Agreement 41-2020

This Regulation has as its objective to establish the norms and procedures for the application of the Free Zones Law contained in Decree No. 356 dated July 19, 1976 and its amendments. CHAPTER II DEFINITIONS

For purposes of the Decree mentioned in the preceding Article and this Regulation, the following definitions are established: Authorized Activity: It is the activity developed by the enterprise under the Free Zones Regime, in accordance with the authorization issued by the competent authority. Enlargement or reduction of area: It is the enlargement or reduction of the restricted area previously authorized to the beneficiary, provided that it is adjacent to the first. Enlargement of new zones: It is the enlargement of new areas, not adjacent, by an operator or operator user, previously authorized. Restricted area: It is the territorial extension without resident population, within which enterprises benefited by the Regime operate under fiscal control and supervision, comprised within the limits established by the competent authority. With the exception of optional buildings, which operate outside the benefit of Free Zones, to provide support to working personnel, with prior authorization from the Ministry of State in charge of Economic Development. Customs authority: The official of the Customs Service who, by reason of his position and by virtue of the competence granted, verifies the correct application of customs regulations, complies with them and enforces compliance. Competent Authority: It is the State authority authorized to administer the Free Zones Regime. Beneficiary: It is any natural or legal person, national or foreign, Operator, Operator User or User of Free Zones, who enjoys the benefits established in the Law. Fiscal benefits and incentives: They are the exemptions and exonerations that the Law grants to enterprises admitted to the Free Zones Regime. Local purchases: They are the purchases of goods and services made by enterprises benefited by the Regime in the local market, which upon entering the restricted area must comply with the customs formality that the Customs Administration determines for each case. Certificate of Registry of user enterprises of the ZOLI Regime: It is the document that authorizes the regime to User enterprises of Free Zones, issued by the Ministry of State in charge of Economic Development, through the General Directorate of Productive Sectors. Contract for Customs Services: Document signed between the Legal Representative of the operator or Operator User and the holder of the Customs Administration, which contains the obligations and rights of the parties for the provision of customs services of control and fiscal supervision, exercised in the restricted area, which must include among others, the number of customs personnel necessary in accordance with the customs operations carried out. Merchandise Declaration: It is the act executed in the form prescribed by the Customs Service, by means of which interested parties freely and voluntarily express the regime to which merchandise is submitted and accept the obligations that it imposes. Basically Commercial Reexportation Enterprise: It is that national or foreign enterprise that operates within the restricted area and allocates no less than fifty percent (50%) of its annual sales to reexportation. Basically Industrial Export Enterprise: It is that national or foreign enterprise that operates in the restricted area and is dedicated to the mechanical, physical or chemical transformation of raw materials, semi-finished products or finished articles, may conduct activities intended for sale in the national market of fifty percent (50%) of its production or sales. Services Enterprise and Related or Complementary Activities: It is that national or foreign enterprise that operates within a restricted area whose production or activity is intended for the supply of productive processes or the provision of services to other enterprises benefited by the Regime. International Services Enterprise by means of Electronic Services: It is that national or foreign enterprise that operates within a restricted area to offer international services of contact centers or Call centers, data processing, back offices, information technologies or any other service that can be offered electronically, using wired or wireless means. Exportation: It is the exit of merchandise from the restricted area destined for abroad, after being subjected to a process of transformation or manufacturing. Importation: It is the entry of merchandise into the restricted area, for its use, consumption or transformation, coming from abroad or the national market. Institution Administering the Regime: The Ministry of State in charge of Economic Development, through the General Directorate of Productive Sectors. Merchandise: Tangible and intangible goods susceptible to commercial exchange. Foreign merchandise: It is that which enters the area coming from abroad, which upon entering the restricted area must comply with the formalities established by the Customs Service. National merchandise: It is that which enters the area coming from the national territory, which, upon entering the restricted area, must comply with the formalities established by the Customs Service. Nationalized merchandise: It is foreign merchandise that has complied with the customs formalities of internation, through the payment of taxes for its definitive use or consumption in the country. Originating Merchandise: It is merchandise that, in accordance with Commercial Treaties signed and ratified by Honduras, complies with the rule of origin. Operator: It is the natural or legal person, national or foreign, legally constituted that, having met the requirements established in the Free Zones Law, this Regulation and authorized to operate and administer a Free Zone, is established within the same. Operator User: It is the natural or legal person, national or foreign, legally constituted that, having met the requirements established in the Free Zones Law and this Regulation, located within the restricted area, is authorized to operate, administer a Free Zone and conduct the activities permitted by the Free Zones Law and this Regulation. Small, Medium and Large Enterprise: It is the classification of enterprises in accordance with the classification for tax purposes carried out by the Tax Administration. Resident Population: Population with permanent residence, understood as the place where the person sleeps and keeps his personal belongings habitually. Customs Control Post: Space enabled in the access area of the Free Zones by the Customs Administration for control and supervision of the operations carried out by enterprises within the regime, such as temporary admission, exportation, reexportation, transfer of merchandise between free zone enterprises and internal transits to Customs, for purposes of internation of merchandise into the national territory. In the case of having Reception, Custody, Appraisal and Dispatch areas within the facilities of the enterprise, the Customs Administration may designate personnel to attend to customs operations of nationalization of merchandise that enterprises transform that operate under the benefit within the restricted area, as well as the other customs operations of entry and exit of merchandise in their different customs regimes. Reexportation: It is the exit of all merchandise from the restricted area and that has not been subjected within it to any industrial process of transformation or manufacturing and that maintains the same condition in which it entered. Direct and Indirect Relationship: It is considered that goods and/or services acquired by enterprises that operate in free zones in the local market or abroad have direct relationship with production when they are incorporated in the productive process or in the machinery and equipment with which those goods are produced. Indirect relationship: When those goods and/or services are used in the administration, protection and comprehensive conditioning of the enterprise with the purpose of making it efficient, not only to improve production processes, but also the quality of its products, the working conditions of its employees in both the technical part and health, safety and hygiene of its work environment as well as the emotional motivation of workers. Resolution: It is the administrative act issued by the Ministry of State in charge of Economic Development, by means of which authorization is granted to enjoy the benefits to a natural or legal person, national or foreign that meets the requirements demanded by the Law and its Regulation. User: It is any natural or legal person, national or foreign, legally constituted that, having met the requirements established in the Free Zones Law and this Regulation, established in a Free Zone, operated and administered by an Operator or Operator User and that is dedicated to conducting the activities permitted by the Law and its Regulation. Free Zone: It is the area of the national territory under fiscal surveillance and without resident population, physically delimited by the Ministry of State in charge of Economic Development, where enterprises of national or foreign capital may be established and operate, dedicated to commercial and industrial activities of Exportation or Reexportation, of International Services by means of Electronic Services and of Services and Related or Complementary Activities or any other activity not prohibited by the Law. CHAPTER III REQUIREMENTS AND AUTHORIZATION PROCEDURE FOR OPERATORS, OPERATOR USERS AND USERS

