Agreement SEFIN 552-2018 - Regulations for Customs Warehouses

PURPOSE. This Regulation has the purpose of establishing the norms and procedures to regulate operations carried out in General Deposit Warehouses and in Customs Deposits.

SCOPE OF APPLICATION. The provisions contained in this regulation shall apply to General Deposit Warehouses and to Customs Deposits.

DEFINITIONS. For the purposes of this Regulation, the following definitions are established: 1. GENERAL DEPOSIT WAREHOUSE: Public-use establishments for the storage and preservation of goods of all kinds, national or nationalized, hereinafter called Warehouse or Warehouses. 2. AREA EXPANSION: Those areas authorized by the hierarchical superior of the Customs Service; also allowing expansion on land adjacent to the Customs Deposit. 3. FISCAL AREA: Delimited area for the storage, custody, security, protection and preservation of merchandise, under fiscal vigilance and control with suspension of taxes, comprised within the limits established by customs regulations. 4. CAUCA: Central American Uniform Customs Code. 5. COMMISSION: National Commission for Banks and Insurance. 6. OPERATION CONTRACT: Document executed between the legal representative of the Customs Deposit and the holder of the Customs Administration, which contains the obligations and rights of the parties, for the provision of customs services of vigilance and fiscal control in relation to merchandise subject to suspension of taxes. 7. FISCAL DELEGATE: Employee of the Customs Administration who exercises inspection, fiscal oversight, control and vigilance of operations carried out during customs dispatch of merchandise. 8. CUSTOMS DEPOSIT OR CUSTOMS WAREHOUSE: Is the Regime by means of which merchandise is stored for a determined period, in a place authorized for such purpose, under the authority of customs, with suspension of corresponding taxes. 9. PRIVATE CUSTOMS DEPOSIT: Facilities authorized by the superior authority of the Customs Service under fiscal vigilance that shall be used for the exclusive use of the depositary and those persons authorized by the Customs Service at the request of the depositary, with suspension of taxes, to store vehicles, raw materials, agricultural machinery and explosives, in compliance with their productive activity or commercial operation. 10. PUBLIC CUSTOMS DEPOSIT: Facilities authorized by the hierarchical superior authority of the Customs Service under fiscal vigilance that shall be used by any person for the storage of merchandise, with suspension of taxes. 11. EXPLOSIVES: Chemical products and their mixtures prepared whose combustion or inflammation produces a large volume of hot gases. 12. AGRICULTURAL MACHINERY: All machinery that is used for the development of agricultural or agroindustrial activities by companies dedicated to these activities. 13. RAW MATERIALS: Any natural good or intermediate good in the production of finished goods to be used directly by industrial companies authorized to operate a Private Customs Deposit. 14. RECAUCA: Regulation of the Central American Uniform Customs Code. 15. REDUCTION OF FISCAL AREA: To reduce the area of facilities authorized by the Superior authority of the Customs Service, provided it is not less than the legally permitted minimum area. 16. SEFIN: Secretariat of State in the Office of Finance. 17. CUSTOMS SERVICE: The Customs Service is comprised of the organs of the Public Administration of the Member States, empowered to apply regulations on the matter, verify their correct application, as well as facilitate and control international commerce within its scope and collect the taxes to which the entry or exit of merchandise is subject, in accordance with the different regimes that may be established. 18. REPRESENTATIVE TITLE OF MERCHANDISE: The document issued by General Deposit Warehouses that represents the certificate of deposit, which grants the holder dominion over the goods and merchandise deposited in the custody of the Warehouse. 19. TRANSFER OF FISCAL AREA: Change of location of the customs depositary to another address. 20. TAXES: Customs duties, taxes, contributions, fees and other legally established tax obligations. 21. VEHICLES: Any automotive means of transport of persons, cargo or transport units.

PURPOSE. General Deposit Warehouses have as their principal purpose the development of activities related to the storage of goods or merchandise, and may carry out operations related to the course of business, detailed in Article 19 of this Regulation.

LEGAL REGIME. General Deposit Warehouses shall be governed by the Commercial Code, Law of the National Commission for Banks and Insurance, Law of the Financial System, Law of the Central Bank of Honduras, Law of Movable Guarantees, this Regulation and the Resolutions and Circulars that within its scope of competence are issued by the Secretariat of State in the Office of Finance, the Central Bank of Honduras and the National Commission for Banks and Insurance. Likewise, in accordance with Article 953 of the Commercial Code, General Deposit Warehouses are considered auxiliary credit institutions.

CAPITAL REQUIREMENT. Every Warehouse must be constituted as a corporation with fixed capital, which shall be divided into registered shares with a minimum subscribed and paid capital of TEN MILLION LEMPIRAS (L10,000,000.00) and with the exclusive purpose described in Article 4 of this Regulation. The minimum capital shall be set and/or modified by the Commission and the same shall be required of Warehouses through SEFIN.

REQUEST FOR AUTHORIZATION. Authorization for the establishment of a Warehouse shall be requested from the Secretariat of State in the Office of Finance, which shall grant such authorization after a favorable opinion from the Commission.

