Regulations of the Land Transport Law of Honduras

The purpose of this Regulation is to regulate the provisions contained in the Land Transportation Law of Honduras, hereinafter referred to as "The Law", with respect to the provision of public and special services for land transportation of persons, cargo and merchandise and the provisions that regulate private vehicles.

For a better understanding of this Regulation, the words listed below, whether written in singular or plural, shall have the following meaning: CALENDAR DAYS: All days including Saturday, Sunday and holidays. BUSINESS DAYS OR WORKING DAYS: All days excluding Saturdays, Sundays and holidays. TRUST: For purposes of this Regulation, it refers to the fund established to sustain the economic autonomy of the Honduran Institute of Land Transportation. QUALITY INDICATORS: Refers to the specific criteria of quality and the levels of service that concessionaires must comply with according to what is defined in their respective Concession Contracts. SPECIAL PERMIT: Administrative act of the Honduran Institute of Land Transportation by means of which the provision of special transportation services is authorized. INTEGRATED PUBLIC TRANSPORTATION SYSTEM: It is the system that comprises the actions for the articulation, linking and integrated physical, technological and tariff operation of the different modalities of public transportation; as well as the requirements for infrastructure, accessibility, circulation and collection of the system. Said system shall be governed by the institutions and organisms established in accordance with law for the functioning of the public transportation system. LAND TRANSPORTATION: Without prejudice to what is established in the Law, land transportation is called the action of providing integral and related services, including terminals, and their auxiliary services, for the transfer of persons, things, substances, and others, making use of installations and the road network. MINIMUM ACCEPTANCE VALUE: In the context of quality indicators, it refers to the minimum measurable values with which it is evaluated whether the concessionaire is providing the concession services with the quality expected by the Institute and users. TITLE II: AUTHORITY IN TRANSPORTATION MATTERS CHAPTER 1: HONDURAN INSTITUTE OF LAND TRANSPORTATION (IHTT)

The general structure of the Institute is composed of the following organisms: 1. The Board of Directors of Land Transportation (CDTT). 2. The Advisory Council of Land Transportation (CATT). 3. The General Inspectorate of Land Transportation (IGTT). 4. The National School of Land Transportation (ENTT). The administrative and technical organization of the Institute and its departments are under the charge of the Board of Directors of Land Transportation (CDTT).

The Board of Directors of Land Transportation (CDTT) is the highest-ranking organism within the Institute, which shall have the powers assigned in the Law and this Regulation, and is composed of three (3) Commissioners and a Secretary General, under the procedure established in this Regulation. The Commissioners must have specialized knowledge or experience, one in land transportation, another in administration and one specialist in finance. The Board of Directors of Land Transportation (CDTT) must meet in session once per week, without prejudice to extraordinary sessions that may be convoked. Without prejudice to the powers contained in the Law, the Board shall have the authority to create the fees and charges to be collected for procedures, services, authorizations, permits and licenses that it issues.

The Commissioners shall be appointed by the Constitutional President of the Republic, from a list of six (6) candidates proposed by the Advisory Council of Land Transportation (CATT) under the following selection mechanism:

• a)

  The proposed candidates must meet all the requirements to be members of the Board of Directors, as established in Article 9 of the Law;

• b)

  The requirement indicated in Article 9.3 of the Law shall be applicable according to the specialty that each Commissioner must accredit;

• c)

  The Advisory Council shall publish in two (2) newspapers of widest circulation in the country the invitation to submit expressions of interest for the position of Commissioner, requiring a minimum of five (5) applicants in each of the specialties, in which the necessary requirements to qualify for such position must be indicated, the receipt of documents shall take place at the offices of the Advisory Council and shall have a receipt period of ten (10) business days counted from the date of publication;

• d)

  Once the documentation is received, the Advisory Council must verify its authenticity, conduct interviews and evaluate the corresponding knowledge within a period not exceeding fifteen (15) business days;

• e)

  Once the six (6) candidates are selected, the proposed list shall be sent to the Constitutional President of the Republic within a period not exceeding five (5) business days;

• f)

  In case of not having the minimum participation of applicants or if there are no applicants who meet the requirements established in the Law to complete the list of six (6) candidates established in Article 8 of the Law, the established procedure shall be carried out one (1) additional time only, and in case of obtaining the same result, the Commissioners shall be elected directly by the President of the Republic, taking into account the requirements established in Article 9 of the Law.

The Secretary General is selected from among a slate of three (3) candidates proposed through a selection process. The Secretary General must be a lawyer and must comply with the same requirements established for the Commissioners, insofar as they correspond to his or her position. The Secretary General has the right to speak, but not to vote, the decisions of the Board being adopted in a collegial manner by the three (3) Commissioners.

The Secretary General of the Board has the following special powers and authorities:

• 1)

  Act as Secretary of the Board;

• 2)

  Receive requests and petitions presented before the Institute and maintain the corresponding registry of files;

• 3)

  Sign all administrative decisions and orders;

• 4)

  Countersign the signature of the Commissioner who holds the representation of the Institute in the resolutions issued;

• 5)

  Make notifications to the interested parties, as appropriate, of the decisions, orders and resolutions issued by the Institute;

• 6)

  Present periodic reports to the Board regarding the matters under his or her responsibility;

• 7)

  Keep the minutes and agreements, prepare the agenda and carry out communication acts for the sessions of the Board, as well as regarding other matters within the competence of the Institute;

• 8)

  Issue the certifications that interested parties request for the purposes they deem appropriate; and,

• 9)

  Exercise the other functions assigned to him or her by the Board of Directors and that correspond to the nature of his or her position.

The Regional, Departmental and Local Delegates are appointed by the Board of Directors of Land Transportation (CDTT). The Board of Directors of Land Transportation (CDTT) may create the delegations it considers appropriate according to the needs of the sector in a determined geographic area, provided that the requirement has previously been incorporated in the Annual Operating Plan and in the Budget of the Institution. ARTICLE 9. COMPETENCE OF REGIONAL, DEPARTMENTAL AND/OR LOCAL DELEGATES: The Regional, Departmental and Local Delegates have the powers and authorities delegated to them by the Board of Directors of Land Transportation (CDTT), and may act as extensions of the Secretary General for purposes of processing and resolution of matters under their responsibility.

To be a member of the Advisory Council of Land Transportation (CATT), the following requirements must be met:

• 1)

  Be Honduran by birth;

• 2)

  Possess a university degree;

• 3)

  Be in full enjoyment of civil rights and be of recognized honor;

• 4)

  Not be spouse or relative within the fourth degree of consanguinity and second degree of affinity between Councilors;

• 5)

  Not have pending accounts with the State; and 6) Not have a criminal record.

The Advisory Council is composed of seventeen (17) Councilors, who are appointed in the following manner:

• 1)

  The owner and alternate representatives of the Government shall be appointed by Agreement issued by the President of the Republic, through the Ministry of Infrastructure and Public Services (INSEP);

• 2)

  The representatives of the legally recognized organizations of the transportation sector shall be appointed by the same transportation sector in accordance with the statutory procedure that governs it, and must also comply with the requirements established in Article 9 above. One representative must be named for each of the following sectors: taxis, mototaxis, urban bus service, interurban service, general cargo transportation and specialized cargo transportation;

• 3)

  The representatives of users appointed by legally constituted organizations and organizations of the transportation sector shall be made through a public invitation in two (2) newspapers of widest national circulation, which must contain the requirements established in this Regulation and the documentation that certifies the legality of the constitution of each organization as well as its functioning, in the same manner the reliable documentation that certifies the representation of the proposed candidates;

• 4)

  The deadline for presentation of the documentation required for accreditation of all representatives may not exceed fifteen (15) business days counted from the publications referred to in the preceding paragraph.

