Chapter I

General Provisions

Purpose of the Law

Article 1 - The purpose of this Law is to establish a legal framework that provides clear legal certainty for the transfer of ownership of any digital asset used in public offerings conducted within El Salvador; to regulate the requirements and obligations of issuers, digital asset service providers, and other participants in public offerings; to promote the effective development of the digital asset market; and to protect the interests of purchasers.

Scope of Application

Article 2 - This Law applies to public offering activities of digital assets within El Salvador, as well as to the issuers of digital assets, digital asset service providers, and other participants in public offerings.

Digital Assets

Article 3 - A digital asset is a digital representation that can be stored and transferred electronically, using a distributed ledger system or similar technology, which encrypts and interconnects records in the system to protect the security and privacy of transactions.

As an essential characteristic, digital assets can be owned, exchanged, transferred, traded, and promoted by natural and legal persons.
Digital assets are not securities; therefore, the provisions regarding securities in the Commercial Code, the Securities Market Law, the Electronic Securities Law, the Electronic Securities Registry Law, or the Investment Law shall not apply to digital assets.

Exclusions

Article 4 - The provisions of this Law shall not apply to:
a) Digital currencies issued by the central bank of any country, jurisdiction, or region; b) Digital assets regulated under the standard of legal tender by any country, region, or jurisdiction for the exchange of goods and services, pursuant to laws prior or subsequent to this Law; goods classified as digital assets and services stipulated in Articles 19 and 26 of this Law are excepted; c) Digital assets that can only be used to exchange goods or services provided by the issuer of such digital asset or by part of the provider of such goods or services; and d) Digital assets that cannot be traded or exchanged.

Definitions

Article 5 - The terms used in this Law are defined as follows:
a) Reference Asset: An asset, such as fiat currency, intangible assets, or stable currency, that serves as the basis or reference for determining the price or value of a digital asset; b) Digital Wallet: An electronic device or mobile application used for transactions by exchanging digital assets and demand deposits; the English name is "electronic wallet"; c) Certifying Unit: A legal entity that performs financial, legal, technical, and administrative analysis of the important and relevant information contained in the Information Document regarding a public offering, issuing and submitting to the National Digital Asset Committee a report on the issuer's compliance with formal and substantive obligations; d) Smart Contract: A computer program that uses distributed registry technology or similar technology to activate when certain predetermined conditions are met; typically used to automate agreements, allowing parties to the agreement to obtain determined results without intermediaries. According to the agreement reached, this scheme can be executed automatically, judicially, or comprehensively; e) Stable Currency: A type of digital asset designed to minimize price fluctuations, providing a reference for, representing, or being endorsed by an asset or a basket of assets; f) Derivative Digital Asset: A contract that uses a certain digital asset as its underlying digital asset or is paid in digital assets, such as futures contracts, options, and swaps; g) Underlying Digital Asset: A digital asset that serves as the basis or reference for determining the price or value of a derivative digital asset; h) Demand Deposit: A currency represented by a book entry, usually held in a bank deposit account; i) Information Document: A document that informs the public of the most relevant information regarding any public offering of digital assets, such as clearly identifying the issuer, the characteristics, and the purpose of the issuance. This document shall indicate whether the interest, yield, income, or rate of return of the public offering is paid in demand deposits or in digital assets; j) Issuer: Refers to the State, natural or legal persons, private or public, who implement or promote the public issuance of digital assets to the public, or seek admission of digital assets for sale or trading on state-owned or private exchanges or trading platforms, and meet at least one of the following three conditions:

1. Reside in El Salvador.
2. Do not reside in El Salvador but use an exchange or trading platform located in El Salvador.
3. Do not reside in El Salvador but intend to advertise or publicly offer digital assets to potential purchasers in El Salvador, except where potential purchasers establish a commercial relationship with the issuer of the aforementioned digital assets in a personal capacity.
   If a digital asset service provider allows the trading of digital assets on its trading platform, the provider does not become an issuer by accepting such trading. k) Public Offering of Digital Assets: A technical or commercial proposal made on a large scale to the public, with the purpose of marketing or selling digital assets; l) Debt Public Offering: A type of public offering of digital assets that establishes credit for the issuer or another entity for the purchasers; m) Ownership Public Offering: A type of public offering of digital assets that establishes ownership in favor of the purchasers in the issuer or another entity; n) Income Public Offering: A type of public offering of digital assets that establishes the right of purchasers to receive income or cash flow of any nature, including yields, profits, or return distributions, in legal tender or digital assets; o) Funds: Economic resources obtained from banknotes and coins, demand deposits, electronic money, and digital assets; p) Market Integrity: Fair, efficient, and transparent market access in terms of price information, marketing practices, and disclosure standards; q) LRU or Uniform Resource Locator (URL): A string of characters that assigns a unique address to each available information resource on the Internet; r) Primary Market: The trading market where issuers and purchasers participate in the public offering of digital assets through state-owned or private platforms, participating in the purchase and sale of the aforementioned digital assets when they are first offered to the public (whether or not regulated); s) Secondary Market: The market where purchasers or their representatives conduct second or multiple transactions of digital assets without the participation of the issuer; t) Node: A physical or virtual intersection, junction, or connection point where several interconnected pieces of information converge, containing a general sequence of instructions acting on a digital or computer system. u) Digital Platform: Digital infrastructure that allows two or more purchasers to interact, enabling the exchange of digital assets with other digital assets or legal tender. v) Digital Asset Service Provider: A natural or legal person whose daily business involves providing one or more digital asset services detailed in Article 19 of this Law, and meeting one of the following two conditions:
4. Resides in El Salvador.
5. Does not reside in El Salvador but actively promotes or markets services to potential clients in the country.
   w) Digital Asset Services: Services detailed in Article 19 of this Law. x) Rules for Public Offering of Digital Assets: Laws, regulations, directives, technical standards, guidelines, and any regulations issued by the competent authorities regarding the public offering of digital assets; y) Distributed Ledger Technology: A database system that records, shares, and synchronizes information in a multi-node network in a consensual manner, where most copies in the database are equally authentic; z) Token: A type of digital asset, based on distributed record technology or similar technology, used in the network as an account unit. The regulations of this Law may establish additional terms for the better operation of the digital asset market.