REQUIREMENTS FOR AUTHORIZATION OF A GENERAL DEPOSIT WAREHOUSE. The requirements to authorize the establishment of a Warehouse are as follows:

• 1)

  Request containing the name, nationality, identification number (RTI for natural person or legal entity); in the case of foreign persons they must present a passport or commercial registration number of the corporation, as well as the address of each of the shareholders;

• 2)

  The draft public deed of incorporation and bylaws;

• 3)

  The financial and administrative structure and the projections of the development of the corporation for the following three (3) years;

• 4)

  An exposition of the reasons of an economic nature that justify the establishment of the Warehouse proposed; which shall be validated by the Commission;

• 5)

  Title of ownership of the land and buildings that will be used for the development of its activities or the draft lease contract, if applicable;

• 6)

  Plans properly endorsed by a licensed civil engineer or architect, of the facilities and warehouses that will be used, whether owned or leased, indicating the useful capacity designated to receive goods or merchandise in deposit and all pertinent specifications;

• 7)

  Certification issued by a professional registered in the registry of valuers of movable and immovable assets, other assets and credit guarantees, authorized by the Commission, in which it is shown that the buildings, constructions or facilities in which the Warehouse will operate comply with the following aspects:

  • a)

    Adequate conditions of location, stability and conditioning for the storage of goods and merchandise.

  • b)

    Having concrete walls or walls of similar material, with windows and skylights properly protected.

  • c)

    Electrical installations must be protected with polyducts or protected wire. Control panels must be located, if possible, at the entrance of the premises and at all times must be in perfect working condition.

  • d)

    Must not have holes or spaces that allow leaks or drafts that could affect merchandise and must have sufficient ventilation to prevent excess humidity.

  • e)

    Vigilance twenty-four (24) hours a day.

  • f)

    Fire extinguishers in strategic locations for fire prevention. 8. The format to be used for Representative Titles of Merchandise; and, 9. Environmental license issued by the Secretariat of State in the Offices of Energy, Natural Resources and Environment, if applicable. The applicant must also comply, as applicable, with the requirements issued by the Commission on this matter.

PROCEDURE FOR AUTHORIZATION. Once the favorable opinion is issued by the Commission, the Secretariat of State in the Office of Finance shall, if appropriate, grant the authorization, proceeding to issue the certification of the corresponding Administrative Resolution, which must be notified to the Commission for the pertinent legal purposes.

DEED OF INCORPORATION. The public deed of incorporation and bylaws shall be registered in the Commercial Registry of the domicile of the corporation, once the process described in Article 9 of this Regulation is completed.

PUBLICATION. The Administrative Resolution by virtue of which authorization is granted, as well as the public deed and bylaws, must be published in the Official Gazette "La Gaceta" and in one (1) newspaper of greatest circulation in the country by the corresponding Warehouse, being required to send a copy of said publication to SEFIN and to the Commission.

REVOCATION OF AUTHORIZATION FOR FAILURE TO BEGIN OPERATIONS. SEFIN shall revoke the Administrative Resolution if, after six (6) months have elapsed, the Warehouse has not begun its operations, after verification and opinion of the Commission. At the request of the interested party and for justified cause, SEFIN may extend said period for up to three (3) additional months.

EXCLUSIVITY IN THE ISSUANCE OF REPRESENTATIVE TITLES OF MERCHANDISE. Only Warehouses authorized in accordance with this Regulation may issue Representative Titles of Merchandise.

MINIMUM CAPITAL. The Commission shall set the minimum initial capital for each Warehouse according to the class of operations it proposes to carry out and the location where it will conduct its business; but in no case shall it be less than the minimum capital indicated in the preceding Article 6. The Commission, based on the behavior of the economy and the growth of operations carried out in the warehouse system, shall update at least every two (2) years the amount of minimum capital and shall require when necessary its increase, determining the maximum time period in which it must be subscribed and paid.

LIMITS ON THE ISSUANCE OF REPRESENTATIVE TITLES OF MERCHANDISE. The total balance of Representative Titles of Merchandise that Warehouses issue shall not exceed fifty (50) times the paid capital plus capital reserves. Said amount shall be backed against the declared value or market value of the merchandise that the certificates warrant.

AUTHORIZATION TO EXCEED OBLIGATION LIMIT. Warehouses that acquire obligations equal to or greater than twenty percent (20%) of their capital and capital reserves shall request authorization from the Commission to carry out the operation.

GUIDELINES ON INVESTMENTS. Warehouses, in the case of new investments in their line of business, shall use capital and capital reserves and earnings, preferably in: 1) The establishment, conditioning and transformation of warehouses, silos and company offices, machinery, transport equipment, tools, implements and equipment necessary for its operation, in accordance with the terms of this Regulation. 2) Investments in securities and deposits, within the prudential limits established by the Commission.

PREVENTIVE ACTIONS IN CASE OF NON-COMPLIANCE WITH ASSET VALUATION. The classification of assets by Warehouses and the creation of reserves shall be supervised and adjusted by the Commission. In case of non-compliance, it may:

• 1)

  Limit the distribution of earnings and any other benefits and/or order that they be applied in whole or in part to the increase of capital or capital reserves, until the legal requirements are met.

• 2)

  Limit any of the operations permitted under this Regulation.

• 3)

  Apply any of the penalties or sanctions of this Regulation or another issued by the Commission.

• 4)

  Require compliance with additional capital beyond the minimum required, when the inadequacy of its processes for managing and controlling the risks it assumes, or the degree of concentration of such risks makes it necessary. CHAPTER IV OPERATIONS

PERMITTED OPERATIONS. Warehouses may perform the following operations:

• 1)

  Storage, safekeeping, conservation, custody and handling of goods or merchandise.

• 2)

  Issuance of Warehouse Receipts representing merchandise.

• 3)

  Changes in presentation or packaging, with the express consent of the owner of the merchandise for the purpose of protecting or preserving the physical state thereof, without substantially altering its nature.

