Law Of Security Interests.


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1 Decree No. 488 the Legislative Assembly of the Republic of EL SALVADOR, considering: I.-that article 101 of the Constitution of the Republic establishes, that the State will promote economic and social development through the increase in production, productivity and the rational use of resources. With equal purpose, encourage various sectors of production and will defend the interests of consumers, and thus boost the economy to generate new sources of employment or to strengthen existing ones;
II.-that a comprehensive policy that includes the modernization of legislation, must be set to achieve a more solid and dynamic economy, combat poverty and promote productive development, creating an agile and modern legal framework that enhances economic of the movable property of a diverse nature value, so that they can be subject to warranty and support adequately the obligations of any nature that the various sectors of the country's economy to contract , mainly, the micro, small and medium-sized entrepreneurs;
III.-that while it legislation civil and commercial contemplates different species of guarantees interests, the regulation of its record and execution is different, by what is necessary establish a regime uniform of procedures agile, transparent, safe and economically accessible for it Constitution, registration, advertising, cancellation or realization of those, for which is necessary the creation of a record electronic specific equipped with safety measures essential to its proper functioning;
IV.-that the experiences legal and practices of the market modern is have collected in a law model on guarantees interests, approved by the Assembly of the Organization of States American; by what many countries are based its efforts of reform on this matter in the law model mentioned, that would lead a base ideal of harmonization regional if is used to issue laws homogeneous in those countries that have with a frame legal on this matter.
Therefore, in use of their faculties constitutional and to initiative of the President of the Republic, by means of the Minister of economy, DECREED the following: law of guarantees interests 2 title I field of application GENERAL chapter I object, scope and field of application of it law object Art. 1.-the present law has by object regular them guarantees interests and the registration of guarantees interests.
Scope and field of law article 2.-this law enforcement will be applicable to the creation, registration, advertising, cancellation or realization of security interests over obligations of any kind, present or future, determined or determinable, and the Constitution and execution of all types of shares, rights or obligations over corporeal property, incorporeal property, commercial things, rights, actions or obligations of another nature that are guaranteed with movable property or commercial property.
Definitions article 3.-for the purposes of the present law means: to) creditor: the person on whose behalf constitutes a security interest, with or without displacement, whether for its own benefit or for the benefit of a third party;
b) property derived or attributable: those who can be identified as originating goods originally taxed, such as fruits, new goods, including, among others, cash and deposits to money deposit and investment accounts or similar, resulting from alienation, conversion or replacement of movable property as collateral for the original obligation regardless of the number and sequence of these disposals, transformations or substitutions. These also include the values paid in compensation by insurance protecting the collateral, as well as any other right of compensation for loss and damages caused to the collateral and dividend payments;
(c) collateral: are all those goods referred to in article 6 of this law;
d) goods and chattels by incorporation or destination: those goods that are or are intended to be part physical property, either by incorporation or destination which are used or intended for specifically in or to the property and that they can be separated without the physical expense of the property or of good furniture same. These collateral include the goods referred to in Article 563 of the Civil Code; but they do not include those movable property that are part of the inventory of the debtor;

(3 e) buyer or acquirer in the course ordinary of them operations commercial: is a third that, acting of good faith and without knowledge that his operation is performed on goods body subject to a warranty interest whose transfer is prohibited by the creditor guaranteed, them buys or acquires and takes possession of these of a debtor guarantor dedicated to trade goods of the same type that them goods subject to the warranty interest , within the normal course of its business operations;
Relatives of the debtor within the degrees of kinship by consanguinity or affinity, as set out in article 132 of the family code, will be excepted from this category its partners, its officers, auditors charged to box or liquidators, and any person who has a business or corporate bond with the same.
(f) control: is the right granted by the secured debtor to the secured creditor to limit disposition and management of accounts of deposit money, investment accounts or similar that serve as collateral. Will this faculty effective debtor instructing the financial institution in writing, accompanying her respective copy of the contract so that they immobilise property guarantees objects, being essential requirement for the validity of the Constitution of this warranty the express confirmation of the corresponding entity;
(g) investment account: refers to the account opened at a financial institution, in which it can deposit or credit securities will invest in various economic operations;
(h) custodian: is the third, who is the delivery of tangible property, money, shares or other assets or rights, for receipt, custody and care, and to whom corresponds the obligation to return it;
(i) secured debtor: the person, whether the principal debtor or a third party, who creates a security interest in accordance with this law. The liability of the third constituting collateral in support of a debtor for the purposes of this law, is limited to the collateral;
j) electronic document: all message data, sent, received or stored by electronic, optical or any other technology that is part of an electronic file;
k) representative documents of goods: documents that are issued to certify in writing the existence, origin, place that lie, quantity, owner and other data on collateral. Representative goods documents can be negotiable or not, can involve or not ownership of the described goods, and include among others, knowledge of shipping;
(l) possessory collateral: is the incorporated property whose possession is transferred by the secured debtor to the secured creditor or to a third party which will indicate this, who will retain such property as deposit;

4 m) non-possessory collateral: is the incorporated property whose possession preserves it the debtor, who is as depositary thereof, so should enroll in the registry so that it takes effect against third parties;
n) specific guarantee for purchase (GEC): is a guarantee privileged specific movable property, granted in favor of a creditor, whose loan finances directly purchase, even when such property belongs to a category of previously encumbered assets, such as inventory;
(o) inventory: refers to one or more movable property of a person for sale or lease in the ordinary course of the commercial activity of that person. The inventory does not include movable property in possession of a debtor for use or regular consumption;
(p) priority: the preferential right having all creditor to collect priority over other creditors of the same debtor;
q) registry: the registry of security interests as part of the national records center;
(r) authorized user: are natural or legal persons who have been authorized by the registry to provide a confidential key of electronic access to the system of the registry of security interests;
(s) registration forms: are the electronic formats that are used to sign the Constitution, modification, extension, total or partial cancellation, or executions of security interests with the registry.
Chapter II system UNITARY concept of the guarantee interest article 4.-the collateral is real law made by a debtor and a creditor, to guarantee the fulfillment of one or more obligations itself or a third party. This right is preferred with respect to the secured creditor, the possession and execution of movable property collateral, without prejudice to the privileged credits provided for in the Constitution.

