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Original Language Title: LEY GENERAL DE ELECTRICIDAD

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LEGISLATIVE ASSEMBLY-REPUBLIC OF EL SALVADOR ____________________________________________________________________

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DECREE Nº 843.-

THE LEGISLATIVE ASSEMBLY OF THE REPUBLIC OF EL SALVADOR,

WHEREAS:

I.-That it is the obligation of the State to assure the inhabitants of the Republic of economic well-being and social justice;

II.-That the State must promote economic and social development, through the increased production, productivity and the rational use of resources, guaranteeing economic freedom and encouraging private initiative, within the necessary conditions of competition, to increase national wealth and to ensure the benefits of this to the greatest number of inhabitants of the country;

III.-That requires an adequate and sustained development of the activities related to the national electricity sector, for which it is necessary and appropriate that the The country's productive sector is fully integrated into them;

IV.- the establishment of a regulatory framework to enable and encourage investment in the various activities of the sector, since the Law on Electrical Services, which has been in force since 18 January 1936, has ceased to be an agile, practical and appropriate instrument;

BY TANTO,

in use of its constitutional powers and on the initiative of the President of the Republic through the Minister of Economy,

DECRETA the following:

ELECTRICITY GENERAL LAW

CHAPTER I GENERAL PROVISIONS

Art. 1. This Law rules the activities of generation, transmission, distribution and marketing of electrical energy. Its provisions apply to all entities that carry out the above activities, whether they are public, mixed or private, regardless of their degree of autonomy and constitution.

Art. 2.-The application of the precepts contained in this Law shall take into account the following objectives:

a) Development of a competitive market in the generation, transmission,

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distribution and marketing of electrical energy;

b) Free access of generating entities to transmission and distribution facilities, without any limitations other than those indicated by law;

c) Rational and efficient use of resources;

d) Promoting access to power supply power for all sectors of the population; and,

e) Protection of the rights of users and all entities developing activities in the sector.

Art. 3.-THE SUPERINTENDENCE OF ELECTRICITY AND TELECOMMUNICATIONS, HEREINAFTER THE SIGET, WILL BE RESPONSIBLE FOR THE COMPLIANCE WITH THE PROVISIONS OF THIS LAW. FOR WHICH YOU ARE EMPOWERED:

(a) ENSURE THE DEFENSE OF COMPETITION IN THE TERMS SET FORTH IN THIS LAW; (3)

(b) REPEALED BY D.L. No. 528/04. (3)

(c) DETERMINE THE EXISTENCE OF CONDITIONS THAT ENSURE HEALTHY COMPETITION IN THE PRICES OFFERED ON THE REGULATORY MARKET OF THE SYSTEM, IN ACCORDANCE WITH ARTICLE 112 E OF THIS LAW; (3)

(d) REPEALED BY D.L. No. 528/04. (3)

(e) RESOLVE DISPUTES UNDER ITS JURISDICTION AND APPLY THE CORRESPONDING SANCTIONS CONTAINED IN THIS LAW; (3)

(f) REQUIRE THE INFORMATION NECESSARY FOR THE FULFILMENT OF ITS PURPOSES, IN ACCORDANCE WITH THE PROVISIONS OF THIS LAW. THE PRESENT LAW; AND (3)

G) REPEALED BY D.L. No. 528/04. (3)

Art. 4.-For the purposes of this law, the following definitions are set:

a) High voltage: is the voltage level equal to or greater than 115 kilovolts;

b) Low voltage: is the voltage level below 115 kilovolts;

c) Marketer: is the entity that buys electrical power from other operators with the object of reselling it;

d) Connection: is the link that allows an end user to receive electrical power from a network

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transmission or distribution;

e) Distributor: is the owning and operating entity of facilities whose purpose is the delivery of electrical power in low voltage networks;

f) Entity: natural or legal person;

g) Generator: is the entity holding one or more production plants of electrical power, which markets its production in whole or in part;

h) Interconnection: is the link that allows two operators to transfer power between their facilities;

i) Node: is the point where they are joined several elements of an electrical system.

j) Operator: is any generating entity, transmitter, distributor or electric power marketer;

k) Transmission network: is the integrated set of transport equipment high voltage electrical power;

l) Distribution network: is the integrated set of equipment Low voltage electrical energy transport;

m) Transmitter: is the entity possessing facilities for the transport of electrical energy in high-voltage networks, which markets its services; and

n) End User: is who buys electrical power for their own use.

Art. 5.-THE GENERATION OF ELECTRICAL ENERGY FROM HYDRAULIC AND GEOTHERMAL RESOURCES, WILL REQUIRE THE CONCESSION GRANTED BY THE SIGET IN ACCORDANCE WITH THE PROVISIONS OF THIS LAW, HOWEVER, THE CONCESSION FOR GENERATING PLANTS WITH CAPACITY NOMINAL TOTAL, EQUAL TO OR LESS THAN FIVE MEGAWATTS SHALL BE PROCESSED BY AN ABBREVIATED PROCEDURE, ACCORDING TO THE METHODOLOGY THAT THE SIGET ISSUES. (3)DECLARED UNCONSTITUTIONAL.

Art. 6. The installation and operation of nuclear power plants shall be governed by a special law.

Art. 7. THE GENERATION ACTIVITIES NOT REFERRED TO IN ARTICLES 5 AND 6, AS WELL AS THE TRANSMISSION, DISTRIBUTION AND MARKETING OF ELECTRICAL ENERGY, SHALL BE CARRIED OUT ON THE BASIS OF THE REGISTRATION OF OPERATORS IN THE ELECTRICITY SECTOR. THE SIGET. SUCH REGISTRATION SHALL BE UPDATED ANNUALLY.

OPERATORS WHO IMPORT ENERGY AND GENERATORS WILL HAVE TO PAY THE SIGET ANNUALLY FOR THE FEE FOR THE UPDATE OF THE REGISTER, THREE

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COLONES THIRTY-NINE CENTS FOR EACH MEGAWATT HOUR INJECTED FOR COMMERCIAL PURPOSES DURING THE PREVIOUS YEAR. THIS VALUE MUST BE ADJUSTED ANNUALLY BY THE SIGET, TAKING INTO ACCOUNT THE CONSUMER PRICE INDEX PUBLISHED BY THE MINISTRY OF ECONOMY. (1) (3)

Art. 8.-Except for the derogation contained in this Article, a single entity may develop generation, transmission, distribution and marketing activities, as long as it establishes separate accounting systems for each of them and are registered as such in the SIGET.

The SIGET is empowered to establish the rules with which the accounting systems of operators who develop the transmission and distribution activities, as well as the Transactions Unit, will have to comply.

entities carrying out generation, distribution and marketing activities may not be shareholders of the company resulting from the restructuring of CEL, which has as normal operations the transmission of electrical energy, and The latter, or its shareholders, may participate in the companies which develop the above mentioned activities.

TO REMOVE INSTALLED CAPACITY FROM GENERATION, THE OPERATOR MUST NOTIFY THE SIGET SIX MONTHS AHEAD OF TIME, AND IF IT DETERMINES THE NEED TO MAINTAIN THAT CAPACITY FOR SIX MORE MONTHS TO ENSURE THAT IT DOES NOT IT WILL NEGATIVELY AFFECT THE OPERATION, SECURITY AND QUALITY OF THE SYSTEM, IT WILL RECOGNIZE COMPENSATION FOR INSTALLED CAPACITY THROUGH THE AUXILIARY COLD RESERVE SERVICE FOR THE LAST SIX MONTHS. IN CASE THE CAPACITY IS NOT NEEDED IN THE SYSTEM, THE SIGET WILL BE ABLE TO AUTHORIZE ITS IMMEDIATE WITHDRAWAL. (3)

Art. 9.-THE CHARGES FOR THE USE OF TRANSMISSION AND DISTRIBUTION NETWORKS, FOR THE COORDINATED OPERATION OF THE TRANSMISSION SYSTEM, THE OPERATION OF THE WHOLESALE MARKET, SALES TO THE END USER, CHARGES FOR CONNECTION AND RECONNECTION OF END USERS TO DISTRIBUTION NETWORKS AND FOR THE CONNECTION OF NEW DISTRIBUTION NETWORKS, WILL BE SUBJECT TO REGULATION AND APPROVAL BY THE SIGET.

ALL COSTS ASSOCIATED WITH CONNECTION OR RECONNECTION OF END USERS TO DISTRIBUTION NETWORKS, SUCH AS SERVICE FEASIBILITY, INSPECTION, BUDGETING, APPROVAL OF PLANS, AMONG OTHERS, WILL BE REGULATED AND APPROVED BY THE SIGET.

SIGNET ' S APPROVAL POWERS OF THE ABOVE LISTED CHARGES INCLUDE THOSE OF REQUIRING THE CLARIFICATIONS, EXTENSIONS OR JUSTIFICATIONS NECESSARY TO VERIFY COMPLIANCE WITH THIS LAW, ITS REGULATION AND OTHER GENERAL RULES WHICH ARE APPLICABLE.

WHEN THE CHARGES PROPOSED BY THE OPERATORS OR THE UNIT OF TRANSACTIONS DO NOT COMPLY WITH THE PROVISIONS OF THIS LAW, ITS REGULATION OR THE APPLICABLE RULES, THE SIGET SHALL INDICATE THE NECESSARY MODIFICATIONS TO THE ENSURE COMPLIANCE AND REFER THEM TO APPLICANTS FOR COMPLIANCE, TO THE

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PURPOSES OF SUBSEQUENT APPROVAL.

THE ADEQUACY SHALL BE MADE BY THE APPLICANTS AND SUBMITTED WITHIN A REASONABLE TIME LIMIT TO BE DETERMINED BY THE SIGET. IF THE DEADLINE SET HAS NOT BEEN MET, THE BOARD OF DIRECTORS OF SIGET WILL ISSUE THE ACT OF APPROVAL WITH THE MODIFICATIONS DULY MOTIVATED IN CRITERIA OF REASONABLENESS AND ATTACHMENT TO THE NORMATIVE PARAMETERS THAT THEY ARE TAXABLE.

PRICES FOR ELECTRICAL ENERGY SERVICES AND SUPPLIES NOT COVERED BY THE ABOVE, SHALL BE FIXED BETWEEN THE PARTIES ON THE BASIS OF THEIR ACTUAL COSTS AFTER NEGOTIATION BETWEEN THE DISTRIBUTOR AND THE END USER. (3) (5)

Art. 10.-Operators shall have no obligations to provide services or to make supplies as contained in this Law and in their contracts.

Art. 10-BIS.-ALL CONTRACTS FOR THE SALE OF POWER AND ELECTRIC POWER BETWEEN OPERATORS MUST BE REGISTERED IN SIGET. (5)

Art. 11.-For the construction of transmission and distribution networks, the use of the rights of way in national public goods will be free, and must be met at all times, the rules of urban planning dictated by the authorities.

The expenses arising from the removal, removal and replacement of electrical installations that may be necessary to implement as a result of the extension, maintenance or improvement of roads, roads, streets, railways, works of municipal ornate or for other reasons of equal nature shall be for the account of the operators, in compensation for the use of national public goods for free.