• 4)

  Negotiation or obtaining of credits backed by Warehouse Receipts on behalf of their depositors; said operation by warehouses must be subject to the regulations issued by the Commission.

• 5)

  Receipt of merchandise on consignment, for delivery to the purchasers thereof, upon payment of their values and of commissions and expenses incurred.

• 6)

  Contracting of insurance on behalf of the client on the value of merchandise deposited, whether in general warehouses, leased or authorized warehouses, establishing that deductible amounts are the responsibility of the depositor.

• 7)

  Inventory management both in general warehouses and in authorized warehouses.

• 8)

  Deposit of national or nationalized merchandise in process of transformation or processing, being required to express in the Warehouse Receipts the product or products that will be obtained and their equivalence in weight, value, quantity, among others, provided that this represents a result or proportion that is acceptable, used and industrially proven.

• 9)

  Simple rental of determined spaces, supported by a lease contract.

• 10)

  Labeling of products or merchandise.

• 11)

  Assembly of offers and packages of various merchandise.

• 12)

  Order preparation.

• 13)

  Transport and delivery of products. Warehouses may perform one or more operations referred to in the preceding numerals provided they have been duly authorized by resolution issued by SEFIN. Any other operation not contemplated in the preceding paragraphs shall require authorization from the Commission. In the operations described in numerals 11), 12) and 13), the responsibility for transfer and security of the goods or merchandise shall be clearly established contractually between the Warehouse and the owner of the goods or merchandise.

REGARDING MERCHANDISE. Merchandise entering Warehouses may be covered by the issuance of Warehouse Receipts or by lease contracts, when it is simple rental of spaces. In the Warehouse Receipt shall be recorded the value of the goods or merchandise that it represents in accordance with the price recorded in the documentation provided by the depositor, as well as any damage or defect that the goods or merchandise received in deposit present. The Warehouse must ensure that the goods or merchandise entering its facilities or placed under its custody have the documentation that supports the lawful origin thereof. Likewise, they shall apply the necessary due diligence measures for client identification at the moment of establishing a service relationship, in accordance with the provisions of the Special Law Against Money Laundering and its Regulation. Warehouses may also issue Receipts for merchandise in transit, provided that the depositor and the pledgee creditor give their written consent, expressly accepting responsibility for shrinkage and other contingencies arising from the movement thereof; therefore the Warehouse shall not be responsible for losses caused by handling and distribution; however, these conditions must be clearly established in the issued Receipts. The documents must be issued or endorsed in favor of the Warehouse. Responsibility for custody, safekeeping and conservation corresponds to the Warehouse from the moment the goods or merchandise enter its facilities, which includes insurance coverage. The costs of import, transport and transport insurance are borne by the owner of the merchandise. Warehouses shall maintain a register of the Warehouse Receipts they issue, in which all data contained in said Receipts shall be noted, including those related to persons to whom they are delivered as guarantee. Merchandise received in Warehouses shall be stowed in a manner that permits easy location and verification. Likewise, they shall fully identify them, labeling them at a minimum with the following information: a. Name of the depositor. b. Number of Warehouse Receipt or contract to which it is associated.

NOTIFICATION REGARDING WAREHOUSES. Warehouses shall notify the Commission and SEFIN of the construction of new general warehouses, their expansions or modifications, accompanied by the documentation required in numeral 7 of Article 8 of this Regulation and any other additional information the Commission may require. Warehouses shall have the responsibility of ensuring that the buildings are maintained in optimal conditions at all times. The foregoing, without prejudice to compliance with any special requirement requested by the Commission.

RENTAL, AUTHORIZATION AND REAUTHORIZATION OF WAREHOUSES. Warehouses, in addition to their own facilities, may lease, authorize or reauthorize foreign facilities anywhere in the Republic to carry out the storage, safekeeping, conservation, custody, transformation and handling of deposited goods or merchandise. To do so, they shall notify the Commission and SEFIN of such matters, accompanied by the documentation required in numeral 7 of Article 8 of this Regulation, as applicable, and any other additional information the Commission may require.

MINIMUM CONDITIONS. Facilities when leased, authorized or reauthorized, shall comply at a minimum with the following requirements:

• 1)

  Direct access to public roads and shall be independent from the rest of the constructions located on the same property.

• 2)

  Good physical conditions of stability and adaptability that ensure the proper conservation of goods or merchandise stored therein.

• 3)

  Warehouses shall ensure that in insurance policies endorsed in their favor, if applicable, the name of the respective Warehouse, the address where the merchandise is deposited and the amount of the endorsement are recorded in the endorsement, which shall be equal to or greater than the balance of Warehouse Receipts issued in favor of the client.

• 4)

  When Warehouses designate as authorized warehouseman the depositor itself or any official or employee thereof, so that on its behalf and representation it takes charge of the safekeeping of goods and deposited national or nationalized merchandise, they shall guarantee the General Warehouse of Deposit the correct performance of these functions by means of bond or insurance issued by an insurance institution authorized to operate in Honduras, without prejudice to the Warehouse requiring accessory guarantees in accordance with this Regulation. Furthermore, they shall comply with the provisions of the complementary standards issued by the Commission that regulate this matter. The service contract for authorized facilities entered into between the Warehouse and the authorized depositor shall contain the scope, conditions, type of bond or guarantee and its amount, the policy number and name of the insurance institution that covers the national or nationalized merchandise, the term and any other requirements necessary for the fulfillment of this subrogated deposit contract. If the Commission, as a result of supervisions conducted, determines that the leased, authorized or reauthorized facilities do not comply with one or more of the requirements contained in numeral 7 of Article 8 of this Regulation, shall order the Warehouse to immediately transfer to other facilities and shall be subject to the corresponding sanctions, in accordance with the Sanctions Regulation to be Applied to Supervised Institutions in effect, issued by the Commission.

