This Doing Business in Ecuador Guide has been prepared by TOBAR ZVS C.L.1, and is intended to provide with general information for the knowledge of potential investors interested in acquiring an existing business or before starting operations in Ecuador.
The information included in this Guide is not exhaustive, and any in‐depth and detailed information shall be consulted with experts.
Read complete Doing Business in Ecuador Guide publication please Download
Based on the activity, the minimum number of juvenile employees working at each company, with regards to the net increase in workers each fiscal year, is the following:
By ZVS Tobar in CORPORATE, M&A , INSURANCE , INSURANCE , News and Bulletins
Teleworking could be:
By ZVS Tobar in CORPORATE, M&A , Featured , News and Bulletins
We are glad to forward herewith the CORPORATE TAX GUIDE, LAWS AND PRACTICE IN ECUADOR, prepared by our firm and published by the prestigious entity Chambers & Partners, as a complimentary reference tool in this specialty.
Should you have any doubts or specific requirements, please do not hesitate to contact us; we will be happy to assist you.
To read the full document, please download
By ZVS Tobar in CORPORATE, M&A , News and Bulletins , TAX CONSULTANCY
The Companies Law does not allow limitations to the shareholders’ right to freely negotiate their shares (Article 191). However, the reform of December 29, 2017, included in the same article an exception to this general rule, through agreements or covenants between shareholders (hereinafter “Covenants”).
The reform recognizes the validity of Covenants and expressly allows establishing conditions for the negotiation of shares. There is no other provision in the Ecuadorian legislation on this subject in addition to this norm.
Main points that we must know about the Covenants between shareholders:
* Can neither contravene the Companies’ Law, nor the company’s bylaws, and must have a lawful purpose;
* Can be subscribed by two or more shareholders;
* Are not opposable against third parties, but only for those who signed it;
* Cannot harm minority shareholders;
* Usually contain agreements on:
o Preferential acquisition rights for all or some of the shareholders;
o Obligations to assign or acquire shares when certain conditions are met (tag along, drag along or similar clauses)
o Joint selling right;
o Obligations not to increase participation in capital above a certain percentage,
o No competition with the company;
o Intermediation in the products of the shareholders;
o Composition and participation of the shareholders in the administrative bodies;
o Arbitration for conflicts between shareholders;
o Powers of the administrative bodies, quorums and majorities that are not regulated by the bylaws;
o Ways to exercise the rights of minority shareholders;
The Covenants are increasingly common and necessary for the development of companies in family businesses, new ventures or in companies that receive new shareholders and are ideal instruments that allow clear rules for all shareholders.
 “The right to freely negotiate shares does not allow limitations.”
 “Agreements between shareholders establishing conditions for the negotiation of shares will be valid, however, such agreements will not be opposable to third parties, without prejudice to the civil liabilities that may arise, and in no case they may undermine the rights of the minority shareholders.”
By Sevilla Álvaro in CORPORATE, M&A , News and Bulletins