Chapter II

National Digital Asset Committee

Establishment and Address

Article 6 - The National Digital Asset Committee, hereinafter referred to as the "Committee," is hereby established as a public law entity with legal personality and its own assets, of a technical nature, with economic, financial, and administrative autonomy, to exercise the powers and duties stipulated in this Law and other applicable general legislation. The National Digital Asset Committee links with the executive branch through the Ministry of Economy. The Committee's headquarters shall be in the city of San Salvador, and it has the right to establish offices anywhere in the national territory and abroad.

Institutional Body

Article 7 - The National Digital Asset Committee is responsible for executing the regulations described in this Law, its regulations, and other rules for the public offering of digital assets.
In activities related to the public offering of digital assets, the Committee must assess the rights of digital asset purchasers and the public, the promotion of innovation, and product competitiveness.

Protection of Digital Asset Purchasers

Article 8 - The National Digital Asset Committee shall verify that the public offering of digital assets fulfills applicable obligations, ensuring market integrity and providing sufficient information to purchasers.

Powers of the Committee

Article 9 - The Committee has the following powers:
a) To promote and strengthen conditions favorable to the development of the digital asset market in El Salvador; b) To process the approval of public offerings and any other applications submitted to the Committee; to authorize, suspend, or cancel public offerings that violate the provisions of this Law and its regulations; c) To manage and continuously update the registry of issuers, certifying units, digital asset service providers, and public offerings of digital assets; d) To authorize, suspend, revoke, and cancel the registration of digital asset service providers, and to suspend the negotiation and operation of digital assets, in accordance with this Law and its regulations; e) To establish protection mechanisms for digital assets in public offerings; f) To authorize, suspend, revoke, and cancel the registration of validators; g) To register and deregister issuers in the corresponding registry; h) To suspend the sale or marketing of digital assets by an issuer if the issuer commits any breach; i) To establish rules of good commercial conduct and ethical standards for digital asset service providers to follow, with sanctions for violations; j) To certify the Information Document without the authorization of a certifying unit; k) To inspect, supervise, and monitor the activities of digital asset service providers and any other units under the supervision of this Committee; l) To ensure that digital asset service providers, certifying units, issuers, and purchasers comply with this Law and its regulations; m) To carry out inspections, procedures, and investigations stipulated in the regulations of this Law; n) To implement the penalties stipulated in this Law; o) To issue technical specifications and standards, as well as guidelines and directives, applicable to this Law and its regulations; p) To issue, modify, and revoke agreements, guidelines, and directives regarding the application of this Law and its regulations; q) To issue guidelines and technical guidelines applicable to stable currency, including proof of funds or endorsement of the value of such currency, and all relevant documents that issuers of such digital assets must submit to the Committee for public offering; r) To coordinate consensus agreements between parties within the scope of this Law in cases where there is a risk to market integrity in the digital asset market; s) To obtain and provide goods and services in any name necessary to achieve its goals, according to applicable rules; t) To issue internal regulations establishing the organizational structure; u) To charge fees for the registration, management, and certification documents of digital asset service providers and certifying units; v) To charge fees for the authorization of public offerings and the certification stipulated in this Law.

Organization and Operation

Article 10 - The highest authority of the Committee is the Board of Directors, composed as follows:
a) One full-time official member (the Chairman of the Committee) and one deputy, appointed by the President of the Republic; b) One full-time official member and one deputy, appointed by the Secretariat of Trade and Investment of the Republic; c) One full-time official member and one deputy, appointed by the Ministry of Economy. The term of office for the aforementioned members is five years. The Chairman of the Committee may decide to exercise legal, judicial, and extra-judicial representation powers. The Chairman of the Committee shall convene and preside over at least one Board of Directors meeting per month. The Chairman of the Committee or the deputy acting in their place must attend the meeting, and all members of the Board of Directors or their deputies acting in their place must also attend. Resolutions or agreements of the Board of Directors of the Committee shall be passed with at least two votes in favor among the members present. When deputies do not act in the place of members, they may attend the meeting without voting rights.