Art. 11-BIS.-THE SIGNET MAY OBTAIN FROM THE OPERATORS AND THE UNIT OF TRANSACTIONS THE INFORMATION NECESSARY IN THE EXERCISE OF ITS FUNCTIONS TO VERIFY COMPLIANCE WITH THIS LAW, ITS REGULATIONS AND THE APPLICABLE RULES.

THE SIGET MAY CARRY OUT, IN ITSELF, OR THROUGH THE EXPERTS OR AUDITORS APPOINTED FOR THIS PURPOSE, THE INSPECTIONS IT DEEMS NECESSARY FOR THE PURPOSE OF CONFIRMING THE ACCURACY OF THE INFORMATION PROVIDED TO THE EXTENT NECESSARY FOR IT. EXERCISE OF HIS DUTIES. (3)

CHAPTER II REGIME FOR DEVELOPING GENERATION ACTIVITIES, TRANSMISSION,

DISTRIBUTION AND MARKETING OF ELECTRICAL ENERGY

SECTION I OF CONCESSIONS

Art. 12. The concessions shall be permanent and transferable. DECLARED UNCONSTITUTIONAL.

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Art. 13.-The person concerned to obtain concession for the exploitation of hydraulic or geothermal resources shall submit a written application to the SIGET, accompanied by the following:

a) The applicant's data relating to its existence and capacity legal;

b) The feasibility study of the project, which will include descriptive memory and the corresponding plans;

c) The environmental impact study, previously approved by the competent authorities in the field, which must allow the systematic assessment of the effects of the project and its annexed works, in its stages of construction, operation and abandonment; the comparison of the different options; the taking of preventive measures; and the design of actions to mitigate adverse effects; and,

d) Any other data required in the This Act or its Rules of Procedure.

Art. 14. Within the eight-day period from the date of its submission, the SIGET shall determine whether the application is admissible.

Art. 15. The inadmissibility of the application may be declared only where the requested action has been granted by another concession or where the application is not complied with in accordance with Article 13.

Art. 16. The Regulation of this Law shall establish the procedure necessary for the processing of applications for concessions. Such concessions shall be granted prior to the establishment of competition by means of invitation to tender.

The procedure to be established in accordance with this Article shall include the publication of the project data in two (a) a national wide circulation newspaper, in effect for those who may be opposed to it.

Art. 17.-The SIGET is empowered to dictate the rules applicable to the tendering procedure; in any case, the tenders submitted must be accompanied by a guarantee equivalent to ten percent of the total amount of the offer.

Art. 18.-The concession for the exploitation of the resource shall be awarded to the one who offers the best price, except if the initial applicant has lost the tender but is willing to pay, in the case of the granting of water resources, ninety percent of the offer of the winning bidder, and in case of a geothermal resource concession eighty-five percent of the bid of the winning bidder.

DELETED PARAGRAPH (2)

Art. 19. WITHIN THIRTY DAYS OF THE PUBLICATION OF THE RESULTS OF THE TENDER, THE SIGET AND THE CONCESSIONAIRE WILL GRANT THE CORRESPONDING CONTRACT BY MEANS OF PUBLIC DEED. THE CONTRACT SHALL SPECIFY THE RIGHTS AND OBLIGATIONS OF THE CONTRACTORS, CONDITIONS UNDER WHICH THE CONCESSION IS GRANTED, CAUSAL TERMINATION FOR FAILURE TO COMPLY WITH THE OBLIGATIONS ARISING OUT OF THE OBLIGATIONS ACQUIRED OR THE TIME LIMITS FOR IMPLEMENTATION. IN ORDER TO DEVELOP THE CONCESSIONARY AND THE PROVISIONS OF THIS LAW THAT ARE APPLICABLE, IN ADDITION TO THE PROCEDURES FOR MAKING MODIFICATIONS TO IT BY AGREEMENT BETWEEN THE PARTIES. (3)

Art. 20.-Concessions may terminate only by resignation or failure to comply with the obligations laid down therein. The foregoing, without prejudice to the fines to which the dealer is awarded in accordance with this Law and its Rules of Procedure.

Art. 21.-In the case of resignation or transfer, in order for the same effect to take effect, there must be prior acceptance by the SIGET.

Art. 22.-Acordada the termination of the concession for noncompliance of the concessionaire, this will be disabled to continue exploiting the resource.

Art. 23.-The terms of the Contries may be modified at the request of the concessionaire, following the same procedures used to grant it, except that the bidding process will not be performed.

In cases where the capacity of generation contemplated in the contract must be extended, the corresponding modification

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will be subject to making the payments that result from proportionally comparing the generation capacity at the time of request for the extension, with the resulting capacity after such an extension has been made.

This Law shall establish the procedure for payments by the extensions are related to the actual value of the original grant.

SECTION II OF THE STUDIES

Art. 24.-The SIGET, at the request of any interested party, may grant you temporary permission for the study of power generation projects using hydraulic or geothermal resources.

Art. 25. The granting of such permission shall at no time consider exclusivity, and shall entitle the person concerned to carry out the studies, surveys, and menses that are necessary in state property. In the case of tax assets, the person concerned shall obtain the permission of the authority which administers the goods in question.

Art. 26.-The maximum period of the temporary permit shall be two years, which may be renewed once at the request of the person concerned. The application for a permit, as well as for renewal, shall be made with the requirements laid down by the SIGET.

INTERCONNECTION SECTION III

Art. 27.-Transmitters and distributors shall be obliged to permit the interconnection of their installations and the use thereof for the transport of electrical energy, except where this represents a danger to the operation or safety of the system, facilities, or people.

Art. 28.-The conditions for the interconnection as well as the use of the facilities shall be subject to the provisions of the parties.

Art. 29.-In the event of no agreement for the interconnection or use of the facilities, either party may turn to the SIGET for the purposes of the provisions of Chapter VII of this Law.

Art. 30. Unless otherwise agreed, the costs of the interconnection shall be on behalf of the applicant.

Art. 31.-Any operator shall be liable for any damage caused by its facilities to the equipment with which it is interconnected or those of third parties.

Art. 32.-Distributors shall submit a report containing at least:

a) Energy delivered by type of consumer;

b) Energy delivered on behalf of third parties;

c) Average prices by type of consumer during the period;

d) The features and failures of your system over the period;

e) THE TOTAL DETAIL OF THE COMPENSATION FOR FAULT USERS, DIFFERENTIATING THOSE THAT ARE FROM CAUSES ATTRIBUTABLE TO THE COMPANY DISTRIBUTION. (5)

F) THE QUALITY OF THEIR SERVICES AND SUPPLIES. (5)

CHAPTER III OF THE TRANSACTION UNIT

ORGANIZATION SECTION I

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Art. 33.-Any interconnected system must have a Transaction Unit, hereinafter the UT, which shall have as its object:

a) Operate the transmission system, maintain the security of the system and ensure the minimum quality of services and supplies; and,

b) Operate the wholesale electricity market.

The UT may not in itself perform electrical energy purchase operations.

THE OPERATING RULES OF THE MARKET TRANSMISSION AND MANAGEMENT SYSTEM WHOLESALER MUST BE CONTAINED IN THE RULES OF OPERATION WHICH FOR THESE PURPOSES THE TRANSACTION UNIT AND APPROVE THE SIGET BOARD OF DIRECTORS.

WHEN THE RULES PROPOSED BY THE UT DO NOT COMPLY WITH THE PROVISIONS OF THIS LAW, ITS REGULATION OR THE APPLICABLE RULES, THE SIGET MUST INDICATE THE MODIFICATIONS NECESSARY TO ENSURE ITS COMPLIANCE AND TO REFER THEM TO THE UT FOR THEIR SUITABILITY, FOR THE PURPOSES OF THEIR SUBSEQUENT APPROVAL.

MEETING THE DEADLINE SET BY THE SIGET WITHOUT HAVING MADE THE APPROPRIATE ADJUSTMENTS, THE BOARD OF DIRECTORS OF SIGET WILL BE ABLE TO ISSUE THE ACT OF APPROVAL WITH THE MODIFICATIONS IT DEEMS NECESSARY. (3)

Art. 34.-The UT must be organized and operated as a capital company, represented by nominative actions.

Art. 35.-The operators and end-users directly connected to the transmission system controlled by that unit may be shareholders of the UT, which comply with the following:

(a) generators with a total nominal capacity of at least five megawatts;

b) Transmitters whose facilities belong to the system;

c) Distributors with a total nominal capacity connected to the transmission system of at least five megawatts; and,

d) Users end with a total nominal capacity connected to the transmission system of at least five

BE SHAREHOLDERS OF THE UT, OPERATORS AND END USERS WHO COMPLY WITH THE FOLLOWING:

GENERATORS WITH A TOTAL NOMINAL CAPACITY OF AT LEAST FIVE MEGAWATTS;

TRANSMITTERS WHOSE INSTALLATIONS BELONG TO THE SYSTEM;

DISTRIBUTORS WITH A TOTAL NOMINAL CAPACITY CONNECTED TO THE TRANSMISSION SYSTEM OF AT LEAST FIVE MEGAWATTS;

END USERS WITH A NOMINAL CAPACITY OF AT LEAST ONE MEGAWATT; AND,

INDEPENDENT MARKETERS REGISTERED IN THE UT WITH MORE THAN ONE YEAR OF OPERATION YOU WOULD HAVE TRANSACTED A MINIMUM OF ONE GIGAWATT HOUR IN THE YEAR BEFORE YOUR ENTRY. (3)

Art. 36.-The representative shares of the social capital of the company shall be distributed in series or groups, to each of which a special denomination is given.

The series or groups of actions referred to in the preceding paragraph shall form for the categories of generators, transmitters, distributors and end-users.

In the Ordinary and Extraordinary General Boards held by the UT, each series of shares shall be entitled to two votes,

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with the exception of transmitters, which will be entitled to one vote.

Each series, with the exception of transmitters, will be represented by two persons appointed on board chaired by the legal representative of any member. of that string.

A single person will not be able to represent simultaneously two or more series of shares.

THE REPRESENTATIVE SHARES OF THE SOCIAL CAPITAL OF THE COMPANY SHALL BE DISTRIBUTED IN SERIES OR GROUPS, EACH OF WHICH SHALL BE GIVEN A SPECIAL DENOMINATION. THE SERIES OR GROUPS OF ACTIONS REFERRED TO ABOVE SHALL BE FORMED FOR THE CATEGORIES OF GENERATORS, TRANSMITTERS, DISTRIBUTORS, INDEPENDENT MARKETERS AND END-USERS. IN SERIES MEETINGS, EACH SHAREHOLDER SHALL BE ENTITLED TO ONE VOTE, IRRESPECTIVE OF THE NUMBER OF SHARES HELD.

IN THE ORDINARY AND EXTRAORDINARY GENERAL MEETINGS HELD BY THE UT, EACH SERIES OF ACTIONS SHALL BE ENTITLED TO TWO VOTES, WITH THE EXCEPTION OF THE TRANSMITTERS, WHICH SHALL BE ENTITLED TO ONE VOTE.