They shall be elected by the seventeen members that make up the Advisory Council from among the nine representatives of the public sector. The members of the Council shall serve four (4) years in their functions and in the fulfillment of their legal and regulatory powers. The Advisory Council may be assisted by specialized technical staff that allows it to monitor and comply with its tasks. This technical staff shall be composed of a group of no more than five (5) specialists in the areas of projects and monitoring thereof.

The publication of the notice of convocation shall be made in two (2) newspapers of widest national circulation forty-eight (48) hours before the date set for the meeting. The meeting in first and second call shall be announced simultaneously. Meetings may be held in any place within the national territory, and must always leave reliable evidence of the attendance of those who participated in them. When it comes to plenary meetings, these may meet without prior convocation, in any place in the Republic of Honduras. The session shall be presided over by the President of the Advisory Council or his or her substitute, and shall act as Secretary the one from the Advisory Council and in their absence, those designated by the members of the Council present. For the Council to be considered legally assembled in ordinary and extraordinary sessions, at least fifty percent (50%) of the members with the right to vote must be represented and resolutions shall only be valid when adopted by a majority of the votes present. If the meeting, ordinary or extraordinary, were held on second call, the Council shall be considered validly constituted regardless of the number of members represented. Decisions must be made by the favorable vote of a number of members representing at least fifty percent (50%) of the members with the right to vote. The disintegration of the quorum of presence shall not be an obstacle for the session to continue and to adopt agreements if voted by the majority present. The minutes of the sessions shall be recorded in the respective book that must be signed by the President and Secretary of the Council. When for any reason the minutes cannot be recorded in the respective book, it shall be notarized.

It has as its objective to assist in the execution of the powers of the Board, as well as to supervise and monitor the provision of land transportation services in its different modalities in accordance with the Law, respective Regulations and other directives that the Board of Directors expressly determines. The General Inspectorate shall be under the charge of an Inspector General of Transportation and a Sub-inspector and other auxiliary staff of the sections that make up the General Inspectorate, which are deemed necessary for its proper functioning, who are appointed by the Board of Directors.

In addition to the requirements established in Article 16 of the Law, the Inspector General of Transportation and the Sub-inspector of this General Inspectorate must meet the following requirements:

• 1)

  Possess a professional university degree;

• 2)

  Not be spouse or relative within the fourth degree of consanguinity and second degree of affinity of the members of the other transportation authorities; and,

• 3)

  Not have been or be a direct or indirect concessionaire of the transportation service, nor be in any circumstance that could cause a conflict of interest.

The General Inspectorate has the following functions:

• 1)

  Receive, process and resolve complaints, reports and communications from public or private institutions, as well as from individuals, related to the functioning of public land transportation services;

• 2)

  Request information and documentation from land transportation concessionaires of persons and cargo, related to the provision of transportation services;

• 3)

  Provide operational support in the different processes that the different directions and units of the Institute request in this regard;

• 4)

  Conduct inspection of school transportation and transportation of minors;

• 5)

  Conduct inspection of maximum authorized weights and dimensions of cargo;

• 6)

  Design the respective planning, which, prior to execution, must be submitted to the knowledge and approval of the Board of Directors, and must especially consider in such planning, the supervision of those routes in which the provision of the service by various concessionaires;

• 7)

  Receive reports of system performance from fleet control or physical inspections for the application of the different sanctions established in the Law and its regulations; and,

• 8)

  Comply, as applicable, with the standards established in the Law and its respective regulations.

SPECIFIC FUNCTIONS OF THE GENERAL INSPECTOR OF TRANSPORT AND SUB-INSPECTOR: The General Inspector of Transport or, in his absence, the Sub-Inspector, has as his principal function to direct and coordinate all sections of the General Inspectorate, and must comply with the provisions and instructions issued for this purpose by the Directive Commission. The Sub-Inspector maintains the hierarchy after the General Inspector of Transport, whom he represents or substitutes in case of absence. The Sub-Inspector must assist in the coordination activities and management of functions and activities corresponding to his role.

ORGANIZATION OF THE GENERAL INSPECTORATE OF LAND TRANSPORT: The General Inspectorate must have in its internal structure at minimum the following sections:

• 1)

  Supervision Section: It is responsible for carrying out patrols, surveillance operations, control and supervision on the country's road network, as well as all those functions related to verification and supervision that correspond to it;

• 2)

  Section for Reception and Treatment of Complaints: It has the attributions referred to in Article 18 of the Law, as well as maintaining a registry of complaints and denunciations received with the necessary data for their identification and registration;

• 3)

  Investigation Section: It is responsible for conducting investigations on the complaints received and issuing the respective reports in order to subsequently be sent to the Directive Commission;

• 4)

  Sanctions Section: It is responsible for imposing and executing the corresponding sanctions in accordance with the instructions issued by the Directive Commission, based on the reports it receives from the investigations conducted, as well as those that according to the categorization of sanctions correspond to it. This section must maintain a Registry of the sanctions applied, in order to determine the recidivism of offenders; and, 5. Other Sections: The Directive Commission may create in the internal structure of the General Inspectorate, other sections that it deems appropriate according to the needs for the fulfillment of its functions.

PATROLS, SURVEILLANCE, CONTROL AND SUPERVISION OPERATIONS ON THE ROAD NETWORK: To carry out these activities, the Supervision Section of the General Inspectorate must establish, either by itself or through its Regional, Departmental and/or Local Delegates, a quarterly coordination program of control and supervision mechanisms. At the control posts established by the General Traffic Administration, the General Inspectorate may also conduct its activities, each within the scope of its competence. When these do not exist, the General Inspectorate must establish checkpoints or control posts, fixed or mobile, at the entrance of the principal cities and at the junctions of highways with the greatest circulation of passenger vehicles, with the objective of guaranteeing control and supervision of operations and faithful compliance with the Law and this Regulation.

PROCEDURE FOR CHALLENGING SANCTIONS: For the challenging of sanctions imposed, the procedure established in the Administrative Procedure Law must be followed.

POLICE ASSISTANCE: The National Traffic Administration must provide police assistance when requested by the Inspectors for the conduct of inspection and supervisory actions that correspond to them.

NATIONAL SCHOOL OF LAND TRANSPORT (ENTT): The National School of Land Transport is responsible for the certification of drivers for both public and special service, as well as for private vehicles. Private Driving Schools intended for the training or instruction of drivers for the provision of public and special land transport services, as well as for private vehicle drivers, must be authorized by the National School of Land Transport. To obtain a Driver's License, the interested party must demonstrate having approved the process of theoretical and practical training or instruction by a certified private school and, furthermore, having obtained the certification of the National School of Land Transport. The Institute, in its capacity as settlor and beneficiary, must incorporate the system of the aforementioned schools in this Article into the Public-Private Partnership project called "Operation, Functioning, Financing and Administration of the Vehicle Property Registry at the National Level and Implementation of Vehicle Inspection Centers, Supply of License Plates, Granting of Driver's Licenses, Modernization of the Traffic Sanctions and Infractions System and Technification of Fines Collection", approved by Legislative Decree No. 369-2013 of March 22, 2014.