Constituted a security interest will be specific to the obligations stipulated in the contract and may not be extended to other obligations, as it established 20 article literal b) law of protection to the consumer.

5. for the purposes of application of this law and its registration, shall be secured transactions set up as a result or effect of contracts, such as: purchase of movable property, the sale of furniture with retention of title, the sale with any clauses that identifiable property of unquestionable way, leases on furniture whose period is more than one year be borne , trusts, the mercantile or civil clothing, transfers of appropriations and accounts receivable, sale of furniture on consignment, lease, as well as endorsement on all manner of titles guaranteed values, or any other operations, with the effect of a credit guarantee and protect the rights of the creditor on furniture or other goods that make up the warranty.
Cancellation or extinction of guarantees interests Art. 5.-the warranty interest is terminate with the registration of the cancellation in the register.
When the debtor has fulfilled the obligation, the secured creditor must grant the cancellation of assessment, presenting the respective form to the registration of guarantees within a maximum period of five working days from the payment of the amount owed. In the event that the debtor paid proportionately obliged and offered guarantee corresponds with various objects or one that supports comfortable division, and at the request of this garment will desgravando proportion to the payments made, in accordance with provisions of article 1538 of the commercial code.
Only for purposes of advertising, registration and priority, judicial and tax levies shall be governed by the provisions of titles III, IV and V of this Act.
When a security interest register in accordance with this law, the secured creditor has the preferential right and can make use of it to be paid with the proceeds of the encumbered assets, observing the rules of due process.
The cancellation of those guarantees have not been entered in the register and which fall on deposit accounts, investment accounts or similar, will be carried out by written notice with authenticated signature that must give the creditor institution that corresponds, in a period not exceeding three days after that the secured debtor has cancelled all of the obligation. Such notice will constitute cancellation of the control referred to in article 3 of this law.
Chapter III goods and obligations property collateral article 6.-to ensure present and future obligations any natural or legal person may, in addition to the cases provided for in other laws, create security interests in favor of another natural person or legal envelope: 6 a) tangible property;
b) incorporeal property;
(c) rights in future assets that the debtor acquires subsequent to the creation of the security interest;
d) expendable;
(e) intellectual property rights;
(f) accounts of deposit and investment accounts or similar;
(g) elements isolated from the company commercial;
(h) shares and participations social representative of the capital of companies commercial;
(i) in general, any other property, right, contract or action to which parties attributed economic value, susceptible of alienation and its assessment is not prohibited by law; including, among others, the property derived or attributable, according to is defined in this law.
(Obligations guaranteed article 7.-them obligations guaranteed, in addition to the debt main, may consist in: to) them interests ordinary and moratorium that generate the sum main of the obligation guaranteed, calculated as is set in the contract of warranty or of credit;
(b) the commissions that must be paid to the creditor guaranteed, as is are certain in the contract of warranty or of credit, whenever is complies with it established in the article 12-to of the law of protection to the consumer.
Title II Constitution, publicity, rights and obligations chapter I Constitution of the guarantees interests Constitution Art. 8.-a security interest is constituted, exceptions contained in other laws, through a contract written between the secured debtor and the secured creditor. A single document may be publicized and the contract to enter or you will be documented separately.

7. the collateral contracts in foreign country will give security interest in movable property situated in El Salvador, provided that they hold to the Salvadoran laws.
Establishment of security interests over property whose property consists in a specific register article 9.-those goods which are subject to registration in a specific register, only can be given in guarantee by who appears as owner when registering.
The collateral must register at the registry of security interests to establish its priority. This must give notice immediately to the specific record in which the movable is registered to make the corresponding marginalization.
When an agreement, Convention or international treaty requires that the title of collateral is registered in a special register and contains also rules on security interests incorporated over ownership of such goods, they shall prevail over the provisions of this law.
Right Real on it warranty Original and them goods derived or attributable Art. 10.-when a warranty interest has been duly constituted of conformity with the present law, the creditor guaranteed will have the right to be paid with the product of the sale of the well pledged, with the well guarantor and their goods derived or attributable, or with any other well as the parties have it.
The effects and the priority of the security interest against third parties shall be established in accordance with the provisions of this law.
Elements of the contract of security interest article 11.-the publicized contract should be granted by public deed or authenticated private document and shall contain in addition the following formalities: to) place and date of conclusion of the contract;
(b) names and General of the parties, the relationship of their respective identity document, number of tax identification and signatures that allow the precise identification of the Contracting Parties;
(c) the maximum amount secured by the security interest;
d) term or condition it is holding the secured obligation;

8 e) the description of the collateral warranty, and where appropriate, of the derived property, on the understanding that such description may be generic or specific way, according to the nature of the collateral;
(f) the express mention of the described assets that serve as collateral to the secured obligation. In the contract must be manifest if the goods have been given collateral previously;
(g) a description of the secured obligation;
(h) the terms and conditions, for the case that good collateral to deteriorate or decrease so that do not cover the value of the credit;
(i) the rights and obligations that the debtor or his successor in title, agreed that are different from those specified in this law;
(j) the authorization by the secured debtor to the secured creditor to bring forward the registration form for initial registration, according to the provisions of this law. This authorization may also be noted by a separate written agreement, but you should make mention of such a situation in the contract;
(k) when a security interest in the collateral are granted with displacement, whether at the hands of the creditor or a third party designated by this, this circumstance shall indicate in the body of the contract and the warranty shall be their effects between the parties where it complies with the requirement laid down in article 13 of this law;
(l) any other contained in the rules of application of this law.
Effectiveness of the non-scrolling article 12.-If the collateral will continue in possession of the secured debtor after constituted the security interest, the contract for which this is, it must be in writing and takes effect between the parties from the time of their subscription, unless otherwise agreed. With respect to third parties, you shall take effect from the moment of its registration in the register.
The corporeal and future property taxed real or personal rights of the debtor in such property only from the moment in which the secured debtor acquires such rights.
Goods collateral in possession of the creditor guaranteed article 13.-a warranty interest with displacement on a well Cabinet body, has effects between them parts from the time in that the creditor guaranteed or a third appointed by this, gets the possession of them property collateral. Respect to third, the priority of the warranty interest is will establish starting from the time of its registration in the register.