WITH EXCEPTION OF THE TRANSMITTERS, WHICH WILL BE REPRESENTED BY ONE PERSON, EACH SERIES WILL BE REPRESENTED BY TWO PERSONS APPOINTED ON BOARD CHAIRED BY THE LEGAL REPRESENTATIVE OF ANY OF THE MEMBERS OF THAT SERIES. THE SAME PERSON MAY NOT SIMULTANEOUSLY REPRESENT TWO OR MORE SERIES OF SHARES.

THE UT MUST AGREE ON CAPITAL INCREASES WHEN THERE IS A REQUIREMENT FOR NEW ENTRANTS, IN ORDER TO INCORPORATE ALL THE NEW MARKET PARTICIPANTS AS SHAREHOLDERS IN THE COMPANY. NEW SHARES CAN ONLY BE SUBSCRIBED BY NEW ENTRANTS. (3)

Art. 37.-THE EXECUTIVE BOARD OF THE UT SHALL BE INTEGRATED AS FOLLOWS:

(a) TWO REPRESENTATIVES FOR EACH SERIES OR GROUP OF ACTIONS, WITH THE EXCEPTION OF TRANSMITTERS WHICH SHALL HAVE A SINGLE REPRESENTATIVE;

(b) A REPRESENTATIVE OF THE COUNCIL NATIONAL ENERGY, WHICH WILL BE ENTITLED TO VOICE AND VOTE;

c) A REPRESENTATIVE OF THE CONSUMER ' S OFFICE, WHO SHALL HAVE THE RIGHT TO VOTE.

AT THE SESSIONS OF THE BOARD OF DIRECTORS, A REPRESENTATIVE OF THE SIGET, WHO WILL HAVE THE RIGHT TO SPEAK BUT WITHOUT A VOTE, WILL BE ABLE TO ATTEND.

A COPY OF ALL DULY CERTIFIED MINUTES MUST BE SENT TO THE SIGET AND THE MINISTRY OF ECONOMY WITHIN 15 DAYS OF THE RESPECTIVE MEETING. (3) (5)

Art. 38. In the constitution of the company, each of its members must subscribe to shares in relation to the value in books of the goods oriented to the activities of the sector. In the case of end users, the value in books of the electrical installations and equipment through which the supply is received will be taken.

Art. 39.-THE UT WILL CHARGE THE CHARGES FOR THE OPERATION OF THE TRANSMISSION SYSTEM AND THE WHOLESALE MARKET ACCORDING TO THE METHOD ESTABLISHED BY THE SIGET. THESE CHARGES SHALL ALLOW THE UT TO OBTAIN SUFFICIENT INCOME TO SATISFY REASONABLE OPERATING COSTS APPLICABLE TO THE SERVICE, TAXES AND REDEMPTIONS, AND COVERING REASONABLE AND CONSISTENT COSTS WITH THE SECURITY REQUIREMENTS OF OPERATION. (3)

Art. 40.-Without prejudice to the provisions of this Law, the UT may provide other services to those who request it.

SECTION II OF THE OPERATION OF THE TRANSMISSION SYSTEM

Art. 41.-Any transmitter shall make available to the UT the means of control of its facilities for the coordinated operation of the system. The UT will be empowered to control the generation units of its members.

Art. 42.-The operating decisions taken by the UT will be mandatory for operators.

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Art. 43. Each operator shall be responsible for the maintenance, extensions and improvements of its facilities. Generators and transmitters must coordinate their maintenance operations with the UT.

Art. 44.-The UT may disconnect from the system the facilities of any operator which keeps them in such a way as to pose a danger to those of other operators, the security or stability of the system and the goods or lives of persons. You may also disconnect the facilities of operators who are in arrears in their obligations with respect to it.

Art. 45. In cases of emergency, all operators must make available to the UT the control of their equipment. The costs resulting from the operation in these cases will be covered according to the methodology established by the UT; the UT will determine the circumstances that may be considered as emergency, these circumstances must be related to the resolution of widespread failures on the system.

Art. 46.-The UT will determine fault liability on the interconnected system.

Art. 47.-The UT shall determine the method to calculate the losses by which each generator shall be responsible according to its participation in the scheduled dispatch and in the System Regulatory Market. Generators may compensate for such losses through their own generation of contracts with other generators or in the System Regulatory Market.

Art. 48.-The users of the system will be able to obtain at their own cost the services of supply of reactive power, rolling stock and others, necessary for the operation of the transmission system. The UT may provide such services at the request of the users, through the payment agreed with the applicants.

Art. 49.-The UT shall determine the requirements with which the information and control systems of the operators interconnected to the system shall comply.

Art. 50.-REPEALED (5)

SECTION III OF THE WHOLESALE MARKET OPERATION

Art. 51.-The wholesale market will be composed of at least the Contract Market and the System Regulatory Market. The UT will operate the System Regulatory Market and use the Contract Market for its scheduled office.

Art. 52. THEY MAY PARTICIPATE IN THE SCHEDULED DISPATCH TO THE MARKETS THAT ADMINISTER THE UT, ALL THE OPERATORS CONNECTED DIRECTLY OR THROUGH OTHER OPERATORS, TO THE TRANSMISSION SYSTEM COORDINATED BY THE LATTER, INCLUDING THE MARKETERS.

THE RULES AND AGREEMENTS ARISING FROM THE APPLICATION OF THIS PROVISION SHALL BE REGULATED IN THE RESPECTIVE REGULATIONS. (3) (6)

Art. 53.-The UT shall be responsible for the scheduled dispatch of power between generators, distributors and end consumers connected to the system. The dispatch period shall be defined by the UT.

Art. 54.-The dispatch scheduled for each period will be based initially on the electrical energy purchase transactions agreed between the individuals in the operation of the Contract Market.

EACH OF THE PARTICIPANTS IN THESE, IT SHALL STATE IN ADVANCE ITS CONFORMITY WITH SUCH TRANSACTIONS, IN ACCORDANCE WITH THE PROCEDURE LAID DOWN BY UT. OPERATORS SHALL BE OBLIGED TO REPORT MONTHLY TO THE UT AND TO THE SIGNET, THE PRICES AND OTHER FINANCIAL AND TECHNICAL CONDITIONS AGREED IN THE TRANSACTIONS CARRIED OUT ON THE CONTRACT MARKET. (5)

The operators involved in the different transactions shall submit to the UT price offers for increases or decreases with respect to the agreed energy quantities, which shall be used to resolve situations.

Based on the information provided by the participants, the UT will determine the scheduled dispatch and congestion charges for the period in question, which it will communicate to the operators.

Art. 55.-The UT will operate a System Regulatory Market, hereinafter the MRS, to maintain at all times the balance sheet

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between the supply and demand for electrical power.

Art. 56.-The MRS shall operate on the basis of offers and prices corresponding to increases or decreases in the quantities of electrical energy established in the scheduled dispatch. The UT will determine the market period and the procedure by which the participants will communicate their offers.

Those generators that do not have energy sales contracts will be able to participate in the MRS, considering their delivery.

CHARGES OF TRANSMISSION, SYSTEM OPERATION, ANCILLARY SERVICES, AND OTHER SIMILAR CHARGES SHALL BE REPORTED BY THE GENERATOR TO THE UT SEPARATELY, TO BE SUBSEQUENTLY TRANSFERRED TO THE CONSUMER DIRECTLY AND NO SURCHARGE, ACCORDING TO METHODOLOGY DEFINED IN THE REGULATION OF THIS LAW. (3)

Art. 57.-The deviations of each participant with respect to the scheduled dispatch will be valued at the prices resulting from the operation of the System Regulatory Market, as follows:

a) The distributor, or end user whose consumption differs from the programmed one will be paid or charged at the price of the System Regulatory Market of each node in which it had scheduled consumption;

b) The generator whose plant generates in excess of the programmed will be paid based on the market price System regulator for the node corresponding to that site;

c) The generator whose plant generates below schedule will be charged based on the cost of energy needed to replenish the undelivered power; and,

d) When a plant generates below schedule due to transmission network failures limiting its Delivery capacity to the system, the UT will charge the transmitter responsible for the failure by the value of replacement of the power not delivered by said generator minus the value of the energy delivered to the System Regulatory Market by the plant in question.

The UT will determine each participant's balance sheets and settle the corresponding amounts of agreement to what you have set.

Art. 58.-When congestion is detected in the transmission system, the UT shall create as many MRS as necessary to maintain the safety and stability thereof. The price differences between the MRS mentioned will result in congestion charging.

Art. 59.-The net income that the UT obtains for handling the congestion charges, will be distributed among the users of the system, according to the method established by the SIGET.

Art. 60.-THE PRICES RESULTING FROM THE OPERATION OF THE MRS, AS WELL AS OF ANY OTHER MARKET ORGANIZED BY THE UT WILL BE PUBLIC.

SPECIFICALLY, THE UT WILL HANDLE SEPARATELY FROM THE OPPORTUNITY OFFERS THE OPERATING COSTS OF THE SECTOR, SUCH AS TRANSMISSION CHARGES, SYSTEM OPERATION, ANCILLARY SERVICES AND OTHER SIMILAR ONES, WHICH WILL BE MOVED OUT OF FORM. TRANSPARENT TO THE CONSUMER THROUGH THE TARIFF.

ALSO, AS PART OF THE WHOLESALE MARKET INFORMATION THAT THE UT PUBLISHES ON ITS WEBSITE, IT WILL BE MANDATORY FOR IT TO INCLUDE THE FOLLOWING INFORMATION ON A DAILY BASIS:

(a) THE HOURLY OFFERS SUBMITTED BY THE OPERATORS TO THE MARKET WHOLESALER AS TO ITS COMMERCIAL, ECONOMIC AND TECHNICAL CONDITIONS;

b) THE LEVEL OF THE RESERVOIRS THAT CEL MUST REPORT DAILY TO THE UT;

c) THE PRICES OF FUELS USED FOR GENERATION, POSITIONS IN PLANT THAT THEY MUST BE REPORTED DAILY TO THE UT BY THE THERMAL GENERATORS.

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ALL INFORMATION REFERRED TO IN THIS ARTICLE WILL BE PUBLICLY ACCESSIBLE. (3) (5)

Art. 61.-THE UT SHALL SUBMIT A REPORT ON A QUARTERLY BASIS TO THE SIGET CONTAINING AT LEAST:

(a) PRICES RESULTING FROM THE REGULATORY MARKET OF THE SYSTEM;

(b) THE GENERATION AND CONSUMPTION OF ENERGY FOR EACH NODE IN THE NETWORK;

(c) FAILURES IN GENERATION AND TRANSMISSION SYSTEMS AND UNDELIVERED POWER;

d) THE QUALITY AND SAFETY PARAMETERS ESTABLISHED FOR THE OPERATION OF THE SYSTEM AND THE DEGREE OF COMPLIANCE OF THESE; AND

E) SYSTEM OPERATION, SUCH AS TRANSMISSION CHARGES, SYSTEM OPERATION, ANCILLARY SERVICES, AND OTHER SIMILAR.