CORRESPONDENT RELATIONSHIP. Warehouses may act as correspondents of other warehouses; performing the operations established in Article 19 of this Regulation. However, when performing these operations, a contract must be signed defining the responsibilities between the participating warehouses, as well as of the depositors.

RESTITUTION OF GOODS. Except as provided in Article 26 of this Regulation, Warehouses are obligated to return the same goods or national or nationalized merchandise deposited therein, directly or indirectly in their facilities in the condition in which they received them, responding only for their conservation and for damages arising from their fault or negligence, with their responsibility limited to returning the amounts deposited or their value as applicable in accordance with their respective Warehouse Receipt. This provision shall not apply when, by court order, the goods or merchandise in the Warehouse's possession have been attached or seized, in any case, responsibility is also limited when there is non-compliance with Article 457 of the Commercial Code and Article 1956 of the Civil Code. Warehouses shall not insert in Warehouse Receipts, documents and stub books, seal inscriptions that distort the information that these Receipts must contain and furthermore, that are contrary to what is prescribed in Article 853, section VII of the Commercial Code which establishes that Warehouse Receipts must contain the specification of the merchandise or goods deposited, such as mention of their nature, quality, quantity and other circumstances that serve for their identification.

RETURN OF FUNGIBLE GOODS. When they receive goods or fungible things generically designated, Warehouses may agree with their depositors on return in equal quantity of other goods that are of the same kind and quality as those of the depositor, circumstances that must be indicated in the Warehouse Receipt with accuracy and may be referred to the kind and quality of samples that may be preserved in the Warehouse under conditions that ensure their authenticity for the purposes of restitution. In no case shall they be responsible for losses of weight, damages or deterioration arising from the inherent defects of the merchandise itself, nor shall they be responsible for lost profits caused by loss or damage.

DEPOSIT CONTRACTS. In the deposit contracts referred to in the preceding Article and that are entered into between depositors and the Warehouse, the contractual clauses established by means of regulations issued or subsequently required by the Commission and what this Regulation establishes shall be specified, likewise, the actions to be taken for those events that arise, such as the drop in price in the national market of deposited merchandise and whose value does not cover the amount of storage, including up to the process of auction or public sale and the treatment for those goods of rapid deterioration or imminent decomposition.

PERISHABLE MERCHANDISE. For the deposit of goods or merchandise susceptible to rapid deterioration or imminent decomposition, General Deposit Warehouses shall establish in advance the procedures to follow for the treatment of this type of goods or merchandise. The Warehouse shall grant the holder of the Warehouse Receipt a period of three (3) business days for the withdrawal of the goods or merchandise. Otherwise, the Warehouse must sell or discard said merchandise as soon as possible. The aforementioned acts shall be performed before a Notary Public and evidence and justification of all the above must be recorded in a report prepared by the Warehouse, which shall be sent to the Commission with its respective supporting documentation.

REGARDING WITHDRAWAL OF DEPOSITED MERCHANDISE. If upon expiration of the storage contract, the depositor or duly identified holder who possesses the Warehouse Receipt does not withdraw the deposited goods or merchandise, the Warehouse shall communicate to the holder the procedure to follow and shall grant a period of fifteen (15) business days for the withdrawal of the goods or merchandise. If after that period the goods or merchandise are not withdrawn by the Holder, the merchandise shall be considered abandoned, and the Warehouse may apply the procedures detailed below following the established order: 1. Sale Through Public Auction. 2. Direct Sale. 3. Disposal, Destruction or Incineration. In all cases the Warehouse shall verify that it gave prior written notice to the depositor of the procedure to be carried out. Whatever procedure is adopted, an instrument shall be executed before a Notary, which must be signed by the representative of the Warehouse, evidence and justification of all the above being recorded in the report prepared by the Warehouse, which shall be sent to the Commission with its respective supporting documentation.

PUBLIC AUCTION. Warehouses must conduct public auctions before a notary and considering the best offer, when due to non-compliance with any of the conditions established in the financing contract and due to failure to pay the amount owed, the holder of the Warehouse Receipt as guarantee in accordance with Articles 865 and 866 of the Commercial Code requests the Warehouse to sell the deposited merchandise and goods. The holder has the right to be paid from the amount corresponding at the maturity of the Warehouse Receipt. Otherwise and in order to preserve the expedited exchange action against the previous signatories responsible, the Receipt must be protested no later than the second business day following maturity.

SALE OF MERCHANDISE. For the sale of merchandise or national or nationalized goods in public auction, the following procedure shall be followed:

• 1)

  To announce the auction with indication of the place, day and time in which it is to take place, by means of notices published at least two (2) times in a newspaper of greater circulation of the domicile of the auctioning institution, where the auction will be held or the nearest one if there is none, to the city of Tegucigalpa or San Pedro Sula and furthermore by posters that will be visibly posted in the warehouses where the goods or merchandise to be auctioned are located, and in the offices of the Warehouse, for at least two (2) days;

• 2)

  The auctions shall be held in the offices of the Warehouse in the presence of a Notary and to carry them out shall serve as a basis the estimated value of the goods or merchandise in the corresponding Title Representing Merchandise, or in any case the one that covers the amount of the debt in favor of the Warehouse, including advances or loans that the Title guarantees; In this sole case, the depositor or owner of the merchandise shall retain their right of preference to recover them, upon payment of the amounts owed;

• 3)

  The price of the goods that are auctioned shall be paid in cash and in case there is no bidder, the Warehouse shall have the right to adjudicate such goods at the price that served as the basis for the auction;

• 4)

  If there is no bidder and the Warehouse does not make use of the right referred to in the paragraph preceding, it shall submit the goods to a new auction, reducing by twenty-five percent (25%) the original or initial base price;

• 5)

  The goods or merchandise that will be subject to auction shall be grouped in a single location. In case they are small objects, it shall be sufficient to display a sample, and;

• 6)

  The Commission shall regulate for those special cases the direct sale of goods or merchandise;

PROHIBITED MERCHANDISE. The Warehouses may not receive in deposit capacity things prohibited by laws or special dispositions.