If the contract establishes it, the possession of the goods delivered under warranty can be in the hands of the creditor or a third party. In case change the possession of such property, it must be notified to the debtor by letter, with return receipt requested.
Sin_que in no way limited the scope of the provisions of the preceding paragraph, the following security interests do not require be entered in the register to acquire or retain its priority: to) security interests granted in favor of pawn shops or mountains of piety on tangible assets with market value of less than twenty minimum monthly wages in the industry.
(b) the security interests over documents of goods in bonded warehouses or in possession of a carrier;
(c) security interests on securities securities issued on paper or in electronic form, the latter as set out in the law of electronic annotations in values into account;
(d) security interests on certificates representing negotiable or non-negotiable goods issued on paper or in electronic form;
(e) the guarantee transactions on accounts of deposit and investment accounts or similar.
Chapter II rights and obligations of the parties rights and obligations of the debtor on the warranty without displacement article 14.-If the security interest is no displacement, the secured debtor or who holds property subject to warranty, unless otherwise agreed, will have the right to use and dispose of its fruits. (Such rights shall be subject to the following obligations: to) save and preserve the well pledged to avoid losses and damage of them goods collateral; and in the case specific of them marks, use them effectively in the trade, without prejudice of it established in the article 5 of the law of marks and other signs distinctive;
b) allow the creditor to inspect the collateral for its quantity, quality and State of conservation;
(c) the payment of all the costs, expenses and taxes related with them goods collateral;

(10 d) suspend the exercise of such right, when the creditor guaranteed you notify of your intention of proceed to the execution of the warranty interest on them goods delivered in warranty, low them terms of the present law;
(e) the other rights and obligations that agreed them parts and that not are contrary to the present law.
You can agree on the recruitment of insurance adequate assets given in guarantee, against destruction, loss or damage in favour of the secured creditor; There is no such agreement, the debtor assumes the risk of loss or damage to the collateral.
You can not negotiate consumer provisions of the law on protection against consumer.
Rights and obligations of the creditor guarantee article 15.-corresponds to the secured creditor: to) exercise reasonable care in the custody and preservation of the collateral which are in his possession, taking the necessary steps to preserve the value of the guarantee and the rights arising from it;
b) keep the collateral which are in his possession, so remain identifiable, but in the event they are fungible, must maintain the same quantity and quality;
((c) if the collateral is an intellectual property right that requires maintenance to preserve its validity, breach of the obligation contained in the literal to)) and (c) of the preceding article, entitle the creditor to take the necessary measures to maintain the application of the law, in accordance with the provisions of article 7 of this law;
d) use the collateral which are in its possession only within the scope provided in the security contract;
(e) collect from the debtor, costs or verifiable maintenance expenses set out in the contract, when given in guarantee goods are in the possession of the creditor or a third party, as in the case provided for in article 13 of this law, unless otherwise agreed or that the pledged good report you some sort of utility to the secured creditor;
(f) at the request of the debtor, the secured creditor must inform in writing to third parties on the amount outstanding with respect to the guaranteed credit and the description of the property covered by the security interest; the debtor guarantor can request this information a time every three months without cost any;

11 g) grant the cancellation of the security interest to the debtor once fulfilled the obligation, without conditioning it to the existence of other obligations not covered under this warranty;
(h) other rights and obligations that do not contradict this law.
In compliance with their obligations, the creditor will respond even in slight guilt.
Rights of the debtor when the main article 16 obligation-is accomplished when the principal obligation of the secured debtor in favor of the creditor is fully paid, the secured debtor will be entitled to the following: to) to submit the registration form for cancellation of the security interest in one period of no more than five working days after cancelled the obligation;
(b) cancellation of control that is exercised on goods which have been granted in guarantee, informing the institutions involved
(c) to be returned to him the possession of the collateral under the terms of the security agreement and within a period that does not exceed the literal h of article 19 of the protection law provisions to the consumer.
The creditor that does not comply with the obligations laid down in this article, be liable for damages that could cause to the debtor.
Title III publicity chapter I rules General effects facing third article 17.-the rights conferred by a security interest, will be effective against third parties only when it publicized, except for those cases expressly established in this law.
The publicity of a security interest will be by registration in the registry of security interests, in accordance with the provisions of the present law.
The priority of security interests shall be determined only through registration in the register.

12 specific guarantee for purchase (GEC) article 18.-the advertising of a specific guarantee for purchase is through the registration of a registration form, which will be referred to the priority, specific and special character of the warranty and that describes the encumbered by the same assets.
Where the collateral to be part of the inventory of the debtor, the secured creditor with a GEC, in addition to register collateral that is set up on their behalf, must be notified in writing and in accordance with the provisions of this law, other creditors secured by the same property encumbered with such specific guarantee of purchase.
Registration and notifications must be made before that the debtor in possession of the warranty or, at the latest within five working days. The notification shall be effective for the period that the parties have established in the respective contract.
Chapter II guarantees interests on credits scope of application article 19.-the security interests over receivables are those that are on the credits that the debtor has in his favor.
The rules on the Constitution, publicity and priority established by this law guarantees concerning security interests over receivables, shall also apply to every type of assignment of receivables.
Effectiveness of assignments article 20.-the assignment of a receivable shall be effective between the secured debtor and the secured creditor from the moment in which the assignment is agreed by the parties. Neither the effectiveness nor the priority to the right of a secured creditor, may be refused by being the transfer of more than one credit, future credits, in a part of a credit or a right to undivided on such credit, if they are at least described as well: to) individually identified as object of the transfer credits;
(b) in any other manner, such that are identifiable as an object of the transfer credits at the time of the same or, in the case of future credit, at the time of the underlying agreement.
Ceded to Favor of the creditor guaranteed Art. 21.-guarantees in the contract of guarantee, the secured debtor will respond in favour of the secured creditor for any disturbance or violation of his right.