Powers of the Board

Article 11 - The Board of Directors has the following powers:
a) To approve strategies to promote digital asset investment in accordance with government policy; b) To approve and modify the Committee's work plan and financial scheme; c) To approve the preliminary budget draft for the Committee's administration, operation, and salary payment for each fiscal year, and send it to the Ministry of Economy to be fully incorporated into the Ministry's overall budget; d) To approve the Committee's operational organizational structure and job description manual, weighing the appropriateness of the aforementioned jobs in the operation of the Board; e) To establish an advisory committee composed of digital asset advisors and trainers; f) To authorize the hiring of external auditors; g) To authorize the Chairman of the Board to initiate preliminary donation negotiations according to legal norms to achieve the Committee's relevant goals; h) To approve the payment amounts for services provided by the Committee; i) To approve the Committee's internal work regulations and other applicable internal regulations; j) To evaluate the results achieved and readjust strategies if necessary; k) To sign deeds, agreements, and contracts with natural or legal persons, state or foreign public or private entities; l) To establish limited liability companies, mixed-economy companies, or any other type of company to achieve investments favorable to the Committee; m) To issue special regulations on technical and operational matters; n) To exercise any other powers necessary to achieve the purposes of the Committee within the framework of this Law.

Fees and Charges

Article 12 - The registration fees for the registry of digital asset service providers, management services, and public offering license processing fees are as follows:

1. Digital asset service providers and certifying units must:
   a) Pay an initial registration fee equivalent to fifteen times the minimum wage of the commercial and service sector; b) Pay an annual registration renewal fee equivalent to ten times the minimum wage of the commercial and service sector in the first quarter of each year; c) Pay fifty dollars, or the equivalent in Bitcoin, for each additional registration certificate other than the original.
2. Issuers must:
   a) Pay an amount equivalent to zero point zero one percent (0.01%) of the total amount of the public offering upon obtaining authorization for the public offering, as stipulated in the Information Document; b) Pay fifty dollars, or the equivalent in Bitcoin, for each license certificate of the issuance authorization. Stable currency issuers must report the amount of stable currency planned to be issued in the next twelve months and pay the corresponding fees for that amount. If, at the end of twelve months, the issuance volume is greater than the planned volume, the issuer must pay the fees corresponding to the stable currency exceeding the original plan. The State, the Treasury, the Central Reserve Bank of El Salvador, and autonomous institutions are exempt from the fees and charges stipulated in this Article. Additionally, the Committee may charge corresponding fees for the services it provides to digital asset service providers, issuers, certifying units, purchasers, and any type of information consultant.

Chapter III

Bitcoin Fund Management Agency

Article 13 - The Bitcoin Fund Management Agency, hereinafter referred to as "AAB" (acronym of the Spanish full name) or "the Agency," is hereby established as a public law entity with legal personality and its own assets, with economic, financial, and administrative autonomy, to exercise the powers and duties stipulated in this Law and other applicable common legislation. The AAB links with the executive branch through the Ministry of Economy. The AAB's headquarters shall be in the city of San Salvador, and it has the right to establish offices anywhere in the national territory and abroad.

Institutional Body

Article 14 - The Bitcoin Fund Management Agency is responsible for managing, safeguarding, and investing: i) the funds of digital assets publicly issued by the State of El Salvador and its autonomous institutions, and ii) the proceeds from such public offerings. In activities related to the public offering of digital assets, the AAB shall prioritize investments in public works and projects.

Institutional Organization

Article 15 - The AAB is managed by an Administrator appointed by the President of the Republic for a term of five years, serving as the legal, judicial, and extra-judicial representative of the Agency.

Powers

Article 16 - The AAB has the following powers:
a) To manage and safeguard the funds of public offerings issued by the State of El Salvador or any of its autonomous institutions; b) To continuously invest the funds of public offerings issued by the State or any of its autonomous institutions; c) To prioritize the investment of funds it manages in public works and projects that benefit the entire population; d) To charge a maximum commission of zero point five percent (0.5%) on its invested and managed funds; e) To issue internal regulations establishing the organizational structure; f) To supervise and control the units in which it invests; g) To carry out necessary direct hiring according to the procedures stipulated in Chapter V, Section 4 of the Public Administration Procurement and Contracting Law to conduct business; h) To sign cooperation agreements with autonomous institutions and other units related to public offerings. The AAB shall open bank accounts or crypto accounts to receive, safeguard, store, and withdraw the funds of public offerings of digital assets issued by the State or any of its autonomous institutions.