Natural or legal persons interested in availing themselves of the Free Zones Law as Operators or Operators-Users shall present to the Ministry of State in charge of Economic Development, a request through a Legal Representative, which must contain: OPERATOR: I. Principal activity to which the enterprise will be dedicated. II. Exact address, telephone and email. III. Amount of investment, as well as number of jobs to be generated, with their respective salaries. IV. Descriptive plan of the existing property or where the project will be developed, identifying the areas that comprise it, including the area intended for the customs office, location, boundaries, surface area and access roads, duly endorsed by a Civil Engineer or Architect. V. Title deed of the property where the project will be developed, or failing that, a Lease Contract for said property, granted for a period of no less than five years, except when the lessee is the State through its Institutions. VI. Photocopy of the National Tax Registry VII. Power of Attorney duly authenticated granted by whoever has the legal representation of the enterprise, accompanied by a photocopy of the Public Instrument in which it appears that said representative has powers to grant powers. VIII. Photocopy of the Public Deed of Constitution of Commercial Company or declaration of individual merchant, duly registered in the Registry of Social or Individual Merchants, as appropriate and in the case of foreign companies, authorization to conduct commerce in Honduras must be registered in the Registry of Social Merchants. IX. Foreign companies must present a Certificate of being registered as an investor issued by the National Investment Council (CNI); X. To accredit by means of Certificate, before the Ministry of State in charge of Economic Development, at least one Permanent Representative of the enterprise, with broad powers to perform all acts of a civil, commercial and labor nature that are to be executed and have effects in the national territory, by means of power granted in Public Deed. It shall be the obligation of the beneficiary of Free Zones to keep updated the information relating to the changes that occur with respect to the designation of this permanent representative. XI. Current Solvency Certificates, issued by the Tax and Customs Administrations. XII. The photocopies of the documents required must be presented duly authenticated, signed and sealed by a notary public. XIII. Tax Revenue Receipt for L. 200.00 OPERATOR - USER In addition to the requirements demanded of Operator enterprises, Operator-Users shall accredit the following information: I. List of products or services that it will manufacture. II. Markets to which it will direct its products or services III. Activities or services that it will provide IV. Projection for three (3) years of the foreign currency to be generated.

For purposes of application of Article 2B of the Law, every User enterprise and Operator User that requests incorporation into the regime must allocate no less than fifty percent (50%) of its production to exportation or reexportation, with the exception of services enterprises, which shall direct their production or activity to the supply of productive processes or the provision of services to other enterprises benefited by the regime or services that can be offered electronically using wired or wireless means to enterprises outside the national territory. Incorporation into the benefits and fiscal incentives granted by the Free Zones regime shall not be authorized to natural or legal persons that operate and pay taxes in the national customs territory and that allocate all of their production to the national market.

Once the authorization request is admitted as Operator or Operator-User, the General Secretariat of the Ministry of State in charge of Economic Development shall transfer the file to the General Directorate of Productive Sectors for it to issue the corresponding Opinion. Prior to the issuance of the aforementioned Opinion, the General Directorate of Productive Sectors shall coordinate, in cases that warrant it, a joint inspection with the Customs Administration. Subsequently, the Ministry of State in charge of Economic Development shall issue the Resolution in accordance with law, expressing the benefits and obligations that according to the Law correspond to the applicant. When the resolution is final and no recourse may be filed against it, a copy of the documents contained in numerals IV, V, VI, VIII and IX of Article 3 of this Regulation and the respective Certification of the Authorization Resolution shall be remitted to the Customs Administration within a period of twenty (20) business days, through the physical, electronic means or electronic platforms that the Ministry of State in charge of Economic Development has available, all without prejudice to the notification and delivery of the Certification of said Resolution to the applicant, a procedure that must be expeditious. Operator or Operator-User enterprises, once notified of the Resolution that authorizes them, must request within a maximum period of thirty (30) business days before the Customs Administration, prior to complying with their registration in the Registry of Exempted Parties, their Commencement of Operations in the Customs Informatic System, as well as the Execution of Contract for Customs Services, which shall contain the obligations regarding services, mechanisms of control and supervision of the restricted area, otherwise the customs administration shall notify the Ministry of State in charge of Economic Development of non-compliance so that it may proceed in accordance with the law. To request access codes to the Electronic System that controls imports, exports and customs transits carried out by enterprises admitted to the regime, only the certificate of registration issued by the Ministry of State in charge of Finance shall be required, which certifies that the enterprise is registered in the Registry of Exempted Parties and also the name and identification number of the person responsible for managing the codes.

The rights conferred to the Operator, Operator-User and User are personal and non-transferable, consequently they cannot be ceded or transferred to another natural or legal person.

The Operator or Operator-User of a Free Zone that requests authorization for enlargement of new zones shall comply with the same requirements contained in Article 3 of this Regulation, except the documents contained in numerals I, VI and VIII; likewise the Customs Administration must proceed to the review and in its case modification of the Contract for Customs Services of Operations, originally executed with the enterprise, for the adequate verification and compliance with customs obligations; the Ministry of State in charge of Economic Development and the operator or operator user being required to comply with that established in paragraphs 3 and 4 of article 5 of this Regulation.

For the enlargement or reduction of the restricted area, together with the request, the new descriptive plan duly endorsed by a Civil Engineer or Architect must be attached, as well as the documentation that proves ownership of the land or the Lease Contract, as the case may be.

Merchandise under the custody of the enterprise benefited by the regime that suffers damages, losses, shortages derived from theft, robbery, fire or any other risk shall be the responsibility of the enterprise, except in cases where they incur in force majeure or act of God and there are indications of absence of fraud or malice, duly proven by the competent authority.

The Contracts for Customs Services and their addendums, executed between the Customs Administration and the Operators or Operator-Users must be in writing and shall be executed under the terms and conditions established by the Law, this Regulation and Customs Legislation, with the parties being obligated to comply with what is agreed. The Customs Administration shall remit a photocopy of said Contract to the General Directorate of Productive Sectors, General Directorate of Tax Policy and Customs Franchise Control Directorate, within a period of twenty (20) business days from the date of execution thereof, which may be sent by physical, electronic means or digital platforms established by the Customs Administration.