13. the creditor shall be entitled to transfer to third parties credit with the guarantees constituted, therefore in the respective contract is expressed that the credit has not been previously assigned.
Publicity and priority of the guarantee on credit article 22.-it gives a publicized granted by a debtor receivables, by registration and shall be effective against the debtor and third parties.
Invalidity of the prohibition on yield security interest article 23.-a security interest in a receivable is valid, notwithstanding any agreement between the account debtor of the receivable and the debtor seeking to limit the transfer or transmission of the same receivable.
Inalterability of the underlying legal relationship

Article 24.-a security interest granted on loans may not modify the underlying legal relationship, or make more onerous obligations of the debtor of the credit that was given or levied, without the consent of the latter.
Payment of the credit given or engraving Art. 25.-the debtor of the credit granted or levied, insofar as it has not been advised legally, may discharge its obligation by paying the secured debtor or the assignee, where applicable.
Any balance due to the secured creditor or the grantor, shall be paid from the moment in which the debtor of the receivable receives notification of the assignment or encumbrance, who indicated in the first notification that it receives. The notification of the assignment should indicate which credits were assigned, the name of the creditor and the terms and conditions of payment.
In relation to notification, if the debtor of the receivable has pointed out in the contract address, must be used this to make the notification, except for those cases which are already regulated in other laws. In the event that the debtor of the receivable has not indicated an address on the contract, or if that information regarding the contractual direction uncertain or inaccurate, should the guaranteed creditor proceed, this proven once circumstances, notification through the publication of three successive and consecutive notices in a newspaper of national circulation , of which is constancy verifiable. Means as notified the debtor of the receivable, the day after the last publication.
Proof reasonable of the guarantee article 26.-the debtor of the receivable, may ask the creditor guaranteed reasonable proof that collateral has been established, and does not provide such proof within a time limit of 14 eight working days prior to the date on which the payment is made, the debtor of the receivable may fulfil its obligation by paying the secured debtor or with payment. Reasonable proof of the assignment ' means any writing signed by the debtor or any equivalent proof that indicate that loans have been granted.
Opposable exceptions by the debtor of the credit art. 27.-are enforceable by the debtor of the credit granted or levied against the secured creditor all defenses real and personal arising from the original contract and any other contract or legal act that was part of the same transaction.
The debtor of the credit given or imposed may raise any other right to compensation against the creditor, provided he is holder of the same in which it received the notification.
The debtor of the assigned or encumbered credit may not object to the secured creditor exceptions and rights of compensation that takes against the secured debtor because of the breach of the prohibition of assignment clause.
Chapter III non-pecuniary obligations right guaranteed creditor article 28 notification.-when good collateral consist of a non-monetary obligation, the secured creditor must notify the person liable to fulfill the corresponding obligation or that run it to their benefit, to the extent permitted by the nature of the same.
The obligor is may refuse only based on a cause that show you clear and reasonably is not the person who should run the obligation, or has not when expressly consented the implementation of the obligation, either in favour of the secured creditor or the secured debtor.
Chapter IV credits letters or letters of credit international guarantee on payment of the funds of the letter of credit art. 29.-the beneficiary may constitute a security interest on a letter of credit funds, once they are payable, upon presentation of documents in compliance with the requirements of the letter of credit if the issuing or confirming Bank accepts or expressly consents to the transfer of such funds.

15. for the purposes of advertising, this security interest shall be considered executable against the issuing or confirming bank and third parties, from the date and hour in which one party accepts, under the terms and conditions governing the payment of the letter of credit and its registration in the register.
The present article does not exclude warranties on documentary credits or the right swing of the beneficiary of a letter of credit, if these meet the requirements of advertising laid down in this law, without prejudice to the provisions of the law of protection to the consumer.
Chapter V titles values and documents representing of goods advertising of securities and warranties representative documents of goods article 30.-the guarantees can be borne titles values or on representative goods documents which can be issued in various forms, whether they are in paper or electronically, which shall be governed by the following provisions: i. guarantees on securities and representative documents of negotiable goods issued in paper on a title is publicized value or a document representative of merchandise negotiable issued in paper, is you will give advertising by means of its endorsement in warranty and delivery in possession to the creditor guaranteed, followed of the registration in them books social, if is necessary and according to appropriate. The warranty interest on titles values and documents representative of goods issued in paper, also is may register in the register of guarantees interests for effects of advertising.
Though representative of an inventory document has been given in guarantee, it is possible to create coexisting levies on goods contained in that inventory, provided: to) the warranty covers property derived or attributable;
b) has been communicated you the decision to the creditor;
(c) will have individualized them goods that are represented by the titles issued.
II. guarantees on representative documents of negotiable goods issued in electronic form for the publicity of a security interest that is created on tradable goods representative documents issued in electronic form, will be observed the following: a) the issuer of the document will indicate, among other data, the name and relationship of document ID and tax ID of the consignor or bailor of the goods;

16 b) at the request of the consignor or bailor of the goods, the carrier or bailee will issue the document, which must bear the name and the number of tax identification of the secured creditor;
(c) after making this designation, the carrier or bailee it will retain this title in its electronic database, depositary of the same character, and the issued title will be transferable only by means of transfer in the databank of the issuer of the document;
(d) the document may be inspected in the databank of the issuer, by any interested party.
Warranties on non-negotiable goods representative documents issued on paper or in the form electronic article 31.-If the security interest is created over representative of non-tradable goods documents in paper, your advertising will be done by the issuance of the document on behalf of the secured creditor as legitimate holder in this quality, at the request of the consignor or bailor.
If the security interest is created on representative goods non-negotiable documents issued electronically, your advertising will take place in accordance with the procedure laid down in article 30, Roman II of this law.
Delivery of representative documents of goods to the secured debtor article 32.-in the case of secured transactions on goods representing documents in paper, which was carried out by the delivery to the secured creditor, this may return the document to the secured debtor, to the removal, storage, manufacture, manufacturing, shipping or sale of the goods covered by the document.
The creditor will keep its priority for a period of ten working days after the delivery of the document of title to the debtor guarantor. However, in order keep his priority after the term before said, the creditor guaranteed must register the warranty interest in the register, prior to the expiration of the term before mentioned.
Chapter VI ownership by a third party depositary Constitution and publicity of a security interest in property in possession of a third party depositary Art. 33.-for purposes of publicity and priority of such a security interest in property in possession of a third party, requires its registration in the register, and in addition, the third party shall be notified of the Constitution of the collateral by the secured creditor , in a period no 17 more than eight working days. Before such notification is made, the third shall no liability whatsoever in favor of the creditor with the goods that are in their possession.
Constitution and publicity of a security interest on deposits in bank accounts or investment accounts or similar

