News and Insights
After World Health Organization (WHO) declared Coronavirus (COVID-19) a pandemic, the Bolivian Government assumed different measures to stop the massive contagion of this virus in the society, as well as to alleviate the effects of this pandemic on the Bolivian society as a whole and, in particular, on social groups with a depressed economic situation. In that sense, the Bolivian Government declared a National Health Emergency and Total Quarantine throughout Bolivian territory, suspending -temporarily- labor activities for public and private companies until April 15.
In this context, the National Government adopted emergency and temporary tax measures established by Supreme Decree No. 4198, dated March 18, 2020, (hereinafter the “SD”) and Normative Resolution of the Board of Directors (hereinafter the “NRD”) No. 102000000006 dated March 27, 2020, issued by National Tax Administration, in order to regulate tax aspects and also extend deadlines of formal and material obligations for taxpayers.
As a consequence, with the objective of implementing the aforementioned actions, the SD was issued establishing the following provisions:
Likewise, to implement the aforementioned actions contained in the SD, the National Tax Administration established in the RND the following provisions:
Likewise, the term computation for the submission and processing of tax proceedings substantiated in the administrative courts (before the General and Regional Tax Challenge Authorities), as well as judicial proceedings (Tax Court Judges), is suspended. Similarly, the term computation for the initiation and processing of determinative and sanctioning proceedings under the control of National Tax Administration and the National Customs Administration is suspended, the terms for notifications of Determinative, Sanctioning, Administrative Resolutions and other challengeable final acts, are specifically suspended. The inspections and verifications scheduled by the tax administrations are exempted from the scope of this paragraph. The computation for suspended terms will restart automatically on the next business day after the Health Emergency Declaration is abolished.
Also, the aforementioned dates and extensions may be subject to changes in case the National Health Emergency and Total Quarantine throughout the Bolivian territory is extended beyond April 15.
- Mar 31, 2020
- by Super User
EVOLUTION OF THE MEASURES TAKEN BY THE BOLIVIAN GOVERNMENT AGAINST COVID-19
After the World Health Organization (WHO) declared the Coronavirus disease (COVID-19) pandemic, the Bolivian Government took several labor, tax, financial, customs and educational measures to stop the massive spread of this virus in society, as well as to reduce the effects of this pandemic on Bolivian society, in particular, on groups in a deprived economic situation.
This time, we decided to share with our readers and clients a compilation of all regulations (updated to March 27) related to the most important measures taken by the Bolivian Government against COVID-19, among these, we highlight the following:
- Health Emergency Declaration and mandatory quarantine in the entire territory of Bolivia. Work for public and private companies is temporarily suspended until April 15.
- Circulation of motorized vehicles during the quarantine is prohibited for public and private persons that do no have special authorization.
- Exceptionally, Companies that perform activities and services declared as essential during the emergency are exempted from the suspension of labors and the prohibition to circulate. These companies (pharmaceutical, energy, financial services, and other basic and indispensable services) should have a special permit issued by the Competent Authority.
- Ground, river, lake transportation and international flights are suspended from March 21 to April 15.
- Border closure from March 20 to April 15.
- Employees are entitled to earn 100% of their salary while the quarantine continues.
- Until December 31, 2020, the importation of supplies, medicines, medical devices, equipment, reagents and fever detectors acquired or donated, related to COVID-19, are deferred to 0%.
- Financial Entities are instructed to implement deferred payment mechanisms for loans until June 2020.
- Payment of the Gross Profit Tax (“IUE” in Spanish) initially due in April is deferred until May 29. People and companies may pay the tax through facilities of up to 3 monthly payments, without fines.
- The Government will grant: (i) a monthly Bonus to families with children in public schools (equivalent to $us 72 per chil); (ii) a family's basic needs package will be awarded to Bolivian families with the lowest incomes; and (iii) will assume a percentage payment on electricity and water bills during the months of April, May and June 2020.
- Fines and sanctions are established for those people and entities that fail to comply with the measures assumed by the Government.
Additionally, the following compilation of regulations provides easy access to the Bolivian regulations referenced above. This compilation shows the evolution of these measures.