THE REPORTS REQUIRED IN THIS ARTICLE, AS WELL AS THOSE REFERRED TO IN ARTICLE 32, SHALL BE PUBLIC, WHICH SHALL BE SUBMITTED WITHIN 15 WORKING DAYS AFTER EACH OF THE PERIODS MENTIONED. (3)

CHAPTER IV OF TRANSMISSION AND DISTRIBUTION CONTRACTS

Art. 62.-Generators connected to the transmission system must be in force at all times, transmission contracts.

The generators or marketers who have signed contracts for the supply of energy to end users shall be required to have at all times current distribution contracts.

Art. 63. In the contracts for transmission and distribution, the charges payable for the construction, extension, modification or replacement of the facilities necessary to carry out the interconnection must be clearly distinguished from the charges payable by the use of the networks.

The charges for the construction, modification, extension or replacement of the facilities shall be established by agreement between the parties, and the charges for the use of the nets shall be established in accordance with the method established by the SIGET.

Transmission and distribution contracts must include compensation for failures in the respective systems. Forced unavailability does not include the maintenance period scheduled by the UT-approved transmitters.

Art. 64.-The transmission and distribution contracts referred to in the preceding articles must be registered with the SIGET and shall be public.

Art. 65.-Generators and marketers may require from the transmitters and distributors the subscription of contracts which in whole or in part are attached to those that have been registered with the SIGET and are in force.

Art. 66.-THE METHOD FOR THE DETERMINATION OF CHARGES FOR THE USE OF TRANSMISSION SYSTEMS SHALL TAKE INTO ACCOUNT THE FOLLOWING:

(a) THE COSTS OF OPERATION, MAINTENANCE AND THE ANNUITY OF THE INVESTMENTS NECESSARY TO BRING TO THE APPROVED EXTENSIONS, IN ACCORDANCE WITH THIS LAW, OF AN EFFICIENTLY SIZED AND OPERATED TRANSMISSION NETWORK;

b) FOR THE CALCULATION OF THE OPERATING AND MAINTENANCE COSTS WILL BE USED TO USE INTERNATIONAL STANDARDS OF EFFICIENCY, CONSIDERING LOCAL AVERAGE COSTS AND MINIMUM LEVELS OF QUALITY SET THE SIGET;

c) THE OPERATING COSTS MUST INCLUDE THE EXPECTED VALUE OF COMPENSATION FOR FAULT

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CORRESPONDING TO AN EFFICIENTLY OPERATED TRANSMISSION NETWORK, AND THIS MUST BE BASED ON HISTORICAL DATA OF WHAT IS ACTUALLY PAID FOR THIS CONCEPT IN THE SALVADORAN SYSTEM;

d) MAINTENANCE COSTS MUST TAKE INTO ACCOUNT THE ANNUITY. OF THE NEW REPLACEMENT VALUE OF THE REQUIRED EQUIPMENT FOR THE EFFICIENT NETWORK MAINTENANCE;

e) IF THE PARTIES HAVE REACHED AN AGREEMENT ON QUALITY LEVELS HIGHER THAN THOSE SET BY THE SIGET, THESE QUALITY LEVELS WILL PREVAIL; AND,

f) THE TRANSMISSION CHARGES WILL BE CALCULATED ON THE BASIS OF THE ENERGY TRANSPORTED IN THE IMMEDIATE YEAR PRIOR TO THAT OF THE CHARGE AND MUST BE EXPRESSED IN A CHARGE PER MEGAWATT-HOUR TO BE COMMUNICATED TO THE UT.

THE ANNUITIES REFERRED TO IN LITERALS (a) AND (d) SHALL BE CALCULATED BY CONSIDERING THE TYPICAL USEFUL LIFE OF THE CORRESPONDING EQUIPMENT AND THE ACTUAL DISCOUNT RATE DEFINED IN THIS LAW FOR THAT PURPOSE. (3)

Art. 67.-THE METHOD FOR THE DETERMINATION OF CHARGES FOR THE USE OF DISTRIBUTION SYSTEMS SHALL TAKE INTO ACCOUNT THE FOLLOWING:

(a) THE CHARGES SHALL BE BASED ON THE CALCULATION OF THE AVERAGE COSTS OF INVESTMENT, OPERATION AND MAINTENANCE OF A NETWORK OF EFFICIENTLY SIZED AND OPERATED DISTRIBUTION. THESE AVERAGE COSTS WILL NOT INCLUDE MARKETING, MARKETING AND OTHER SERVICES COSTS TO THE END USER.

HOW INVESTMENT COST WILL BE USED THE ANNUITY OF THE NEW REPLACEMENT VALUE OF AN EFFICIENT DISTRIBUTION NETWORK SIZED TO THE MARKET. THE ANNUITY SHALL BE CALCULATED BY CONSIDERING THE TYPICAL USEFUL LIFE OF DISTRIBUTION FACILITIES AND THE ACTUAL DISCOUNT RATE DEFINED IN THIS LAW FOR THAT PURPOSE.

HOW OPERATING AND MAINTENANCE COSTS WILL BE USED THE ANNUAL OPERATING COSTS, CONSIDERING LOCAL COSTS AND INTERNATIONAL STANDARDS OF EFFICIENCY, AVERAGE LOSS OF POWER AND ENERGY DISTRIBUTION AND THE EXPECTED VALUE OF THE COMPENSATION FOR FAILURES CORRESPONDING TO AN EFFICIENTLY SIZED AND OPERATED DISTRIBUTION NETWORK, WHOSE COMPENSATION AND ELECTRICAL LOSS LIMITS WILL BE SET BY THE SIGET;

b) CHARGES FOR MEDIUM AND HIGH DEMAND WILL BE CALCULATED ON THE BASIS OF POWER DELIVERED BY VOLTAGE LEVEL, WITHOUT CONSIDERING ENERGY A SUPPLIED. IN THE CASE OF THOSE USERS CORRESPONDING TO THE TARIFF CATEGORY OF SMALL DEMAND, THE DISTRIBUTION CHARGE SHALL BE ESTABLISHED ONLY ON THE BASIS OF THE ENERGY DEMANDED OR CONSUMED;

c) IF THE DISTRIBUTOR HAS RECEIVED SUBSIDIES, GRANTS OR GRANTS FOR THE EXPANSION AND EXPANSION OF YOUR NETWORK, SHOULD BE EXCLUDED FROM THE NEW REPLACEMENT VALUE, THE VALUE OF SUCH CONTRIBUTIONS. THIS ADJUSTMENT SHALL BE MADE ON THE BASIS OF THE TYPICAL LIFE OF THE FACILITIES AND THE DISCOUNT RATE SET OUT IN THIS LAW FOR THIS PURPOSE. (5)

Art. 67 BIS. THE SIGET WILL ESTABLISH THE STANDARDS OF QUALITY OF SERVICE OF THE DISTRIBUTION SYSTEMS, WHICH WILL INCLUDE QUALITY OF SERVICE AND TECHNICAL PRODUCT SUPPLIED, AS WELL AS QUALITY OF THE COMMERCIAL SERVICE.

EVERY DISTRIBUTOR SHALL BE OBLIGED TO:

(a) DISPOSE OF AN AUDITABLE SYSTEM THAT ALLOWS THE ANALYSIS AND TREATMENT OF MEASUREMENTS MADE FOR THE VERIFICATION OF THE QUALITY OF SERVICE, IN ACCORDANCE WITH THE RULES THAT THE SIGET DICTATES;

(b) REPORTING IN THE PERIODS THAT THE SIGET INDICATES IN RESPECT OF THE REQUIREMENTS SET OUT IN THE QUALITY STANDARDS, INDICATING THE NON-COMPLIANCE WITH THE PARAMETERS SET OUT IN THESE STANDARDS; AND

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(c) PAY THEIR USERS THE REGULATED COMPENSATIONS THAT CORRESPOND TO DEFICIENCIES IN THE QUALITY OF SERVICE ESTABLISHED BY THE SIGET.

THE SIGET WILL BE RESPONSIBLE FOR DEFINING THE MEASUREMENT AND CONTROL METHODOLOGY, THE CONTENT AND THE FORM OF INFORMATION EXCHANGE, AND CAN AUDIT THE INFORMATION AND PROCESSES AT THE MOMENT THAT IT DEEMS NECESSARY. (3)

Art. 68.-The actual discount rate to be used for the purposes of this Law in determining the charges for the use of transmission and distribution networks will be ten percent.

CHAPTER V OF THE EXPANSION OF THE NETWORKS TRANSMISSION AND DISTRIBUTION

Art. 69.-THE PLANNING OF THE EXPANSION, THE CONSTRUCTION OF NEW EXTENSIONS AND REINFORCEMENTS OF THE TRANSMISSION NETWORK, AS WELL AS THE MAINTENANCE OF THE AFOREMENTIONED NETWORK, WILL BE IN CHARGE OF THE TRANSMISSION COMPANY RESULTING FROM THE RESTRUCTURING OF CEL.

THE TRANSMISSION COMPANY HAS AN OBLIGATION TO EXPAND THE NATIONAL TRANSMISSION NETWORK, IN ACCORDANCE WITH AN EXPANSION PLAN APPROVED BY THE SIGET TO MEET THE DEMAND GROWTH AND RELIABILITY AND QUALITY OF SERVICE CRITERIA. ADOPTED. TO THIS END, IT MUST PREPARE A FIVE-YEAR INVESTMENT PROGRAMME FOR THE EXPANSION OF THE NETWORK AND PRESENT IT FOR THE APPROVAL OF THE SIGET, WITH THE COMMENTS MADE BY THE UT, AND THE GENERATION AND DISTRIBUTION COMPANIES, WHICH MUST BE REVISED WITHIN THAT PERIOD, IF MARKET CONDITIONS WARRANT IT. (3)

Art. 70.-THE PLANNING OF THE EXPANSION, THE CONSTRUCTION OF NEW EXTENSIONS AND REINFORCEMENTS OF THE TRANSMISSION NETWORK, AS WELL AS THE MAINTENANCE OF THE AFOREMENTIONED NETWORK, WILL BE CARRIED OUT BY THE TRANSMISSION COMPANY RESULTING FROM THE RESTRUCTURING OF CEL.

THE TRANSMISSION COMPANY HAS AN OBLIGATION TO EXPAND THE NATIONAL TRANSMISSION NETWORK, IN ACCORDANCE WITH AN EXPANSION PLAN APPROVED BY THE SIGET TO MEET THE DEMAND GROWTH AND RELIABILITY AND QUALITY OF SERVICE CRITERIA. ADOPTED. TO THIS END, IT MUST PREPARE A FIVE-YEAR INVESTMENT PROGRAMME FOR THE EXPANSION OF THE NETWORK AND PRESENT IT FOR THE APPROVAL OF THE SIGET, WITH THE COMMENTS MADE BY THE UT, AND THE GENERATION AND DISTRIBUTION COMPANIES, WHICH MUST BE REVISED WITHIN THAT PERIOD, IF MARKET CONDITIONS WARRANT IT. (3)

Art. 71.-REPEALED (3)

Art. 72.-REPEALED (3)

Art. 73.-The State may agree with the transmitters or distributors to grant, or through any of its dependencies or institutions, financial resources for the expansion or expansion of their systems in specific areas, in special for the development of rural electrification works.