Obligations

Article 17 - The AAB has the following obligations:
a) To maintain transparency and honesty in the management of relevant funds; b) To publicly report the management of invested funds quarterly; c) To diligently evaluate the projects it plans to invest in; d) To ensure that stocks and debt securities have the lowest possible risk when investing in them; e) To continuously analyze new investment opportunities for the funds it manages; f) Any other obligations stipulated in this Law.

Chapter IV

Digital Asset Service Providers

Registration of Digital Asset Service Providers

Article 18 - A registry for digital asset service providers is hereby established, hereinafter referred to as the "Registry," managed by the National Digital Asset Committee.
The registration of digital service providers shall comply with the following provisions:
a) Digital asset service providers regulated by this Law must register with the National Digital Asset Committee of El Salvador before providing digital asset services; b) Digital asset service providers providing digital asset services before the regulations of the Digital Asset Service Providers Registry take effect are subject to the provisions of Article 45 of this Law; c) Natural persons must present their unique identification document or resident card upon registration. Additionally, they must provide their address in El Salvador; d) Legal persons must present their legal qualification. Foreign legal persons registered in other countries, jurisdictions, or territories must establish a limited liability company or branch located in El Salvador, formally registered in the National Registry Center, and submit the legal qualification of such company or branch to the Committee. Other provisions regarding the organization and operation of the registry, such as procedures and formats for registration, modification, or cancellation, are detailed in other corresponding regulations of this Law. The aforementioned provisions shall be comprehensive and match the nature, scale, and complexity of the services provided by the applicant, as well as the nature of digital assets and their derivative digital assets.

Digital Asset Services

Article 19 - Digital asset service providers may carry out the following activities:
a) Exchange digital assets into legal tender or equivalents, or into other currencies, using own capital or third-party capital; b) Operate platforms for exchanging or trading digital assets or derivative digital assets; c) Assess the risk, pricing, and ordering of digital asset issuances; d) Place digital assets on digital platforms or in electronic wallets; e) Promote, structure, and manage all types of investment products in digital assets; f) When the following actions are carried out in the name of a third party and for the benefit of the third party:

1. Transfer digital assets or means of access to or control of these assets between natural or legal persons or among different purchasers, electronic wallets, or digital asset accounts;
2. Preserve, protect, or manage digital assets, or preserve, protect, or manage the means of access to or control of the aforementioned digital assets;
3. Receive and transmit orders for the purchase or sale of digital assets or derivative digital assets;
4. Execute orders for the purchase or sale of derivative digital assets.
   The National Digital Asset Committee may establish procedures and determine the necessary forms to implement the aforementioned services in the optimal manner through technical and operational regulations, directives, and guidelines.

Requirements for Digital Asset Service Providers

Article 20 - The requirements for registering as a digital asset service provider are as follows:
a) Proof of ability to provide the digital services described in the registry; b) If providing the services stipulated in letters a), b), d), and f) of the previous article, submit a list of digital assets planned to be sold or marketed, including the profits, restrictions, and limits of such digital assets, and any type of financial and commercial restrictions. Additionally, appropriate cybersecurity standards stipulated by the Committee must be adopted on the platform to complete the relevant operation; c) Provide detailed information on the organizational structure, including but not limited to names, positions, and specific functions; d) Prove the existence of a coherent and efficient user service system matching the nature of the services to be provided; e) Registered service providers, regardless of the initial registration date, must pay the annual fee to renew the registration in the first quarter of each year in the amount stipulated by this Law. If the renewal is not paid on time, the registration will be canceled. The Committee shall determine the technical, financial, and commercial parameters that service providers must comply with through the regulations of this Law. When a digital asset service provider submits the information required by this Law and corresponding regulations in the application format prescribed by the Committee, the Committee shall decide to approve or reject the registration application within twenty (20) working days. If the application has omissions, the Committee will notify the applicant and order them to complete it within five working days. The Committee will issue its decision after receiving the missing information. If the applicant fails to submit complete information, the Committee will reject the application, and the service provider may resubmit the registration application. If the application is approved, the service provider must pay the fees stipulated in this Law. After verifying compliance with requirements and payment of corresponding fees, a registration number will be issued. Registered service providers, regardless of the initial registration date, must pay the annual fee to renew the registration in the first quarter of each year in the amount stipulated by this Law. If the renewal is not paid on time, the registration will be canceled.

