Court Decision rejects the petitioner’s submission on procedural technicalities, and doesn’t reflect on the merits.

Any project in any industrial sector with potential environmental impacts should be consulted to communities as part of the licensing process (prior consultation). This is not the kind of consultation at issue; instead, petitioners resorted to the public consultation process, a mechanism contemplated for quite different political participation purposes.

Under the Ecuadorian Constitution (EC), public consultation requests should be approved by the Constitutional Court (CC) before the National Electoral Council calls for a local or national vote, in order to ensure that the subject matter proposition is consistent with constitutional provisions. Respondents -including mining companies, business associations, government agencies, business chambers and other stakeholders- argued thorough amicus curiae that public consultations should not be allowed by the CC to the extent it calls into question constitutional or legal rights or would otherwise contradict constitutional provisions. Also, to the extent a given consultation is not intended to amend the law -there is a very specific and qualified national process in that regard-, the CC must also ensure that consultation requests do not attempt to by-pass the legal constitutional process that would otherwise be necessary in order to change the legal framework.

In case 0002-19-CP, where the consultation’s question would have called fora vote on whether mining is accepted or not, the CC could have rule out, once and for good, public consultation requests of the sort, particularly as the EC provides for specific mechanisms of prior consultation designed to ensure community participation. The CC avoided dealing on the case merits and limited itself to reject the petition on legal standing grounds and further technicalities. Given this outcome, the industry should expect anti-mining groups to reformulate their legal approach and come back in the short term with a number of public consultation requests to be heard by the CC.

It should be stressed that the threat the mining industry is facing as a result of the abuse of the consultation mechanism may extend to any other industry, so it can be also expected that other business sectors will get organized and join the defence of the rule of law.

The mining industry has still a number of legal and communication initiatives to advance its cause and deal with the upcoming wave of political consultations, this time hopefully through a proactive strategy.

For more information and deeper understanding of this ruling or of the legal and political battle ahead, please contact INFO@TZVS.EC.

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.

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The Organic Administrative Code (hereinafter “OAC”) came into force on July 7, 2018. The inclusion of this new codification brings with it: (I) The delimitation of the state body, as well as its attributions; (II) The normative regulation on administrative procedures; (III) The determination of special procedures; and, (IV) The extension of the responsibility of the State towards its administered.

Following is a brief summary of the essential points of the State’s non-contractual liability:

This figure only had constitutional recognition, making impossible the materialization of the right consecrated to the administered. The OAC is considered the first regulatory codification that regulates the extra contractual responsibility of the State, establishing a procedure and regulating its competence.

What Does It Consist Of?

All State institutions as of July 7, 2018 will be liable for qualified damages arising from their actions or omissions, even when these are lawful. Qualified damages are understood as the one that the administered is not legally bound to support or that results from the violation of the principle of equality in the distribution of public charges.

When Must The State Respond?

The State must respond when the public service is directly provided by it.

In the case of concessionaires and legatees, these are the ones who respond directly, leaving only the joint and several liability to the State.

What Requirements Must Be Fulfilled?

* The lack or deficiency when providing a public service or any other service to which the administered has right.

* The damage must be qualified.

* The existence of a causal link between the action or omission of the State and the damage described.

The administrator must prove both the damage and the causal link, and may submit his claim within a period of up to 90 days, after the action or omission of the State.

What Is The Procedure?

* You can opt for the administrative procedure under the ordinary procedure regulated by the OAC, or directly by judicial means.

* The claim must be presented directly by the affected party, detailing: the damage, the causal link, the assessment of the damage and the request for reparation.

Faculties Of The State

* The State, once it has complied with the compensation for the damage imputed under its responsibility, has the right to repeat against the officials who in the exercise of their functions are responsible for the imputed action or omission.

* The process of repetition is governed by the General Organic Code of Processes, through the ordinary procedure before the administrative contentious judges. Same that does not admit any counterclaim.

The State may be exempt from liability in case of unforeseeable and unavoidable circumstances; envents of force majeure; the victim’s fault; and, actions of a third party.

Summary: According to the declaration of Health Emergency enforced by the spreading of COVID-19 in Ecuador, the Ministry of Labor issued regulatory guidelines in order to adjust teleworking, reduction, modification and cessation of the working time public and private sector.

According to the Ministry of Labor’s provisions through Ministerial Accords MDT-2020-076 and MDT-2020-077 respectively, pursuant to the Health Emergency due to the COVID-19 in Ecuador, the employers are empowered to apply the teleworking as well as to reduce, modify or cease the working hours of its employees, without going against the legal dispositions, for a maximum period of 6 months with a single renewal of 6 months.

Teleworking only modifies the place of activities of the employee, without disrupting the employment relationship conditions. This modality cannot be regarded as a termination of the employment relationship. Public and private sector may adopt Teleworking.

Workers who adopt this modality are required to take care of the equipment that is provided for this purpose as well as the confidentiality of the information that is handled. Employers will establish guidelines for the execution of corresponding activities during the period of health emergency.

Activities that cannot be carried out by teleworking, reduction or modification of the working day, may be suspended indefinitely, without this implying termination of the employment relationship. The employees will have the obligation to recover the working day once the health emergency is over with the same effects in force before their suspension, at the risk of of not receiving the salary corresponding to the suspension period. The recovery may be carried out for up to 3 additional daily hours or to 4 hours on Saturdays.

The employer is obliged to register the reduction, modification and suspension of the working day in the Labor System “SUT”, in order to receive electronic authorization from the Regional Labor Director.

Additionally, the termination of the teleworking modality, reduction, modification and suspension may finish by agreement of the parties, as well as the culmination of the declaration of sanitary emergency.