Art. 74.-Differences related to technical or economic aspects between the parties will be resolved by the SIGET.

CHAPTER VI OF ENERGY SALES TO END USERS

Art. 75.-EVERY END USER SHALL CONTRACT THE SUPPLY OF ELECTRICAL ENERGY WITH A MARKETER.

CONTRACTS SHALL INCLUDE COMPENSATION BY THE UNDELIVERED ENERGY MARKETER IN ACCORDANCE WITH THE FORMS AND CONDITIONS LAID DOWN IN THE REGULATION OF THIS LAW.

THE CLAUSES CONTAINED IN THE CONTRACTS OF ACCESSION OR CONTRACTS FOR THE SUPPLY OF ELECTRICITY PRODUCED BY THE MARKETER OR DISTRIBUTOR ACTING AS A MARKETER SHALL COMPLY WITH THE TERMS AND CONDITIONS OF THE SPECIFICATIONS TARIFFS AND REGULATIONS ESTABLISHED BY THE SIGET, AND MAY BE MODIFIED

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PROVIDED THEY DO NOT UNDERMINE OR PREJUDICE THE INTERESTS OF THE END USER AND THE PROVISIONS OF THE CONSUMER PROTECTION ACT AND ITS REGULATION.

THE MARKETER OR DISTRIBUTOR ACTING AS A MARKETER MAY CONCLUDE CONTRACTS OTHER THAN THE CONTRACTS OF ACCESSION OR CONTRACTS FOR THE SUPPLY OF ELECTRICAL ENERGY, PROVIDED THAT THEY PRECEDE A REAL NEGOTIATION AND WHEN THE CONTRACTS ARE CONCLUDED. AGREED CONDITIONS INCORPORATE GREATER COMMUTATIVE BENEFITS TO THE USER THAN THE CONTENT IN THE TERMS AND CONDITIONS OF THE TARIFF SPECIFICATION.

IN THE FRAMEWORK OF THE OPERATION OF THE NATIONAL CONSUMER PROTECTION SYSTEM, THE SIGET MUST ENSURE THAT THE CONTRACTS OF ACCESSION OR CONTRACTS FOR THE SUPPLY OF ELECTRICAL ENERGY REFERRED TO IN THE PRECEDING POINTS DO NOT CONTRAVENE THE PROVISION IN THE LAW ON CONSUMER PROTECTION. (5)

Art. 76.-In the charging documents for the supply of electrical energy to end users, the charges for the use of the distribution network, the charges for the consumption of electrical energy must be differentiated.

Art. 77. Any contractual provision in which charges for the change of marketer are established shall be unwritten.

Art. 77-A.-THE DISTRIBUTORS SHALL CHARGE CHARGES FOR CONNECTION AND RECONNECTION OF THE SUPPLY OF ELECTRICAL ENERGY, IN ACCORDANCE WITH THE METHOD ESTABLISHED BY SIGET BY AGREEMENT. (5)

Art. 77-B.-ELECTRICAL ENERGY DISTRIBUTORS, COMPANIES ENGAGED IN THE CONSTRUCTION AND DESIGN OF ELECTRICAL POWER DISTRIBUTION FACILITIES AND USERS REQUIRING A CONNECTION AND/OR RECONNECTION OF THE SUPPLY OF ELECTRICAL ENERGY, MUST COMPLY WITH THE PROVISIONS OF THIS LAW, ITS REGULATION AND THE REQUIREMENTS OF THE STANDARDS ISSUED BY THE SIGET. (5)

Art. 77-C.-THE DISTRIBUTOR SHALL BE OBLIGED TO EXPAND ITS DISTRIBUTION LINES UP TO A MAXIMUM DISTANCE OF ONE HUNDRED METERS IN ORDER TO PROVIDE THE ELECTRICAL SERVICE TO THE END USERS WHO REQUEST IT. THE EXTENSION OF THE DISTRIBUTION LINES UP TO THIS DISTANCE WILL BE AT THE EXPENSE OF THE DISTRIBUTOR, AND ONLY THE CONNECTION OF THE SERVICE; THAT IS, THE CONNECTION AND METER, WILL BE AT THE COST OF THE END USERS.

IN CASES WHERE THE DELIVERY POINT IS LOCATED AT A DISTANCE GREATER THAN ONE HUNDRED METRES FROM THE DISTRIBUTOR ' S PREMISES, THE CONSTRUCTION OF THE INFRASTRUCTURE EXCEEDING THAT DISTANCE SHALL BE BORNE BY THE END USER AND THAT IT IS NECESSARY FOR THIS ACCESS TO THE ELECTRIC POWER SERVICE. THE AFOREMENTIONED INFRASTRUCTURE MAY BE DEVELOPED BY THE DISTRIBUTOR, FROM THE END USER, IN ACCORDANCE WITH THE REGULATIONS ESTABLISHED BY THE SIGET.

THE DISTRIBUTOR MUST PROVIDE THE END USER WITH FINANCIAL FACILITIES FOR THE PAYMENT OF THE REQUESTED DISTRIBUTION LINE EXTENSIONS, WHEN THEY ARE RUN ON BEHALF OF THAT END USER, AS WELL AS FOR PAYMENT OF THE COSTS OF CONNECTION AND RECONNECTION OF THE ELECTRICAL SERVICES. IN ANY CASE, THE FINANCING MUST BE UP TO TWELVE MONTHLY, EQUAL AND SUCCESSIVE, INTEREST-FREE QUOTAS. (5)

Art. 78.-Operators of distribution networks operating as marketers in the geographical area where their networks are located must submit annually to the SIGET for approval, a tariff statement containing the prices and conditions of power supply, according to the level of voltage, seasonality and time distribution of the use of the power.

Art. 79.-THE PRICES INCLUDED IN THE TARIFF SHEETS REFERRED TO IN THE PREVIOUS ARTICLE SHALL BE BASED ON:

(A) THE ENERGY PRICES AND CAPACITY CONTAINED IN LONG-TERM CONTRACTS APPROVED BY THE SIGET, ACCORDING TO THE METHODOLOGY THAT IT SHALL BE DEFINED IN A REGULATORY MANNER. THESE CONTRACTS WILL BE PUBLIC AND WILL BE AWARDED THROUGH A FREE COMPETITION PROCESS THAT COMPLIES WITH THE PARAMETERS AND PROCEDURES ESTABLISHED BY THE SIGET. THE DISTRIBUTORS WILL BE REQUIRED TO ENTER INTO LONG-TERM CONTRACTS, TAKING INTO ACCOUNT THE MINIMUM PERCENTAGES OF CONTRACTS SET OUT IN REGULATORY FORM;

b) THE AVERAGE PRICE OF THE ENERGY IN THE MSS ON THE NODE RESPECTIVE, IN ACCORDANCE WITH THE PERIOD LAID DOWN IN THE REGULATION OF THIS LAW;

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(c) THE SPECIFIED DISTRIBUTION CHARGES, IN ACCORDANCE WITH ARTICLE 67 OF THIS LAW;

(d) MARKETING CHARGES. (3) (5)

Art. 80.-THE TARIFF STATEMENT REFERRED TO IN THE PRECEDING ARTICLE SHALL INCLUDE AN AUTOMATIC ADJUSTMENT FORMULA, ESTABLISHED IN ACCORDANCE WITH THE PROVISIONS OF THIS LAW, IN ORDER TO PRESERVE THE REAL VALUE OF THE PRICES.

IN THE CASE OF THE ENERGY PRICE OF THE TARIFF SPECIFICATION, THE AUTOMATIC ADJUSTMENT SHALL BE MADE AT LEAST TWICE A YEAR, IN ACCORDANCE WITH THE PROVISIONS OF THIS LAW. (5)

Art. 81.-Consumers connected to a distribution network may require the distributor concerned to award energy supply contracts in accordance with the tariff specification approved by the SIGET.

Art. 82. NOTWITHSTANDING THE PROVISIONS OF THE FOREGOING ARTICLE, FINAL USERS MAY NEGOTIATE WITH ANY MARKETER, THE PRICES AND CONDITIONS OF THE SUPPLY OF ELECTRICAL ENERGY, OTHER THAN THOSE APPROVED BY THE SIGET, WITHOUT INTERVENTION BY THE SIGET.

END-USERS MAY NEGOTIATE ELECTRICITY SUPPLY CONTRACTS THROUGH THE MECHANISMS ESTABLISHED IN THE PRODUCT AND SERVICES EXCHANGE LEGALLY ESTABLISHED IN THE COUNTRY, TAKING INTO ACCOUNT THE LEGAL PROVISIONS ESTABLISHED IN THE THIS LAW AND THE LAW OF THE BAG OF PRODUCTS AND SERVICES.

THE BAG OF PRODUCTS AND SERVICES WILL REPORT MONTHLY TO THE SIGET OF THE NEGOTIATED CONTRACTS. (5)

Art. 83.-Distributors may make the service cut in the following cases:

a) When they are pending payments of two or more months, related to the supply of electrical energy;

b) At the request of the marketers, when the end user has outstanding payments of two or more months, related to the supply of electrical energy;

c) When electrical energy is consumed without prior authorisation of the operator, or when the user fails to comply with the contractual conditions;

d) When user facilities endanger the security of persons or property, whether they are the property of the operator, user or third party; and,

e) When the user denies the operator's access to the internal facilities he has made for the supply.

CHAPTER VII OF CONFLICT RESOLUTION

SIGET SECTION I

Art. 84.-The SIGET may at the request of a party, administratively resolve the conflicts between operators, between them and the end users, as well as the ones between the operators and the UT.

THE SIGET MUST ESTABLISH TECHNICAL STANDARDS TO REGULATE COMPENSATION FOR ECONOMIC DAMAGE OR EQUIPMENT; ARTIFACTS OR INSTALLATIONS. (3) (5)

Art. 85.-Resolutions which, in the exercise of the powers granted in the preceding article, issue the SIGET, shall accept the review appeal as the last administrative act.

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Art. 86.-The SIGET shall base its resolutions on the reports presented by the appointed expert for the case.

Neither the SIGET nor the expert shall be able to resolve or rule on points where they have not been asked to do so.

Art. 87.-Experts shall take into account the international technical standards of the electrical industry accepted by the SIGET.

Art. 88.-The direct costs of the hiring of the expert in which the SIGET incurs for the resolution of the conflict, will be covered in equal proportion by the parties.

SECTION II OF THE PROCEDURE

Art. 89.-The request to resolve a specific case, the SIGET, shall be received within three working days from the other party, and shall submit to the other party a list of which they shall, by common agreement and within five working days. later, choose the expert that will rule on this.

Art. 90.-There is no agreement regarding the appointment of the expert, after the five working days referred to in the previous article, the SIGET will have one day to make the appointment, which will notify the parties.