Obligations of Digital Asset Service Providers

Article 21 - Digital asset service providers shall comply with the following obligations:
a) Register as a digital asset service provider in the corresponding registry; b) Conduct activities in good faith and honesty in accordance with the code of good commercial conduct and ethical standards established by the National Digital Asset Committee; c) Give due attention to the interests and needs of each client and communicate in a clear, fair, equal, and non-deceptive manner according to the nature of the services provided; d) Provide true and intuitive information about the services provided on their digital platforms; e) Comply with directives from the National Digital Asset Committee and other relevant competent authorities, providing the required information; f) Act diligently when marketing or selling digital assets on their platforms or infrastructure, and in public offerings promoted and accepted on their platforms, in accordance with the parameters and standards established by the National Digital Asset Committee. However, they are not responsible for the yield or profitability promised by the issuer, nor for the authenticity of the financial data disclosed by the issuer; g) Establish customer support services accessible by telephone, email, or other convenient means; h) Hold sufficient financial and non-financial resources in accordance with the regulations of the National Digital Asset Committee; i) Effectively manage their business considering the risks to the business and clients, exercising due skill and diligence in conducting their business; j) Establish and implement effective mechanisms to protect the digital assets and legal tender of issuers and purchasers held by them; k) Provide and implement effective mechanisms to prevent price manipulation and maintain market integrity, in accordance with Articles 33, 34, and 35 of this Law; l) Formulate and implement effective corporate governance mechanisms as appropriate; m) Report the prices of services provided to the Committee quarterly, including all types of commissions and specific fees; n) Use secure, high-quality, and cybersecurity-protected information systems in accordance with international standards and parameters adopted and established by the Committee; o) Have systems to prevent, detect, and expose financial crime risks, such as money laundering and terrorist financing; p) Have an orderly and reliable contingency plan for clearing business; q) Notify the Committee and submit a corresponding deregistration application if operations cease; r) Immediately inform the Committee and specify the technical and commercial characteristics of any new stable currency added to its platform for trading.

Chapter V

Public Offerings

Section 1

Issuers and Certifying Units of Public Offerings

Requirements for Issuers

Article 22 - Issuers, including stable currency issuers, may conduct public offerings stipulated in this Law, provided they meet the following requirements:
a) If the issuer is a legal person, provide an overview of its business or usual line of business, including the date of establishment, the date of registration with the relevant competent authority, and the address; if the issuer is a natural person, provide full name, unique identification document, resident card or passport number, and residential address; b) Indicate the LRU of the main website; c) Clearly indicate the jurisdiction, country, or region where business is conducted; d) Provide a list of digital assets publicly issued in other jurisdictions, countries, or regions in the past three years; e) Comply with all requirements and conditions stipulated in the regulations and technical standards issued by the Committee. To obtain certification and license for the public offering, the issuer must submit the Information Document, which shall contain all the aforementioned information. If the issuer's public offering is authorized by the Committee, it is deemed to have met the requirements in the previous paragraph. If the issuer modifies any of the information described in the first paragraph of this Article, it must report within ten working days from the date of modification. Except for the requirements stipulated in letter e) of this Article, the State, the Treasury, and the Central Reserve Bank of El Salvador are not subject to the other requirements of this Article.

Issuer Registration

Article 23 - When an issuer's public offering is authorized by the Committee, the issuer is automatically listed in the Issuer Registry managed by the National Digital Asset Committee.
Other aspects regarding the organization and operation of issuer registration, including the procedures and formats used, will be detailed in the corresponding regulations.

Issuer Deregistration

Article 24 - Issuer registration shall be canceled in the following cases:
a) The issuer voluntarily applies to the National Digital Asset Committee for deregistration, and it is verified that there are no approved but unissued public offering products, and obligations from previously approved public offerings have been fulfilled; b) If a public offering of the issuer is canceled by the Committee, and there are no unfulfilled obligations from previously approved public offerings, the issuer will be removed from the registry and cannot re-register within one calendar year. c) If a public offering of the issuer is currently ongoing and another public offering of the issuer is canceled by the Committee, the issuer cannot proceed with the currently ongoing approved public offering, and the issuer will be removed from the registry and cannot re-register within one calendar year. The subsequent regulations of this Law will stipulate the procedures for suspending or canceling issuer registration.

Issuer Liability

Article 25 - Issuers are responsible for the authenticity of the data reported in public offerings, as well as for the authenticity of the information and documents provided to certifying units and the Committee. Issuers, whether in their own name or through third parties, must establish effective mechanisms to control and protect funds or other digital assets obtained during the public offering. Additionally, they must demonstrate that funds or other digital assets obtained during the public offering are properly safeguarded. In addition to the provisions of the preceding paragraphs of this Article, issuers shall always comply with the following obligations:
a) Conduct all transactions with purchasers and potential purchasers in an honest, fair, and professional manner in accordance with the regulations of the Committee. b) Timely update the relevant information stipulated in Article 22 of this Law when necessary; c) Preserve electronic transaction books, records, and other documents related to their public offerings in electronic form through the methods prescribed by the National Digital Asset Committee; d) Comply with the obligations stipulated in Articles 33, 34, and 35 of this Law; e) Comply with regulations, directives, technical standards, guidelines, and any other rules issued by the National Digital Asset Committee. Additionally, when publicly offering digital assets, issuers shall comply with the following obligations:
a) Conduct a detailed analysis of the technical feasibility and commercial functionality of their publicly offered digital assets; b) Inform purchasers of the most relevant content of the public offering in a clear and non-misleading manner; c) Preserve electronic records and documents related to the public offerings conducted by the issuer in the forms specified by the Committee; d) Submit, prepare, and timely update financial statements when required by the Committee; e) Mark all information related to the public offerings they issue at a determined LRU address, including all information in the Information Document of the public offering. Technical and operational regulations will stipulate the procedures that issuers should follow in public offerings.

