Technical Standards for the Constitution of Electronic Money Provider Companies

THE COMMITTEE OF STANDARDS OF THE CENTRAL BANK OF RESERVE OF EL SALVADOR, CONSIDERING:
I. That article 2, paragraph three of the Law for Facilitating Financial Inclusion, establishes that the Superintendency of the Financial System will authorize the constitution of Electronic Money Provider Companies, in accordance with the requirements and procedures established in the technical standards issued for such effect by the Central Bank of Reserve of El Salvador, through its Committee of Standards.
II. That article 3, letter b) of the Law for the Supervision and Regulation of the Financial System, establishes that it is the competence of the Superintendency of the Financial System to authorize the constitution, operation, start of operations, suspension of operations, modification, revocation of authorization, closure, and other acts of the members of the financial system, in accordance with the legal, regulatory, or technical provisions established regarding the matter.
III. That article 1, paragraph one of the Special Law for the Prevention, Control, and Sanction of Money Laundering, Terrorism Financing, and Financing of the Proliferation of Weapons of Mass Destruction establishes that the purpose of said law is to prevent, detect, monitor, investigate, and sanction money laundering, terrorism financing, and financing of the proliferation of weapons of mass destruction; as well as the identification and evaluation of related risks, in order to implement adequate policies and procedures for the application of a risk-based approach. (3)
IV. That it is necessary to regulate novel mechanisms for the provision of financial and payment services in the national territory, which allow facilitating the insertion of the traditionally excluded population into economic activity.
V. That by Legislative Decree No. 464 dated October 31, 2019, the Legislative Assembly approved reforms to the Law for Facilitating Financial Inclusion, in which the minimum social capital for the constitution of Electronic Money Provider Companies was modified, decreasing it from five hundred thousand to two hundred thousand United States Dollars, establishing additionally that sixty percent of said minimum capital must be subscribed and paid in cash at the time of the constitution of the company and the remaining forty percent may be credited within the following three years of operation. (2)

THEREFORE,

AGREES to issue the following:

TECHNICAL STANDARDS FOR THE CONSTITUTION OF ELECTRONIC MONEY PROVIDER COMPANIES

CHAPTER I
OBJECT, SUBJECTS, AND TERMS

Object
Art. 1.- These Standards aim to regulate the requirements and the process for the authorization of the constitution of Electronic Money Provider Companies, in accordance with what is provided in the Law for Facilitating Financial Inclusion.

Subjects
Art. 2.- The subjects obligated to comply with the provisions established in these Standards are those persons interested in constituting an Electronic Money Provider Company in accordance with the Law for Facilitating Financial Inclusion. (3)

Terms
Art. 3.- For the purposes of these Standards, the terms indicated below have the following meaning:
a) Central Bank: Central Bank of Reserve of El Salvador; b) Electronic Money: Monetary value registered in favor of a holder or client, which constitutes a payment obligation enforceable against its provider, which is accepted by other actors who have agreed to receive or provide this service, as a means of payment in an amount equivalent to the cash delivered, and is stored in an electronic medium; c) Inclusion Law: Law for Facilitating Financial Inclusion; d) Supervision Law: Law for the Supervision and Regulation of the Financial System; e) Provider Company: Electronic Money Provider Company; and f) Superintendency: Superintendency of the Financial System.

CHAPTER II
CONSTITUTION OF ELECTRONIC MONEY PROVIDER COMPANIES

Nature and Constitution
Art. 4.- Provider Companies shall be constituted in accordance with what is established in article 2 of the Inclusion Law and shall be governed by what is provided in said Law, by the technical standards issued by the Central Bank through its Committee of Standards, as well as by the current legislation applicable to them.