Art. 91. Within three working days of the date of notification of the appointment of the expert, the parties shall submit to the SIGET their closing arguments and positions in relation to the matters to be resolved.

Art. 92.-Finished the term indicated in the previous article, the expert shall have sixty days to deliver his opinion to the SIGET.

Art. 93. The parties shall be obliged to permit the examination of the technical and financial information required by the expert or the SIGET.

Art. 94.-Received the expert's opinion, the SIGET will have a period of 15 days to resolve the cases that have been submitted to it.

Art. 95.-In order to resolve the issues related to the interconnection or connection, the SIGET shall take into account the following:

a) For each of the points in dispute, it shall choose the final conditions required by one of the parts. No position other than one of the proposals may be chosen at any time; and,

b) The SIGET must resolve in favour of the final position which is closest to that of the expert. In the case of equidistant positions of the expert opinion, it must be resolved in favour of the applicant for the interconnection or connection.

Art. 96.-The time limit set in this Chapter, the non-existence of a resolution by the SIGET, shall have the following effects:

(a) In technical aspects of interconnection, in favour of the party to which the access; and,

b) In economic aspects, in favor of the party requesting the interconnection or the use of facilities of the other party.

The subsequent resolution of the SIGET or the judicial authorities, will give rise to the compensation corresponding.

Art. 97.-In order to resolve matters relating to charges for the use of the transmission and distribution systems or for the services of the UT, the expert shall use the methodology established by the SIGET and the information provided by the parties. In these cases, the resolution of the SIGET shall establish that the charges that it determines on the basis of the report of the expert shall be applied.

Art. 98.-After the deadline set in this Chapter, the non-existence of a resolution by the SIGET will result in the application of the charges contained in the last contract registered by the operator to whom the services are requested.

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The subsequent resolution of the SIGET or the judicial authorities will result in the corresponding compensation.

CHAPTER VIII OF INTERNATIONAL TRANSACTIONS

Art. 99.-Operators and end-users may conclude contracts for the supply of energy and services with entities located outside the national territory.

Transactions made under such contracts shall be be subject to the provisions of this Law, and coordinate through the agency responsible for dispatch in the country where the said entities are located.

Art. 100.-The costs of dispatch incurred by the UT to carry out the international transactions will be covered by the operators or national end users participating in them, and will be based on the prices of the MRS in the respective node.

Art. 101.-The UT shall establish mechanisms to resolve aspects related to inadvertent disturbances or transfers of electrical energy caused by the interconnected operation with electrical systems of other countries.

Art. 102.-Prior to the conclusion of international interconnection agreements, the opinion of the SIGET shall be heard.

CHAPTER IX OF THE SANTIONS

Art. 103. THE INFRINGEMENTS ARE CLASSIFIED AS SERIOUS AND VERY SERIOUS AND WILL BE SANCTIONED BY THE SIGET.

THE RESPONSIBILITIES ARISING OUT OF THE SANCTIONING PROCEDURE SHALL BE INDEPENDENT OF THE CIVIL OR CRIMINAL LIABILITY WHICH MAY BE CARRIED OUT BY THE SAME ACTS IN ACCORDANCE WITH THE LAWS RESULTING FROM THE APPLICATION. (3)

Art. 104.-SERIOUS INFRACTIONS:

(a) NOT UPDATE THEIR REGISTRATION IN THE RESPECTIVE REGISTRY; (3)

b) CONDUCT STUDIES ON STATE-OWNED PROPERTY WITHOUT SIGET AUTHORIZATION, AIMED AT THE ESTABLISHMENT OF GENERATION OF ELECTRICAL ENERGY; (3)

c) NOT SUBMITTING IN A TIMELY MANNER, THE REPORTS REFERRED TO IN ARTICLES 32 AND 61 OF THIS ACT; (3)

d) NOT ENTERING INTO TIMELY TRANSMISSION AND DISTRIBUTION CONTRACTS; (3)

e) NOT DIFFERENTIATE IN THE CHARGING DOCUMENTS TO THE END USER, THE VARIOUS CHARGES APPLICABLE ACCORDING TO THIS ACT, OR THE FAILURE TO COMPLY WITH SUCH DOCUMENT WITH THE APPLICABLE NORMATIVE PROVISIONS; (3)

F) REFUSE TO MAKE OR DELAY PAYMENT OF THE COSTS INCURRED BY THE SIGET IN THE RESOLUTION OF CONFLICTS; (3)

g) CLASSIFY A USER WITHOUT THEIR EXPRESS CONSENT IN DIFFERENT CATEGORIES TO THAT WHICH CORRESPONDS TO THEM IN ACCORDANCE WITH THE APPLICABLE RULES; (3)

h) CUT THE SERVICE TO THE END USER FOR CAUSES OTHER THAN THOSE ESTABLISHED IN THE LAW; (3)

I) NOT COMPENSATE AN END USER OR THIRD PARTY FOR THE DAMAGES CAUSED BY THE IMPROPER OPERATION OF INSTALLATIONS CONNECTED TO THE POWER SYSTEM AND THE TRANSMISSION AND DISTRIBUTION NETWORK, WITHIN THE APPROPRIATE TIME LIMIT; (3)

j) NOT COMPENSATE FINAL USERS FOR THE ENERGY NOT DELIVERED BY THE SUPPLIERS, AS WELL AS THE LOWER COMPENSATION TO WHICH IT CORRESPONDS; (3)

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k) THE OCCASIONAL AND ISOLATED REFUSAL TO PROVIDE THE SIGET WITH THE INFORMATION REQUESTED TO IT, IN ACCORDANCE WITH THE PROVISIONS OF THIS LAW; (3)

L) TO PROVIDE INFORMATION IN AN INCOMPLETE OR INACCURATE MANNER OR IN A MANNER OTHER THAN THAT OF THE ESTABLISHED, IF THERE IS AN OBLIGATION TO SUPPLY IT; (3)

m) THE NEGATIVE OCCASIONAL OR ISOLATED TO ADMIT VERIFICATIONS AND INSPECTIONS AGREED BY THE SIGET OR THE OBSTRUCTION OF ITS REALIZATION; (3)

N) THE OCCASIONAL IRREGULAR APPLICATION OF THE AUTHORIZED TARIFF SHEETS, IN SUCH A WAY AS TO PRODUCE A ALTERATION IN EXCESS OF THE RESPECTIVE TOTAL INVOICED AMOUNT; (3)

OR) USE ACCOUNTING SYSTEMS FOR THE TRANSMISSION, DISTRIBUTION, WHOLESALE MARKET OPERATION AND OPERATION OF THE ELECTRIC POWER TRANSMISSION SYSTEM, WHICH DO NOT COMPLY WITH THE STANDARDS ISSUED BY THE SIGET; AND (3)

p) THE IRREGULAR APPLICATION AND INTENTIONAL OR NEGLIGENT OF THE QUALITY OF SERVICE STANDARDS ESTABLISHED BY SIGET, SO THAT LESS RELEVANT COMPENSATION IS DETECTED FOR USERS IN AN OCCASIONAL AND ISOLATED FORM, ACCUMULATED IN THE CONTROL PERIOD DEFINED BY SGET. THE FINE MAY BE INCREASED BY UP TO 100% OF THE COMPENSATION AMOUNT ARISING FROM THE DIFFERENCE FOUND, IRRESPECTIVE OF THE OBLIGATION OF THE DISTRIBUTOR TO PAY THE COMPENSATION DUE TO THE USERS. (3)

q) APPLY CHARGES FOR CONNECTION AND RECONNECTION OF THE POWER SUPPLY, WHICH DO NOT COMPLY WITH THE METHOD SET BY SIGET. (5)

Art. 104 Bis.-IN ADDITION TO THE VIOLATIONS APPLICABLE IN THIS LAW, SERIOUS VIOLATIONS OF THE TRANSACTION UNIT SHALL BE CONSIDERED, THE FOLLOWING:

(a) ANY PERFORMANCE OF THEIR PART IN DETERMINING THE EFFECTIVE ORDER OF ENTRY IN OPERATION OF GENERATING FACILITIES THAT RESULT IN AN UNJUSTIFIED ALTERATION IN THE OUTCOME OF THE BIDDING OFFICE, AS WELL AS NOT RESPECTING THE ECONOMIC ORDER OF THE OFFICE WITHOUT JUSTIFIED CAUSE;

b) THE INCURRING OF DELAYS UNJUSTIFIED IN ITS INFORMATION AND OPERATION FUNCTIONS;

c) UNJUSTIFIABLY HIDING THE MARKET INFORMATION AND SYSTEM OPERATION TO MARKET PARTICIPANTS;

d) REPEATED ERRORS OR MANIPULATION OF DATA IN THE CALCULATION OF COMMERCIAL MARKET INFORMATION;

e) REFUSE TO SUPPLY OR ALTER INFORMATION REQUIRED FOR A TECHNICAL FAULT ANALYSIS ON THE TRANSMISSION SYSTEM;

f) PUTTING THE SYSTEM AT RISK WITHOUT JUSTIFIED CAUSE;

g) REPEATED NON-COMPLIANCE WITHIN THE TIME LIMITS LAID DOWN IN THE OPERATING REGULATION FOR THE SUPPLY OF INFORMATION TO MARKET PARTICIPANTS;

h) OPERATING THE POWER SYSTEM OR THE MARKET ELECTRIC POWER WHOLESALER CONTRAVENING THE RULES ISSUED FOR THAT PURPOSE, AND

I) NOT USING THE UNIFORM SYSTEM OF ACCOUNTS APPROVED BY THE SIGET.