Functions of Certifying Units

Article 26 - All public offerings of digital assets must be authorized. The certifying agency shall first conduct a comprehensive analysis of the requirements for public offerings according to the provisions of laws, regulations, directives, technical standards, guidelines, and any other rules issued by the National Digital Asset Committee. After the analysis by the certifier, a report shall be issued, including an assessment of the feasibility of the publicly offered product. Regardless of whether the decision is to approve or reject, it must be submitted to the Committee in all cases. Only reports showing approval are considered certified.

Requirements for Certifying Units

Article 27 - Certifying units must be registered with the National Digital Asset Committee and must meet the following requirements: They must be entities with at least five (5) years of experience in financial, tax, legal, administrative, or related affairs. The partners or shareholders of the entity, at the individual level, must hold higher education university degrees in the aforementioned fields.

Registration of Certifying Units with the National Digital Asset Committee

Article 28 - The National Digital Asset Committee shall maintain a registry of domestically authorized certifying units. Certifying units must provide the following information and corresponding legally effective documents for this purpose:
a) Articles of association and list of shareholders formally registered with the relevant competent authority, which must be updated annually; b) Organizational structure chart of the institution; c) International organizational structure (if necessary); d) Resumes of partners or shareholders, along with relevant attachments and academic credentials; e) Initial asset assessment and financial documents; f) Valid company registration; g) Tax identification number; After the certifying unit submits the information required by this Law and corresponding regulations in the application format prescribed by the Committee, the Committee shall decide to approve or reject the registration application within twenty (20) working days. If the application has omissions, the Committee will notify the applicant and order them to complete it within five working days. The Committee will issue its decision after receiving the missing information. If the applicant fails to submit complete information, the Committee will reject the application, and the service provider may resubmit the registration application. If the application is approved, the service provider must pay the fees stipulated in this Law. After verifying compliance with requirements and payment of corresponding fees, a registration number will be issued. Registered service providers, regardless of the initial registration date, must pay the annual fee to renew the registration in the first quarter of each year in the amount stipulated by this Law. If the renewal is not paid on time, the registration will be canceled.

Responsibilities of Certifying Agencies

Article 29 - Certifying agencies bear the following responsibilities:
a) To assess the feasibility of the public offerings proposed by issuers from financial and technical levels; b) To assess the financial, technical, and legal risks of the public offerings proposed by issuers and report to the National Digital Asset Committee; c) To provide comprehensive opinions on the certification of applications for public offerings, indicating agreement or disagreement, and communicate the results to the National Digital Asset Committee; d) To keep confidential the information and documents received from potential issuers; e) Not to participate in any business suspected of illegal activities, nor to provide consulting services for them; f) To report suspected illegal acts discovered during the assessment of public offerings to the Office of the Attorney General of the Republic; g) To comply with regulations, directives, technical standards, guidelines, and any other rules issued by the National Digital Asset Committee. Technical and operational regulations will stipulate the procedures to be followed when working in certifying units.

Section 2

Public Offering of Digital Assets

Publication of Public Offering of Digital Assets

Article 30 - The publication of a public offering of digital assets is required when digital assets are made available to the public on a large scale for the purpose of marketing or selling such digital assets. The public offerings mentioned in the previous paragraph may be conducted by issuers defined in this Law, using existing digital assets and establishing new digital assets through them, such as tokens offering yields on specific digital asset platforms, or by issuers creating completely original digital assets. Public offerings may be conducted by the State, the Treasury, the Central Reserve Bank, autonomous institutions, as well as natural and legal persons.

Exceptions to Public Offering of Digital Assets

Article 31 - The provisions of this Law regarding public offerings do not constrain privately issued digital assets or their derivative digital assets.

Information Document and Public Offering License

Article 32 - When an issuer plans to conduct a public offering, it must prepare the Information Document.
The Information Document must be certified by a unit officially authorized by the National Digital Asset Committee.
The certified document must be submitted to the Committee for review. If the offering is licensed, the Committee shall publish the content of the Information Document on its LRU address for potential purchasers. The content and parameters contained in the document, as well as the procedures for certification and authorization of the offering (detailed in the corresponding technical and operational regulations), apply. Submission of the Information Document is not required for the acceptance or application to include a stable currency on a digital platform located in El Salvador.