Purpose
Art. 5.- The purpose of Provider Companies shall be to provide electronic money, but they may also administer or operate mobile payment systems, in accordance with what is established in article 2 of the Inclusion Law. (1)

Social Capital
Art. 6.- The minimum amount of social capital for the constitution of a Provider Company shall be two hundred thousand United States Dollars, as established in article 2 of the Inclusion Law. Sixty percent of this capital must be fully subscribed and paid in cash at the time of constitution, and must be credited through the deposit of the corresponding sum in the Central Bank. The origin of the funds with which the capital will be subscribed and paid must be duly documented. The remaining forty percent may be completed in the following three years of operation; for this effect, persons interested in the constitution of the Provider Company must present to the Superintendency a program that reflects how the minimum social capital will be fully paid. (2)

Authorization Request for Constitution
Art. 7.- Persons intending to constitute a Provider Company must request in writing from the Superintendency the authorization for its constitution. The request must contain the following information:
a) Regarding the applicants: full name, age, profession or occupation, expression of the type and number of identity document, Tax Identification Number, domicile, and nationality; b) Regarding potential shareholders:
i. If a natural person: full name, age, profession or occupation, expression of the type and number of identity document, Tax Identification Number, domicile, and nationality, as well as the amount of their respective subscriptions and percentage of participation in the share capital; and
ii. If a legal entity: name of the company, Tax Identification Number, domicile, and Taxpayer Registration Number as well as the amount of their respective subscriptions and percentage of participation in the share capital;

c) In the case that the request is signed by the legal representative or attorney-in-fact of the potential shareholders, their full name, age, profession or occupation, expression of the type and number of identity document, Tax Identification Number, domicile, nationality, and certified copy of the document accrediting them as such must be expressed; d) Indication of the amount of capital to be subscribed and paid, which cannot be less than that required in article 2 of the Inclusion Law. In the event that the payment of the Capital is made partially, the entity must adhere to what is established in article 6 of these Standards, for the purposes of amortizing the subscribed but unpaid capital; (2) e) Full name, age, profession or occupation, domicile, nationality, expression of the type and number of personal identity document, of each of the potential managers, directors, and chief executives; f) The denomination of the Provider Company; g) The place to receive any kind of notifications and the designation of the persons commissioned for such effect and to initiate the request procedure for authorization of constitution; and h) If the potential shareholders belong to a business group or conglomerate, their name and composition must be indicated.

Documents that must be attached to the request Art. 8.- The authorization request for constitution must be accompanied by the following documentation:
a) Draft deed of constitution, whose purpose must be in accordance with what is established in article 2 of the Inclusion Law; b) Draft bylaws of the Provider Company; c) Legible copies of the personal identity document or valid passport in the case of foreigners and the Tax Identification Number of each of the potential shareholders and their legal representatives, mandataries, and attorneys-in-fact if applicable; d) Sworn declaration granted before a notary, by each of the potential shareholders in more than twenty-five percent, managers, directors, and chief executives in accordance with Annex No. 1 of these Standards, with the objective of evidencing that they are not within the circumstances detailed in article 3 of the Inclusion Law; e) In the case of persons interested in being managers, directors, and chief executives, they must accredit knowledge in financial and administrative matters that allow them to develop their positions in accordance with the nature of the operations of the Provider Companies, such as the Curriculum Vitae of each of the initial managers, directors, and chief executives or any other kind of documentation that accredits their experience in the area related to the position they will hold; f) In the case that one or several shareholders are legal entities, they must attach, additionally, insofar as applicable to them, the following documents:
i. Copy of the deed of their constitution or social pact in force if applicable and of the latest credential of the election of their administration body;
ii. Certification of the list of shareholders who possess twenty-five percent or more of their social capital. Such certification must be signed by whoever has the legal representation of the applicant and must be authenticated by a notary;
iii. Certification of the point of the minutes of the General Shareholders' Meeting or General Assembly of Shareholders in which the agreement of authorization granted to the legal representative is recorded, if in the social pact in force or bylaws, as applicable, it is established that, to invest in the constitution of any kind of company, the legal representative of the applicant needs authorization from any superior body;
iv. Last audited financial information at the close of the exercise prior to the date of the request. When the closing information corresponds to a date greater than six months prior to its presentation, non-audited financial information corresponding to at least three months prior must also be presented; and
v. When the potential shareholder is an entity that by virtue of law is supervised by the Superintendency and has presented the information requested in this letter in compliance with the corresponding regulation, it will not be necessary to present it again unless such information is not updated;
g) Certification of the point of the minutes of the General Shareholders' Meeting or General Assembly of Shareholders in which the agreement of the superior administration body authorized to authorize the investment in any kind of company is recorded, in case the legal representative is not the one who has the faculty for it; h) Legible copies of the personal identity document or valid passport in the case of foreigners and the Tax Identification Number of each of the potential managers, directors, and chief executives; and i) Audited financial statements of the potential shareholders when applicable. For the case of foreign legal entities, the requirements of letter f) of this article must be accredited with documents duly authenticated. Public or authentic documents emanating from a foreign country and their photocopies must comply with what is established in the Civil and Commercial Procedural Code or the apostille procedure, in the case of countries signatories of the "Hague Convention Abolishing the Requirement of Legalization for Foreign Public Documents".