The Operator or Operator-User whose restricted area has been authorized at the project level must begin construction of the essential elements of the zone within a period of three (3) months, counted from the day following the date of notification of the Resolution issued by the Ministry of State in charge of Economic Development. The Operator or Operator-User whose restricted area has been authorized and who already has the infrastructure must complete the observations and improvements related to the customs control post and delimitation of the area that were indicated in the Resolution issued by the Ministry of State in charge of Economic Development, within a period of three (3) months, counted from the day following the date of notification thereof. In said Resolution, the requirements to be completed shall be established. The Operator or Operator User may request an extension of the established period for duly justified cause, prior to the date of expiration thereof. Once the period is exhausted, the Ministry of State in charge of Economic Development, in coordination with the Customs Administration of Honduras, shall conduct a joint inspection to verify compliance; otherwise the Ministry of State in charge of Economic Development shall proceed in accordance with Law.

Enterprises that for any reason must suspend their operations must notify it in writing immediately to the Ministry of State in charge of Economic Development, indicating the date on which their operations should resume. Said Ministry of State must notify it to the institutions related to the regime.

The Operators and Operator Users of a Free Zone may register in the Registry of Users of the Free Zones Regime maintained by the General Directorate of Productive Sectors, the enterprises that establish themselves within the restricted area that was authorized to them. For compliance with this provision they shall have fifteen (15) business days counted from the date on which the respective lease contract was signed. Said registry may also be requested by the User. For purposes of the Registry, the General Manager, Legal Representative or Legal Representative of the Operator, Operator-User or User shall present to the General Directorate of Productive Sectors the respective form that the latter shall deliver to them, being required to provide the data required therein, also attaching the information contained in numerals I, II, III and the documents referred to in numerals VI, VIII, IX and X of Article 3 of this Regulation. Additionally they must present: I. Photocopy of the Lease Contract executed between the Operator or Operator-User with the User of the Regime or Certificate issued by the former, by means of which it is proven that the parties have executed the Lease Contract, detailing in the document among others: location, term and rented area. II. In the case of User Enterprises whose business is Basically Industrial Export, the date of commencement of operations and volume of exportable production must also be indicated. III. For electronic services enterprises when so required, they must present the authorization from the National Telecommunications Commission (CONATEL) for those services that require such authorization. IV. The photocopies of the documents required must be presented duly authenticated, signed and sealed by a notary public. V. Tax Revenue Receipt for L. 200.00

The General Directorate of Productive Sectors, upon receiving the registration request contained in the form, together with the information and documentation previously related, shall verify by means of field inspection that the User has the physical installations required for its activity and is located in the restricted zone of the operator or operator-user that mentions in its request, proceeding to register the User, issuing to it the corresponding Certificate of Registry under the Regime; in which the number of user registry, the fiscal benefits that correspond to it in accordance with the law, shall be included, also expressing that said certificate constitutes and serves as operating permit for the enterprise and that consequently no other document is required for that purpose. This certificate shall serve to accredit before any authority, the condition of User of the Free Zones Regime. The General Directorate of Productive Sectors must remit to the Customs Administration within a maximum period of twenty (20) business days from the date of issuance, a copy of the documents contained in numerals IV, V, VI, VIII and IX of Article 3 of this Regulation and a photocopy of the Certificate of Registry under the Regime, through the physical, electronic means or digital platforms that the Ministry of State in charge of Economic Development has available. The certificate of registry shall be delivered to the user without delay, who shall have the right to operate within the Free Zone Regime from the date of the certificate of registry issued to them by the General Directorate of Productive Sectors. The failure to remit mentioned in this article, which is an obligation of the General Directorate of Productive Sectors, is not grounds for the delivery of the certificate of registry to the interested party.

Once the Certificate of Registry of user of the Regime is issued and delivered, the beneficiary prior to its registration in the Registry of Exempted Parties must request before the Customs Administration the Commencement of Operations in the Customs Informatic System within a maximum period of thirty (30) business days; To request access codes to the Electronic System that controls imports, exports and customs transits carried out by enterprises admitted to the regime, only the certificate of registration issued by the Ministry of State in charge of Finance shall be required, which certifies that the enterprise is registered in the Registry of Exempted Parties and also the name and identification number of the person responsible for managing the codes.

Users may expand their operations in other restricted areas that are under customs and fiscal control, in compliance with what is established in Article 13 of this Regulation.

Companies authorized to operate under the Free Trade Zone regime shall enjoy the fiscal benefits granted by law, while they are enrolled and operating under the regime, with the exception of Income Tax and Related Taxes, which shall be subject to the following terms: a. The exemption from Income Tax and Related Taxes contained in the Free Trade Zones Law, subject to the twelve (12) year term established in Article 23 of Decree No. 278-2013 dated December 21, 2013, ends its benefit on the date that Decree No. 8-2020 of February 14, 2020 comes into force. b. As of the effective date of Decree No. 8-2020 of February 14, 2020, companies enrolled in the Free Trade Zone Regime shall have the right ipso jure (automatically) to a period of fifteen (15) years for the benefit of exemption from Income Tax and its Related Taxes. c. Upon expiration of the fifteen (15) year period established in article 4-B of Decree No. 8-2020, of February 14, 2020, as this period is subject to extension, the beneficiary of the regime may request an extension of ten (10) years, before the expiration of the 15 year period, for the benefit of exemption from Income Tax and Related Taxes, before the State Secretary in the Office of Economic Development, for which they must comply with the following requirements: 1. Export statistics for the last five (5) years. 2. Employment statistics generated during the last five (5) years. 3. Investments made during the last five (5) years. 4. Present tax and customs solvency. In granting the new term, the State Secretary in the Office of Economic Development shall take into consideration the stability of the jobs generated by the requesting company, the performance of its exports, its investment amounts, and the fulfillment of the obligations that correspond to it in accordance with the law. Likewise, consideration shall be given to the endogenous and exogenous factors that may have negatively influenced the growth of the company's commercial activity.

Companies that operate in the restricted area and carry out operations involving handling, mixing, packaging of chemical, pharmaceutical, food products, or any other product that may affect the health of persons, must comply with the sanitary, environmental, and other applicable regulations that correspond for each case. When the State Secretary in the Office of Economic Development, the Customs Administration, and the Operator or Operator User identify non-compliance with sanitary or environmental regulations, they must notify the competent authority to proceed with the pertinent investigations.

Prior to the closure of operations, other than that resulting from force majeure or act of God, the Operator, Operator-User, or User shall notify the State Secretary in the Office of Economic Development and State Secretary in the Office of Labor and Social Security, as well as the Customs Administration with ten (10) days' notice prior to the definitive closure, for the corresponding legal purposes. The General Directorate of Productive Sectors, once the benefits have been cancelled, shall notify the Customs Administration and the State Secretary of Finance, so that these may conduct the verifications and apply the measures that correspond in accordance with the law. Operators, Operator Users, or Users who fail to comply with the provisions of this article shall be sanctioned in accordance with what is established in the Tax Code and other applicable laws.

The Resolution or Certificate of Registration issued by the State Secretary in the Office of Economic Development is the document that authorizes the administration and operations of the Free Trade Zones Regime, and in order to enjoy the benefits, it must be registered in the Registry of Tax-Exempt Entities administered by the State Secretary in the Office of Finance, within a period of fifteen (15) business days after the authorization document becomes final.