Article 34.-the security interest on deposits to deposit money or investment accounts or similar, it is and advertise through the control by the secured creditor in accordance with the provisions of article 3 literal f) of this Act.
Chapter VII other tangible property or intangible publicity of the security other tangible property or Incorporales article 35.-to a corporeal and other personal or incorporeal property, present or future and their derivatives or attributable property, which not have been specifically covered in previous articles, advertising you will be given by its registration in the register so that it takes effect against third parties.
Publicity of the security property intellectual article 36.-a security interest in intellectual property rights, such as industrial and commercial secrets, copyrights, patents, trademarks, trade names and other assets derived or attributable thereto may be constituted.
Publicity of the security interest in the rights referred to in the preceding paragraph, is constituted by registration in the registry of security interests and is subject to the provisions of the present law.
The registry of security interests should apply, where appropriate, the entry corresponding to the intellectual property registry, as set out in article 9 of this law; for these effects is must be entered in the form respective the number of registration or deposit of the well guarantor.
Chapter VIII CONVERSION of a warranty interest method of Conversion of guarantees Art. 37.-a warranty with displacement, as a right of retention granted by the law, may be converted in warranty without displacement retaining its priority original, provided is you give advertising to such warranty, by means of the registration of the form registry of modification in the registration , before that returned the collateral to the secured debtor.

18 a warranty without displacement can be converted in warranty with displacement retaining its priority, provided is you give advertising to such warranty, in accordance with the provisions of the article 13 of this law.
Title IV registration of guarantees interests chapter I priority by registration effects of it registration registry Art. 38.-it warranty interest to which is you give advertising through the registration of the form of registration registry in the record will be opposable facing third and has all their effects from the time of its presentation in the registration of guarantees interests.
Chapter II the registration, services and administration the record Art. 39.-the registration of guarantees interests will be part of the Center national of records and will have by object the registration of the Constitution, modification, extension, extinction and execution of guarantees interests and consequently, the advertising of them same.
The registry of security interests is public, electronic, automatic registration, equipped with essential security mechanisms that guarantee and safeguard rights registered, as well as the information contained in the same record.
The registration forms for registration are subject to the applicable electronic system.
Seats of registration article 40.-registration of security interests in the register shall be made in accordance with this law and its regulations.
Characteristics of the registry article 41.-the registration of security interests in the register, will have the following characteristics: to) will operate through the registration of standardized forms, in accordance with the requirements established by the regulation of this law, 19 which will contain information about the advertising, Constitution, amendment, extension, cancellation, termination and enforcement of security interests, without having to sign contracts for the financing or the security interest;
(b) organize a system of personal electronic folio, depending on the individual or legal person who is the debtor. It must be transparent and give publicity to all existing levies on the movable property of the debtor. Be ordered based on the tax debtor guarantors identification numbers, as provided in the regulations under this law;
(c) registration registration forms must be submitted to the register electronic format;
(d) in the registry should be centralized and register security interests over movable property defined in this law;
(e) is a record electronic that allows them inscriptions previously listed, limiting is only to the verification of that each one of them fields of them forms registration are complete with the information pertinent;
(f) you will be provided with the security measures for electronic communications, including the authentication or electronic certification of the existence of the previously listed entries;
(g) based on the security requirements referenced in the preceding paragraph, you may interconnect with similar registries in other countries which held conventions on the subject.
The register article 42.-the registrars services shall issue who requested it, literal certificate or extract of the seats. All certification, registrars shall set forth the marginal annotations appearing in the registration concerned.
It is legally presumed that legal relations and rights exist, as it appears in the inscriptions.
The contents of the inscriptions of the registry shall be deemed exact to every person who has contracted, trusting in their statements, except that the record itself indicates possible causes of inaccuracy thereof.
Issuing instructions technical article 43.-you will correspond to the national records center issuance of instructional technicians that facilitate the application of this law.

20 Chapter III operations before the registration requests to the registry article 44.-any person may have access to the register and apply for certificates of registration. Similarly, you may request the issuance of certifications of registration or existing liens.
Interested persons may request be authorized users and have a confidential password to the system of registration, which may present the respective registration forms, make inquiries and request certifications of registration or levies. To be approved, they must follow the procedure that is established in the regulations under this law.
Authorized users are responsible for civil and criminal sanctions for the veracity of the information that is presented in the registry of security interests.
Form registry of security interest article 45.-the registration of the security interest regulated by this law will be through electronic registration form registry, which shall contain, as a minimum, the following data: i. the secured debtor and the secured creditor: to) full name, address, nationality, tax ID number and number of the identity document enabling their identification;
(b) in the case of societies, the name or business name, your number of tax identification, nationality and address. Full name, tax ID number, number of the respective identity document and relationship of the personality of the legal representative or proxy of the society, for which just quote numbers of registration under which are registered the respective to the trade registry documents, being entitled the register to assign a unique identification number, in the case of societies;
(c) the domicile of the parties;
(d) e-mail addresses, if they had them;
(e) any other personally identifiable information of the parties listed here, as it is provided in the regulations under this law.
II. cause of registration, specifying if it is the original inscription, or extension, cancellation, modification, extinction or the execution of that.
III. A description of the collateral collateral, which may be generic or specific.