AUTHORIZATIONS FOR PRIVATE DRIVING SCHOOLS: To obtain the authorization of a private driving school, in any of its modalities, an application must be submitted to the Institute, complying with the formalities of the Administrative Procedure Law, and through which the following requirements must be demonstrated:

• 1)

  Certificate of incorporation of the commercial corporation;

• 2)

  National Tax Registry;

• 3)

  List of permanent instructor personnel that it will hire, with a description of their experience or training;

• 4)

  List of the vehicles that it owns or will acquire to fulfill the tasks of training and instruction of drivers and pilots, which must have all the equipment and instruments necessary for practical learning. These vehicles must have a Certificate of Good Operating Condition issued by the manufacturer, its distributor or, in its absence, by certified workshops in the country; and,

• 5)

  List of all didactic material, manuals and equipment that it must use in the tasks of training and instruction of drivers and pilots. The instructive and formative didactic material must comply with the content approved by the Institute in accordance with each type of Driver's License that a pilot or driver requests. Prior to making a decision, the Institute must conduct a detailed review and physical inspection of the facilities proposed for the operation of the school, the material and equipment to be used, to verify that the minimum requirements required for its authorization are met. Every school must, at minimum, be equipped with teaching classrooms, projectors, didactic material, mechanical components and other equipment necessary to provide good service. Once the inspection is completed, the corresponding Legal Opinion will be issued and subsequently, the corresponding Resolution will be issued. With the authorizing Resolution issued by the Institute, the corresponding Municipal Operating License can be obtained and processed. Every application of this type must be resolved within a period of thirty (30) business days counted from the date on which all requirements have been met by the applicant. CHAPTER II ORGANIZATIONAL STRUCTURE

ORGANIZATIONAL STRUCTURE: Within its organic structure the Institute, in addition to the departments contained in the Law, must have at minimum the following areas:

• 1)

  Executive Direction;

• 2)

  Administrative Management and Human Resources;

• 3)

  Operations Management;

• 4)

  Process and Compliance Management;

• 5)

  Legal Management;

• 6)

  Internal Audit; and,

• 7)

  Project Coordination Unit (PCU).

REQUIREMENTS FOR EXECUTIVE, MANAGERIAL AND SUPERVISORY PERSONNEL: The same requirements apply for those seeking to serve in the General Inspectorate of Land Transport, privileging professionals with graduate or postgraduate training in the areas of project management, public policy, industrial engineering, administration and finance.

EXECUTIVE DIRECTION: It is the highest executive authority within the Institute, responsible for coordinating and executing the policies that emanate from the Directive Commission, within the framework of its attributions and competencies. Likewise, it is the body responsible for executing the Resolutions and Agreements issued by the Directive Commission and for verifying that the institutional and operational objectives of the Institute are met, serving as support for the fulfillment of the tasks and activities that correspond within the framework of the legal and regulatory attributions of the General Inspectorate of Land Transport and the National School of Land Transport. Without prejudice to the general and inherent functions of its position, it corresponds to:

• 1)

  Execute the operational direction and implementation of the plans, programs and projects approved by the Directive Commission;

• 2)

  Through the Administrative Management and Human Resources, prepare and execute the budget of the Institute for approval by the Directive Commission;

• 3)

  Through the Process and Compliance Management, prepare, coordinate, execute and monitor the strategic plan and the annual operational plan of the Institute for approval by the Directive Commission;

• 4)

  Through the Process and Compliance Management, present to the Directive Commission for its approval, the annual report of the Institute;

• 5)

  Coordinate and supervise the fulfillment of the functions and activities of the management units, divisions, departments, heads and other officials and employees of the Institute;

• 6)

  Coordinate and execute the tasks that correspond to be carried out within the framework of compliance with the Law of Transparency and Access to Public Information; and,

• 7)

  Others that the Directive Commission delegates to it.

ADMINISTRATIVE MANAGEMENT AND HUMAN RESOURCES: It has charge of the tasks related to the administration and disposition of the entity's property; the selection, competition, contracting, promotion, dismissal and administration of the Institute's human resources; and the other financial and material resources of the institution. Among some of its principal functions are the following:

• 1)

  Keep the institution's accounting and present financial and accounting reports to the Executive Direction monthly, quarterly, semi-annually and annually;

• 2)

  Plan, organize, direct, coordinate and control all administrative processes of the institution in order to meet the established objectives;

• 3)

  Administer and safeguard the institution's property in accordance with applicable legal and regulatory provisions; and,

• 4)

  Prepare, execute and control the assigned budget, with the purpose of achieving maximum utilization of the resources granted, according to applicable legal and regulatory provisions; likewise, present monthly budget execution reports.

OPERATIONS MANAGEMENT: It has charge of the operation and execution of the tasks and public objectives of the Institute and of the Directive Commission, with the exception of those that by law correspond to other departments of the Institute. Likewise, without prejudice to the authorizing function of the Directive Commission, it is the Management responsible for executing the functions described in Article 5.6 of the Law, of the Vehicle Fleet Renewal Program; of the transport operations control center, including fleet control systems and user information, collection and on-board video surveillance; of the regulation of service according to its different modalities and of information technology services for all departments of the Institute. Likewise, it has charge of the citizen service area to attend, process, authorize and issue all the procedures, permits and licenses contained in the Law, with the exception of the authorizations that correspond to the Directive Commission, unless these have been delegated in whole or in part; for which, it must coordinate with the General Secretariat the delegation of the functions and attributions that correspond in order to streamline and simplify all the procedures of the Institute. The citizen service area must operate as a single window for the management of concessions, route expansion, route certificates, exploitation permits, operation certificates, among others. The Management is responsible for controlling the collection of income, current account and collection management.

PROCESS AND COMPLIANCE MANAGEMENT: It has charge of raising, publishing and continuously improving all operational processes, with internal and external impact on the Institute, executing its functions with strict adherence to the principles of unity of criteria, expedience, agility and simplification of processes; seeking to the extent of legal possibilities, to eliminate discretion and arbitrariness in the making of operational decisions. This Management has as its mandate to obtain within the first two (2) years of the Institute's creation, the certification of its processes under the ISO 9000 standard and is responsible for maintaining said certification annually; for which all departments of the Institute must comply with the recommendations that the Management issues. Likewise, the Management must verify the fulfillment of the strategic and operational objectives of all departments of the Institute, and must monitor compliance with the goals that annually and monthly the Directive Commission approves.

LEGAL SERVICES MANAGEMENT: It has charge of providing legal advisory services to the Directive Commission, to the Advisory Council, to the Executive Direction and to the other Units of the Institute, both regarding institutional aspects, as well as with respect to processes related to land transport operations and everything related to the matter.

INTERNAL AUDIT: It has charge of the fulfillment of the attributions and faculties that the General Law of Public Administration and its Regulation confer upon it; as well as those that correspond to it in accordance with the Law of the Superior Court of Accounts, its General Regulation, its special regulations and other norms issued by the Plenary of said Court.