Alameda Juan Pablo II, between 15 and 17 Av. Norte, San Salvador, El Salvador.
Tel. (503) 2281-8000 www.bcr.gob.sv
CNBCR-06/2016
NASF-04
TECHNICAL STANDARDS FOR THE CONSTITUTION OF ELECTRONIC MONEY PROVIDER COMPANIES Approval: 27/06/2016 Validity: 03/10/2016 In case the documentation is not in the Castilian language, it must be translated in accordance with what is provided in the Law on the Notarial Exercise of Voluntary Jurisdiction and Other Proceedings. Any copy that is presented to the Superintendency in compliance with what is provided in these Standards, when applicable, must be certified by a notary authorized in El Salvador. Likewise, signatures that match in all types of documentation must be authenticated by a notary authorized in El Salvador. The Superintendency will verify compliance with the requirements related to the credit situation of shareholders, executives, or administrators through the information systems it has available. Art. 8-A.- Upon receipt of the documentation in proper form and verified by the Superintendency that the previous requirements have been met, the Superintendent will communicate the authorization of constitution of the Provider Company or deny it, within a maximum period of thirty business days. Upon expiration of this period, and if the Superintendency does not pronounce itself, it will be understood that the authorization is favorable for the interested parties. (2)

If the request is not accompanied by the complete information as established in articles 7 and 8 of these Standards, the Superintendency may require the interested parties, within a period of ten business days counted from the day following the notification, to present the missing documents. (2) The Superintendency in the same notice will indicate to the interested parties that if they do not complete the information within the aforementioned period, it will proceed without further procedure to archive the request, leaving them free to present a new request. (2)

Analysis of the request (2)
Art. 8-B.- The Superintendency, after the analysis of the documentation established in articles 7 and 8 of these Standards, may notify the interested parties to remedy the deficiencies found. (2) The interested parties will have a period of ten business days, counted from the day following the notification of the notice, to remedy the observations or to present the documentation and information required by the Superintendency. (2) The Superintendency, through a reasoned resolution, will extend by up to another ten business days the period indicated in the previous paragraph, when the nature of the observations or deficiencies notified so requires. (2)

Extension Period (2)
Art. 8-C.- The interested parties may present to the Superintendency a request for extension of the periods indicated in articles 8-A and 8-B of these Standards, expressing the grounds on which it is based and proposing, if applicable, the pertinent proof. (2) The extension period cannot exceed ten business days and will start from the next business day after the expiration of the original period. (2)

Suspension of the period (2)
Art. 8-D.- The period of thirty business days indicated in article 8-A of these Standards will be suspended for the days that elapse between the notification of the requirement to complete information or overcome observations referred to in article 8-B of these Standards, until the interested parties remedy the observations indicated by the Superintendency. (2)

Regarding the resolution (2)
Art. 8-E.- Once the required documents have been presented in due form, the Superintendency will proceed to respond to the request for authorization of constitution of the Provider Company. (2) Once the aforementioned authorization is issued, the interested parties will be responsible for ensuring compliance with these Standards and the regulatory framework applicable to Provider Companies, for their proper operation. (2)