Competitiveness

Article 33 - Products provided by digital asset service providers shall be economically competitive in price and conditions. Prices include specific fees or charges, which must match the nature of the services provided. Digital asset service providers shall report all prices and fees for services provided to the Committee. Additionally, they shall clearly display the fee amounts, including all specific fees and charges, to users on the LRU address of their main website or on their digital platforms and applications. Issuers of public offerings and digital asset service providers shall inform potential purchasers of the terms and conditions of the public offering being conducted or traded before conducting transactions, transfers, or purchases and sales. When transferring or purchasing digital assets, purchasers are deemed to agree to and accept the aforementioned terms and conditions, as well as corresponding obligations and rights. Additionally, for approved public offerings of digital assets traded on their digital platforms or applications, digital asset service providers shall confirm the identity of all purchasers through identity documents and other necessary information. For any potential purchaser who does not meet the aforementioned identity identification and information transparency requirements, digital asset service providers have the right to refuse to sell or purchase digital assets to them. The procedures for identity identification and information transparency of purchasers are detailed in the corresponding regulations. Issuers of public offerings and digital asset service providers shall avoid the following behaviors as appropriate:
a) Disseminating or planning false or misleading signals regarding their ongoing public offerings, demand for their digital assets, or prices; b) Coordinating with other issuers or market participants to determine the price of one or more digital assets to achieve illegal enrichment for issuers; c) Using fictitious mechanisms or any other form of deception or means to conduct transactions, issue trading instructions, or engage in any other activities or behaviors that affect or may affect the price of one or more digital assets; d) Disseminating information through media, including the Internet, or in any other manner, implying false or misleading signals regarding the supply, demand, or price of digital value; e) Adjusting the pricing mechanism of the provided digital assets; f) Engaging in behaviors that seriously undermine the stability and market integrity of the digital asset market; g) Adjusting plans to purchase digital assets before public offering, causing abnormal high network and technical prices on the digital asset operation platform; h) Any other practices determined by the National Digital Asset Committee through reasonable resolutions to suppress the normal operation of the market. Issuers and service providers of digital assets have the right to design public offering and marketing plans for digital assets and establish specific standards. Such standards may impose broad restrictions and constraints on the purchase, trading, or acquisition of digital assets by citizens or residents of certain jurisdictions, countries, or regions.

Market Integrity

Article 34 - Issuers and service providers of digital assets shall take appropriate measures to ensure that the market maintains integrity and prevent market abuse and sales manipulation.
Any other behavior recognized by the National Digital Asset Committee as undermining market integrity may be warned through reasonable resolutions issued by the Committee.

Market Manipulation

Article 35 - Issuers and service providers of digital assets shall avoid activities that lead to market manipulation, specifically as follows:
a) Damaging or delaying the operation of digital asset trading platforms, engaging in any activities that may produce such an effect; b) Making it difficult for others to identify real orders on digital asset trading platforms, engaging in any activities that may produce the same effect, including issuing orders that disrupt the normal operation of digital asset trading platforms; c) Issuing false or misleading signals regarding the supply, demand, or price of digital assets, especially issuing a series of instructions requiring the opening or mandatory execution of a series of operations, or engaging in any activities that may produce the same effect; d) Using traditional or electronic communication means to express opinions on a digital asset after trading it, and benefiting from the influence of opinions on the price of that digital asset, without simultaneously disclosing the nature of these transactions and their interests; e) Any other behavior determined by the National Digital Asset Committee through reasonable resolutions as market manipulation.

Preferential Treatment

Article 36 - Issuers of digital assets, formally registered digital asset service providers, certifying units, purchasers of digital assets, and public offerings of digital assets shall comply with the following rules and enjoy the following preferential treatments:
a) The return on digital assets shall be determined according to the digital asset market situation at the time of transaction. Digital assets may be discounted or at a premium according to the customs of the digital asset market in the place of issuance; b) The face value and income or yield of digital assets are exempt from any kind and nature of levies, tariffs, taxes, fees, and surcharges, including existing, potential, general, special, or specific ones. Capital gains or ordinary income obtained from the sale or any other form of transfer of digital assets, including debt forgiveness, shall be exempt from any form of taxation. c) Issuers, certifying units, and registered digital asset service providers enjoy all tax exemption policies related to the digital assets they develop stipulated in letter b) of this Article, without paying property transfer tax, service tax, income tax, municipal tax, or taxes of any other nature; issuers, certifying units, and registered digital asset service providers also cannot charge the aforementioned taxes to their customers. d) For legal persons, when profits or dividends are involved in the activities detailed in the preceding paragraphs, the tax exemption policies in letters b) and c) apply to the entity and the partners/shareholders individually. e) The tax exemption policies stipulated in the preceding paragraphs do not apply when digital assets are exchanged for goods or services not listed in Article 19 of this Law.

Chapter VI

Violations and Penalties

Penalty Procedures

Article 37 - The procedures for recognized violations, their related penalties, and statutes of limitations shall comply with the relevant provisions of Chapter V of the Administrative Litigation Law regarding penalty powers and responsibilities.