COORDINATING UNIT FOR PROJECTS (UCP). It shall be responsible for the continuity of the implementation of the Public Land Transportation modality of Rapid Transit Buses (BTR) and other modalities that the Board of Directors may delegate to it, as well as the monitoring of the functions established in the Legislative Decree creating the BTR and its respective agreements, such as: Subsidiary Agreements, Loan Agreements with bilateral or multilateral cooperation organizations, among others. Likewise, it must coordinate with the Operations Management the administration of all procurement processes and hiring of specialists, national or international, that are required for the design and implementation of the following programs: Institutional Reengineering Program, Route Restructuring, Vehicle Renewal Program, transportation operations control center that includes fleet control systems and user information, collection and onboard video surveillance, service control in its different modalities (urban, interurban, taxi, mototaxi, motorcargo and other modalities). The UCP shall be composed at minimum by a Program Coordinator, Transportation Operations Coordinator, New Projects Coordinator, Administrative Specialist, Procurement Specialist, Environmental Specialist, Communications Specialist, Monitoring and Evaluation Specialist, Engineering Coordinator, among others. TITLE III PROVISION OF LAND TRANSPORTATION SERVICE CHAPTER I GENERAL PROVISIONS

PRINCIPLES. The land transportation of persons and cargo is an essential service that responds to the following principles:

• 1)

  RESPONSIBILITY.- The State approves the policies, regulations and controls necessary to promote compliance, by users and operators of land transportation, with what is established in the Agreements, the Law, the Regulations and applicable Technical Standards.

• 2)

  UNIVERSALITY.- The State guarantees access to the land transportation service, without distinction of any nature, in accordance with what is established in the Constitution of the Republic and pertinent laws.

• 3)

  ACCESSIBILITY.- It is the right that users have to the mobilization of themselves and their goods, requiring therefore that the entire transportation system in general respond to this purpose.

• 4)

  COMFORT.- It constitutes part of the level of service that land transportation operators of persons and cargo must comply with and demonstrate, in accordance with the standards, technical regulations and homologations that for each modality and service system are established by the HTI.

• 5)

  CONTINUITY.- In accordance with what is established in their respective Exploitation and Operation Permits, authorizations granted by the State without delays and interruptions.

• 6)

  SAFETY.- The State guarantees efficient mobility of transportation of persons and cargo, through adequate road and service infrastructure, which allows operators in turn to guarantee the physical integrity of users and transported goods while respecting pertinent regulations.

• 7)

  QUALITY.- It is the compliance with the service parameters established by the competent bodies of land transportation, transit and road safety and other added value offered by transportation operators to their users.

• 8)

  STANDARDIZATION.- Through the technical process of homologation established by the Institute, it shall be verified that vehicles entering the motor vehicle fleet comply with the technical standards and regulations of safety, environmental and comfort requirements issued by the authority, allowing the establishment of a service standard at the national level.

• 9)

  ENVIRONMENT.- The State guarantees that vehicles entering the national motor vehicle fleet comply with environmental standards and shall promote the application of new technologies that allow the reduction of emissions of polluting gases from vehicles.

• 10)

  FREE COMPETITION: All concessionaires are guaranteed equality of rights and conditions, as well as the adoption of mechanisms that promote equal competition to avoid monopolistic, oligopolistic or any other measures that are detrimental to the Concessionaire.

PUBLIC LAND TRANSPORTATION SERVICE. Without prejudice to the possibility that other modalities could be included in the future, Public Land Transportation is classified as:

• 1)

  URBAN.- Is the term applied to collective transportation of passengers, travelers of public transportation have to adapt to the schedules and routes offered by the operator. Usually the travelers share the transportation means, and the different units are available to the general public. It may be regular, rapid, executive, rapid transit buses (BTR) and other mass transportation systems that could be implemented in the future.

• 2)

  INTERURBAN.- That which occurs between different towns of a city or occurs between different cities. It may be regular, direct and executive.

• 3)

  TAXI.- Vehicle for hire, with a driver, that is used in the transportation service of one or a small group of passengers directed to different destinations by contract or payment. These can be classified in the following types: a. Collective or Point Taxi.- Have a determined route and fixed price for the fare which varies depending on the distance to be traveled, in some cases it can be paid in a special rate and leave the passenger at a more specific point, if this point does not depart from the authorized route. b. Direct or Sweep.- Usually, in this mode of public transportation, the user determines the places where the passenger is picked up and dropped off. That is, unlike other types of public transportation, such as the bus, the service offered by the taxi is characterized by being door-to-door. c. Radio Taxi.- Taxi equipped with a radio transmitter and receiver or telephone that connected with a physical or electronic center, communicates to the taxi driver the services requested by customers.

• 4)

  MOTOTAXI.- Three (3) wheeled motorcycle with a roof that is used as a means of popular transportation for short distances, in exchange for money in the same way as a taxi and is intended for the provision of individual public transportation service of passengers.

• 5)

  MOTORCARGO.- Is a motorized tricycle or three-wheeled light transportation vehicle, whose front part derives from the mechanical part of a motorcycle and the rear part consists of a cargo space for the vehicle for delivery.

• 6)

  CARGO.- Merchandise, livestock, things or goods and all types of goods or merchandise, that are transferred from one place to another by motor vehicles or other means of land transportation. It may be General or Specialized, which must have special regulations in accordance with international agreements of which Honduras is a party. a. Non-Specialized or General Cargo.- Transfer of products and merchandise that do not require special handling and do not represent a threat to the safety of persons and property. b. Specialized Cargo.- Transportation of all those products that require special treatment, equipment and handling and that could represent a risk to the safety of persons and the environment.

• 7)

  INTERNATIONAL.- Is the transportation service that concessionaires provide from one country to another; that is provided with vehicles within national territory without carrying out cabotage or that passes in transit through Honduran territory. This may be of persons or cargo. Other modalities that the Institute authorizes.

REQUIREMENTS TO OBTAIN THE EXPLOITATION PERMIT. To obtain the exploitation permit, interested parties must submit an application in accordance with the Administrative Procedure Law, in which they must specify the modality of the type of transportation service they wish to offer, complying with the following requirements:

• 1)

  Identity Card in the case of natural persons; articles of incorporation or certification of legal personality of the interested party, in the case of legal persons;

• 2)

  Contact data telephone number, cellular and email of the applicant;

• 3)

  National Tax Registry (RTN);

• 4)

  The partners or members, as well as the legal representative of the applicant must accredit: a. Certificate of not having current criminal background issued by the Judicial Branch. b. Certificate of not having pending accounts with the State currently issued by the General Attorney of the Republic (PGR). c. Certificate of current tax solvency issued by the Tax Administration Service (SAR).

• 5)

  Evidence of compliance with what is prescribed in Articles 23, 24 and 27 of the Law on Land Transportation of Honduras;

• 6)

  Title of property or equivalent property certification of the vehicle with which the service will be provided;

• 7)

  In the event that the applicant is not the owner of the unit or units indicated in their application, they must provide the contract or corresponding legal document that certifies the authorization to dispose of them;

• 8)

  Vehicle inspection certificate with which the service will be provided; and,

• 9)

  Sworn declaration, authenticated before a Notary, of the legal representative or interested party, stating that they will use the unit indicated in their application exclusively for the land transportation service in the modality requested and in which they expressly declare that they understand that the violation of the provisions of this law and its regulations authorize the Institute to cancel the exploitation permit that may eventually be granted.

MANDATORY INSURANCE COVERAGE TO RESPOND FOR DAMAGES TO THIRD PARTIES. It is an insurance that must be contracted by every owner of a motor vehicle, trailer or cargo, with an insurance company. Its coverage allows payment of hospitalization expenses or medical, surgical, pharmaceutical and dental care, or rehabilitation of a person occupant or not of a vehicle that suffers a traffic accident, in which an insured vehicle participates. In case of disability or death, it indemnifies the affected party or the heirs, as applicable. ARTICLE 37.- DATABASE OF INSURED VEHICLES. The Institute must incorporate into the database of its integrated system, the information of vehicle insurance, which is available to users in order to be consulted publicly.