21 IV. If it is a specific collateral for purchase, GEC, should be mentioning that aspect in particular, and to identify the assets acquired, enabling to distinguish them from the general assets of the debtor.
V. In the case of goods by incorporation or destination, it must identify the type of property that the location question, as well as the registration number, or failing this, and identification needs of the building and the name of their owner or holder, as well as where these goods are or expected that they are.
VI. date and exact time of receipt of the application for registration, added by electronic registration process.
When there is more than one secured debtor granting a security interest over the same movable, such debtors must be separately identified on the form. Of equal way shall proceed is when the warranty interest is constitutes in favor of several creditors.
The registration requirements of the warranty interest specific to the purchase (GEC) article 46.-for a specific collateral for the purchase, GEC, be enforceable against third parties, the preferential creditor must comply with the following requirements:

(a) register the registration form prior to the acquisition of property by the debtor or, at the latest within five working days of the date in which the debtor has acquired his possession and ownership;
(b) specify in the registration form that the secured obligation has as destination the financing for the acquisition of assets that constitute the security interest; and, c) notify, prior to the acquisition of property by the debtor or, at the latest within five working days of the date on which the debtor purchased his possession and ownership, all secured creditors registered with guarantees Mobilier ias of the same debtor against collateral that could qualify within the description of the goods subject to the GEC.

Rectification and modification of registration article 47.-the registration data may be rectified at any time by the registration of a modification form, and its effects are rolled back to the date of the original registration which is rectified.
In the event that warranty to be changed, this will take effect from the moment of registration of the amendment.

22 authority to request registration article 48.-the creditor or any person authorized by him, shall be entitled to request, through the respective registration form, the inscriptions referred to in this law, to effect give the publicized.
Cancellation or modification of a record in a substantial error or fraudulently, shall be governed by the rules laid down in the Civil Code or the criminal code, as the case may be, by court order, following due process.
Chapter IV article 49 registration fee registration fee.-the procedure of registration of security interests will cause in respect of payment of fees for registration in the following ranges: one dollar ($1.00) of the United States of America for every hundred dollar or fraction of a hundred, the amount of which is up to fifteen hundred dollars of the United States of America ($1,500.00).
Fifteen dollars ($15.00) of the United States of America, for those entries whose amount exceeds a thousand five hundred dollars ($1,500.00), up to a maximum of ten thousand dollars ($10,000.00) of the United States of America; on this last amount excess be paid also a dollar ($1.00) of the United States of America for every hundred dollars or fraction of hundred up to a maximum of registration rights of twelve thousand dollars ($12,000.00) of the United States of America.
By the process of cancellation whose value does not exceed ten thousand dollars ($10,000.00) of the United States of America, will be paid six dollars ($6.00); excess of ten thousand dollars of the United States of America shall be paid in addition, twenty cents ($0.20) per every hundred dollar or fraction of hundred, up to a maximum of one hundred fifty dollars ($150.00) of the United States of America.
In the case of the process of execution, will be paid five dollars ($5.00) of the United States of America by the registration of the respective form of execution.
By all document of value undetermined, as well as any other document not specified in this tariff, is will pay six dollars ($6.00) of them United States of America by right of procedure of registration.
(Certifications, records and password of user authorized Art. 50.-by them certifications is charged them rights following: to) by it certification literal of registration, by them first ten leaves, six dollars of the United States of America ($6.00), more twenty-five cents of dollar ($0.25) by each an of them leaves additional of that record the certification requested;

(23 b) by each certification in extract of a registration, twelve dollars ($12.00) of the United States of America;
(c) any other literal certification, not specified in the above literals, three dollars ($3.00) of the United States of America by issued document;
(d) to obtain the password for the authorized user, will be charged an annual amount of fifteen dollars ($15.00) of the United States of America; (and e) for each record of the registration status of borrowers, will be charged five dollars ($5.00) of the United States of America.
Payment article 51.-the duties set out in this law, will be paid through the commandments of entry at the customs or banks which authorised the national records center; In addition, the national records center must implement mechanisms to enable payment by suitable electronic media.
Chapter V proceedings of cancellation of registration registration of warranty interest cancellation of registration article 52.-the inscriptions are extinguished by the following reasons: to) by its cancellation;
(b) by a direct consequence of a legal act after the recordal;
(c) by judicial decision.
Cancellation at the request of the debtor article 53.-the creditor is obliged to extend a registration form of cancellation within the five working days following payment of the obligation or guaranteed obligations to the debtor. Damages article 54.-the breach of the obligation referred to in the preceding article will lead to compensation for the damages caused to the debtor mentioned in such an arrangement, in accordance with the law.

24. Unilateral application by the secured debtor's cancellation of a registration article 55.-the debtor guarantor that it intends the cancellation of the registration of a security interest, without the participation of the secured creditor, you must request it before the competent judge, establishing the reasons which founds its claim. The judge will resolve as appropriate in accordance with law.
Title V chapter unique rules of priority priority since the registration of the Constitutive Act of the interest guarantee by form registry Art. 56.-the priority of a security interest constituted in accordance with this law, as well as judicial and tax, levies is determined by the time of its publicity, which can precede the lodging of security.
The guarantee is entered in the registry of security interests has priority over that not publicized. If the security interest is not advertised, its priority against other creditors secured by security interests not advertised will be determined by the date of conclusion of the contract of guarantee.
Priority and other rights article 57.-preference will be given security interests that have been entered in the register, even if they had been created after the security interests not publicized.
Protection to the purchaser or acquirer article 58.-Nevertheless stated in the previous article, a buyer or transferee in the ordinary course of business of the debtor, will receive the collateral free of any encumbrances established on them.
The secured creditor may authorize the secured debtor to dispose of goods, free of any charge and outside the ordinary course of business of the debtor, in which case, who acquires such collateral, also will acquire them free of the security interest.
The secured creditor cannot interfere with the rights of use and enjoyment of a lessee or licensee of movable goods which have been delivered under a contract of lease or a license granted in the ordinary course of business of the lessor or licensor.