CONDITIONS AND WAREHOUSE TARIFFS. The general conditions of the deposit contract established by the Warehouses, as well as their modifications, shall be evaluated by the Commission. The tariffs that they apply for the different services they provide shall be determined by each Warehouse based on the conditions prevailing in the market. However, these must be communicated to the Commission within the first ten (10) business days following the close of each month and published periodically.

LEGAL REGIME ON GENERAL DEPOSIT OPERATIONS. The issuance of Titles Representing Merchandise as well as general deposit operations shall be governed by the provisions of Chapter VII, Sections I and II of Title II of Book IV of the Commercial Code; as well as, the provisions established in the Movable Guarantees Law and its Regulation.

PROCEDURES MANUAL AND POLICIES. The Warehouses must approve and apply a manual of procedures and written decision policies related to the receipt, custody, safekeeping and withdrawal of the goods or merchandise that they receive in deposit, and others required through specific regulations issued by the Commission.

INSURANCE OBLIGATIONS. The Warehouses are obligated to insure against damage and loss their warehouses, facilities and the merchandise they receive in deposit; they must maintain in force a floating insurance policy or another type that must cover the actual value established in the Titles of the products or merchandise deposited, against the risks that may affect them. When the merchandise is not covered by the Warehouse's floating policy, the depositor must make the appropriate arrangements with an insurance institution authorized to operate in the country, and effect the endorsement of the damage policy in favor of the Warehouse. The indemnification minus the respective deductible corresponding to the goods or merchandise deposited, in case of loss, shall be applied in the terms of Article 866 of the Commercial Code. The Commission shall oversee compliance with this provision.

OBLIGATION TO INFORM. The Warehouses are obligated to make known to the depositor user of the General Warehouse service and to the National Financial System the general and specific conditions in the handling of the goods or merchandise that are subject to deposit.

OBLIGATION TO PUBLISH FINANCIAL STATEMENTS. It shall be the obligation of the Warehouses to publish annually and in one (1) newspaper of national circulation the audited financial statements by audit firms registered in the External Auditors Registry of the Commission, authorized for such purpose. In the same manner, the notes and complementary financial information that form an integral part of the financial statements shall be published.

LEGAL REGIME OF CUSTOMS DEPOSITS. Customs Deposits shall be governed by the provisions of the Central American Uniform Customs Code and its Regulation, Customs Law and its Regulation, Tax Equity Law and its Regulation and the provisions contained in the present Regulation.

CONSTITUTION AND AUTHORIZATION. Persons interested in establishing and operating a Customs Deposit shall formulate before the Customs Service a written request, which shall contain the following information:

• 1)

  Name, corporate name or designation and other general information of the petitioner and their legal representative, if applicable;

• 2)

  Precise indication of the activities to which it will be dedicated;

• 3)

  Address or means to receive notifications regarding the request; and,

• 4)

  Tax domicile and in its case address of their offices or main facilities.

DOCUMENTS ATTACHED TO THE REQUEST. The following documents must be attached to the Request:

• 1)

  In the case of legal entities, notarial or registry certification of the incorporation deed;

• 2)

  In the case of natural persons, a certified or legalized copy of the respective identification document and in case of being registered as individual merchants, a certified or legalized copy of the document that accredits them as such;

• 3)

  Original or certified or legalized copy of the document that accredits the representation, if applicable;

• 4)

  Certified or legalized copy of the identification document of the legal representatives and the subordinate personnel who will act before the Customs Service; and,

• 5)

  Certification issued by the competent authorities that it is current in the payment of all its tax obligations.

• 6)

  The ownership or right of use of the facilities for which it intends to obtain authorization, attaching the respective documentation;

• 7)

  Descriptive plan of the existing facilities or that will be built, identifying the areas that comprise them, among others, storage, custody and preservation of merchandise, office of the customs delegation, indicating the location, limits, square meters of surface area and access routes;

• 8)

  Opinion, in original, issued by a licensed active civil engineer or architect, regarding the type of construction of the facilities intended for customs deposit storage and appropriate for the storage, custody and preservation of merchandise according to the type or class that will be stored, fundamentally if it is merchandise of an inflammable, toxic nature or that may cause damage to health or the environment. Likewise, the opinion must indicate that it has the necessary areas for the reception, permanence, operation and maneuvering of transport means, without prejudice to inspection;

• 9)

  Indication of the system for controlling the movement and existence of merchandise and description of the automated equipment with which such controls will be carried out.

• 10)

  Licenses, permits, certificates or other documents for the storage, custody and preservation of merchandise according to the type or class that will be stored.