Publication of Request
Art. 9.- Once the request is admitted, the Superintendency, within a period that must not exceed fifteen business days, will publish on its website and in a newspaper of national circulation, once and at the expense of the applicants, a notice that includes the name of the Provider Company to be constituted, the list of shareholders who have a participation of more than twenty-five percent of the Provider Company, the list of initial managers, directors, and chief executives. The publication will have the purpose that any person who has knowledge that any of the disqualifications contained in article 3 of the Inclusion Law applies to the managers, directors, and chief executives or shareholders who will be part of the Provider Company, may object to them. Objections must be presented in writing to the Superintendency within a period of fifteen days counted from the day following the publication, attaching the pertinent proofs. The information will have a confidential character. The Superintendency will notify this circumstance to the person objected to, who must appear within a period of eight business days counted from the respective notification, having to pronounce themselves on the opposition raised, being able to attach any kind of proof tending to support their arguments. Upon completion of the aforementioned period, the Superintendency will resolve within ten business days on the alleged disqualifications, having to notify this circumstance in the manner previously provided. If any shareholder, manager, director, or chief executive is declared disqualified according to what is established in the Inclusion Law to hold such quality, the applicants must remit to the Superintendency a new list in which the corresponding shareholder, manager, director, or chief executive has been excluded, having to attach all the documentation concerning the person who replaces them. Notwithstanding the foregoing, at any time during the authorization process, the Superintendency may ex officio or at the request of a party declare the disqualification, prior to a hearing of the person objected to within a period of eight business days counted from the day following the notification, to exercise their right of defense. Upon completion of the aforementioned period, the Superintendency will resolve within ten business days on the alleged disqualifications, having to notify this circumstance in the manner previously provided. Once the period has elapsed without objections having been presented or them having been resolved, the Superintendency must issue a resolution authorizing or denying the request for constitution of a Provider Company, within a period not greater than thirty days. When the Superintendency denies or authorizes the request for constitution of a Provider Company, the Superintendency will publish such resolution on its website and in a newspaper of national circulation, with the Provider Company assuming the costs thereof.

Granting of Constitution Deed
Art. 10.- Upon receipt of the communication of authorization of constitution, the interested parties must proceed to the granting of the constitutive deed within a period of thirty days counted from the date of notification of the resolution of the Superintendency. Upon expiration of said period without the deed being granted, the agreement of authorization will become void. If for any circumstance, the persons interested in constituting a Provider Company decide at this stage not to continue with the process, they must notify it to the Superintendency, who in this case will publish it on its website and in a newspaper of national circulation at the expense of the applicants.

Alameda Juan Pablo II, between 15 and 17 Av. Norte, San Salvador, El Salvador.
Tel. (503) 2281-8000 www.bcr.gob.sv
CNBCR-06/2016
NASF-04
TECHNICAL STANDARDS FOR THE ESTABLISHMENT OF ELECTRONIC MONEY PROVIDER COMPANIES Approval: 27/06/2016 Validity: 03/10/2016

Modifications
Art. 11.- If during the period referred to in Article 10 of these Standards, any change occurs in the information or documentation presented to the Superintendency in accordance with Articles 7 and 8 of these Standards, the Provider Company must send the updated information or documentation to the Superintendency within five days following the occurrence of the change. Additionally, when a change occurs in the information published in the notice referred to in Article 9 of these Standards, this fact must be published under the terms and deadlines established in said article. Once the Superintendency has verified the modifications to the information or documentation presented, it will issue a new resolution authorizing or denying the application for the establishment of the Provider Company, within a period not exceeding thirty days. From the notification of this resolution, the thirty-day period referred to in Article 10 of these Standards will begin to run.

Review of Deed Copy
Art. 12.- Prior to presenting the copy of the deed of establishment in the Commercial Registry, applicants must send it to the Superintendency within fifteen business days following its execution, so that the latter verifies that it has been drawn up in accordance with the project presented pursuant to letter a) of Article 8 of these Standards, which has been previously authorized, having the Superintendency a period of ten business days for such verification. Likewise, they must attach the receipt accrediting the deposit at the Central Bank of the amount corresponding to the minimum social capital. If there are differences between the public deed of establishment and the authorized project thereof by the Superintendency, the latter must communicate this to the applicant within the period indicated in the previous paragraph, so that the authorizing notary proceeds to make the respective adjustments, and the copy of the public deed must be presented again before the Superintendency, within a period of five business days from the date of communication of the inconsistencies or differences for verification. Art. 13.- If it is determined that there are no inconsistencies between the public deed of establishment and the reviewed deed project, or in the case where the inconsistencies communicated according to what is established in the previous article have been overcome, the Superintendency will proceed within a period of five business days counted from the receipt of the duly corrected documentation, to place a reason signed by the Superintendent of the Financial System, stating the favorable qualification of said deed, with the object that it may be presented in the Commercial Registry for the corresponding inscription and without which it cannot be inscribed in said registry.