25 preferential priority of the specific security guarantee for purchase (GEC) article 59.-the secured with GEC will not be affected by any restriction against the GEC agreed between the debtor and another creditor.
The GEC will cover exclusively the specific movable property acquired under this and funds specifically attributable to the sale of the same, if the secured creditor complies with the conditions laid down in the law.
Modification of priority by will of secured creditors art. 60.-the priority of a security interest may be amended by written agreement between the secured creditors involved, unless it affects the rights of third parties or otherwise prohibited by law. Modification of the rights of priority must be filed in the registry so that effective legal effects between the parties and be enforceable against the debtor and third parties.
(Cases special of priority article 61.-in them cases that corresponds, without prejudice of it established in the Art. 13 of this law, the right of priority is determined by them following rules: I. the priority of them guarantees interests on them documents representative of goods is governed by it following: to) a warranty interest on a document representative of merchandise , already is that record in paper or form electronic, will have priority with regard to any assessment about them goods represented by said document, provided the same is had issued validly following the rules contained in the present law. Is except them cases of rights of retention or them charges by provision of the law, registered with prior to the Constitution of the warranty interest on the document representative;

(b) in the case of a security interest in negotiable goods representative documents in paper, advertised by your endorsement and possession, it will take priority over a security interest in the same document, advertised by means of its registration in the register;
(c) in the case of a security interest in securities values advertised by its possession or its possession and endorsement, will have priority over a security interest over the same title value publicized by its registration in the register.
II. the priority of a security interest in receivables, will be determined at the moment of its registration in the register. In the case of a security interest in a letter of credit funds, the secured creditor who first receives notice of the acceptance of your payment by the issuing or confirming bank and entered the warranty registration, will have priority 26 over any security interest over such proceeds. The right of the secured creditor does not affect the other rights of the beneficiary of a letter of credit.
III. A security interest in goods by incorporation or destination, which was publicized in the manner established by this law, will have priority with respect to guarantees on the real estate, if publicized has been registered in the register before their accession or incorporation.
IV. priority of a security interest in accounts of deposit and investment accounts or similar, will be determined at the time that is entered in the same control.
V. The holder of a negotiable value that is in the possession of the same, with endorsement or without endorsement, as appropriate, in the ordinary course of business or line of business of the person who transferred it, receives free of charge.
Title VI procedures of execution chapter I registration registration of the execution home of the process execution by the registration of the registration form of execution article 62.-the creditor guaranteed that it intends to begin execution in case of default of the secured debtor, shall be the registration of an enforcement form in the registry, which must be notified to the debtor for the purposes of the applicable law.
Enforcement form Article 63.-the form registration of execution must contain as a minimum: a) a description of the cause that produces the default by the secured debtor;
(b) registration number of the registration form of the security interest by which you try to execution, with their date of registration;
(c) statement of the amount of capital owed, more the interests agreed in the contract accrued during the validity of the credit or credits guaranteed.
Choice of procedure by the creditor guaranteed Art. 64.-registered the form of execution, the creditor guaranteed may choose between a process of arbitration, a process extrajudicial before notary, or a process court before judge competent.

27. in the case of contracts of adhesion, notarial or arbitral procedure option, must be agreed among the parties through free discussion, separate contracts clause.
Started the process of execution before notary, any of them parts can, in any moment, before the pronouncement definitive, ask the suspension of the action Attorney and that the record is return to the creditor guaranteed. The right of go to the instance judicial is indispensable from the debtor guarantor.
Chapter II execution Attorney of the warranty interest notification Attorney Art. 65.-If the creditor guaranteed singles the procedure extrajudicial before notary, this last, through notification Attorney, will deliver a copy of the form registry of execution to the debtor guarantor, to the debtor main of the obligation guaranteed, to the person in possession of them goods given in warranty and to any person with a registration of warranty interest existing on them same goods furniture in warranty , pursuant to this law.
Deadline for reply article 66.-received the notarized notification, the debtor shall have a period of three working days counted from the day following receipt of the enforcement form, to oppose or not to the same, in written form; in the case of opposition, the notary will not follow knowing of that process; also, if the debtor does not I will answer in the term mentioned above, the notary nor may continue with this procedure.
In case of opposition by the principal debtor of the secured obligation or the debtor in the case by which promotes the execution, according to the enforcement form registered, the creditor may request proceed in accordance with article 71 of this law or by sale at auction arranged by chapter III of this title.
Opposition of the debtor article 67.-in the event that the borrower of the secured obligation or the debtor opposed the execution, the notary will not know and return the record to the creditor in a maximum period of three working days.
Delivery volunteer of the goods article 68.-before the lack of opposition from the principal debtor of the secured obligation or the debtor in the case that promotes the notarial execution by the secured creditor, the notary can continue knowing execution.

28. in the case of collateral without scrolling over corporeal property under supervision and notarial inventory, the collateral shall be delivered to the secured creditor or to a third party, to the first request and with the consent of the debtor.
Chapter III sale in public auction not JUDICIAL or in auction private nature of the auction article 69.-the parties may request, by mutual agreement, the goods to be sold in non-judicial public auction or private auction.
He notary will send to valuing them goods by means of an expert accepted of common agreement by them parties, who must be duly registered as such in the Superintendence of the system financial; except that the parties agree a price by the nature of the good.
Received the forensic report and for non-judicial public auction, send to publish notice of auction in two newspapers with national circulation, at which point place, date and time to carry out this.
Article 70.-the extra application appointed Notary Act under the key provisions of this law, as well as the law of the notary exercise of the voluntary jurisdiction and other errands, and other laws to which both relevant and applicable.
Dation in payment Art. 71.-the parties may agree, by common agreement, the payment in kind of the goods by the value set.
Right of the debtor to be declared by finished or suspended the process of implementing article 72.-at any time, before the secured creditor disposes of the collateral in the collateral, the secured debtor, as well as any other interested person, entitled to give terminated execution procedures, either: to) paying the total amount owed by the secured debtor to the secured creditor as well as the expenses incurred by the secured creditor in the execution procedure, accepted by the debtor;