The State Secretary in the Office of Economic Development, through the General Directorate of Productive Sectors, shall maintain a Registry of Companies Benefiting from Free Trade Zones, in accordance with the Authorization Resolution or Registration Certificates.

The State Secretary of Economic Development shall authorize natural or legal persons who, prior to the corresponding application, establish themselves in the restricted area, without enjoyment of fiscal benefits, in support of companies enrolled in the regime as well as their workers, through different services. The State Secretary in the Office of Economic Development shall communicate to the Honduras Customs Administration and the Tax Administration Service the authorizations referred to in this article, as well as the closure of operations of the related companies. The companies referred to in the preceding paragraph must notify the State Secretary of Economic Development within 30 days following the date of closure; otherwise they are subject to the sanctions contained in the Tax Code for these cases. The Operator or Operator User shall be responsible for notifying the State Secretary in the Office of Economic Development of companies that establish themselves without enjoyment of benefits, in order to provide support through the provision of services to workers in the restricted area of the Free Trade Zone, within 15 business days following the execution of the rental contract. In the event that these companies cease to operate, the period to notify shall be 30 days. Likewise, the State Secretary in the Office of Economic Development shall notify the Honduras Customs Administration and the Tax Administration Service (SAR) of the entry of new companies and/or the closure of the same, whose business line is related in this provision. CHAPTER IV

The Operator or Operator-User of the Free Trade Zones shall provide to the Customs Administration, for the operation of the customs control post, an office intended solely and exclusively for that purpose, which must have access and wide visibility toward the entry and exit zones. Likewise, it shall be equipped with sanitary facilities, air conditioning, computers according to the technical specifications indicated by the Customs Administration, multifunction photocopier, desks, filing area for storing customs documentation, fixed telephone service restricted to domestic use, internet access, office supplies, source of potable water for human consumption, personal protective equipment, and others that may be necessary for the development of its activities. The use of telephones, computers, and photocopiers shall be exclusive for the exercise of their functions. Likewise, the internet service shall be with independent connection or exclusive service to the Customs Post of the Free Trade Zone. Violation of this provision shall authorize the Customs Administration to apply corrective measures in accordance with what is agreed in the Customs Services Contract executed between the parties. In the event that the Operator or Operator-User of the Free Trade Zones require opening new access points, these must be authorized by the State Secretary in the Office of Economic Development. The customs authority shall determine whether it is necessary to establish new customs control points and the corresponding review of the Cost Annex of the Customs Services Contract.

Companies that, under the protection of this law and by reason of their business activity to be carried out, present a proven limitation for compliance with what is provided in the first paragraph of article 9 of the Free Trade Zones Law, prior to the authorization of the regime, the State Secretary of Economic Development, jointly with the customs authority, shall determine the control mechanisms for the entry and exit of merchandise, persons, vehicles, loading and unloading of merchandise, which must have a security system that permits permanent monitoring of these areas. The controls referred to in this provision shall not place at risk the safety of persons or companies as a consequence of the monitoring.

Operator-Users and Users shall have the following operational obligations: 1. Maintain an electronic record of entries, exits, and inventory balances of raw materials, inputs, and finished products which shall be made available to the Customs Administration, at the moment it requires them, for the respective fiscal control. 2. According to the nature of the authorized activity, they must have adequate facilities for storage, custody, and preservation of merchandise. 3. Be responsible before the Customs Administration for merchandise that may have been improperly intended for the national customs territory, including damaged goods and waste, without prejudice to the sanctions established in the Tax Code. 4. In the event that merchandise has entered the restricted area for which taxes have been paid, they must maintain separate inventories of those entered under the regime, properly identified. 5. After 6 months of having begun operations, the beneficiary company must have available to the Customs Authority the utilization coefficients and percentages of waste or loss of raw materials and inputs used in production, when applicable.

Beneficiaries of the Free Trade Zones Law are obligated to comply with the formal commitments of the Law and this Regulation, regarding the facilitation of information, in order to be able to obtain statistical data that permit measuring the degree of operability of the Regime, information that shall be evaluated by the State Secretary of Economic Development and the Customs Authority.

Operators, Operator-Users, and Users must carry out the activity in accordance with what is authorized by the State Secretary in the Office of Economic Development. In the event of modification thereof, they must request authorization before the said office.

Beneficiary companies of the Regime for control of their commercial transactions must comply with what is established in the Invoicing Regime, Other Fiscal Documents, and Fiscal Registry of Printing Offices. The tax behavior of companies enrolled in this regime does not justify preventing their export operation, by preventing the printing and validity of their fiscal vouchers; this without prejudice to compliance with the material and formal obligations that correspond in each case, on the terms set by the law.

When the Customs Administration identifies irregularities regarding customs operations and others related to said operations, they must notify the State Secretary in the Office of Economic Development, who in turn shall refer the cases to the Offices according to their competence. When the Operator and Operator User determines that a User is violating the Free Trade Zones Law and its regulation, they must give written notice to the State Secretary in the Office of Economic Development in order for the corresponding investigation to be conducted.

Companies benefiting from Free Trade Zones are obligated to provide the necessary facilities to the different State entities directly related to the Regime, duly accredited and identified, which in accordance with their competence and by reason of their activity require conducting inspections or verifications in the facilities of said companies. In the event of not providing the required support, an incident report shall be drawn up, which must be sent to the State Secretary in the Office of Economic Development to apply the measures that correspond in accordance with the law.

Operators, User-Operators, and Users of Free Trade Zones shall grant their workers all benefits established in current labor legislation and must additionally comply with the General Regulation on Preventive Measures for Work Accidents and Occupational Diseases, issued by the Secretariat of State in the Offices of Labor and Social Security. Any labor dispute shall be resolved in accordance with the procedures established in the Labor Code.

