.

Background:

On November 19, 2019, a natural person applied for the mark “DASH” intended to protect goods in international class No. 11, specifically: “Apparatus for lighting, heating, steam generating, cooking, refrigerating, drying, ventilating, water supply and sanitary purposes [1].”

PA-CO COMERCIAL E INDUSTRIAL S.A. filed an opposition based on trademark “DASH”, to protect the following goods in Class 09: “scientific, nautical, surveying, photographic, cinematographic, optical, weighing, measuring, signalling, control (inspection), life-saving and teaching apparatus and instruments; Apparatus for conducting, distributing, transforming, accumulating, regulating or controlling electricity; apparatus for recording, transmission, reproduction of sound or images; magnetic record carriers, recording discs; automatic vending machines and mechanisms for prepaid apparatus; cash registers, calculating machines, data processing equipment and computers; fire extinguishers.” The opposing party also argued the applicant’s unfair competition.

On July 10, 2020, the applicant answered the opposition, which was added to the file on January 31, 2022. 

Case resolution:

Through Resolution No. 2000009, issued on February 15, 2022, SENADI accepted the opposition filed, rejecting the registration of the applied-for mark. In the aforementioned resolution, SENADI considered that that the conflicting marks were identical as well as acknowledged the relationship between the conflicting classes. Therefore, it concluded that there was a risk of confusion or association for consumers, who could assume that the goods are related or have the same business origin.

Regarding the registrability of trademarks, Decision 486 of the Andean Community establishes that:

“Those signs whose use in commerce unduly affects a third party’s right may not be registered as trademarks, in particular when:

a) are identical or similar to a trademark previously applied for registration or registered by a third party, for the same products or services, or for products or services in respect of which the use of the trademark may cause a risk of confusion or association[2]; (…)”

When deciding the opposition, SENADI ruled on the argument of unfair competition -an uncommon fact – in the following terms:

“Given the above, it could be considered as an act of unfair competition, the fact that it is intended to register a mark that is identical to a trademark that is in the market, generating confusion among consumers, which is precisely what intellectual property should avoid.”

In this regard, Decision 486 of the Andean Community rules that:

“When the competent national office has reasonable indications that allow it to infer that a registration had been filed to perpetrate, facilitate, or consolidate an act of unfair competition, it may deny said registration.[3]; (…)”

With this decision, SENADI has taken a very positive step in the analysis of intellectual property matters, leaving aside purely formal aspects, by analyzing complex situations, protecting not only trademarks owners but also consumers.

[1] Proceeding No. SENADI-2019-82640.

[2] Article 136 of the Decision 486 of the Andean Community.

[3] Article 137 of the Decision 486 of the Andean Community.

Katherine González
Associate at CorralRosales
katherine@corralrosales.com

Renewable energy sources are increasingly important in tackling climate change^[1]. They are also essential to achieve safe and environmentally friendly energy development^[2]. As a result, companies have a growing tendency to assume environmental commitments in the international private sphere, including electricity consumption with clean energy^[3].

Regarding this, Ecuadorian legislation, as an alternative to power purchase and sale schemes^[4], contemplates the possibility of installing and operating non-conventional renewable energy systems for the self-sufficiency of electrical energy^[5]. 

This article (i) contains the main characteristics of distributed generation systems and (ii) summarizes the procedure that must be followed before the respective electricity distribution company (hereinafter, the “Distributor”) for their installation and operation.

1. Distributed Generation System

Through Regulation No. ARCERNNR-013/2021 of April 05, 2021 (hereinafter, the “Regulation”), the Agency for the Regulation and Control of Energy and Non-Renewable Natural Resources (hereinafter, “ARCERNNR”) regulated article 24 of the Regulation to the Law of the Public Electric Power Service (hereinafter, the “RGLOSPEE”), which empowers any natural or legal person to install and operate electric power generation systems for self-sufficiency, provided they maintain a supply contract with the Distributor and benefit from the provision of the public energy service (hereinafter, “regulated consumer“).

The systems must have the following main characteristics:

i. Its nominal power must be less than 1 MW^[6].

ii. Its annual production must be equal to or less than the annual energy demand of the regulated consumer.

iii. It must be a distributed generation system^[7]. That is, the energy has to be produced from small generation plants, close to consumption (within the same service area^[8]where the regulated consumer is located), and connected to the power distribution network.

iv. It should be based on non-conventional renewable energy sources (e.g., wind, solar, etc.).

Distributed generation systems for self-sufficiency (hereinafter, “SGDA”) do not limit electrical energy consumption from the traditional distribution network. Therefore, if the SGDA does not cover the demand of the regulated consumer, they can additionally consume electricity from the grid. On the other hand, as provided in article 18 of the Regulation, if due to operating conditions of the SGDA or variation in consumption, there are surpluses of energy produced by the SGDA, these will be injected into the power distribution network. As a result, a credit will be generated in favor of the regulated consumer, who will be compensated with the consumptions made from said network.

Therefore, any company can install and operate, for example, solar panels connected to the distribution network, with a nominal power of less than 1MW, to generate clean energy and cover all or part of its demand.