Procedure in case the Commercial Registry makes observations on the Copy of the Public Deed of Establishment of the Company, or denies its inscription Art. 14.- When the Commercial Registry notifies the authorizing notary or any other interested party of the denial of the copy of the public deed of establishment of a Provider Company, that person or persons must in turn notify such circumstance to the Superintendency in writing and no later than the next business day after having received the respective notification. In the case that the correction of observations is notified, they will be notified in the manner and deadline previously indicated, only those observations that affect the purpose or object and the nature of the Provider Company being established. If for the inscription of the instrument in question, it is necessary to modify the conditions under which the Superintendency ordered its favorable qualification, it may, upon written request of the potential shareholders or their representatives, proceed to issue a new reason under the terms established in Article 13 of these Standards.

Art. 15.- Once the copy is inscribed and the statutes are deposited in the Commercial Registry, within a period of five business days following the inscription, the Provider Company will send a certified copy of said instruments to the Superintendency.

CHAPTER III
OTHER PROVISIONS AND VALIDITY

Sanctions
Art. 16.- Non-compliance with the provisions contained in these Standards will be sanctioned by the Superintendency in accordance with what is established in the Supervision Law.
Unforeseen Aspects
Art. 17.- Aspects not provided for in regulatory matters in these Standards will be resolved by the Central Reserve Bank of El Salvador through its Standards Committee. (3) Validity Art. 18.- These Standards will enter into force as of October 3, two thousand sixteen.

(1) Modifications approved by the Central Bank through its Standards Committee, in Session No. CN-03/2017, dated May 23, two thousand seventeen, with validity starting from May 26, two thousand seventeen.
(2) Modifications approved by the Central Bank through its Standards Committee, in Session No. CN-13/2020, dated August 19, two thousand twenty, with validity starting from September 7, two thousand twenty.
(3) Modifications in Consideration III, in Articles 2 and 17, and in Annex No. 1, approved by the Central Bank through its Standards Committee, in Session No. CN-02/2026, of February 26, two thousand twenty-six, with validity starting from March 13, two thousand twenty-six.

ELECTRONIC MONEY PROVIDER COMPANY
MODEL OF SWORN DECLARATION FOR DIRECTORS, MANAGERS AND SHAREHOLDERS OF THE ELECTRONIC MONEY PROVIDER COMPANY

In the city of San Salvador, at _______ hours of the day ________ of _______ of two thousand ___.
Before me, _______notary of the domicile of ______________appears the gentleman_________of ____________years, (profession or trade) _______, from the domicile_____________whom I know (or do not know), holder of (or identify by) Unique Identity Document number (or passport number), with Tax Identification Number _______who acts in his own name (or in representation of, in this case consign if he is a legal representative or attorney and relate the authority according to the case, at this moment or at the end) and TELLS ME: That in his capacity as future director or administrator of the society ________________________, UNDER OATH MAKES THE FOLLOWING DECLARATIONS: A) That I am not under twenty-five years of age (except if he is a shareholder); B) That I am not a debtor to the treasury and the Salvadoran financial system classified in any of the categories of highest credit risk; C) That I have not been convicted by a final judgment in the country or abroad, for having committed or participated fraudulently in the commission of any crime; D) That I am not in a state of bankruptcy or suspension of payments, and that I have not been judicially qualified as responsible for a negligent or fraudulent bankruptcy; E) That my participation in activities related to drug trafficking and connected crimes, and with money laundering, terrorist financing and financing of the proliferation of weapons of mass destruction, in the country or abroad, has not been proven judicially; F) That I have not been declared ineligible in the country nor abroad, for this type of position nor have I been administratively or judicially sanctioned for my participation in infractions to laws and norms of a financial nature, especially the collection of funds from the public without authorization and in financial crimes. The undersigned notary states: That I explained to the appearing party about what is established in the Penal Code, regarding the crime of ideological falsity, regulated in article two hundred eighty-four of said legal body. Thus expressed the appearing party whom I explained the legal effects of this notarial act, which consists of _____ page(s) front and back; and read to him by me in a single act without interruption and entirely, ratifies its content and we sign. I CERTIFY. (3) The Sworn Declaration must comply with what is established in the Notary Law.

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