On March 12, the National Assembly passed the Commercial Organic Code bill (See Ruling). It includes regulations on securities trading, electronic signatures and electronic commerce. It also prevents the charging of fees for insurance or other services in the hiring of financial services which have not been expressly accepted by users, especially in relation to insurance. Now the Assembly will pass the bill to the Executive, which may enact the proposal or, alternatively, completely or partially veto it. This decision will become known in the coming weeks.

The bill establishes the right to commercial freedom, transparency, social and environmental responsibility, as well as provisions to prevent dumping. It also incorporates articles on securities trading, the use of electronic signatures, credit notes and promissory notes, and it regulates electronic commerce.

During today’s debate, at the proposal of the opposition assembly member Juan Lloret (Revolución Ciudadana), new modifications were introduced. These amendments will prevent “abuses” by financial institutions in the contracting of their services, according to the legislator. To that end, they establish that no charges may be made for insurance or other services that users have not accepted in a written statement. Such written consent may be hard-copy or by e-mail.

The bill was passed with the support of all the parties of the National Assembly. Each of its sections were unanimously passed, except the seventh, owing to the refusal by some opposition legislators from Movimiento CREO to support the regulations proposed there concerning air transport management, which they argued are already regulated under a law passed in 2018.

The bill now passes to the Executive Branch, which will have three options. It will be able to enact the bill as it was sanctioned. It will be able to partially veto it, proposing changes to its content, in which case the Executive will have to return it to the Assembly. Or it can completely veto the bill and reject it. In Ecuadorian legislative practice the second option usually prevails, so it is probable that the Executive will push for modifications to the bill in the coming weeks.