Executive Publishes Entrepreneurship Law Regulations, Amends Money Laundering Law and Orders Income Tax Payments
31 julio 2020

The National Executive Branch also issued three decrees of interest to the sector. These include: the General Regulations for the Organic Entrepreneurship and Innovation Law . modifications to the Regulation governing the Organic Law of Prevention, Detection and Eradication of the Crime of Money Laundering and Crime Financing, and finally, it also ordered  the early collection of income tax charged to fiscal year 2020.

General Regulations of the Organic Law of Entrepreneurship and Innovation

Through Decree No.1113, the Executive regulated the conditions for contracts between investors and promoters regarding collaborative funding or crowdfunding platforms. It established that once conditions have been verified, the platforms must corroborate the information and order the bank to release the funds in favor of the developer, after which the bank must send a message of acknowledgment in favor of the investor.

However, companies using crowdfunding to publish their project activities may not use their own platforms either to raise funds on behalf of third parties or to present projects with the aim of covering their own expenses or investments.

Regulation of the Organic Law on the Prevention, Detection and Eradication of the Crime of Money Laundering and Crime Financing

The Decree, establishes that all organizations obliged to report to the Financial and Economic Analysis Unit (UAFE, for its acronym in Spanish), must publish the Manual for the Prevention of Money Laundering and Crime Financing, on their institutional web pages within a period of sixty days from the publication of these regulations in the Official Gazette.

Advance collection of income tax charged to fiscal year 2020

In turn, the Internal Revenue Service published Decree No. 1109, requiring individuals and companies, including permanent establishments of non-resident foreign companies, earning a gross income in an amount equal to or greater than five million dollars, to make advance income tax payments, charged to the fiscal year 2020. The regulations will come into effect when published in the Official Gazette.