Ecuador

Click here to see a comprehensive summary of jurisdictional tax measures and government reliefs in response to COVID-19.

• Superintendence of Banks: The collection of loans instalments has been postponed for 60 days regarding  personal microcredits, as well as those granted to small companies, deferring them without charges, at the end of the originally agreed term.
• Banks will offer refinancing solutions for the remaining debts, in accordance with the particular needs of each debtor.
• Foreign Trade Committee: Temporarily apply a 0% tariff for imports for consumption of medical supplies, while the state of sanitary emergency is enforced.

On-site workdays have been suspended for the public and private sector until April 5th.

The following work modalities have enter enforce:

• Reduction of workday: The workday can be decreased up to 30 weekly hours from the regulated 40-hour working week. Such decrease shall be agreed between the employer and the employee and registered within the Ministry of Labor online registry. This measure can be applied over a 6-month period, renewable for a single period.
  • The employer shall pay wages considering the reduced schedule, however the employer´s social security contribution would not be reduced.
  • If the employer wishes to distribute dividends obtained in the fiscal year on which the workday was reduced, the employer must pay the employees for the reduced working hours prior to the distribution of dividends to its shareholders.
• Modification of workday: During the state of emergency, the employer is able to modify the working day schedule, including working days on Saturdays and Sundays, considering the maximum working week duration of 40-hours per week, distributed among 5 working days. However, even if the working week is modified, the employee has the right to 2 uninterrupted rest days per week.
• Suspension of the workday: Applicable to all economic activities that due to their nature it is not possible to apply remote working measures (home office), the reduction or modification of their workday.
  • In such cases, the employer is able to notify the suspension of services to its employees. The suspension of the services does not imply that the employees are dismissed or that the work contract is terminated.
  • Working days that were missed due to the suspension of the services shall be recovered by the employees, once the emergency state ends. The employer shall determine the recovery schedule, up to 12 hours during the work week and up to 8 hours on Saturdays. During such recovery schedule no overtime charges apply.
  • Employees are obliged to recover the missed work days or to reimburse to the employer the paid wages during the suspension of services.
  • Employees could choose not to recover the missed work days. In such case, the employer shall not pay their wages.
  • During the suspension of the services, the employer and employee can agree upon a wages' payment calendar.
• Vacations: Employers can notify employees the use of their accrued vacation leave.
  • Employers and employees can agree on the use of advanced vacation periods.

• Superintendence of Companies: Suspension of terms on all administrative, coercive, tax and prescription processes for collection action and, in general, all processes in charge of the aforementioned Superintendence.
• Nacional National Court of Justice:  Services are suspended, as of March 16th, for the duration of the sanitary emergency. The terms established by law for judicial processes are suspended. Said suspension shall not apply to cases of flagrant infractions.
• Ministry of Energy and non-renewable resources: the term for the payment of mining conservation patents was extended, for 60 days counted from end of the state of emergency.

Main sources of information

• Ecuador: Tax relief measures (COVID-19)

Tax: Karina Rubio -  krubio@kpmg.com
        María de Lourdes Ortiz – marialortiz@kpmg.com