2. Procedure

The following procedure must be followed to install and operate an SGDA:

i. The regulated consumer must request the Distributor to determine whether or not it is feasible to connect the SGDA to the power distribution network. In said request, the general data of the regulated consumer and the SGDA must be included (e.g., nominal power, an estimate of the annual energy to be generated, primary energy resource, connection point to the distribution network, among others).

ii. If the Distributor determines that the connection is feasible, it will accept the request and establish the connection scheme and operating conditions of the SGDA.

iii. Once the “feasibility of connection” is granted as defined by the standard, the regulated consumer must demonstrate to the Distributor that it complies with the requirements established in the Regulation to install and operate the SGDA. For which you must present the following fundamental information:

• Location of the property or property where the SGDA will be installed; 
• SGDA technical report;
• Design of the works and/or necessary adjustments to the distribution network for the connection of the SGDA; and,
• Project execution schedule.

iv. If the Distributor determines that the requirements are met, it will issue the Qualification Certificate, that is, the document that enables the regulated consumer to install and operate the SGDA under the conditions approved and established by the Distributor.

Those who want to benefit from this scheme should take the following into account:

• The SGDA must be installed according to the execution schedule approved by the Distributor.

• The regulated consumer must cover the costs of the works and/or adjustments necessary to connect the SGDA to the distribution network.

• The necessary assistance must be provided to the Distributor to carry out the tests it deems pertinent to the equipment that will allow the connection of the SGDA to the distribution network.

• The regulated consumer will be responsible for the SGDA’s quality and safe operation to the Distributor and competent authorities. Also, will be liable for any damages to third parties derived from such operation. 

• The Qualification Certificate will be valid for the useful life of the SGDA:

TechnologyUseful Life(years)Photovoltaic25Wind25Biomass20Biogas20Hydraulic30

• The Qualification Certificate may be terminated for various reasons^[9], among them, due to: (i) increasing the nominal power of the SGDA without prior authorization from the Distributor, (ii) the expiration of its period of validity, or (iii) the decision of the regulated consumer. Upon the termination of the Qualification Certificated, the SGDA will be disconnected of the distribution network.    

In conclusion, the SGDA is an interesting option for regulated consumers who want to make environmental commitments, such as meeting their demand for electricity with clean energy. Furthermore, if the SGDA is appropriately structured, its installation and operation could be cheaper than the regular consumption cost of the power distribution network. In this case, the investment is profitable, and the consumer could install the SGDA in order to: (i) eliminate its consumption from the distribution network; or (ii) reduce it and, eventually, compensate it if the SGDA produces energy above its own needs. 

^[1] Hugo Altomonte, ed., “Non-conventional renewable energies in the electricity generation matrix: three case studies”, ECLAC, accessed October 31, 2021, https://repositorio.cepal.org/bitstream/handle/11362 /40975/S1601254_es.pdf?sequence=1&isAllowed=y

^[2] Susa Jiménez, “Non-Conventional Renewable Energy: Promotion Policies in Chile and the World”, Libertad y Desarrollo, ISSN: 0717 – 1536, accessed on November 21, 2021, https://archivos.lyd.org/other/files_mf /sie218energiarenovablenoconventcionalpoliticasdepromocionenchileyelmundosjimenezsetember2011.pdf

 Santiago Hoyos, Carlos Franco and Isaac Dyner, “Integration of non-conventional renewable energy sources to the electricity market and its impact on the price.”, Ingenieria y Ciencia, doi: 10.17230 / ingciencia.13.26.5, http: // www. scielo.org.co/pdf/ince/v13n26/1794-9165-ince-13-26-00115.pdf

^[3] Veronika Henze, “Corporate Clean Energy Buying Grew 18% in 2020, Despite Mountain of Adversity” BloomberNEF, January 26, 2021, https://about.bnef.com/blog/corporate-clean-energy-buying-grew-18-in-2020-despite-mountain-of-adversity/ 

^[4] The sale of electricity between private parties is possible under two schemes: (i) the buyer must qualify as a large consumer and buy all their demand for electricity from a generator or self-generator authorized as such before the competent authority; or (ii) the buyer must be a shareholder in a self-generator to buy electricity from the latter. 

^[5] Paragraph 10 of article 3 of the LOSPEE states that “… Non-conventional renewable energies are considered to be sources: solar, wind, geothermal, biomass, tidal, hydroelectric of smaller capacities, under the terms and conditions established in the regulations, and others that will be defined in the respective regulation. “

^[6] According to the ARCERNNR, the average consumption of regulated customers at the residential, commercial and industrial level is 141.42 kWh, 575.68kWh and 9,739.14 kWh, respectively. Available at: https://www.controlrecursosyenergia.gob.ec/wp-content/uploads/downloads/2021/09/Estadistica-2020-baja.pdf

^[7] Article 3 of the RGLOSPEE defines distributed generation as: “(…) Small generation plants installed close to consumption and connected to the distribution company’s network.”.

^[8] Article 3 of the RGLOSPEE defines the service area as “… the geographic area established by the Ministry of Energy and Non-Renewable Natural Resources in which an electricity company provides the public service of distribution and commercialization of electric power and the public lighting service….”

^[9] Ecuador, Regulation No. ARCERNNR-013/2021, Official Registry 448, May 10, 2021, Art. 11.      

Mario Fernández García
Associate at CorralRosales
mfernandez@corralrosales.com