The legislature approved on August 21 the Regulatory Act for granting concessions for electricity generation projects on a small scale (less than 5MW), which limits the maximum concession period to 50 years and requires that energy projects be approved by the Assembly.

Previously, the approval of the concessions was the responsibility of the Superintendency of Electricity and Telecommunications (Siget). Under the new law, "the Siget will be responsible only for the proceedings, but it will be the deputies who must approve the concessions."

"After a year of study, legislators attended a ruling by the Constitutional Chamber of the Supreme Court on June 27, 2012, which resolved to put limits on the concessions and require that they be approved by the Assembly.

Source: elmundo.com.sv

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Proposed Tax On Geothermal Exploitation

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The Congress of El Salvador is evaluating implementing a tax which would in principle would apply only to LaGeo, a subsidiary of the Italian company Enel.

Against the backdrop of the dispute between the Government and the Italian company Enel over the capitalization of the geothermal LaGeo, "...an ad-hoc committee of the Legislature which is studying the LaGeo concession, the only cmpany with state permission to exploit subterranean heat sources, has proposed a series of amendments to the Electricity Law, including a tax that would be incurred by the activity of the geothermal company. "

Free Zones Law Reform in El Salvador

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Companies starting operations in free zones outside the metropolitan area will be fully exempt from income tax for 15 years.

From a press release issued by the Legislative Assembly of El Salvador:

With 82 votes from all of the parliamentary groups, the Legislature approved tonight reforms to the Law on Industrial Free Zones, which according to the ruling, will generate greater certainty and legal security for the productive sector.

Construction of New Legislative Building Announced

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The president of the Salvadoran Assembly has presented an outline for the the new Legislative Assembly building project.

The project will be financed by the Inter-American Development Bank (IDB) with $5 million, over a 25 year term.

The new 8 floor building will have a meeting and conference room and larger installations than those at the current site, among other things.

El Salvador: $3.654 Million in 2010 Budget

November 2009

The Legislative Assembly passed the General Budget for 2010: $3.645 million.

This edition is marginally higher than the budget for 2009, which stood at $3.627 million.

"The opposition party warned that social expenditure was reduced by $17 million, and that the Executive plans a Tax reform to collect $250 million", reported EFE.