29 b) if guaranteed obligations not fulfilled in accordance with the terms set forth in the agreement and without a final resolutory clause therein for such cause, debtor, during the process of implementation of the warranty, shall be entitled to meet their obligations, by means of fees or partial estimates and also pay the expenses incurred in this process all in agreement with the creditor, and can ask as a result to be declared suspended the same.
Order of priority of payment on goods resulting from the liquidation article 73.-the resulting proceeds of the public auction no judicial or private, as well as the equivalent in case of taking property in payment, shall apply to the cancellation of the obligation secured in the following order: a) the satisfaction of the balance due of the secured obligation applying first to moratory interest, then interest ordinary and finally to capital;
(b) the payment of the taxes that are payable in respect of the collateral, if any, since the law provides a lien on the property in such circumstances;
(c) the costs of execution, Depot, repair, insurance, preservation, or auction incurred by the creditor;
(d) the satisfaction of obligations secured with secured transactions with lower priority;
(e) the remainder, if any, be delivered to the debtor.
If the balance due by the debtor exceeds the product of the real atr ibuibles to the realization of the collateral warranty, the secured creditor retains its action to suing the debtor of the obligation via the corresponding payment by the remnants.
Enforcement of a security interest in goods by incorporation or destination

Article 74.-when a same creditor warranty registered on goods by incorporation or destination and in addition, have a mortgage on the real estate which have been incorporated or intended for, the creditor can, at its option, run all or any of the above guarantees, complying with the provisions of this law and other laws relating to the enforcement of security against real estate. If the creditor has priority, this can remove goods by incorporation or destination. Such secured creditor must pay to the owner or mortgagee of property, provided that it is not the same secured debtor, any damage caused to the property by the removal of goods by incorporation or destination, according to the provisions of this law.

30 agreement between the parties article 75.-at any time, before or during the enforcement proceeding, the debtor may agree with the secured creditor terms other than those previously established, either on delivery or recovery of good, conditions of sale, the auction or any other matter, provided that said agreement does not affect third parties.
Rights of the debtor against abuses in the process article 76.-in any case, will be to retain the right of the debtor to claim damages before the competent authority, by the abusive exercise of rights by the secured creditor or claimant elsewhere and the experts.
Rights of secured creditors lower in priority article 77.-any lower priority secured creditor may subrogate the rights of the secured creditor priority higher, by paying the secured obligation of the secured debtor.
Order of priority between guaranteed article 78.-the creditor secured creditors may exercise their enforcement rights and assume control of the collateral in the order of their priority.
Chapter IV proceedings of execution Court of warranty interest proceedings of Judicial enforcement of security interest article 79.-If the secured creditor chooses the judicial procedure, shall be as set out in the code of Civil and commercial procedure.
Title VII chapter only Arbitration Arbitration on secured transactions article 80.-any controversy that arises with respect to the invalidity, interpretation and enforcement of a guarantee, be submitted by the parties to arbitration, in accordance with applicable law.

31 arbitration on the execution of them guarantees interests article 81.-the execution of the warranty interest is may carry to out before a court arbitration, prior Convention between them parts.
Title VIII chapter only conflicts of laws and reach TERRITORIAL of the application of this law bonding of the guarantee interest in several countries article 82.-in the event that a security interest has contacts for any reason with more than one country, issues relating to the validity, publicity and priority of the security shall be governed by the law of the country in which they are settled at the time of the creation of the security.
Effects of the transfer of the collateral to another country article 83.-If the collateral is moved to a different country than the one in which advertising was publicized, the law of the country of the new location of the collateral governs issues relating to the publicity and priority of the security interest against third persons who acquire rights in the collateral , after the fixing of the new location. However, the priority of the registered under the law of the previous location remains, if such security is given publicity in accordance with the law of the country of the new location of the collateral, within 90 days of the transfer.
Conflicts between collateral and non-scrolling article 84.-the priority of a non-possessory on negotiable incorporeal property as against third persons who acquire a guarantee with displacement on such property, is governed by the law of the country where the collateral is located at the time of the acquisition of the warranty with displacement.
Location of the debtor article 85.-effect of applying the rules of this title, a secured debtor is considered domiciled in the country where has registered in the register of traders or companies or keeps the main center of business.
If the debtor is not a trader registered in the register of traders or companies, does not operate a business in the usual way or does not maintain a business center, the debtor shall be deemed domiciled in the country of their habitual residence.

32 title IX provisions General and effective chapter only prevalence Art. 86. in the field of their application, these provisions by their special character, prevail over any others that contradict them; and that which has not been regulated explicitly in this law and its regulations, you can replace by the laws and regulations that apply to them.
Contracts and legal situations in force or existing at the time of coming into force this law will continue to be governed by terms and conditions originally agreed.
Garments registered prior to the entry into force of this law, shall maintain their priority in accordance with the inscriptions contained in the respective records. The parties have the right to sign such garments in the registry of security interests to effect of publicizing information on attention to the person of the debtor and without losing acquired priority therefore. However, any assessment that is constitutes on these goods with after to the force of the present law, is governed by it willing in this and must do is allusion to the existence of a garment, to effect of avoid charges hidden.
Obligation of regulate Art. 87.-the President of the Republic shall issue the regulation of this law in a term of six months counted from its publication in the daily official.
Entry into force article 88.-the present Decree shall enter into force six months after its publication in the official journal, and the national records center begin operations of the registry of security interests at the latest six months after its entry into force.
GIVEN in the SALON blue of the Palace legislative: San Salvador, to the nineteen days of the month of September of two thousand thirteen.

33 ROBERTO José d'AUBUISSON MUNGUIA, fifth Vice President.
House presidential: San Salvador, to the four days of the month of October in the year two thousand thirteen.
PUBLISHED, Carlos Mauricio Funes Cartagena, President of the Republic.
German Jose Armando Flores, Minister of economy.
D. OR. No. 190 volume no. 401 date: 14 October 2013 SV/ielp 11-11-2013 legislative index