ARE VERY SERIOUS VIOLATIONS OF THE TRANSACTION UNIT, AS FOLLOWS, WITHOUT PREJUDICE TO THE OTHERS CONTAINED IN THIS LAW THAT WOULD APPLY:

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(a) UNJUSTIFIABLY ORIENTATE DECISIONS, STUDIES OR RESOLUTIONS IN FAVOUR OF ANY MARKET PARTICIPANT;

b) INTENTIONALLY DISCLOSE MARKET PARTICIPANTS ' OFFERS OF OPPORTUNITY PRIOR TO THE PERIOD SET OUT IN THE OPERATION REGULATION; AND

c) HIDING INFORMATION FROM THE MARKET AND SYSTEM OPERATION TO MARKET PARTICIPANTS. (3)

Art. 105.-THEY ARE VERY SERIOUS INFRACTIONS:

a) EXPLOIT HYDRAULIC OR GEOTHERMAL RESOURCES FOR THE GENERATION OF ELECTRICAL ENERGY WITHOUT BEING GRANTED FOR IT;

b) PERFORM ACTIVITIES OF GENERATION, TRANSMISSION, DISTRIBUTION OR MARKETING ELECTRICAL ENERGY WITHOUT HAVING BEEN ENROLLED IN THE SIGET;

c) NOT UPDATING THE REGISTRATION IN THE RESPECTIVE REGISTRY, WHEN THIS MUST BE DONE BY OPERATORS OF ELECTRICAL POWER GENERATION;

d) NOT TO SEPARATE THE SYSTEMS OF THE ACCOUNTING, WHEN THE SAME ENTITY DEVELOPS DIFFERENT ACTIVITIES IN THE SECTOR;

e) USE ACCOUNTING SYSTEMS FOR THE TRANSMISSION, DISTRIBUTION, WHOLESALE MARKET OPERATION AND OPERATION OF THE ELECTRIC POWER TRANSMISSION SYSTEM, WHICH DO NOT COMPLY WITH THE STANDARDS ISSUED BY THE SIGET;

f) TO DENY, RESTRICT OR DELAY ACCESS TO THE SIGET, AS WELL AS EXPERTS, AUDITORS OR DELEGATES THAT THIS NAME, THE INFORMATION REQUIRED IN ACCORDANCE WITH THIS LAW;

g) NOT COMPENSATE AN OPERATOR OR THIRD PARTY FOR DAMAGES CAUSED BY THE IMPROPER OPERATION OF FACILITIES CONNECTED OR INTERCONNECTED TO THE DISTRIBUTION AND TRANSMISSION NETWORK;

h) REFUSING TO INTERCONNECT TRANSMISSION OR DISTRIBUTION NETWORKS, WITHOUT FAIR CAUSE FOR ELLO;

i) NOT ALLOW THE USE OF TRANSMISSION OR DISTRIBUTION NETWORKS, WITHOUT FAIR CAUSE FOR IT;

(j) INTERCONNECT TRANSMISSION OR DISTRIBUTION FACILITIES WITHOUT AGREEMENT WITH THE NETWORK OWNER;

k) APPLY CHARGES FOR THE USE OF TRANSMISSION AND DISTRIBUTION NETWORKS, AS WELL AS FOR THE OPERATION OF THE WHOLESALE MARKET AND THE TRANSMISSION THAT DOES NOT COMPLY WITH THE METHOD ESTABLISHED BY THE SIGET;

l) DISCONNECT THE PREMISES OF AN OPERATOR WITHOUT JUSTIFIED CAUSE;

m) THE REPEATED REFUSAL TO PROVIDE THE SIGET WITH THE INFORMATION REQUESTED, IF ANY OBLIGATION TO SUPPLY IT;

n) PROVIDE INCOMPLETE OR INACCURATE INFORMATION OR FORM OTHER THAN THAT ESTABLISHED, IF THERE IS AN OBLIGATION TO SUPPLY IT;

OR) THE PROVISION OF FALSE OR UNDULY MANIPULATED DATA;

p) THE REPEATED IRREGULAR APPLICATION OF THE AUTHORIZED TARIFF SHEETS, IN SUCH A WAY AS TO PRODUCE A OVERRIDE OF THE CORRESPONDING TOTAL INVOICED AMOUNT, IN THE PERIOD

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HALF-YEARLY CONTROL PERFORMED BY SIGET; AND

q) THE REPEATED, INTENTIONAL OR NEGLIGENT APPLICATION OF THE QUALITY OF SERVICE STANDARDS ESTABLISHED BY THE SIGET, IN SUCH A WAY AS TO DETECT A MINOR COMPENSATION OF THE DUE TO USERS IN THE CONTROL PERIOD DEFINED BY SIGET. THE FINE MAY BE INCREASED BY UP TO 100% OF THE COMPENSATION AMOUNT ARISING FROM THE ALTERATION FOUND, WITHOUT PREJUDICE TO THE OBLIGATION OF THE DISTRIBUTOR TO PAY THE COMPENSATION DUE TO THE USERS. (3)

Art. 105 BIS.-REPEALED BY D.L. No. 528/04. (3)

Art. 106. SERIOUS INFRINGEMENTS WILL BE SANCTIONED BY THE SIGET WITH A FINE OF UP TO FIFTY THOUSAND COLONES AND THE VERY SERIOUS ONES WITH A FINE OF UP TO FIVE HUNDRED THOUSAND COLONES.

SECOND PARAGRAPH REPEALED BY D.L. No. 528/04

WHEN THERE IS A FIRM RESOLUTION ORDERING OR REFRAINING FROM PERFORMING ANY ACTION, THE INFRINGER DOES NOT COMPLY WITH SUCH AN INDICATION WITHIN THE TIME LIMIT SET FOR THAT PURPOSE, THE SIGET MAY IN SUCH CASES IMPOSE FINES OF UP TO 150 THOUSAND DAILY COLONS, IN ORDER TO COMPEL COMPLIANCE WITH THE RESOLUTION.

FOR DETERMINATION OF THE PENALTIES, THE FOLLOWING SHALL BE TAKEN INTO ACCOUNT:

(a) THE DANGER RESULTING FROM THE VIOLATION FOR THE LIFE AND HEALTH OF THE PERSONS, THE SAFETY OF THINGS AND THE ENVIRONMENT;

b) THE DAMAGE OR DETERIORATION CAUSED;

c) THE DAMAGES PRODUCED IN THE CONTINUITY AND REGULARITY OF THE SUPPLY OF ELECTRICAL ENERGY;

d) THE DEGREE OF PARTICIPATION IN THE ACTION OR OMISSION TYPIFIED AS AN INFRINGEMENT AND THE PROFIT OBTAINED THEREFROM;

e) LA INTENTION IN THE COMMISSION OF THE INFRINGEMENT OR THE REITERATION IN THE MISMLA RECIDIVISM BY COMMISSION IN THE THREE YEARS OF MORE THAN ONE INFRINGEMENT OF THE SAME NATURE, WHERE IT HAS BEEN DECLARED BY FIRM RESOLUTION, AND THE EFFECT ON THIRD PARTIES. (3)

Art. 107. In the event of repeated failure to comply with the provisions of the Law by the Operators, the amount of the fines will be increased by ten percent for the second infringement, and by twenty-five percent for the third infringement.

In case an operator reincites on four opportunities in the same breach, the SIGET, in accordance with the Regulation of this Law, will initiate the process to declare the termination of the concession, or the cancellation of the registration, as the case.

Art. 108.-The SIGET shall penalize with a fine of a Thousand Colones the end user who consumes electric power without authorization of the Operator, or that it does not comply with the contractual conditions, without prejudice to the judicial actions that the Operator can exercise.

Art. 109.-The fines set out in this Chapter shall be enforceable and shall be adjusted annually by the SIGET, taking into account the Consumer Price Index published by the Ministry of Economy. The escalation basis for the calculations will be the last day of the month in which this Law takes effect.

Art. 110.-THE REFUSAL OF THE OFFENDER TO COMPLY WITH THE PROVISIONS OF THIS LAW, AFTER THE ORDER WHICH THE SIGET WOULD HAVE RECEIVED, SHALL BE DEEMED TO BE A DIFFERENT AND QUALIFIED INFRINGEMENT OF A SERIOUS OFFENCE WITHIN THE PERIOD SPECIFIED. AFTER THE DEADLINE FOR THE CESSATION OF THE OFFENDING CONDUCT HAS ELAPSED, NEW FINES MAY BE IMPOSED, SUBJECT TO THE INSTRUCTION OF THE RELEVANT SANCTIONING PROCEDURES. (3)

Art. 111.-SHALL BE PRESCRIBED IN THREE YEARS FROM THE DATE OF THE DECISION, THE FINES NOT

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HAVE BEEN EFFECTIVE.

THIS PERIOD WILL BE INTERRUPTED BY ACTIONS AIMED AT THE ENFORCEMENT OF THE SANCTION. IF THE INFRINGER DOES NOT MAKE THE FINE EFFECTIVE WITHIN THE PRESCRIBED PERIOD, THE SIGET MUST INITIATE THE RESPECTIVE EXECUTIVE PROCESS IN ACCORDANCE WITH THE COMMON RULES. FOR THIS PURPOSE IT WILL SERVE AS EXECUTIVE TITLE THE CERTIFICATION OF THE AGREEMENT ISSUED BY THE SUPERINTENDENT.

THE LIMITATION PERIOD FOR THE PENALTIES SHALL BEGIN TO BE COUNTED FROM THE DAY FOLLOWING THE DAY ON WHICH THE DECISION IMPOSING THE SANCTION BECOMES FINAL.

VERY SERIOUS VIOLATIONS COMMITTED AND NOT SANCTIONED WILL BE PRESCRIBED BY THE FOUR YEARS OF YOUR COMMISSION; THE SERIOUS ONES, AT THREE YEARS.

THE LIMITATION PERIOD FOR INFRINGEMENTS SHALL BEGIN TO BE COUNTED FROM THE DAY ON WHICH THE INFRINGEMENT WAS COMMITTED.

INTERRUPT THE PRESCRIPTION, THE INITIATION WITH KNOWLEDGE OF THE PERSON CONCERNED OF THE SANCTIONING PROCEDURE, RESUMING THE LIMITATION PERIOD IF THE SANCTIONING FILE WILL BE PARALYZED FOR CAUSE NOT IMPUTABLE TO THE PRESUMED RESPONSIBLE. (3)

Art. 112.-FOR THE IMPOSITION OF SANCTIONS PROVIDED FOR IN THIS LAW, THE SIGET SHALL FOLLOW THE APPROPRIATE PROCEDURE BY APPLYING THE FOLLOWING PRINCIPLES:

IN NO CASE MAY A SANCTION BE IMPOSED WITHOUT THE PROCEDURE BEING PROCESSED PREVIOUSLY ESTABLISHED;

THE ALLEGED INFRINGER SHALL BE GUARANTEED THE RIGHT TO BE NOTIFIED OF THE FACTS THAT ARE IMPUTED TO HIM, OF THE OFFENCES THAT SUCH ACTS MAY CONSTITUTE AND OF THE SANCTIONS THAT MAY BE IMPOSED ON THEM;

THE SANCTIONING PROCEDURE MUST GUARANTEE AN ADEQUATE RIGHT OF DEFENSE AND REASONABLENESS OF ALL ACTS THAT ARE PASSED IN THE COURSE OF THE PROCEDURE;

THE ALLEGED INFRINGER MAY BE ABLE TO KNOW THE STATE OF THE PROCESSING OF THE PROCEDURE IN WHICH HE HAS THE CONDITION OF BEING CHARGED, AND WILL BE ALLOWED TO OBTAIN COPIES OF DOCUMENTS. CONTENT IN THEM;

THE RESOLUTION TERMINATING THE PROCEDURE SHALL BE MOTIVATED AND SHALL RESOLVE ALL THE QUESTIONS RAISED IN THE FILE; AND

IN THE RESOLUTION, FACTS OTHER THAN THOSE DETERMINED SHALL NOT BE ACCEPTED TESTED IN THE COURSE OF THE PROCEDURE, IRRESPECTIVE OF THEIR DIFFERENT LEGAL ASSESSMENT.

THE RESOLUTION SHALL, WHERE APPROPRIATE, ADOPT THE PRECAUTIONARY MEASURES NECESSARY TO ENSURE ITS EFFECTIVENESS, AS LONG AS IT IS NOT ENFORCEABLE.

