The Executive Process in El Salvador

The Executive Process in El Salvador

The Executive Process in El Salvador

Published on august 07 , 2023

Foto de Héctor Josué Deras Argueta

Héctor Josué Deras Argueta - Associate

In El Salvador the executive process is the one through which a creditor (the plaintiff) seeks to obtain the forced payment of an overdue debt from a debtor (the defendant). The debt must be evidenced in an executory title, which is a document that proves the existence of a liquid and enforceable debt. Examples of executory titles are: a bill of exchange, a promissory note, a court judgment or authenticated public or private documents where a debt is acknowledged.

The executive process is faster and more direct than the common or ordinary process, since it is used when the debtor does not comply voluntarily with its obligations. This implies that the right to request enforcement has a specific content: the judge in charge, without the need to previously summon or hear the debtor, must order the performance of the executive actions established by law.

Once the term to comply with the payment of the obligation by the debtor has expired and the debtor has not complied with the obligation, the creditor has the right to file the claim before the competent judge, which may be the judge of the special domicile established in the executory title or, in the absence of designation, the judge of the domicile of the defendant. For this, it is necessary that the creditor has the enforceable title, Once the claim is admitted, in order to prevent the debtor from seizing assets, a seizure of assets, whether movable or immovable, is ordered; and it is only after the seizure that the judge orders the notification of the debtor, who must appear within the established term to present his defenses. The debtor has the opportunity to oppose the claim and present its arguments to demonstrate the payment of the claimed obligation or that there is some irregularity in the process. If the debtor does not oppose or if the opposition is unsuccessful, the judge will proceed to issue a judgment. The period to reach this point can be up to 2 years.

After the judgment, in the absence of voluntary compliance, the creditor has the right to initiate the final phase of the process in which the collection is sought either through an auction or public auction of the seized assets or the adjudication of the seized assets. The time period during this stage varies according to the type of seized assets, so it can range from 6 months -after the execution is admitted- to years to obtain the fulfillment of the obligation.

The executive process must follow certain deadlines and procedures to guarantee the rights of both the creditor and the debtor. It is important to emphasize that the judicial process may vary according to the particular circumstances of each case and that it is advisable to have the advice of a lawyer specialized in civil and procedural law in El Salvador to carry out an executive process in an adequate manner.
email
Last June, the new Instructions for the Prevention, Detection and Control of Money Laundering, Financing of Terrorism and Financing of the Proliferation of Weapons of Mass Destruction, issued by the Attorney General's Office (FGR), under the framework of the Anti-Money Laundering Law (LCLDA), came into force. In its Article 2, the LCLDA establishes that every person must submit information to the FGR that allows demonstrating the licit origin of any transaction he/she carries out. This leads us to conclude, then, that every person must prepare the manual and internal policies for the implementation of a money laundering prevention system, and the continuous development of these.

What is the difference between the new Instructions and the prevention systems elaborated before it came into force? Article 4 of the Instructions requires individuals to apply a risk-based approach, which consists of identifying, assessing and understanding the risks of their sector and operation, and applying resources aimed at ensuring that they are effectively mitigated. Therefore, it is necessary to update the manuals and policies that companies had developed in the past, so that they have a risk-based approach and comply with the new provisions.

From the manuals prepared, it is necessary to comply with other obligations, among them, to develop due diligence and KYC policies to identify the final beneficiary of the company's business relationships, to detect and mitigate all unusual or suspicious transactions and report them to the FGR (not only cash transactions), to train employees, to keep a historical record of the files analyzed, and above all, to appoint a compliance officer.

Why is it important to comply? Article 8 of the LCLDA establishes that, if there is any encumbrance due to negligence, impertinence or ignorance of the directors or employees of the companies, there will be a sanction of two to four years in jail.

Therefore, as a Firm we recommend:


We offer you our services, in order to comply with these legal obligations, so that your company has the peace of mind and support of a money laundering prevention system.

For more information about how this may affect your company, please contact our specialized team at bvaldez@bvaldezlaw.com  or  benjamin@bvaldezlaw.com