PUBLIC-PRIVATE PARTNERSHIP.- With the purpose of avoiding unnecessary costs and procedures for users and vehicle owners, the Institute must incorporate into the system of the Property Institute (IP), ex officio, all information related to registrations, authorizations, licenses, permits, certificates and insurance, among others, within the framework of the Public-Private Partnership previously referred to. CHAPTER II SPECIAL TRANSPORTATION SERVICE

SPECIAL TRANSPORTATION SERVICE.- Is that whose business is not the provision of public transportation service, so they do not share the stations designated for regular public service and are conferred through a contract of private nature between the service provider and the client, which require a special permit from the Institute. In accordance with Article 50 of the Law, the transportation units that are dedicated exclusively to this type of service must be marked with a distinctive colored stripe, that identifies the nature of the service and includes the registration number, preceded by the initials STE (Special Transportation Service), as well as the other technical specifications that the Institute considers pertinent.

SPECIFIC REGULATIONS FOR SPECIAL TRANSPORTATION SERVICE: In order to regulate the conditions and other aspects that regulate the Special Transportation Service, once the Board of Directors is constituted, a Special Regulation shall be approved that shall develop the precepts and general conditions established in this Chapter.

TYPES OF SPECIAL TRANSPORTATION.- The Special Transportation Service may adopt the following modalities:

• 1)

  Student Transportation;

• 2)

  Worker Transportation;

• 3)

  Tourism Transportation;

• 4)

  Excursion Transportation;

• 5)

  Transportation of Social and Religious Groups;

• 6)

  Private Cargo Transportation; and,

• 7)

  Any other type that may arise and that the Institute authorizes and others that are established in the Specific Regulation.

GENERAL REQUIREMENTS FOR THE PROVISION OF SPECIAL TRANSPORTATION SERVICE. These are the general requirements that concessionaires must comply with to provide the special transportation service:

• 1)

  The units must bear a colored stripe that identifies it as Special Transportation Service, according to its nature;

• 2)

  Units with a capacity of no less than fifteen (15) seated passengers;

• 3)

  Subscription to a service contract that accredits the relationship between the service provider and its clients, as well as the price agreed upon by mutual agreement of the parties, as applicable. The contract stipulations must coincide with what is established in the Law on Land Transportation and its Regulations; and,

• 4)

  They must comply with the same technical requirements that are required of Public Transportation Service concessionaires, regarding safety, quality and efficiency, as applicable.

SERVICE PROVISION CONTRACT: The Special Transportation Service may be contracted with natural or legal persons, the latter being required to be legally constituted. In no case may the Special Transportation Service be provided without the subscription of the respective Contract that establishes at minimum, the purpose thereof, the obligations of the parties, the characteristics of the units, number of units, schedules and itineraries, number of stops, route and/or route, number of students, workers, tourists, among others and others applicable according to the required modality, without prejudice to the other stipulations that are indicated in the Special Regulation that is issued for this purpose and those that the parties deem convenient. The Private Special Transportation, used for its own purposes, is excepted. To provide the special service, the respective permits required must be obtained.

PERMITS: For the authorization or renewal of Exploitation Permits for Special Transportation Service, the applicant must attach a copy of the transportation service provision contract duly authenticated, in the cases that prove applicable.

COMMON REQUIREMENTS FOR OBTAINING SPECIAL TRANSPORTATION SERVICE PERMITS: To obtain the necessary permits in the different modalities of Special Transportation Service, the following general requirements must be presented to the Institute, without prejudice to the Specific Requirements for each modality:

• 1)

  Application for transportation specifying the modality that is intended to be authorized;

• 2)

  Photocopy of document proving the Power of Representation in case the application mentioned in the first numeral is presented through a third party;

• 3)

  Properly authenticated copy of the identity document and National Tax Registry of the owner and driver if applicable, or of the Attorney-in-Fact in case it is presented through a third party, or of the Legal Representative in case of a legal person;

• 4)

  Copy of the Public Deed of Constitution properly registered, in case of a legal person;

• 5)

  National Tax Registry (RTN) of the legal person, as applicable;

• 6)

  Photocopy of the document proving payment of the single annual vehicle fee, properly authenticated;

• 7)

  The applicant must present a certificate of vehicle or certification of proper operation original and current, issued by a qualified body, with the exception of zero-kilometer units;

• 8)

  Photocopy of the pilot certificate, properly authenticated;

• 9)

  Original certificates of criminal and police background of the owner of the unit(s) and of the pilot;

• 10)

  Photocopy of the Driving License, properly authenticated; and,

• 11)

  Electronic certificate of Tax Compliance. CHAPTER III EXECUTIVE SERVICES AND PREFERENTIAL ATTENTION TO PASSENGERS IN THE GENERAL LAND TRANSPORTATION SERVICE

EXECUTIVE OR LUXURY TRANSPORTATION SERVICE. For all modalities of transportation service, it is considered Executive service if it meets at least the following conditions:

• 1)

  Comfort, accessibility and operation conditions superior to basic service, such as greater spaces between seats, larger luggage compartment;

• 2)

  It shall offer its services using only technological means, including platforms for timely and efficient attention to users;

• 3)

  Payment is made only through electronic means;

• 4)

  Regulated minimum rate, which in no case shall be equal to or lower than that of the basic level;

• 5)

  Rating of the service and the driver; and,

• 6)

  The technological platforms shall be owned by the transportation companies or contracted with third party owners of them and shall have to obtain the authorization of the Institute. Said platform must have the ability to rate and individualize the driver and the user, identify the vehicle that will provide the service and know the approximate value of the service. The providers of this type of service may associate in Operating Consortiums to meet their objectives.

PREFERENTIAL ATTENTION. Persons with disabilities, elderly adults, pregnant women, girls and boys under five years of age and students accredited by their respective and current identification card enjoy preferential attention. For this purpose, the transportation system in general grants the following benefits:

• 1)

  Special areas and accesses and properly signalized, in accordance with the standards and technical regulations of the Institute for these types of service;

• 2)

  Special assistance to the persons indicated in this section, according to their needs, facilitating their access to vehicles and offering them the greatest comfort within the respective category. Furthermore, the physical infrastructure of the vehicle and the transportation corridors must be accessible to this group of users. The Institute and its auxiliary bodies, within the scope of their competencies, shall control compliance with these obligations;

• 3)

  Right to board the bus in a prior and priority manner to any other user. If necessary, the personnel in charge of the provision of the service shall determine the advisability of disembarking first or at the end of the departure of the rest of the passengers;

• 4)

  Wheelchairs, baby strollers, stretchers, crutches or other equipment required by the persons referred to in this chapter shall be transported free of charge as priority baggage;

• 5)

  Right to access directly to the window for the purchase of tickets or any other transaction without waiting in line;

• 6)

  Right to preferential rates, in accordance with what is stipulated in applicable laws; and,

• 7)

  Children under five years of age shall not pay any fare. CHAPTER IV TRUST

TRUST AGREEMENT.- In application of Legislative Decree 369-2013 of January 20, 2014, published on March 22, 2013, containing the provisions of the "Trust Agreement Contract for the Project of Operation, Operation, Financing and Administration of the Vehicle Property Registry at the National Level and Implementation of Vehicle Inspection Centers, Supply of License Plates, Issuance of Driver's Licenses, Modernization of the Transit Violation Sanctions System and the Professionalization of Fine Collection," executed by substitution with the National Agricultural Development Bank (BANADESA), the income from vehicle inspection centers and the issuance of driver's licenses, referred to in the provisions of the Land Transportation Law and this Regulation, shall be collected and received in the autonomous patrimony of this Trust Agreement. The Private Investor Operator contracted within the framework of the aforementioned public-private partnership trust agreement shall comprehend within its scope the implementation of the vehicle inspection centers project, in accordance with the regulations approved in the exercise of its competencies by the Property Institute and the Honduran Land Transportation Institute, as well as the driver's license issuance project.