AUTHORIZATION PROCEDURE. Upon presentation of the authorization request, the Customs Service shall verify compliance with the requirements established for such purpose, and shall issue the authorization or rejection resolution, as appropriate. In case the petition has been presented in defective form, a period of ten (10) days shall be granted for its correction. After this period has elapsed without the applicant complying with what is required, the filing of the proceedings shall be ordered without further procedure. If the request presents errors or omissions that are not subsanable in the judgment of the Customs Service, the superior authority of the Customs Service shall issue the respective denial resolution, which shall be notified to the applicant.

AUTHORIZATION OF EXPANSION, REDUCTION AND RELOCATION OF FISCAL AREA. When it comes to construction of new warehouses, tanks, silos or other expansions or modifications to existing ones, as well as reductions and relocations, the Customs Depositary must request before the Superior Authority of the Customs Service the corresponding authorization. In no case shall be authorized what is indicated in the preceding paragraph, if the customs depositary is not current in the payment of its tax obligations.

REVOCATION OF AUTHORIZATION. The Superior Authority of the Customs Service shall revoke the authorization resolution, when the customs deposit does not begin operations within the period of six (6) months counted from the day following the notification of the Authorization Resolution. This period may be extended for three (3) months, upon prior request presented before the expiration date of the period indicated in the preceding paragraph, provided that the applicant demonstrates to the Customs Service the justifications of the case.

AUTHORIZATION PERIOD AND OPERATION. The authorization period to establish and operate a Customs Deposit shall be fifteen (15) years, extendable for equal and successive periods at the request of the interested party, which shall be granted upon prior evaluation of the performance of activities carried out, by the superior authority of the Customs Service.

PRIOR REQUIREMENTS TO BEGIN OPERATIONS. Natural persons or legal entities that request authorization to act as customs warehouse operators shall:

• 1)

  Present to the Customs Service a guarantee of immediate convertibility constituted in its favor, in an amount not less than one hundred fifty thousand Dollars (USD 150,000.00) or its equivalent in Lempiras, which may be increased by the Customs Service according to the volume of operations, taxes paid or declared and other parameters established by said Service registered during the previous period. The Guarantee shall be renewed annually and presented within fifteen days (15) before its expiration.

• 2)

  Designation of the appropriate area for the operation of the customs delegation.

• 3)

  Possess the equipment and programs necessary to carry out electronic transmission of the operations it will perform.

• 4)

  Execute with the Customs Service the Operating Contract for the Provision of customs services, surveillance and fiscal control, which must include within its clauses the obligation to render before the Customs Service a guarantee of immediate convertibility for a percentage equivalent to at least twenty percent (20%) of the total value of the operational fee to guarantee payment of labor liabilities.

• 5)

  The fiscal area shall be delimited by walls, fences or any other infrastructure, which must have a height not less than three (3) meters.

• 6)

  The buildings must be constructed of concrete or other similar material that offers security against theft, fire, moisture or deterioration of merchandise, with windows and skylights or air intakes properly protected, so that objects cannot be introduced or removed through them. In the case of installations for the storage of merchandise that by its nature cannot be stored in such buildings, it must have the certifications or authorizations from the competent authorities.

• 7)

  Fire extinguishers in strategic locations for fire prevention.

• 8)

  Have a security system through cameras with the specifications that the customs service establishes.

• 9)

  Have appropriate equipment that allows for the recognition, weighing, measurement and count of merchandise entering or leaving the Deposit. In the cases referred to in numerals 8) and 9), they must have the corresponding certifications.

OBLIGATIONS OF THE CUSTOMS WAREHOUSE OPERATOR. In addition to the obligations established in the CAUCA and its Regulations, the Customs Warehouse Operator shall have the following obligations:

• 1)

  Register and report in the Computer System of the Customs Service, the entry and exit of merchandise at the time of arrival or physical departure from the deposit;

• 2)

  Possess the area for the provision of repackaging and dispatch services;

• 3)

  Keep the administrative installations of the Customs Warehouse Operator separate from the storage, custody and conservation areas of merchandise and customs delegation;

• 4)

  Any others that the customs service assigns as control measures.

PERMITTED ACTIVITIES IN CUSTOMS DEPOSIT. Merchandise that is under the control of the customs authority in a Customs Deposit may be subject to the following operations:

• a)

  Consolidation or deconsolidation;

• b)

  Division and classification of shipments;

• c)

  Packing, unpacking and repacking;

• d)

  Packaging;

• e)

  Marking, remarking and labeling;

• f)

  Placement of commercial information legends;

• g)

  Extraction of samples for analysis or registration; and, h) Any other activity provided that it does not alter or modify the nature of the merchandise. The respective Customs Administration may authorize that the operations mentioned above be provided by the customs warehouse operators or by any natural or legal person under their responsibility, in the presence and under the supervision of the Fiscal Delegate.

SUPERVISION AND CONTROL OF CUSTOMS DEPOSIT. The Customs Deposit shall operate under the permanent supervision, vigilance and control under the jurisdiction of the nearest Customs Administration and the personnel designated by the Customs Service.

DECLARATION OF ENTRY TO DEPOSIT. The entry of merchandise into the Customs Deposit regime shall be made through electronic transmission of the corresponding merchandise declaration, which shall contain, as applicable, the information, data and documents required by the CAUCA and its Regulations, and the Manual of Customs Procedures.

PERMANENCE OF MERCHANDISE IN CUSTOMS DEPOSIT. In the Customs Deposit, merchandise may remain for a period of up to one year, non-extendable, counted from the date of receipt of the merchandise by the warehouse operator. Once this period expires, the merchandise shall be considered abandoned.