THE DIRECT COSTS OF HIRING EXPERTS OR AUDITORS IN WHICH THE SIGET INCURS FOR THE INSTRUCTION OF THE FILE WILL BE COVERED BY THE INFRINGER, PROVIDED THAT IT IS SANCTIONED BY FIRM RESOLUTION. (2) (3)

Art. 112-A.-FOR THE IMPOSITION OF THE PENALTIES FOR VIOLATIONS OF THIS LAW, THE SUPERINTENDENT SHALL ORDER THE INSTRUCTION OF THE RESPECTIVE FILE BY REASONED RESOLUTION WHICH SHALL CONTAIN THE DESCRIPTION OF THE SANCTIONABLE CONDUCT, THE IDENTIFICATION OF THE ALLEGED INFRINGER AND THE RELATIONSHIP OF THE EVIDENCE TO WHICH IT IS COUNTED TO DETERMINE THE CORRESPONDING RESPONSIBILITY. (3)

Art. 112 -B.-THE DECISION INITIATING THE PROCEDURE REFERRED TO IN THE PRECEDING ARTICLE SHALL BE NOTIFIED TO THE ALLEGED INFRINGER, WHO SHALL, WITHIN THREE DAYS OF SUCH NOTIFICATION, EXPRESS HIS INCONFORMITY WITH THE FACTS. ATTRIBUTED, PRESENTING THE APPROPRIATE DISCLAIMER OR

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REQUESTING VERIFICATION OF THE SAME. (3)

Art. 112-C.-AS EXPRESSED BY THE ALLEGED INFRINGER, THE PROCEDURE FOR THE EIGHT-DAY TERM, IN WHICH THOSE REQUESTED BY THE ALLEGED INFRINGER, MUST BE PRODUCED, SHALL BE OPENED FOR EVIDENCE. AFTER THAT PERIOD, THE APPROPRIATE RESOLUTION SHALL BE DELIVERED. (3)

Art. 112-D.-THE RESOLUTION BY MEANS OF WHICH A SANCTION IS IMPOSED, WILL ADMIT THE APPEAL OF APPEAL TO THE BOARD OF DIRECTORS OF THE SIGET. (3)

Art. 112-E.-IN THE ABSENCE OF CONDITIONS GUARANTEEING COMPETITION IN THE PRICES OFFERED TO THE MSS, THE UT WILL BE GOVERNED BY AN INTERNAL REGULATION WHICH WILL ENCOURAGE THE CONDUCT OF OFFERS WHICH RESEMBLE A COMPETITIVE MARKET, ACCORDING TO THE ESTABLISHED METHODOLOGY. IN THIS LAW, THE LAW WILL BE BASED ON MARGINAL COSTS OF PRODUCTION, FIXED COSTS AND INVESTMENT COSTS. IN THE CASE OF HYDROELECTRIC POWER PLANTS SHALL BE BASED ON THE WATER REPLACEMENT VALUE. FOR SUCH PURPOSES, THE MARKET CONDITION SHALL BE ESTABLISHED BY THE GENERAL SUPERINTENDENT OF ELECTRICITY AND TELECOMMUNICATIONS AND THE SUPERINTENDENT OF COMPETITION JOINTLY, BY MEANS OF AN AGREEMENT BASED ON TECHNICAL INDICES INTERNATIONALLY ACCEPTED TO MEASURE COMPETITION IN ELECTRICAL MARKETS. (3) (4)

CHAPTER X TRANSIENT PROVISIONS

Art. 113.-Within 60 days from the date of validity of this Law, the holders of concessions to exploit geothermal or hydraulic resources shall request the SIGET to modify them, with the the purpose of adapting them to this Law.

The SIGET must grant concession for generating electric power with hydraulic resources, to the entities that to the date of entry into force of this Law carry out such activities without grant.

Art. 114.-Within sixty days of the entry into force of this Law, operators who perform activities of generating, transmitting and distributing electrical energy shall request the SIGET to register corresponding.

Art. 115.-Within two hundred and ten days from the entry into force of this Law, operators of generation, transmission and distribution facilities shall subscribe to the respective transmission and distribution contracts. and register them in the Register which for the purposes will carry the SIGET.

Art. 116. In the period of two hundred and seventy days from the entry into force of this Law, the traders shall subscribe to the respective supply contracts with their end users. Upon completion of this period, the marketer may suspend the service, with the exception of the consumers referred to in Article 122.

Art. 117.-As long as the CEL is the owner, any title, the transmission network and more than fifty percent of the installed capacity of generation, the UT will be governed by a transitional internal regulation that guarantees the existence of mechanisms transparent and equitable for decision making related to the operation of the system.

Art. 118.-As long as the UT does not perform its normal operations, the dispatch will be performed by the Operations Center of the CEL System, according to the method of the marginal costs of operation, with the participation of representatives of the existing operators.

Art. 119. Within the period of three years following the validity of this Law, the CEL shall be restructured to the effect that the maintenance activities of the system of transmission and operation of the power system are carried out by entities

The UT must be constituted within the year after the date of entry into force of this Law.

To the companies that constitute CEL as a result of its restructuring, will not be applicable to the legal provisions on constitution of companies for shares of mixed economy.

Art. 120.-The companies resulting from the restructuring of the CEL and which have as their normal operations, the

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operation of the premises of the aforementioned institution, must receive from the SIGET the respective concessions when it is the case, within ninety days after the date of its constitution.

Art. 121.-Distributors may use networks other than their own or other distributors to deliver electrical energy, but in such cases, the costs of maintaining such facilities shall be borne by the users.

Art. 122.-The SIGET is empowered to establish, during the eighteen months following the validity of this Law, maximum prices and conditions for the supply of electrical energy to end users of the residential sector with an average monthly consumption of less than five hundred kilowatt hours.

After that period, maximum prices and conditions will be established for electrical energy supplies to end users of the residential sector with a consumption monthly average less than two hundred kilowatt hours, over the following eighteen months.

Art. 122 A. IN THE TERM OF SIXTY DAYS AFTER THE ENTRY INTO FORCE OF THIS LAW, THE UUT SHALL SUBMIT THE NECESSARY MODIFICATIONS TO ITS SOCIAL PACT AND REGULATION OF OPERATION OF THE TRANSMISSION SYSTEM AND THE WHOLESALE MARKET, REFLECTING THE CHANGES. ESTABLISHED IN THIS LAW FOR APPROVAL BY THE SIGET. IN ADDITION, IT WILL HAVE TO AGREE ON AN INCREASE IN CAPITAL IN ORDER TO INCORPORATE NEW MARKET PARTICIPANTS, THROUGH ITS INCOME AS SHAREHOLDERS TO THE COMPANY. (3)

Art. 122-B.-FOR THE PURPOSES OF ARTICLE 67A (C) OF THIS LAW, THE GRADUAL PROCESS WHICH CORRESPONDS BASICALLY TO THE TIME REQUIRED TO FILL THE QUALITY REQUIREMENTS WHICH ARE DULY REGULATED BY THE COMPLIANCE WITH THE METHODOLOGY ESTABLISHED BY THE SIGET. (3)

Art. 122-C.-THE FIRST EXPANSION PLAN OF THE TRANSMISSION SYSTEM REFERRED TO IN ARTICLE 69 OF THIS LAW, SHALL BE SUBMITTED TO THE SIGET FOR APPROVAL, SIX MONTHS AFTER THE ENTRY INTO FORCE OF THIS DECREE. (3)

CHAPTER XI FINAL PROVISIONS

Art. 123.-The time limits contained in this Law that refer to the actions of the SIGET are unextendable.

Art. 124. Within one hundred and eighty days after the date of entry into force of this Law, the President of the Republic shall issue the regulations necessary for its implementation.

Art. 125.-Where there is a discrepancy, the provisions of this Law shall prevail over the provisions of the Law of CEL and any other than the law.

Art. 126.-Repeal the Decrees indicated below:

a) Legislative Decree No. 177 of 31 December 1935, published in the Official Journal No. 4, Volume 120 of 6 January 1936, and its amendments;

b) Legislative Decree No. 8 of May 27, 1941, published in Official Journal No. 122, Volume 130 of June 4, 1941, and its modifications;

c) Legislative Decree No. 109 of September 7, 1946, published in Official Journal No. 209, Volume 141 of September 1946, and its modifications.

Art. 127.-This Law will enter into force eight days after its publication in the Official Journal.

GIVEN IN THE BLUE HALL OF THE LEGISLATIVE PALACE, San Salvador, ten days of the month of October of a thousand nine hundred and ninety-six.

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MERCEDES GLORIA SALGUERO GROSS PRESIDENT

ANA GUADALUPE MARTÍNEZ MENÉNDEZ ALFONSO ARISTIDES ALVARENGA VICE-PRESIDENT

JOSÉ RAFAEL MACHUCA ZELAYA JULIO ANTONIO GAMERO QUINTANILLA VICE-PRESIDENT

JOSÉ EDUARDO SANCHO CASTANEDA GUSTAVO ROGELIO SALINAS OLMEDO SECRETARY SECRETARY

CARMEN ELENA CALDERÓN DE ESCALA WALTER RENE ARAUJO MORALES SECRETARY

RENÉ MARIO FIGUEROA FIGUEROA SECRETARY

CASA PRESIDENTIAL: San Salvador, at the twenty-one day of the month of October a thousand nine hundred and ninety-six. PUBESQUIESE,

ARMANDO CALDERÓN SOL, President of the Republic.

EDUARDO ZABLAH TOUCHE, Minister of Economy.

D.O. Nº 201 TOMO Nº 333 DATE: 25 October 1996

REFORMS:

(1) D.L. Nº 176, 4 DECEMBER DE 1997; D.O. NO 239, T. 337, 22 DECEMBER 1997.

(2) D.L. Nº 355, JULY 9, 1998; D.O. NO. 142, T. 340, JULY 29, 1998.

(3) D.L. Nº 1216, APRIL 11, 2003; D.O. NO 83, T. 359, MAY 9, 2003.

(4) D.L. No. 1018, MARCH 30, 2006; D.O. No. 84, T. 371, MAY 9, 2006.

(5) D.L. No. 405, AUGUST 30, 2007; D.O. No. 181, T. 377, OCTOBER 1, 2007.

(6) D.L. No. 732, OCTOBER 22, 2008; D.O. No. 211, T. 381, NOVEMBER 10, 2008.

PARTIAL REPEAL:

D.L. NO 528, NOVEMBER 25, 2004; D.O. No. 240, T. 365, DECEMBER 23, 2004.

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CGC 1/12/08

UNCONSTITUTIONALITY:

THE COURTROOM OF THE CONSTITUTIONALITY OF THE SUPREME COURT OF JUSTICE, BY RESOLUTION 28-2008, DATED 27-06-2012, DECLARED AS UNCONSTITUTIONAL BY ARTS. 5 AND 12 OF THIS LAW, BECAUSE ONLY THE LEGISLATIVE ASSEMBLY HAS THE POWER TO CONCESSION AND THESE DO NOT THEY MUST BE PERMANENT, VIOLATING THE ARTS. 86 INC. 1ST, 103 INC. 3RD, 120 INCS. 1ST AND 2ND, AND 131 ORD. 30º CN. (ROM/ 08/08/12)