I.- FINANCIAL, INSURANCE AND SECURITIES MARKETS
1.- AMENDMENTS TO BOOK III “PRIVATE INSURANCE SYSTEM” OF THE CODIFICATION OF MONETARY, FINANCIAL, SECURITIES AND INSURANCE RESOLUTIONS
By Resolution No. JPRF-S-2022-029, issued by the Financial Policy and Regulation Board, Article 3 of Section II “OF THE PRIVATE INSURANCE FUND COVERAGE” Chapter I “GENERAL RULES OF THE PRIVATE INSURANCE FUND”, Title V “OF THE PRIVATE INSURANCE FUND”, Book III “PRIVATE INSURANCE SYSTEM” of the Codification of Monetary, Financial, Securities and Insurance Resolutions, was replaced by the following:
“Art. 3. – The coverage of the Private Insurance Fund, in accordance with the provisions of article 80, numeral 10; and article 344, second paragraph of the Organic Monetary and Financial Code, shall be limited to the payment, by the Deposit Insurance Corporation, Liquidity Fund and Private Insurance Fund (COSEDE), of the claims pending payment on the date of the declaration of the compulsory liquidation of an insurance company of the private insurance system, which shall be paid by COSEDE up to the total protected amount of the Private Insurance Fund.
Claims pending payment shall be understood to be those incurred and accepted by the insurance company in compulsory liquidation.
With respect to the claims that have occurred and have not been reported, the insured may report them to the liquidator, who will be responsible for accepting them or not.
The liquidator shall deliver to COSEDE the database of insured or beneficiaries, in which the value of each claim shall be compulsorily included, with which the payment of the coverage of the Private Insurance Fund shall be made”.
- SOURCE: Official Gazette. No. 77
- DATE: June 06, 2022.
2.- CONTROL RULE TO AUTHORIZE SAVINGS AND CREDIT COOPERATIVES AND MUTUAL HOUSING SAVINGS AND CREDIT ASSOCIATIONS TO NEGOTIATE BILLS OF EXCHANGE, PROMISSORY NOTES, PROMISSORY NOTES, INVOICES AND OTHER DOCUMENTS THAT REPRESENT PAYMENT OBLIGATIONS CREATED BY CREDIT SALES, AS WELL AS THE ADVANCE OF FUNDS BACKED BY THE REFERRED DOCUMENTS.
Resolution No. SEPS-IGT-IGS-IGJ-INSESF-INR-INSEPSINGINT-2022-0165, issued by the Superintendencia de Economía Popular Y Solidaria – SEPS, issued the “Control regulation to authorize savings and credit cooperatives and mutual savings and credit associations for housing to negotiate bills of exchange, promissory notes, promissory notes, invoices and other documents representing payment obligations created for credit sales, as well as the advance of funds backed by the referred documents”.
The following are the most important aspects of this regulation:
The entities, prior to obtaining authorization from the Superintendency of Popular and Solidarity Economy without prejudice to observing the provisions of Article 3 of this regulation, must comply with the following conditions:
a) Not to be in a corrective or intensive supervision program; Not to register non-compliance with the strategies associated with the findings with critical risk rating, determined by the Superintendency of Popular and Solidarity Economy.
b) Comply with 100% of the specific provisions required in the Norms for the Constitution of Provisions for Risk Assets in Savings and Credit Cooperatives and Mutual Savings and Credit Associations for Housing, of the Codification of Monetary, Financial, Securities and Insurance Resolutions;
c) To have a ratio between constituted technical equity and risk-weighted assets and contingencies of at least 9%;
d) Comply with structural liquidity limits and not present a liquidity position at risk in accordance with the Liquidity Risk Management Standard for Savings and Credit Cooperatives, Central Banks and Mutual Savings and Credit Associations for Housing, of the Codification of Monetary, Financial, Securities and Insurance Resolutions and the technical note for liquidity risk management issued by the Superintendency of Popular and Solidarity Economy;
e) Maintain a positive financial intermediation margin at least during the entire fiscal year prior to that of the application; and,
f) Not to present non-compliance in the submission of information requested by this Control Organism, as of the period immediately prior to that of the request.
- SOURCE: Official Gazette. No. 92.
- DATE: June 27, 2022.
II.- TAX
1.- PROVISIONS REGARDING THE ISSUANCE OF SALES, WITHHOLDING AND COMPLEMENTARY DOCUMENTS ELECTRONICALLY, AS WELL AS REGARDING THE MANDATORY ISSUANCE OF ELECTRONIC WITHHOLDING VOUCHERS IN THE “ATS VERSION”.
