Actualidad Ecuador

Organic Entrepreneurship & Innovation Act

Bill for an Organic Law

At the end of 2018, the Republic of Ecuador's National Assembly presented the Organic Entrepreneurship & Innovation Bill, setting out a regulatory framework that provides incentives for the creation, development, growth and expansion of entrepreneurial projects, as a basis for the country's productive development.

The bill covers the following important areas:

Public policies

The regulation recognizes that the State has the obligation to implement policies that encourage entrepreneurial development and growth, streamlining the process of setting up a company by making the paperwork simpler and by assigning public resources. To this end, the bill creates the National Council for Entrepreneurship & Innovation -in charge principally of designing a national entrepreneurship and innovation strategy- and the National Registry of Enterprises, which will classify enterprises so that they can benefit from the programs provided for in the law.

In addition, the law requires training content designed to develop the entrepreneurial and innovation-focused spirit to be included in obligatory secondary education and supports initiatives that bring young university students closer to the world of business.

Intellectual property and innovation

The bill simplifies patents and brands procedures and grants preferential access to sources of financing and investment to projects considered to be innovative, in alignment with the criteria set by the National Council for Entrepreneurship & Innovation.

Alternative sources of financing

To make access to financing easier, the law recognizes alternative sources to the traditional ones: seed capital, venture capital, angel investing, investment risk, crowdfunding platforms.

Lastly, the bill outlines certain amendments to the Companies Act and the Auditing Firms Act, adding a section on simplified joint-stock companies in the first Act, and a section on group profit and interest companies in the second.