Key Benefits:
LEGISLATIVE ASSEMBLY-REPUBLIC OF EL SALVADOR ____________________________________________________________________
1
DECREE NO 711
THE LEGISLATIVE ASSEMBLY OF THE REPUBLIC OF EL SALVADOR,
CONSIDERING:
I.-That the Organic Law of the State Financial Administration establishes that it is the attribution of the Ministry of Finance, in representation of the State, to place Titles Securities in capital markets, prior to the authorization of the Legislative Assembly.
II.-That in accordance with the requirements of the Constitution of the Republic, the Executive Body in the corresponding Ramo, is empowered to carry out financial operations aimed at the consolidation or conversion of public debt, which is particularly relevant, in order to improve the profile of the debt portfolio and reduce the pressures of the tax box; all prior to the authorization of the Legislative Assembly.
III.-To pay attention to the above and on the basis of the provisions of Art. 148 of the Constitution of the Republic, It is appropriate to authorize the Executive Body in the Land of Finance to issue Titles of Credit for convert short-term debt to medium-or long-term obligations.
BY TANTO,
in use of its Constitutional powers and on the initiative of the President of the Republic, through the Minister of Finance.
DECCRETA:
Art. 1.-Authorize the Executive Body in the Ramo de Hacienda, to issue Titles of Credit in Dollars of the United States of America up to the sum of eight hundred million dollars of the United States of America (US$ 800,000,000.00), to be placed interchangeably in the National or International Market.
Art. 2.-The funds obtained from the issuance of the Securities of Credit Securities will be used exclusively to convert the short-term debt of the Central Government (Public Treasury Letters), in medium or long-term debt; and in no case will they be used to finance other expenses, including the current.
The violation of the provisions of the foregoing paragraph will give rise to criminal and civil liability as the case may be.
Art. 3.-The Securities of Credit, whose issuance is authorized in this Decree, will be issued according to the following conditions:
a) The performance of the Titles of Credit Securities will be determined at the time of the
___________________________________________________________________ LEGISLATIVE INDEX
LEGISLATIVE ASSEMBLY-REPUBLIC OF EL SALVADOR ____________________________________________________________________
2
transaction, in accordance with financial market conditions. The Securities of Credit Securities may have a discount or prize, according to market practice;
b) The nominal value and yields of the Securities of Credit Securities will be exempt from all kinds of taxes, fees and contributions. The capital gain obtained by the purchase-sale of these securities will be subject to the tax treatment stipulated in the relevant legislation; and,
c) The Securities of Credit Securities may be placed within a period of up to 30 years. The nominal value they represent, may be amortised by periodic instalments, by means of a single payment at the end of the term or at a pre-established date.
Art. 4.-The Central Reserve Bank of El Salvador will act as the Financial Agent of the Government and for this purpose, the Ministry of Finance will subscribe with the Bank, the respective Financial Agent Contract.
Art. 5.-For the placement of the Securities of Credit, the Ministry of Finance, in coordination with its Financial Agent, will define the mechanism corresponding to the issue, dates and amounts of placement thereof, considering the options on the market.
Art. 6.-Authorize the Ministry of Finance to cancel any costs that the operation authorized by this Decree requires.
Art. 7.-The Ministry of Finance shall be empowered to carry out the risk coverage operations related to the interest rate in accordance with the practice of the market and to subscribe to the corresponding contracts derived therefrom.
Art. 8.-The income obtained as a result of the placement of the Titles of Credit Securities authorized by this Decree, shall be incorporated into the General Budget of the State of the fiscal year in which the conversion.
Art. 9.-By the nature of the obligations contained in this Decree and in order to comply with the formalities contained in Art. 148 of the Constitution of the Republic, have authorized and approved this Decree in the terms that the same slogan.
Art. 10.-This Decree shall enter into force from the day of its publication in the Official Journal.
GIVEN IN THE BLUE HALL OF THE LEGISLATIVE PALACE: San Salvador, at the twelve days of June of the year two thousand fourteen.
OTHON SIGFRIDO REYES MORALES, PRESIDENT.
___________________________________________________________________ LEGISLATIVE INDEX
ASSEMBLY-REPUBLIC OF EL SALVADOR ____________________________________________________________________
3
ENRIQUE ALBERTO LUIS VALDEZ SOTO, GUILLERMO ANTONIO GALLEGOS NAVARRETE, FIRST VICE PRESIDENT. SECOND VICE-PRESIDENT.
JOSÉ FRANCISCO MERINO LÓPEZ, LORENA GUADALUPE PEÑA MENDOZA, THIRD VICE PRESIDENT. FOURTH VICE-PRESIDENT.
CARLOS ARMANDO REYES RAMOS, FIFTH VICE PRESIDENT.
GUILLERMO FRANCISCO MATA BENNETT, MANUEL VICENTE MENJÍVAR ESQUIVEL, FIRST SECRETARY. SECOND SECRETARY.
SANDRA MARLENE SALGADO GARCÍA, JOSÉ RAFAEL MACHUCA ZELAYA, THIRD SECRETARY. FOURTH SECRETARY.
IRMA LOURDES PALACIOS VÁSQUEZ, ERNESTO ANTONIO ANGULO MILLA, FIFTH SECRETARY. SIXTH SECRETARY.
FRANCISCO JOSE ZABLAH SAFIE, JOSE SERAFIN ORANTES RODRIGUEZ, SEVENTH SECRETARY. EIGHTH SECRETARY.
CASA PRESIDENTIAL: San Salvador, on the thirteenth day of June of the year two thousand fourteen.
PUBESQUIESE,
Salvador Sánchez Cerén, President of the Republic.
Juan Ramón Carlos Enrique Cáceres Chávez, Minister of Hacienda.
D. O. No. 109 Took Nº 403 Date: June 13, 2014
FN/adar 15 -07-2014
___________________________________________________________________ LEGISLATIVE INDEX