ADMINISTRATION TRUST AGREEMENT.- Without prejudice to the provisions of the preceding Article, the Institute, through the Public-Private Partnership Promotion Commission (COALIANZA), shall create a trust agreement whose purpose and objective is the operation of the system referred to in Article 92 of the Law, which shall be constituted with eighty percent (80%) of the funds of the remaining resources already committed in the trust agreement described in the preceding article.

DETERMINATION OF RATES.- Once the Directive Commission is selected and incorporated according to what is established in Article 98 of the Law, it shall have a maximum period of ninety (90) days to conduct the technical studies, valuation and necessary determination to establish the rates for the provision of the Public Service by the Concessionaire, taking into account the variables of specific operating costs established in the Law. For such purpose, a Special Regulation must be created that determines the costs, rates, payments, formulas, mechanisms and procedures to be used by the Institute for the application and compliance of the Law, to which concessionaires must adhere once said regulation is approved and published.

MODIFICATIONS TO RATES.- The Special Regulation referred to in the preceding Article may also establish that in case modifications to the rates are required, the Institute shall conduct the necessary reviews to determine the appropriateness of making such modifications, prior to their approval by the Directive Commission.

SYSTEM FOR COLLECTION OF RATES.- The system for collection of rates comprises the services of sale and reloading of prepaid electronic cards, the distribution of access validation means to the system, as well as the handling and safekeeping of income until its delivery to the fiduciary entity. All of the above shall be provided as part of the concession of the Integrated Public Transportation System (SITP). The procedures for establishing the formula and distribution of collection, as well as the specific procedures for conducting and reporting collection shall be established in the Special Regulation to be implemented for such purpose.

GENERAL CRITERIA FOR COLLECTION OF RATES BY ELECTRONIC CARDS.- The prepaid electronic cards shall be easily identifiable by their color to differentiate the different types of rates defined by the Institute; they shall register the corresponding payment, prioritizing user security and rights. Enabled cards must have information technology security mechanisms, as well as coded series and numbering for each modality of use. In the case where preferential rate cards are implemented, they shall be personal and non-transferable and shall contain on their reverse the photograph and identification data of the user. Service operators shall be responsible for generating and maintaining the database and files with user documents that personalize the cards in order to facilitate renewal in case of loss or replacement of the card, without the need to submit documents again. To encourage the use of prepaid electronic cards, the Institute in coordination with the SITP concessionaire may design promotions and incentives, which may include special bonuses for students, discounts, free fares, promotional cards and access to other national or municipal services. The physical, graphic and promotional model of electronic cards must be approved by the Institute.

PAYMENT OF SANCTIONS.- Payment of sanctions applied shall be made no later than thirty (30) days after they were imposed, following the procedures established in the collection control system implemented by the Institute. Non-compliance with payment of sanctions within the granted periods generates interest and surcharges according to what the Institute establishes in its specific regulations, without prejudice to the application of other measures deemed appropriate by the Institute.

AUTOMATIC DEDUCTION OF SANCTIONS.- Sanctions defined in concession contracts, in accordance with the modalities of operation, and which may be determined automatically through the systems implemented to control the operations of concessionaires, shall be deducted from the payment of service consideration through the collection control system.

CHALLENGE TO SANCTIONS.- The procedure to be followed to challenge an imposed sanction shall follow the procedure established in the Administrative Procedure Law.

SANCTION FOR OFFERING OR ACTUALLY PROVIDING LAND TRANSPORTATION SERVICE WITHOUT STATE AUTHORIZATION.- The natural or legal person who offers or actually provides land transportation service in any of its modalities without State authorization shall incur in a very serious infraction in accordance with Article 80, numeral 1 of the Law, and shall be sanctioned with a fine equivalent to two (2) minimum salaries, and as long as payment is not made effective, the unit shall be retained for six (6) months and the referral of the sanctions file to the Directive Commission in order to file the corresponding criminal action as well as the consequent final cancellation of the driver's license.

SANCTION FOR DRIVING A MOTOR VEHICLE WITHOUT INSURANCE.- The driver who is found driving a vehicle without the corresponding mandatory insurance shall be sanctioned in accordance with what is established in Article 83 of the Law. For the purposes of this Article, when the driver does not belong to the Transportation system, it shall be referred to the National Transit Directorate, which shall be provided with the database containing the corresponding vehicle insurance information, in order to proceed in accordance with its attributions.

CONCEPT.- It is the system that comprises the actions for the articulation, linkage and integrated operation physical, technological and tariff of the different modalities of public transportation; as well as the requirements for infrastructure, accessibility, circulation and collection of the system. Said system shall be directed by the institutions and organisms established by law for the functioning of the public transportation system.

COMPONENTS OF THE INTEGRATED PUBLIC TRANSPORTATION SYSTEM.- Form part in an enunciative but not limiting manner of this system, the following:

• a)

  National Public Transportation Security System;

• b)

  Public Transportation Registry System;

• c)

  Service Quality Evaluation System;

• d)

  Sanctions, Infractions and Fines System;

• e)

  General Collection System;

• f)

  Onboard Collection System;

• g)

  Stations, Stops and Terminals System; and, h. Operations Control Center.

CONCEPT.- It is the systemic set of institutions involved, users, concessionaires, operators and other participants, actions, regulations, technological tools of information and/or communication, which aim to guarantee the security of users of public land transportation, as well as of concessionaires and transportation operators.

TECHNOLOGICAL AND/OR COMMUNICATION FUNCTIONS.- In order to guarantee the effectiveness of the security system, the technological and/or communication tools on board the units of urban and interurban land passenger transportation must comply at a minimum with the following functions and equipment in relation to security, without prejudice to the expansions deemed convenient and necessary for its proper functioning in accordance with current technology:

• 1)

  Security Cameras: Transportation units must have real-time security cameras, which must interoperate with camera systems installed on roads, stations, stops, terminals, among others, which must collectively respond to a single alert system and immediate response to public transportation security emergencies, managed by the inter-institutional unit of security forces, intelligence, prevention and reaction referred to in Article 89 of the Law.

• 2)

  Global Positioning Systems (GPS): Transportation Units must have a global positioning system (GPS) with the purpose of knowing in real time the location of all transportation units in order to efficiently coordinate response actions and facilitate monitoring and tracking thereof.

• 3)

  Panic Button: All transportation units must have a panic button which must be installed strategically so that drivers can activate it without being detected when they consider they are faced with an imminent danger situation. The panic button alerts the emergency status in the security control center to coordinate immediate response actions.

• 4)

  Unit Identifier (Bar Code, RFID or current technology): The type of identifier adopted must allow remote identification of the transportation unit and the linking of its associated information, in order to guarantee whether any transportation unit is authorized to operate under the modality granted through the respective permit.

• 5)

  Pilot Identifier: Remote identification system that allows validating the authorization the Pilot possesses with respect to the type of license he has to drive a certain unit.

• 6)

  Monitoring and Tracking System for Transportation Units: This system must contribute to guaranteeing the effectiveness of response actions through vehicle fleet monitoring and control tools, with respect to schedules, routes, deviations of the unit from the assigned route and other aspects to be controlled and supervised.