The Permanent Representative of the companies must be accredited before the Secretariat of State in the Office of Economic Development, by means of an authenticated photocopy of the Power of Attorney deed in which the representation is recorded, with broad powers to perform all acts and legal transactions of a civil, commercial, and labor nature that are to be executed and take effect in the national territory, and to whom any notification shall be made that in accordance with the laws corresponds. In the event that the Permanent Representative ceases in his functions for any reason, the company is obligated to immediately notify the Secretariat of State in the Office of Economic Development of the designation of the new Permanent Representative. The failure to appoint a Permanent Representative shall be sufficient grounds to consider the authorization to operate in Free Trade Zones as cancelled. In case of closure for any reason, the Permanent Representative of such companies shall be responsible on his account before third parties for all pending debts and obligations. The Secretariat of State in the Office of Economic Development shall make available to the Secretariat of State in the Offices of Labor and Social Security and to the Customs Administration the information regarding what is provided in the preceding paragraph. OBLIGATIONS OF CUSTOMS PERSONNEL

The customs personnel assigned in the restricted area of the Free Trade Zone shall have, among others, the following obligations: a) The customs officer designated in the Free Trade Zone by the Customs Administration is obliged to safeguard the fiscal interests of the State, maintaining special control and supervision of merchandise, vehicles, and persons entering and leaving the restricted area of the Free Trade Zones, in order to comply with all requirements and customs formalities established in legal provisions. b) Verify and authorize all merchandise entering and/or leaving the Free Trade Zone c) Adopt the necessary measures for compliance with the Free Trade Zones Law, its amendments, this Regulation, and other provisions, making known to the superior authority of the Customs Administration the non-compliance of companies benefiting from the regime. d) Comply with the schedules and hours established by the Customs Administration, which, in accordance with the needs of the Operator, User-Operator, and User, may be extended at their request, previously authorized in accordance with what is established in the Customs Service Contract executed between the Customs Administration and the Operator and/or User-Operator. e) Allow the entry and exit from the restricted area of means of transport, after verifying the conditions and status of the corresponding seals and other security measures. f) The others established in the Free Trade Zones Law, its amendments and respective Regulations, Customs Service Contract executed between the Customs Administration and the Operator and/or User-Operator, the provisions issued by the Customs Administration, the Central American Uniform Customs Code (CAUCA), and its Regulation, within the scope of application of the latter. CHAPTER V CUSTOMS CONTROL MECHANISMS

The restricted area shall be delimited by concrete blocks, brick, concrete, or other solid material and/or cyclone fencing, which allow for the exercise of fiscal control, which must have a height not less than three (3) meters. The access and exit from the restricted area of persons, vehicles, and merchandise shall be carried out solely through the places authorized by the Customs Administration. The Customs Administration shall determine the necessity of assigning necessary personnel when there is more than one access of entry and exit to the restricted area and in accordance with the volume of operations generated in the Free Trade Zone.

Any Operator or User-Operator that requests authorization to enjoy the benefit of the Free Trade Zones Law and that, due to the nature of its activity to be developed, presents some verified limitation for compliance with the delimitation of the area, prior to the issuance of the Opinion, the General Directorate of Productive Sectors shall coordinate a joint inspection with the Customs Administration, issuing the corresponding report.

The fiscal control and supervision of the restricted area shall be in charge of the Customs Authority designated to the customs post of the Free Trade Zone, in accordance with what is established in customs regulations, the Free Trade Zones Law, this Regulation, and insofar as applicable, the country's tax laws. For compliance with the provisions of the preceding paragraph, the customs authority shall maintain special control at the points of access and exit of the restricted area, guaranteeing that merchandise, vehicles, and persons entering or leaving comply with the requirements and formalities established in the legal provisions related in the preceding paragraph, without obstructing or hindering the processes of importation, production, exportation, reexportation, services, and/or related and complementary activities that are carried out, taking into account the nature of the Zones and the aims pursued in the Law and this Regulation.

All merchandise entering a Free Trade Zone must be consigned to a legally established company authorized to operate under the benefits of a Free Trade Zone; under no circumstances, without authorization from the Secretariat of State in the Office of Economic Development, may merchandise be imported in the name of the Operator, User-Operator, or User operating within the restricted area. The violation of this provision shall give rise to the sanctions typified in the Tax Code.

All entry of merchandise into the restricted area must have the authorization of the Customs Authority in accordance with the following:

• a)

  Entry of merchandise from abroad: All merchandise from abroad shall be sent by the port of entry customs directly to the Free Trade Zone, prior to the presentation of the Declaration of Goods in Transit, which shall contain the information and requirements established in Articles 320 and 321 of the Regulation to the Central American Uniform Customs Code (RECAUCA). Upon arrival of the merchandise at the restricted area, the beneficiary company must present the Declaration of entry to the Regime.

• b)

  Entry of merchandise purchased in the domestic market with purchase order exempt from Sales Tax: All merchandise from the domestic market with exempt purchase order shall have its arrival at the Free Trade Zone confirmed in the Customs Computer System by the customs authority, providing a copy of the Exempt Purchase Order and commercial invoice.

• c)

  Entry of merchandise purchased in the domestic market, exempt from Sales Tax: All merchandise from the domestic market that is by Law exempt from Sales Tax, upon entering the restricted area, must comply with the customs formality and other applicable requirements.

• d)

  Entry of domestic merchandise: All merchandise produced in the national territory that, at the time of entering the restricted area, must comply with the customs formality or other simplified mechanism that the Customs Administration establishes for this purpose.

• e)

  Merchandise acquired by the beneficiary through the payment of tax: Merchandise that the beneficiary of the Regime has acquired with the payment of taxes may enter the restricted area, providing to the customs authority a copy of the document of its acquisition. The companies benefiting from the regime may dispose of the merchandise arrived at the restricted area once they register in the Customs Computer System the Declaration of Entry to the Free Trade Zone. The maximum period for the registration of the customs formality in the Customs Computer System shall be ten (10) business days, counted from the date of arrival of the merchandise at the restricted area. After the period expires, the company may register the customs formality of entry to the Free Trade Zone, prior to payment of the administrative sanction of two (2) minimum salaries established in the Tax Code.

All merchandise originating from the domestic market or from another duly authorized special regime that has as its objective reexportation, in compliance with what is established in Article 10C of Decree No. 8-2020, must enter the restricted area of the Free Trade Zone to be subjected to a transformation process, which must be verified by the Customs Authority.

For the application of the percentage of sales destined for the domestic market by Basically Re-exporting Commercial companies, they must be carried out in accordance with the units or quantities in weight and volumes declared in the Declaration of Merchandise with which it entered the Free Trade Zone, with the customs officer assigned to the customs post being responsible for exercising the control and application thereof. For the control of the permitted percentage, sales shall be considered per fiscal year. For Basically Exporting Industrial Companies, the percentage of sales destined for the domestic market shall be established in accordance with the volume of production in the annual fiscal period.

The customs authority may authorize the transfer of merchandise between User-Operators or Users in a definitive or temporary manner. When the transfer is temporary, it shall be understood that it does not constitute transfer of ownership, there being in this case the provision of services between Free Trade Zone companies. In both cases the customs formality shall be used through the formats that the Customs Administration establishes for this purpose. Violation of this provision shall give rise to the application of sanctions in accordance with the Tax Code, without prejudice to other applicable laws.

The Customs Authority, either ex officio or at the instance of the competent authority, shall conduct within the restricted area and in the presence of the beneficiary of the Regime the physical verification of merchandise entering or leaving, in order to determine the accuracy of what is declared in the Declaration of Merchandise.