SUPERVISION OF CUSTOMS DEPOSIT. The receipt, dispatch and handling of merchandise shall be the responsibility of the administrative personnel of the Customs Deposit who have been accredited before the Customs Service. The control and immediate supervision of these operations shall be the responsibility of the Fiscal Delegate designated by the Customs Service. The expenses incurred by the State to exercise the control and supervision referred to in the preceding paragraph shall be charged to the account of the deposit holder. The value of these expenses includes: The salaries and wages and other expenses incurred in the provision of this service, which shall be determined by the Customs Service.

TRANSFER OF MERCHANDISE. The Customs Administration shall not authorize the transfer of merchandise to a customs deposit in any of the following cases:

• 1)

  If they have fallen into abandonment.

• 2)

  When the merchandise is subject to prohibited trafficking.

• 3)

  If due to the nature of the merchandise the customs deposit does not have authorization to store the declared merchandise.

• 4)

  If the guarantee of immediate convertibility presented by the warehouse operator for commencement of operations does not cover the amount of customs duties and other applicable charges.

RECEPTION AND EXIT RECORDS. The warehouse operator and the Fiscal Delegate shall keep records of receipt and exit of merchandise for each consignee, through control systems that allow, at any time, easy determination of inventory. In the records, the following information shall be noted, at a minimum:

• 1)

  Name, business name or designation of the depositor or consignee.

• 2)

  Number of the customs declaration processed under the Customs Deposit Regime and date of receipt of the merchandise.

• 3)

  Quantity of shipments entered and withdrawn, marks, counter-marks and numbering thereof, damage, shortages or surpluses of shipments.

• 4)

  Detailed description of the merchandise, by model or style.

• 5)

  Number and date of the merchandise declaration corresponding to the regime to which the deposited merchandise has been subject.

• 6)

  Date of receipt and exit.

HANDLING OF MERCHANDISE IN CASE OF THEFT, SHRINKAGE, DETERIORATION OR DAMAGE. When it is observed that the deposited merchandise shows signs of theft, shrinkage, deterioration or damage, the Fiscal Delegate shall immediately notify in writing the Customs Administrator, who shall order that jointly, they proceed to inventory the same. At the end, those present shall sign the respective record, which shall be attached to the original of the corresponding declaration of entry of merchandise to the Customs Deposit regime. Based on the results of this verification, the Customs Administrator shall proceed to assign the corresponding responsibilities aimed at the protection of the interests of the fiscal authority.

PHYSICAL INVENTORIES. The Fiscal Delegate shall conduct physical inventories of the merchandise, at least every three (3) months. These inventories shall be carried out with the customs personnel designated by the respective customs administration.

WITHDRAWAL OF MERCHANDISE FROM CUSTOMS DEPOSIT. For the withdrawal of merchandise from customs deposits, it shall be necessary to have authorization from the corresponding Customs Authority, once the requirements and legal formalities established for the requested regime or operation have been met. The withdrawal of merchandise may be total or partial for each requested regime or customs operation.

PARTIAL WITHDRAWALS OF MERCHANDISE. The Customs Administration may authorize partial withdrawals of merchandise that are in customs deposits, provided that they are covered by the same bill of lading and are complete shipments. In the Merchandise Declaration that covers the first partial withdrawal, the original documents must be presented and in subsequent withdrawals the number and date of acceptance of the Declaration that covered the first withdrawal shall be correlated.

HANDLING OF ABANDONED MERCHANDISE. Merchandise that has fallen into abandonment shall be separated from the rest and placed at the order of the Customs Service, which shall receive it after inventory. Said merchandise shall be sold at public auction following the procedures established in customs legislation.

SUPERVISION AND VIGILANCE OF GENERAL STORAGE WAREHOUSES AND CUSTOMS DEPOSITS. The supervision and vigilance of the General Storage Warehouses shall be in charge of the Commission and in the case of Customs Deposits, it shall be the responsibility of the Customs Service.

TRANSMISSION OF INFORMATION. In accordance with the general instructions that shall be communicated to the General Deposit Warehouses, they shall present to the Commission, within the first ten (10) business days of each month, the balance sheets and financial information of the operations corresponding to the previous month. Likewise, they shall be obligated to provide other data and information, periodic or occasional, that the Commission may request. Such reports shall be signed by two officials or employees with at least authorized signature and may be verified at any time. The Commission shall order a Warehouse to implement corrective measures when administrative, operational, financial deficiencies or non-compliance with applicable regulations are determined, considering the specialized nature of the operations corresponding to the General Deposit Warehouses sector, and they shall be subject to the sanctions established in the Sanctions Regulation to be applied to Supervised Institutions.

REPORTS. The operations referred to in Articles 21, 22, 28, and 29 of this Regulation must be reported semiannually to the Commission and to SEFIN, within a maximum period of ten (10) business days following the closing of the months of June and December of each year.

RULES. The Commission shall establish the rules that Warehouses must follow in their accounting, and these may freely choose auxiliary methods provided they are within such rules and allow their true situation to be easily appreciated. Likewise, it shall establish the necessary standards for the presentation of their accounts, summaries, and balance sheets, intended for publication.

SANCTIONS. When the Commission determines that the Warehouses have committed infractions to the provisions of this Regulation and other applicable legal dispositions, it shall proceed to impose sanctions in accordance with what is established in the Sanctions Regulation to be applied to Supervised Institutions. The non-compliance with customs and tax obligations described in this regulation, as well as the resolutions issued by the Customs Service, must be sanctioned in accordance with what is established in the Tax Code and other applicable legal framework in force. Any action or omission that violates the customs legal system constitutes a customs infraction.