Infringements and Sanctions

Article 38 - Digital asset service providers, certifying institutions, and public offering issuers shall be subject to the following sanctions if they commit the following violations:
a) For each offense, if the following violations occur, they may be fined up to 114 times the local minimum wage of the commercial and service sector:

1. Service providers and certifying institutions that have not completed registration with the relevant departments;
2. Omitting information, records, notices, data, explanatory documents, and related applications required by the National Digital Asset Committee or its auditors without just cause, including data related to public offerings of digital assets, or providing incomplete reports;
3. Not complying with the code of conduct established by the National Digital Asset Committee;
   b) The following violations will be fined, with a single penalty standard between 115 times and 305 times the local minimum wage of the commercial and service industry:
4. Placing or selling digital assets on their digital platforms without authorization from the National Digital Asset Committee;
5. Violating the provisions of Article 33, paragraph 5, and the provisions of Article 35 of this Law;
6. Refusing to execute resolutions issued by the National Digital Asset Committee regarding procedures required by this Law and its regulations;
7. Refusing to provide information required by the Committee related to public offerings of digital assets, digital asset services, and users of digital platforms or applications;
8. Providing incorrect information and failing to correct it in a timely manner within the rectification period given by the Committee;
   If the relevant operating entity fails to pay the fine within the time limit stipulated by the Committee after receiving the violation ticket, and the overdue time exceeds 5 days, an additional late fee equivalent to 20% of the total fine amount shall be paid. c) If the issuer clearly violates the terms stipulated in its relevant policy documents, a fine of 306 to 1200 times the minimum wage of the commercial and service sector shall be imposed; if the involved enterprise fails to pay the corresponding fine within the prescribed time, and the delay exceeds 5 days, an additional fine of 20% of the total amount shall be imposed. d) If the issuer commits one of the following violations, a fine equivalent to one percent (1%) of the total value of its initial public offering shall be imposed:
9. Issuing digital assets without relevant authorization from the National Digital Asset Committee;
10. Concealing important information related to public offering activities, especially when the concealed information is highly related to financial, commercial, and technical risks, the Committee will issue a higher fine amount as appropriate.
    e) For certifying institutions, if it is determined through relevant regulations, administrative resolutions, and implementation guidelines that they have failed to fulfill the duties stipulated in the guidelines of the National Digital Asset Committee, they shall be suspended from business for 45 calendar days. After the suspension period, the National Digital Asset Committee will lead the formation of an internal hearing to decide whether to permanently revoke the practicing qualification of the involved certifying institution or authorize it to continue fulfilling its duties. This Law will also stipulate the process for suspending or canceling the qualifications of the involved certifying institutions and the relevant charter for holding hearings on the aforementioned process.

Criteria for Determining Related Penalties

Article 39 - The Committee shall impose corresponding penalties based on the following criteria:
a) Causing serious infringement; b) Causing damage to one party of the digital asset purchasers or the integrity of the digital asset market; c) Intentional falsification; d) Affecting the compensation ability and the所受制裁 (sanctions received) impacting the compensation due to the purchaser party;

Mitigating or Aggravating Circumstances for Penalty Measures

Article 40 - When the National Digital Asset Committee imposes penalties on involved violating institutions, if the relevant institution voluntarily corrects the violation, omission, or erroneous behavior within the first five days of its rectification period, the fine will be reduced by 75%. If the aforementioned institution rectifies after five days from the beginning of the period, although not overdue, it shall not enjoy the fine reduction clause in principle. If there are repeated violations, the involved institution will face aggravated penalties. In such cases, when the involved institution violates the same regulation again, has been recognized as violating and should be punished, and fails to correct the violation in a timely manner within the relevant period, an additional fine of 50% shall be imposed on the involved institution, and this situation does not apply to any penalty mitigation clauses.

Revenue from Funds

Article 41 - Funds obtained from the implementation of penalties shall be included in the national unified management account.

Chapter VII

Other Provisions

Electronic Signature

Article 42 - The National Digital Asset Committee shall recognize electronic signatures that comply with its relevant regulations in all its work processes and administrative procedures, including links such as digital asset issuers, certifying institutions, and service providers submitting documents and information. Such electronic signatures shall have the same effect as handwritten signatures, and possess legal and evidentiary效力 (validity).

General Regulations

Article 43 - The President of the Republic shall approve the general regulations of this Law within 90 days after the entry into force of this Law.

Temporary Registration of Service Providers

Article 44 - Digital asset service providers that have started operations before the entry into force of this Law must apply for registration in accordance with the relevant requirements of Articles 18 and 20 of this Law within 10 working days after the entry into force of this Law. During the processing of the formal registration application, they may temporarily obtain temporary registration, which is valid for six months. If the relevant institution does not submit the registration application within the time limit stipulated by the regulations, they will not be able to continue conducting business, and must complete the application submission after the entry into force of the relevant regulations, while meeting all relevant requirements stipulated in this Law.

Certification of Information Documents by the Committee

Article 45 - For entities that are not certified and registered as certifying institutions, the National Digital Asset Committee shall be responsible for certifying the information disclosed in their Information Documents.

Authority

Article 46 - Given the authority of this Regulation in the relevant professional field, in case of different provisions in other laws and regulations, the relevant clauses in this Regulation shall prevail.

Entry into Force

Article 47 - This Decree shall enter into force eight days after its publication in the Official Gazette.

Compiled in the Blue Hall of the Legislative Palace: San Salvador...