Statement No. 12/2020 from the Ministry of Labor of March 26, 2020
Please find the cited regulation in the following link: https://www.mintrabajo.gob.bo/index.php/comunicacion/27-destacados/1270-comunicado-12-2020.html
Ministry of Productive Development and Plural Economy Statement of March 26, 2020
Please find the cited regulation in the following link: https://produccion.gob.bo/2020/03/comunicado/
Supreme Decree No. 4200 of March 25, 2020
Please find the cited regulation in the following link: https://bolivia.infoleyes.com/norma/7276/decreto-supremo-4200
Statement No. 11/2020 from the Ministry of Labor of March 24, 2020
Please find the cited regulation in the following link: https://www.mintrabajo.gob.bo/index.php/comunicacion/27-destacados/1268-comunicado-11-2020.html
Statement No. 10/2020 from Ministry of Labor of March 21, 2020
Please find the cited regulation in the following link: https://www.mintrabajo.gob.bo/index.php/comunicacion/27-destacados/1263-comunicado-10-2020.html
Supreme Decree No. 4199 of March 21, 2020
Please find the cited regulation in the following link: https://bolivia.infoleyes.com/norma/7269/decreto-supremo-4199
MEMO/ASFI/DNP/CC-2598/2020 of March 19, 2020
Please find the cited regulation in the following link: https://www.asfi.gob.bo/images/ASFI/DOCS/SALA_DE_PRENSA/Cartas_Circulares/CC-2598.pdf
Supreme Decree No. 4198 of March 18, 2020
Please find the cited regulation in the following link: https://bolivia.infoleyes.com/norma/7268/decreto-supremo-4198
Supreme Decree No. 4197 of March 18, 2020
Please find the cited regulation in the following link: https://bolivia.infoleyes.com/norma/7267/decreto-supremo-4197
Ministerial Resolution No. 189/20 of March 18, 2020
Statement No. 09/2020 from the Ministry of Labor of March 18, 2020
Please find the cited regulation in the following link: https://www.mintrabajo.gob.bo/index.php/comunicacion/27-destacados/1262-comunicado-09-2020.html
Supreme Decree No. 4196 of March 17, 2020
Please find the cited regulation in the following link: https://bolivia.infoleyes.com/norma/7266/decreto-supremo-4196
Supreme Decree No. 4192 of March 16, 2020
Please find the cited regulation in the following link: https://bolivia.infoleyes.com/norma/7265/decreto-supremo-4192
Statement No. 08/2020 from the Ministry of Labor of March 16, 2020
Please find the cited regulation in the following link: https://www.mintrabajo.gob.bo/images/Comunicados/2020/comunicado-08-2020.pdf
Bi-Ministerial Resolution No. 001/20 of March 13, 2020
Please find the cited regulation in the following link: https://bolivia.infoleyes.com/norma/7263/resolución-biministerial-01-2020
Supreme Decree No. 4179 of March 12, 2020
Please find the cited regulation in the following link: https://bolivia.infoleyes.com/norma/7262/decreto-supremo-4179
March 27, 2020
- Mar 30, 2020
- by Super User
The health emergency generated by the spread of COVID-19 has led different governments to take preventing measures aiming to stop the transmission of the virus in their territories. In Bolivia, the government ordered the total quarantine of the population as determined by Supreme Decree No. 4199 dated March 21, 2020, which provides in its Article 2, paragraph I:
“Article 2. – (Total Quarantine Declaration)
- In safeguard of life and health as fundamental rights of Bolivians, Total Quarantine is declared throughout the territory of the Plurinational State of Bolivia, from zero (0) hours on Sunday, March 22, 2020, until Saturday, April 4, 2020*, with the suspension of public and private activitiesin light of the national health emergency declaration against the transmission and spread of Coronavirus (COVID-19)”. [Added emphasis].
These determinations are adopted to adequately address the current situation generated by COVID-19. However, they also represent new legal circumstances that influence the fulfillment, or non-compliance, of contractual obligations.
These circumstances do not justify, by themselves, a failure to comply with the terms of a contract. To establish whether the current situation is a justified cause for non-compliance, the specific case must be assessed. The possibility that the pandemic and measures taken by governments are factors that influence contractual relationships depends on multiple factors such as:
- What type of contract is this?;
- Is there a clause that foresees this kind of situation?;
- Is there an alternative way to comply with contractual obligations?;
- What are the obligations regarding the communication of these circumstances?
For example, in some cases, these circumstances may result in the termination of the contractdue to supervening impossibility, in other cases, they justify a change in the term or schedule of compliance with obligations due to a cause of force majeure.
Bolivian jurisprudence, expressed in the Supreme Court of Justice Sentence No. 33/2015 of January 19, 2015, understands supervening impossibility and justified involuntary contract breach as “the insurmountable and unforeseeable obstacles presented after the contract signing, circumstances of “force majeure” and “act of God” that make it impossible to comply with the obligation, that is, when the person obliged does not comply with the obligation due to unforeseen reasons, unrelated to his will” [Added emphasis]. In other words, to claim the existence of an involuntary contract breach, it is necessary to prove that it is: i) an unforeseen event, ii) outside the will of the parties, and iii) that has occurred after the contract signing.
It is also possible for the parties to a contractual relationship to have agreedon a force majeure clause that determines aspects such as:
- What circumstances are considered force majeure (using a broad or restrictive definition). If the clause provides for a restrictive definition that does not specifically consider situations such as the ones created by the sanitary emergency, there may be differences among the parties as to the applicability of the clause.
- There may be a dutyto give notice of an event, in writing to the other party within a limited number of days, in which case the party that wishes to defer or stop contract compliance must act quickly and provide notice.
- The party claiming force majeure may need to take damage mitigation duties, and show that they tried to mitigate the damage caused by the unforeseen events.
In such cases, these clauses must be understood as an expression of the free will of the parties to the contract and, for the time being, Bolivian jurisprudence has not set limits on their contentand applicability.
We recommend that the decisions taken by the parties are always within the framework of contractual good faith. If one of the parties intends to invoke a circumstance of force majeure as a result of the current situation caused by COVID-19, the parties must respect any specificagreements between them and act diligently.
- Mar 26, 2020
- by Nina Leguizamon