IMPROPER USE OF MERCHANDISE. If the diversion of merchandise or improper use thereof is verified, or any fraudulent act constituting tax fraud in detriment to the State, the Customs Depositary shall incur administrative, civil, and criminal liability as applicable.

VOLUNTARY LIQUIDATION. If the shareholders of a Warehouse, meeting in assembly, decide to end their operations, they shall present to SEFIN the request for voluntary liquidation, including: 1) Program for the liquidation of their business or operations. 2) Sufficient guarantees for the fulfillment of all their obligations to third parties. 3) The proposal for the appointment of the liquidator or liquidators. Said request shall be resolved by SEFIN, prior to the opinion of the Commission. SEFIN must proceed to cancel the authorization to operate, simultaneously with the approval of the voluntary liquidation program. Voluntary liquidation shall not apply to Warehouses when:

• 1)

  The Warehouse is in a situation of insolvency;

• 2)

  There are reasonable grounds indicating that the Warehouses, shareholders, or directors thereof have participated in illicit activities;

• 3)

  The Institution or members of its Board of Directors or Board of Administration or shareholders and principal officials perform or have been involved in illicit activities; and,

• 4)

  The members of its Board of Directors or Board of Administration or shareholders and principal officials have participated in any action in such a manner that endangers the interests of the public, the viability of the Warehouse, or the stability of the financial system. The Commission, taking into account the nature of the supervision that the Law of the National Commission of Banks and Insurance confers upon it, as well as in accordance with what is established in the Financial System Law, may recommend to SEFIN the application of other resolution measures that may be utilized by the Warehouse, with the purpose of maintaining the stability of the institutions of the supervised financial system. In this case, the Commission shall recommend the moment at which the license to operate as a Warehouse must be canceled.

FORCED LIQUIDATION. The forced liquidation of the Warehouses shall be the responsibility of SEFIN, and shall be governed by what is provided in the articles of incorporation, this Regulation, the standards established in the Commercial Code, Financial System Law, and Law of the National Commission of Banks and Insurance. SEFIN shall declare the forced liquidation of a Warehouse prior to the opinion of the Commission, when one or more of the situations described in the fourth paragraph of Article 66 of this Regulation are presented, or if in the institution administrative or financial deficiencies are determined that prevent the viability of the Warehouse as an ongoing concern. SEFIN shall proceed to cancel the authorization to operate and shall appoint the liquidator or liquidators, simultaneously with the forced liquidation resolution. Notwithstanding, the Commission, taking into account the nature of the supervision that the Law of the National Commission of Banks and Insurance confers upon it, as well as in accordance with what is established in the Financial System Law, may recommend to SEFIN the application of other resolution measures that may be utilized by the Warehouse, with the purpose of maintaining the stability of the institutions of the supervised financial system. In this case, the Commission shall recommend the moment at which the license to operate as a Warehouse must be canceled.

DISQUALIFICATION. Disqualification is the temporary suspension of customs operations and shall be applied by the Customs Service through the corresponding notification when its grounds are properly proven.

GROUNDS FOR DISQUALIFICATION. The grounds for disqualification are, among others: 1. Expiration of the operations guarantee without the respective renewal. 2. Non-compliance with customs and tax obligations duly notified and not paid within the established period. 3. Non-compliance in the annual presentation of the tax solvency certification issued by the competent authorities. Disqualification shall be maintained as long as the ground that originated it persists.

CANCELLATION OF A CUSTOMS DEPOSIT. The authorization to operate a Customs Deposit shall be canceled by the superior authority of the customs service, in any of the following cases: 1. For recidivism in the non-compliance of the obligations undertaken in its capacity as customs depositary, in the custody of merchandise, and any non-compliance that includes tax obligations. It is considered that recidivism exists when the depositary fails to comply with the same obligation on more than two occasions within a period of one year counted from the date on which the administrative resolution acquired a definitive character. 2. For having been convicted the customs depositary for the crimes of smuggling or tax fraud.

CESSATION OF OPERATIONS. The authorization to operate a Customs Deposit shall cease for the following causes: 1. For expiration of the period of authorization to operate the customs deposit, without the extension having been requested before expiration or within the thirty (30) days following expiration. 2. For voluntary resignation of the depositary, in which case it must be duly justified and accepted by the Customs Authority. In this case, the depositary must communicate it to the Customs Service at least one month prior to cessation. 3. For any of the causes provided for terminating the duration of the legal entity that exercises this activity, in accordance with the Commercial Code. Once it is determined that there are no pending obligations with the Tax and Customs Administration, the Customs Service shall authorize the request, shall proceed to the temporary or definitive cessation of the concession, and shall make the annotations in the respective register. In both cases, the depositary must notify the Customs Service of the existence of merchandise subject to customs control in its facilities, so that it may verify its existence and order, in such case, its transfer to another customs deposit. In case of pending tax debts to be paid, the Customs Service shall initiate the relevant administrative and judicial procedures for their payment.

ADMINISTRATIVE DISPOSITIONS. The Customs Service, through its superior authority, shall have a period of six (6) months from the effective date of this Regulation to issue the procedures and technical criteria necessary for the application of this Regulation.

SUPPLEMENTARY APPLICATION. Matters not provided for by this Agreement shall be resolved in accordance with the applicable legal dispositions.

REPEAL. Agreement No. 0681 issued by the Executive Branch through the Ministry of Finance on November 19, 2004, and other regulatory provisions that conflict with the dispositions contained in this Regulation are hereby repealed.

EFFECTIVE DATE. This Regulation shall become effective on the date of its publication in the Official Journal "La Gaceta."