• 7)

  User Information System: This system must provide information to the user about routes, stops, terminals, prices, reload stations, stations, frequencies, schedules and other aspects of interest to the user.

• 8)

  Security Control Center: It is the Center where video, surveillance, positioning, identification of units and pilots, panic button alerts, among others, shall be coordinated.

VERIFICATION OF EQUIPMENT. Certified workshops shall verify that public paid passenger transport units are equipped with the equipment referred to in the preceding Article, as well as the correct functioning of technology and/or communication tools. Prior to issuance or renewal of the vehicle certificate or certification of proper functioning, the Control and Supervision Unit of the General Inspectorate of Land Transportation (IGTT) shall ensure that the equipment always remains on board in good condition, as well as apply the respective sanctions, fines or penalties for non-compliance. It is the obligation of pilots, operators and transport concessionaires to guarantee the care of the equipment.

GOVERNANCE OF THE SYSTEM. The National System for Land Transportation Safety shall be governed by the National Defense and Security Council, which together with the Steering Commission of Land Transportation (CDTT) must implement the Safe Routes Program, in accordance with the authority granted by the Law in Article 5, numeral 6. Said Program comprises the adoption of necessary mechanisms and implementation of all elements that improve route safety. The National Defense and Security Council shall create a control and safety unit, which shall exclusively be in charge of managing the National System for Land Transportation Safety. Among its functions is the implementation of a phased program that guarantees the safety of users of public land transportation of persons, urban and interurban and in all its modalities, as well as of concessioners and transport operators. CHAPTER III. PUBLIC TRANSPORTATION REGISTRATION SYSTEM

CONCEPT. It is a set of integrated technological and programmatic tools, in order to maintain a public record of transportation, where units, concessioners and pilots shall be registered, identified and related, with the obligations and rights granted in the different concession contracts, exploitation permits, operation certificates, vehicle certificates or certifications of proper functioning and special permits. Every procedure and authorization shall be registered in this system, which must also implement a unique number for concessions and operation permits by relating it to the vehicle plate. This System shall be articulated by the Institute together with the Institute of Property (IP).

COMPONENTS. The components of the Public Transportation Registration System are:

• 1)

  Pilot registry;

• 2)

  Registry of concession contracts;

• 3)

  Registry of exploitation permits;

• 4)

  Registry of operation certificates;

• 5)

  Registry of special permits; and,

• 6)

  Registry of vehicle certificate or certification of proper functioning.

SINGLE WINDOW. The Institute is obligated to implement the single window in central and regional offices, where this system shall function, as well as online services that facilitate users' access to the respective registration procedures.

PILOT REGISTRY. This registry must register and link, among others, the following information:

• 1)

  Registration and identification system for pilots;

• 2)

  Current pilot categorization and training history;

• 3)

  Work history;

• 4)

  Registry of infractions and sanctions committed;

• 5)

  Integration of information from the National Registry of Persons (RNP);

• 6)

  Information regarding the issuance of land transportation licenses;

• 7)

  Integration of information from the driver's license issuance system; and 8) Any other additional information that proves relevant to this Registration System.

REGISTRY OF CONCESSION CONTRACTS. This registry must register and link, among others, the following data:

• 1)

  Verification of compliance with the requirements defined by applicable laws and regulations for Concession Contracts to be approved;

• 2)

  Requirements and steps to renew, modify or cancel the concession;

• 3)

  Information on the natural or legal person that is the concessionaire;

• 4)

  Link if there are other concessions assigned to the same concessionaire;

• 5)

  Routes assigned to the concessionaire, exploitation permits, operation certificates, vehicle certificates or certifications of proper functioning;

• 6)

  Unique identifier of the Concession;

• 7)

  Registry of Exclusive and/or Common Routes to the Concession: Roads, stations and terminals of the routes;

• 8)

  Service modality;

• 9)

  Registry of fines and sanctions for non-compliance; and,

• 10)

  Quality indicators system of fines and sanctions for non-compliance

REGISTRY OF EXPLOITATION PERMITS. This registry must register and link, among others, the following information:

• 1)

  Permit Identifier (Barcode, Radio frequency identification, or others that may be implemented);

• 2)

  Name or business name of the holder;

• 3)

  Route;

• 4)

  Schedules: a. Itineraries b. Fares c. Stops or stations;

• 5)

  Date of Issuance;

• 6)

  Date of Expiration;

• 7)

  System quality indicators, fines and sanctions for non-compliance;

• 8)

  Obligations;

• 9)

  Prohibitions;

• 10)

  Other Sanctions;

• 11)

  Types of Vehicles covered by the permit; and 12) Requirements and steps to grant, renew, modify or cancel the permit

REGISTRY OF VEHICLE CERTIFICATE OR CERTIFICATION OF PROPER FUNCTIONING. This registry must register and link the following data:

• 1)

  Plate Number;

• 2)

  Certificate Identifier (Barcode, RFID or current technology);

• 3)

  General data of the vehicle in accordance with the vehicle property registry in which it must be previously registered;

• 4)

  Date of issuance of the certificate;

• 5)

  Date of expiration of the certificate;

• 6)

  Vehicular inspection diagnosis; and,

• 7)

  Any other relevant information.

REGISTRY OF OPERATION CERTIFICATE. This registry must register and link, among others, the following data:

• 1)

  Exploitation Permit Number;

• 2)

  Operation Certificate Number;

• 3)

  Vehicle Certificate Number or certification of proper functioning;

• 4)

  Name or business name of the Concessionaire;

• 5)

  Service modality;

• 6)

  Date of Issuance of the certificate;

• 7)

  Date of Expiration of the certificate;

• 8)

  Number of seats or passengers;

• 9)

  Permit identifier (barcode etc.);

• 10)

  Quality indicators sanctions, fines or penalties;

• 11)

  Requirements and steps to grant, renew, modify or cancel the certificate;

• 12)

  Characteristics of the Unit authorized for the provision of Transportation Service; and 13) Any other relevant information. CHAPTER IV: SYSTEM FOR EVALUATION OF SERVICE QUALITY

CONCEPT. It is the planned and systematic method of means and actions, aimed at ensuring the quality of service to users, through indicators that guarantee that public transportation service meets their expectations and complies with all regulatory and technical requirements. Compliance with this system shall be the responsibility of concessioners, operators and pilots; and oversight of compliance with this system shall be the responsibility of the corresponding Unit of the General Inspectorate of the Institute, who shall also receive information from the Fleet Monitoring and Control System, to automatically generate compliance reports on the indicators established in the Concession Contracts. The General Inspectorate, through the corresponding Unit, is responsible for applying the different sanctions, fines or penalties for non-compliance.

QUALITY INDICATORS: The Concessionaire must comply with the Quality Standards and Service Levels defined in the Concession Contract, for which the Indicators shall be incorporated that allow measurement in a specific, timely, pertinent and viable manner, the Service Level of the transportation system. Some of the mandatory indicators to be included in the contracts are: a. Accessibility: Physical and psychological ease of use of the system and means of information to the user. b. Level of Information Provision: On indications to the user regarding stations, terminals, schedules, itineraries, fares and other elements of the service to be used by the user. c. Time: Duration of the trip, coordination and compliance with schedule and itineraries. d. Customer Service: Communication and personal treatment with the customer, assistance and commitments. e. Comfort: Comfort, hygiene and complementary services of the system. f. Security: Protection and prevention of aggression and accidents, obligation to carry video equipment on board, management of emergency situations, obligation to carry all certifications required by law and its regulations. g. Environmental Impact: Minimization of impacts produced by the public transportation system on persons and the environment.