The Customs Authority may authorize the entry or exit of merchandise to the restricted area on non-business days and hours due to force majeure or fortuitous event duly established, or, in accordance with the needs of the companies in order to comply with their production contracts.

For purposes of application of Article 19 of the Free Trade Zones Law, in the case of merchandise destined for the domestic market, the Customs Authority must verify that there are no Exclusive Distributors of such products, in accordance with the records that for this purpose are provided by the Secretariat of State in the Office of Economic Development to the Customs Administration.

The Customs Authority in a Free Trade Zone may authorize the exit of merchandise from the restricted area toward the exit Customs office of the national territory, through the declaration of merchandise for exportation or reexportation as the case may be; the exit customs office shall confirm the arrival and authorize the exit of the merchandise from the national territory.

Merchandise that is under customs control in the Free Zone may be destined to the national territory under any of the customs regimes established by law, complying with tariff and non-tariff requirements and other customs formalities in accordance with the requested regime.

Merchandise that has origin in accordance with trade treaties ratified by Honduras originating from the Free Zone is not subject to the payment of tariffs; however, applicable taxes must be paid, calculated on the value of the transformation, which is not subject to the tariff regime.

The Free Zone that requests to destine merchandise to the national territory in accordance with the requested regime shall present a written request to the Customs Administration, which shall be a mere procedural matter, requesting authorization of one or more Reception, Custody, Appraisal, and Dispatch Areas to locate the merchandise that will be subject to customs clearance.

The Reception, Custody, Appraisal, and Dispatch Area to locate merchandise subject to nationalization or another applicable customs regime must meet the following requirements:

• a)

  It must be labeled, illuminated, ventilated, delimited, and protected with concrete walls, cyclone wire, or other solid material that delimits the space and provides adequate security for the preservation of merchandise.

• b)

  If the requested area is located outside the user company's facilities, it must be covered and protected with solid walls, and may or may not be roofed depending on the type of merchandise to be stored.

• c)

  It must have a single, restricted access that is sufficiently wide to facilitate the entry and exit of merchandise.

• d)

  The Reception, Custody, Appraisal, and Dispatch Area must be within the area authorized as a free zone. Once the area is defined and complies with the requirements contained in this article, the Customs Administration shall issue an official document containing the corresponding authorization or denial within a maximum period of ten (10) business days, counted from the date of completion of verification of compliance with the requirements. If space outside the free zone is required, it must previously have the authorization of the Ministry of State in the Office of Economic Development to expand the restricted area.

The provisions of the preceding article apply to those cases in which nationalizations of merchandise resulting from sales made by free zone companies to the national market and any other regime on a frequent basis; the Operator or User Operator must request from the Customs Administration the assignment of necessary personnel to perform appraisal of the merchandise, whose appointment and other labor conditions shall be included in the Customs Services contract that the operator or operator-user signs with the Customs Administration. In case the transactions are not required on a frequent basis, the Operator or User Operator must request from the Customs Administration the temporary assignment of personnel.

Companies operating in the Free Zone that occasionally make sales to the national market shall request from the customs administration of the jurisdiction support through the assignment of the Appraisal Analyst for each case; these sales shall be formalized at the customs control post in accordance with the normal procedure for the importation of merchandise to the national market. Occasional is understood to mean one (1) operation per month.

Companies engaged in textile activity that occasionally make sales in the national market shall delimit a sufficiently wide space within their industrial facility, marked with yellow lines to locate within said area the merchandise subject to introduction into the national territory. The importer shall pay the expenses related to appraisal, inspection, and authorization incurred as a result of the introduction; the Customs Administration shall set the value of these costs and the payment mechanisms for the customs service provided. Once the area is defined and complies with the requirements contained in this article, a written request shall be presented to the Customs Administration, which shall be a mere procedural matter; the administration shall issue an official document containing the corresponding authorization or denial within a maximum period of ten (10) business days, counted from the date of completion of verification of compliance with the requirements. All customs procedures required for the introduction of merchandise shall be conducted at the customs post of the operator or operator-user where the company making the sale is located.

The declaration of merchandise for introduction into the national territory must be presented through a Customs Agent or Special Proxy before the customs authority assigned at the Customs Control Post, by means of electronic transmission in the Customs Information System, transferring the merchandise to the Reception, Custody, Appraisal, and Dispatch Area in accordance with the general procedure for the importation of merchandise. In those cases where merchandise, due to its volume and/or weight, makes it difficult to move to the Reception, Custody, Appraisal, and Dispatch Area, the review process shall be conducted where the merchandise is located. When the Free Zone company makes sales to national market companies that do not exceed the value of one thousand dollars ($1,000.00), it shall not be necessary to authorize the Reception, Custody, Appraisal, and Dispatch Area; the importer of the merchandise shall present the invoice issued by the Free Zone company to the Customs Authority designated at the control post for entry and exit of merchandise from the restricted area, who must register a Declaration for Definitive Importation by Official Action, and the importer must pay the taxes in accordance with the tax regime in effect on the date of acceptance of the declaration, being the responsibility of the Customs Authority to verify what was declared in accordance with the established procedure for such purpose. Free Zone companies that destine sales to the national market of less than one thousand dollars ($1,000.00) may not perform more than one nationalization operation per day to the same consignee, except when it involves waste.

Merchandise that has been subject to transformation and whose product is subject to introduction into the national territory, such as medications, food for humans or animals, or similar products, which by their nature must be inspected by the Ministry of State in the Offices of Natural Resources and Environment, National Agricultural Health Service, or Health Regulatory Agency, must have the authorization of these authorities, as applicable, prior to the Customs Authority authorizing the introduction. The importer shall incur the expenses involved in the inspection and authorizations required by the institutions aforementioned, which shall provide dedicated personnel to perform this work.

For Free Zone companies that destine merchandise to the national market, the importer must use the services of a Customs Agent or Special Customs Proxy; so that these may provide their customs clearance services for merchandise subject to introduction into the national territory, they must request authorization from the Customs Administration to operate at the Customs Control Posts of the Free Zones, complying with the obligation to pay One Thousand Lempiras (L. 1,000.00) annually for each Customs Post where they exercise their activities.

Free Zones that do not have authorization for the Reception, Custody, Appraisal, and Dispatch Area shall transfer the merchandise through the Internal Transit Regime to the Customs Office under the jurisdiction of the Free Zone or the importer, so that the merchandise is subject to the customs clearance process by the importer in accordance with the established customs procedure according to the requested regime.

The Customs Authority shall authorize the release of merchandise introduced into the national territory once it has complied with customs formalities in accordance with the requested regime. The assigned personnel from the Customs Control Post must confirm in the Customs Information System the effective departure of the merchandise; this process is the completion of the declaration cycle.