Resolution No. NAC-DGERCGC22-00000024, issued by the Internal Revenue Service, established the “PROVISIONS REGARDING THE ISSUANCE OF ELECTRONIC SALES, WITHHOLDING AND COMPLEMENTARY DOCUMENTS AND THE OBLIGATORY ISSUANCE OF ELECTRONIC WITHHOLDING INVOICES IN THE “ATS VERSION”.
The main aspects of this regulation are as follows:
Article 1. Income Tax taxpayers obliged to invoice that, as of the effective date of this Resolution, are not yet obliged to issue sales, withholding and complementary documents vouchers in the electronic modality, shall incorporate this type of scheme to their activity until November 29, 2022, in accordance with the provisions of the Fourth Transitory Provision of the Organic Law for Economic Development and Fiscal Sustainability after the COVID-19 Pandemic.
Article 2. Individuals and corporations that are not considered income tax taxpayers but that: i) are obliged to invoice, and ii) that at the date of entry into force of this Resolution, are not yet obliged to issue sales, withholding and complementary documents in the electronic modality, in application of the respective resolutions issued by the Internal Revenue Service, shall also incorporate this type of scheme to their activity until November 29, 2022.
The taxpayers obliged to issue sales, withholding and complementary documents under the electronic modality, as indicated in Articles 1 and 2 of this Resolution, who are qualified as withholding agents by the Internal Revenue Service, including special taxpayers, shall mandatorily implement the ATS version of withholding vouchers, in accordance with the provisions of the technical sheet of electronic vouchers, available on the web portal of the Internal Revenue Service (), and in accordance with the provisions of the technical sheet of electronic vouchers, available on the web portal of the Internal Revenue Service ().
Internal Revenue Service (www.sri.gob.ec), until November 29, 2022.
- SOURCE: Second Supplement to the Official Gazette No. 80
- DATE: June 09, 2022.
2.-RULES FOR THE APPLICATION OF THE ORDINARY IMPUTATION METHOD TO AVOID INTERNATIONAL DOUBLE TAXATION.
Through Resolution No. NAC-DGERCGC22-00000026, issued by the Internal Revenue Service, “RULES FOR THE APPLICATION OF THE ORDINARY IMPUTATION METHOD TO AVOID INTERNATIONAL DOUBLE TAXATION” was issued.
This regulation, among several aspects, determines the general rules for the application of the ordinary imputation method to avoid international double taxation, which consist of the following:
Art. 3.- General rules of application.- When a tax resident taxpayer of Ecuador receives income from abroad that is taxed in Ecuador, it may use as a tax credit in the liquidation of its income tax the tax paid abroad, considering for this purpose the following:
a. The tax to be considered as a tax credit will be the tax actually paid abroad by the taxpayer resident in Ecuador, whether it has been paid directly, withheld, or withheld in Ecuador.
paid directly, withheld at the source by the payer or by any other method of levy, provided that the taxpayer tax resident of Ecuador does not have and has not had a tax credit or right to a refund for such tax abroad.
b. It may only be used as a tax credit on Ecuadorian income tax, income tax or direct taxes equivalent to Ecuadorian income tax.
c. If for the payment of the tax abroad a currency other than the legal currency of Ecuador has been used, that is, in US dollars, the value must be converted to its equivalent in US dollars, for which purpose, the last exchange rate reported by the Central Bank of Ecuador, prior to the date of payment of the tax or withholding, shall be used. In the event that the Central Bank of Ecuador has not reported the respective exchange rate during the sixty (60) days prior to the date of payment or withholding, the exchange rate of the calendar month of payment or withholding reported in the Monthly Bulletin of the United Nations Statistics Division (https://unstats.un.org/home/) shall be used.
d. The recognition and quantification of the income obtained abroad shall correspond to the provisions of the Internal Tax Regime Law and its implementing regulations; consequently, it shall be that before subtracting the tax paid abroad for such income.
e. If the foreign income is not taxed in Ecuador or enjoys tax exemptions, the tax paid abroad may not be used as a tax credit either.
f. The taxpayer resident in Ecuador must have the necessary evidence of the tax paid abroad.
g. The part of the tax paid abroad that exceeds the limit of what would correspond to tax those incomes in Ecuador, in a fiscal year, is not subject to refund, compensation or any other form of recovery and cannot constitute a tax credit, neither in that nor in any other fiscal period.
- SOURCE: Second Supplement to the Official Gazette No. 80
- DATE: June 09, 2022.
DISCLAIMER: The text contained in this bulletin is for information purposes only. Lince – Saltos & Asociados is not and shall not be liable for any loss or damage caused as a consequence of having acted or failed to act based on the content of any of the notes contained herein.