COMPONENTS OF QUALITY INDICATORS. Each Indicator is composed of the following elements: Identifier, Measurement Concept, Measurement Frequency, Unit of Measurement, Method of Measurement and Minimum Acceptance Value. Additionally, for each of the Indicators, a Maximum Correction Time is established during which the Concessionaire, Operator or Pilot may resolve any event in which the Indicator results are below the Minimum Acceptance Value. In accordance with the foregoing, the structure of each of the indicators corresponds to that indicated below:

• 1)

  Name: Corresponds to the name of the Indicator.

• 2)

  Identifier: Refers to the code with which an Indicator is identified.

• 3)

  Measurement Concept: Refers to the physical characteristics of the infrastructure or Equipment, Transportation units, or operational conditions that are intended to be verified through the corresponding Indicator.

• 4)

  Frequency: Refers to the minimum periodicity with which Inspectors or the Monitoring and Control System of the Units must measure each Indicator.

• 5)

  Unit of Measurement: Refers to the unit in which the measure of the Measurement Concept is expressed.

• 6)

  Method of Measurement: Refers to the description of the procedure for taking the measurement of the corresponding Indicator.

• 7)

  Minimum Acceptance Value: Corresponds to the minimum value that is acceptable for each Indicator.

• 8)

  Maximum Correction Time: Corresponds to the maximum term available to the Concessionaire, Operator or Pilot to correct the level observed for any Indicator, without affecting the fulfillment of their responsibilities defined in the concession contract. CHAPTER V SYSTEM OF SANCTIONS, INFRACTIONS AND FINES

CONCEPT. It is the systematic method of means and actions, aimed at maintaining a record of information concerning infractions committed by concessioners or pilots as well as the imposition and execution of sanctions, fines or penalties as appropriate.

OPERATION. There must be a centralized system in support of the process of recording infractions under the responsibility of the General Inspectorate through the unit created for such purpose, who may have mobile devices integrated into the system in real time and to the administrative process for the application of sanctions, fines or penalties established in the Law and its regulations. This System must interoperate with the infraction system of the General Directorate of Traffic (DGT). CHAPTER VI GENERAL COLLECTION SYSTEM

CONCEPT. It is the unique system where all debit operations are recorded, such as the generation of fees or other obligations, and corresponding credit for payments, which are generated as a result of the Institute's operations. Primarily the system should record and link all the Institute's income, which includes among other concepts: Tariffs for collected revenues, tariffs for concessions, fines and other income. The General Collection System should also administer a current account in which it is possible to track obligations of concessionaires that are pending payment, as well as record corrections to the operations that are registered in the system. The system must include all protocols and interfaces necessary to carry out collection through the institutions of the national banking system and control the transfer of collected amounts to the trust fund or the National Treasury, as applicable. CHAPTER VII EMBEDDED COLLECTION SYSTEM

CONCEPT. It is the set of equipment and technological systems aimed at the collection of tariffs applied to land transport such as urban buses, Rapid Transit Buses (BTR) and taxis among others, which must be carried out under the prepaid card modality. Subsequently, other types of land transport to which the prepaid card modality applies shall be incorporated into this system, at the discretion of the Institute.

OPERATION. The Institute is the only authority with national competence to regulate collection systems in any of their modalities, and it shall in turn issue policies to guarantee the interoperability of the system. The Institute may grant this operation through a Public-Private Partnership in accordance with what is established in the Law for the Promotion of Public-Private Partnership and its regulations.

EQUIPMENT AND SYSTEMS. The minimum equipment is composed of prepaid cards, validation machines, dispensing machines, platform and technological infrastructure for central information systems.

PARTICIPANTS. The Institute through its departments is responsible for regulating and controlling the operations of the collection system in all its modalities, being responsible for the implementation and operation of the system, in accordance with the law and its regulations. CHAPTER VII SYSTEM OF STATIONS, STOPS AND TERMINALS

STATIONS, STOPS AND TERMINALS. Stations, stops and terminals are part of the National Public Land Transport Security System. Once the Institute is in operation, the processes of restructuring, modification or creation of new routes must have a joint strategy between the Institute and the National Defense and Security Council that includes physical security, technological security and response capacity, to guarantee the safety of users, concessionaires and transport operators.

BASIC REQUIREMENTS FOR OBTAINING PERMITS FOR THE OPERATION OF TERMINALS. Natural or legal persons requesting authorization to obtain permits for the operation of terminals must present at a minimum the following requirements, without prejudice to the Special Regulations for Stations, Terminals and Stops, to be prepared for this purpose:

• a)

  General location plan establishing the georeference of the station or terminal in the system of coordinates that the country declares as official;

• b)

  Operating permit from the Municipality;

• c)

  Specific plan of the premises, establishing the distribution of ticket sales, parking for vehicles intended to cover the route, parking for customers which must comply with what is established in the respective municipal tax plan, description of the system that guarantees: provision of water, comfort temperature, and any other facility to the user;

• d)

  Deed of full ownership or failing that a lease contract; and, e. Description of Systems or mechanisms appropriate for the movement of persons with disabilities or with special needs.

RELATED SERVICES. To obtain authorization for the construction and operation of Related Services referred to in Article 74 of the Law, the respective design and construction plans must be presented that comply with what is established in the Construction Code and the Tax Plans.

CONCEPT. It is the unit where all information on internal operational management, known by its English term as back office, of the collection, operations, monitoring and fleet control of the Integrated Public Transport System is coordinated.

FUNCTIONS. The operations control center shall have the following functions:

• 1)

  Coordinate the processes of route reordering;

• 2)

  Respond for the process of controlling the operation and coordinate the operational contingencies of the System;

• 3)

  Perform statistical processes of validations carried out;

• 4)

  Perform statistical processes of reloads carried out;

• 5)

  Perform collection reconciliations;

• 6)

  Control of payment systems;

• 7)

  Perform statistical processes of demand in real time;

• 8)

  Fleet control management;

• 9)

  Manage communications between installed equipment and the operations and security control center;

• 10)

  Manage communications between the collection operator and the control center; and, 11. And other functions necessary for the proper functioning of the Center.

NON-COMPLIANCE WITH THIS REGULATION. Non-observance of the provisions of this Regulation entails the disciplinary and administrative responsibilities that may be applicable, without prejudice to the civil and criminal responsibilities that correspond in accordance with the current legal system.

APPROVAL OF MANUALS, INSTRUCTIONS AND SPECIAL REGULATIONS. Within a maximum period of one (1) year from the entry into force of this Regulation, the National Transport Institute must prepare the manuals, instructions and special regulations that are necessary to carry out the different processes established in the respective Law and this Regulation, which must be approved by the Directive Commission. SECOND: This Decree enters into force from its publication in the Official Gazette "La Gaceta". Given in the city of Tegucigalpa, municipality of the Central District, on the seventeenth (17) day of the month of June of the year two thousand sixteen (2016). COMMUNICATE AND PUBLISH. JUAN ORLANDO HERNANDEZ ALVARADO CONSTITUTIONAL PRESIDENT OF THE REPUBLIC. ROBERTO ANTONIO ORDONEZ SECRETARY OF STATE IN THE DEPARTMENTS OF INFRASTRUCTURE AND PUBLIC SERVICES