The customs procedure for the introduction into the restricted area of national or nationalized merchandise intended for export or reexport shall be conducted at the Customs Office under the jurisdiction of the Free Zone or of the company conducting the export or reexport, unless the Free Zone has the Reception, Custody, Appraisal, and Dispatch Area, observing the requirements and formalities established in the customs regulations; the Customs Administration must establish the procedure that facilitates the operation of entry into the zone, in accordance with the provisions of Articles 10-C and 15-A of Decree No. 8-2020. The purchases made locally with sales tax exemption or without exemption are excepted from this article.

User Operators and Users may export waste or damaged goods with or without commercial value by complying with the respective merchandise declaration; otherwise, such goods shall be placed at the disposal of the Customs Administration so that it determines the market value in accordance with the nature of the waste; this operation shall be subject to the following:

• a)

  Definitive importation, after payment of the corresponding taxes and compliance with customs formalities;

• b)

  Donations to legally recognized Public or Private charitable or educational Institutions; provided they address priority needs in health, food, education, employment generation, and those granted to the Permanent Contingencies Commission (COPECO); once the donation is approved, the Customs Administration shall send the authorization with the documents of the request to the Ministry of State in the Office of Finance so that it grants the corresponding Customs Franchise; and c) Destruction, duly supervised by the competent authorities, for the purpose of conducting the corresponding write-offs.

The donations referred to in Article 4C of the Free Zones Law, as amended, shall be subject to the provisions of subsection b) of the preceding article; the Ministry of State in the Office of Finance must verify the proper use that will be given to such donations.

User Operators and Users may grant manufacturing contracts to other natural or juridical persons, national or foreign, located within national territory, or contract repair services. In these cases, they may temporarily intern merchandise in national territory proceeding from restricted zones for use in the manufacturing process of these contracts, subject to the provisions of the Customs Authority, in accordance with the following: The company located within national territory that will perform any of the processes referred to in the preceding paragraph shall request in writing from the Customs Administration authorization for the operation as well as the departure of raw materials and inputs to be used in said processes, which does not include machinery and equipment; this request is a mere procedural matter and shall be resolved immediately. When Free Zone companies intern machinery or parts thereof into national territory for repair, they shall make use of a form designed by the Customs Authority, in which the type of machinery or parts, departure date, reason for repair, and return date to its place of origin shall be specified.

User Operators and Users may provide maquiladora services or repair services to companies located within national territory, provided that said activity is authorized by the Secretariat of State in the Office of Economic Development. In this case, goods from national territory may be temporarily exported to a company beneficiary of the Free Zone regime, with the purpose that they may be submitted to perfection operations, transformation, processing, repair, or any other service that may be required; the maximum term for their reimportation to national customs territory shall be six months counted from the date of registration of the merchandise declaration. Said goods, when reimported to national customs territory, shall pay corresponding taxes only on the value added to exported merchandise and the expenses incurred due to reimportation. For the application of this provision, the provisions of Articles 15-A, 15-B, and 16 of Decree No. 8-2020 shall be observed.

The Customs Authority of the Free Zone shall verify the quantities of merchandise that enter the restricted area by validating the quantities in accordance with the entry declaration and its documents. If from the verification carried out undeclared merchandise results, the Customs Authority of the Free Zone shall proceed in accordance with the following: a) Merchandise that forms part of the productive process: The Customs Authority through physical inventory taking shall determine the surplus of merchandise; if it is proven that the surpluses form part of the company's productive process, it shall proceed to authorize that they be declared in accordance with the procedure through the Customs Informatics System, prior payment of the corresponding sanction, according to what is established in the Tax Code, or the reexportation thereof without application of sanctions. b) Merchandise that has no direct or indirect relationship with the productive process: The Customs Authority through physical inventory taking shall determine the surplus of merchandise; if it is proven that these have no direct or indirect relationship with the productive process, the company shall pay the corresponding taxes and duties, plus sanctions according to what is established in the Tax Code, in accordance with the procedure established by the Customs Administration. The Customs Authority of the Free Zone shall issue an Act or Report being signed by the parties involved, the importing company being required to justify the corresponding event, which shall be resolved as a mere procedural matter by the Customs Authority within three (3) business days following its presentation. In case of shortages, the Customs Authority of the Free Zone shall issue an Act or Report of Shortages being signed by the parties involved. The beneficiary company must justify such shortages with reliable documents that allow the Customs Authority to make an assessment of such facts. If prohibited merchandise is found, the Customs Authority shall proceed to seize or confiscate it, ordering it to be placed in a space under its custody within the restricted area, proceeding to notify the corresponding Authorities.

For purposes of customs control, when entry and exit of merchandise is verified without the respective formality required for each type of operation, it shall give rise to confiscation thereof and application of the corresponding sanction in accordance with the Tax Code. The confiscated merchandise shall be placed at the disposal of the competent authority for the deduction of other liabilities.

Beneficiaries of the Regime shall maintain electronic accounting books and records related to the activities they conduct and that are linked to their formal tax obligations; non-compliance with these obligations shall be sanctioned in accordance with what is established in the Tax Code and other applicable laws.

The State Entities related to the control, regulation, and compliance of the activities of Call Centers and energy-generating companies located in Free Zones shall provide all necessary information to the Customs Administration of Honduras and to the Secretariat of State in the Office of Economic Development, in order to establish the controls that by Law correspond.

NON-PERFECTED EXPORTS. Exports made by beneficiary companies from the restricted area and these, once having arrived at the exit customs office, are not exported due to causes not attributable to the company, the merchandise may return to the Free Zone through a Declaration of Merchandise for Internal Transit, complying for this purpose with the procedure as if it were a new import under the benefit. The beneficiary company must present to the Customs Authority of the Free Zone and to the exit customs office the causes that motivated the non-exportation of the merchandise. Once the justifications are presented and accepted by the exit customs office, it shall mark in the Customs Informatics System the merchandise declaration of export/reexportation with an incident in which it states the reason why the merchandise was not exported, remaining as non-perfected export.

RETURN OF MERCHANDISE FROM ABROAD DUE TO REJECTION. Merchandise that has been exported and has been rejected by the recipient abroad may be returned to the Free Zone for its restoration, repair, review, or the process that warrants for its subsequent reexportation, presenting to the Customs Authority of the entry customs office the corresponding justifications. In case the merchandise in question is destined for the local market, Free Zone companies must submit the same to the respective customs procedure and payment of corresponding taxes.

The Secretariat of State in the Office of Economic Development through the General Directorate of Productive Sectors and the Customs Administration shall conduct joint or separate inspections of the Operators, User Operators, and Users to verify compliance with their obligations established in the Law, its Regulation, and Resolution or authorization document to the Regime.

In case the Operator, User Operator, or User incurs in non-compliance with the obligations established in the Free Zones Law, in this Regulation and its Resolution or authorization document to the Regime, the Secretariat of State in the Office of Economic Development shall apply the sanctions contained in said law and in the absence thereof, those established in the Tax Code.

When a company covered under the Free Zone regime ceases to operate for more than 6 months without notifying the corresponding authority of the causes for which it has ceased to operate, the Secretariat of State in the Office of Economic Development shall cancel the Regime ex officio.

Companies covered under the Free Zones regime that for any reason suspend their operations, without proper written notification to the Secretariat of State in the Office of Economic Development, shall be sanctioned in accordance with what is provided in the Tax Code.

The Operators, User Operators, and Users are obligated to provide to the authorities of the Secretariat of State in the Office of Economic Development, Secretariat of Finance, and Customs Administration, all information that is requested of them to determine that they are complying with the obligations contained in the Tax Laws, Customs Laws, Free Zones Law, this Regulation, and the Resolution or authorization document to the Regime. Every Operator company, User Operator, and Free Zone User shall present semiannually, in the months of January and July of each year, to the General Directorate of Productive Sectors of the Secretariat of State in the Office of Economic Development and Customs Administration, the information relating to the entry of merchandise, exports or reexports, activity they conduct, as well as number of jobs, wages and salaries, investments, local sales, transfers, utilization coefficients, and waste percentages that they develop within the restricted area.

All merchandise entered into the restricted area under Free Zone benefits shall not produce abandonment while the company is operating under the Regime, except that it ceases to operate without notifying the Secretariat of State in the Office of Economic Development and the Customs Administration; in this case, the Customs Authority assigned to the Customs Control Station must take inventory of the merchandise in order to initiate the auction process in accordance with the established Procedure. When the company has ceased its operations and has notified the Secretariat of State in the Office of Economic Development and the Customs Administration, without having exported/reexported or definitively imported its merchandise, after the period of thirty (30) days, these shall be considered abandoned.

Beneficiary companies of the Free Zones Regime that due to the urgency of their productive processes need to import or export merchandise in small packages or high value, may apply the accompanied baggage service (Hand Carrier) and shall place the merchandise at the disposal of the Customs Authority of the entry Customs Office, so that it authorizes its transfer to the Free Zone or in its case the departure from national territory, in accordance with the procedure established by the Customs Administration.

With prior authorization from the Customs Administration, the Operators, User Operators, or Users may remove from their inventories obsolete or unused goods that were acquired under the Free Zones benefit. The Customs Administration shall authorize the nationalization, following payment of corresponding taxes or, as applicable, the destruction or incineration, in compliance with the provisions established by said authority for such purpose: If the company beneficiary of the Regime wishes to export, re-export, or trade the goods with other free zones, such authorization shall not be necessary.

The utilization coefficients and waste percentages handled by the beneficiaries of the Regime must be verified by the Customs Administration and/or Secretaría de Estado in the Office of Economic Development.

The contract that the Operator or User Operator enters into with the Customs Administration and to which Article 10 of this Regulation refers shall also include, among others: An amount equivalent to the salaries, wages, and social benefits earned by the officials and employees required to provide the corresponding services. The customs operations contract signed by the operators and user-operators with the Customs Administration is subject to a framework contract in which the general clauses to which the relationship is subject are recorded; for legal certainty of the parties, such clauses may only be modified by agreement of the same. The economic annex to said contract, which regulates the commitment to pay the operations fee, in which the salaries and labor rights of the employees of the customs post are recorded, shall be reviewed annually and shall vary according to the inflation rate reported by the Central Bank of Honduras.

The operations fee that must be paid as a result of the customs services contracts entered into between the Operator or User Operator and the Customs Administration must be made in a special account created for this purpose in the Central Bank of Honduras, at the request of the General Treasury of the Republic.

Those companies covered under other Special Regimes that wish to enjoy the benefits of the Free Zone Law must renounce the benefits of the previous regime, accrediting such circumstance by means of the presentation of a current solvency certificate, issued by the Customs Administration and Tax Administration. Without prejudice to the audits or verifications that the Customs Administration considers necessary to conduct, the same may be executed without need to halt the operations carried out by the company in the new regime and according to the result of the audit, the corresponding sanctions shall be applied in accordance with existing legislation. TRANSITIONAL PROVISIONS

The Operator or User Operator that at the entry into force of this Regulation has within its restricted area companies without benefits of the Regime, which are engaged in the provision of services to working personnel, shall accredit before the Secretaría de Estado in the Office of Economic Development, within a period of sixty (60) days counted from the entry into force of this Regulation, the list of the same, detailing the activity that they carry out, accompanied by a copy of the deed of incorporation and National Tax Register.

In accordance with the provisions of the second paragraph of Article 4B of Decree No. 8-2020 of February 14, 2020, in order to grant the fiscal benefits and incentives established by this Law, companies that as of the date of entry into force of said Decree enjoy the benefits of the Free Zones Law shall have a period of three (3) months, renewable for an equal period, counted from the entry into force of this Regulation, to accredit before the Secretaría de Estado in the Office of Economic Development, the continuation of their operations within the said regime, and must submit to the General Secretariat of this Institution a request for the issuance of the Resolution validating the enjoyment of benefits. Additionally, they shall accompany the form with the information that for statistical purposes the said Secretaría de Estado determines.

In the event that the companies referred to in the previous Article do not comply with the accreditation of the continuity of their operations under the Regime, the Secretaría de Estado in the Office of Economic Development, through the General Directorate of Productive Sectors, shall proceed to the ex officio cancellation of the benefits granted under the Free Zones Law, established in Article 5B of Decree No. 8-2020, and must notify the same to the Secretaría de Estado in the Office of Finance and Customs Administration.

UNFORESEEN CASES. Cases not provided for in this regulation shall be resolved by the competent authorities in accordance with the general principles of Customs Law, custom and usage, equity, and the general principles of administrative law.

The National Port Company (ENP) as Operator of the Free Zone of Puerto Cortés and La Ceiba is subject to all the obligations and benefits contained in the Free Zone Law and this Regulation.

Agreement No. 43-2009 of January 26, 2010, containing the Regulation of the Free Zones Law, and Agreement No. 489-2017 dated July 10, 2017, containing the Regulation for the Nationalization of Merchandise Produced under the Free Zone Regime, are hereby repealed.

This Agreement shall enter into force from the date of its publication in the Official Gazette "La Gaceta". LET IT BE COMMUNICATED AND PUBLISHED, MARTHA VICENTA DOBLADO ANDARA SECRETARÍA DE ESTADO COORDINATING GENERAL SECRETARY OF GOVERNMENT, BY LAW According to Delegation Agreement No. 023-2018, published in the Official Gazette "La Gaceta" on April 16, 2018. MARIA ANTONIA RIVERA ACTING HEAD OF THE SECRETARÍA DE ESTADO IN THE OFFICE OF ECONOMIC DEVELOPMENT