Please note, your browser is out of date.
For a good browsing experience we recommend using the latest version of Chrome, Firefox, Safari, Opera or Internet Explorer.

03 Apr 2020

Covid-19

Measures adopted by the Paraguayan Government in front of the Covid-19 pandemic

On March 26th of the current year, Law N.° 6524/20 entered into force, under which the country was declared in a state of emergency resulting from the COVID-19 pandemic, and which established fundamental measures in several areas.

In the following lines, we will comment on the main measures taken, organized according to the sector that they address.

FINANCIAL

Public loans: The granting on public loans for State Financing was approved, which will allow the Ministry of Treasury to issue bonds and offer them to the national and international markets.

Current Accounts: Local Banks will have to abstain from applying and communicating the sanctions of disqualification of existing bank accounts deriving from checks rejected due to lack of funds to the Superintendence of Banks until July 1st of 2020.

Financing of Micro, Small and Medium Companies (MIPYMES for its Spanish acronym):

-Authorization of the Executive Branch to have 20% of the National Development Bank’s (BNF for its Spanish acronym) utilities available, for the constitution of trusts to support MIPYMES (to be granted through the Agency of Financial Development- AFD-). The entities regulated by the Superintendence of Banks, the National Institute of Cooperatives, and others may participate in these trusts. 

-The Executive Power’s contribution of USD 4.687.500 for the Guarantee Fund for MIPYMES is approved. Additionally, the Fund is authorized to cover the guarantee and/or the counter-guarantee initially up to the amount of the capital of each financing in a deadline of up to 10 years.

-The Ministry of Treasury will initiate a summary procedure for the inscription and updating of the MIPYMES to the registry of the State Undersecretariat of Taxation (SET for its Spanish acronym). 

-The AFD will be enabled to establishing lines of credit for the economic relief of MIPYMES and may also undertake the role of fiduciary in the trusts they constitute.  

Agricultural credit: Increase of USD 18.750.000 to the integrated capital, for loans and financing of those affected by the diminution of income.

Suspension of payment for essential services: Invoices for services of the National Electricity Administration (ANDE for its Spanish acronym), the Paraguayan Health Services Company (ESSAP for its Spanish acronym) and the Paraguayan Communications Company (COPACO for its Spanish acronym), corresponding to March, April, and May, may be temporarily deferred and financed up to 18 payments without interests. Also, the ANDE will exonerate payment for users that required under 500 kWh of energy monthly. 

TAX

-Tax returns and payment of taxes: The Executive Branch may extend the due dates of the tax returns and the payment of the taxes liquidated under Law 6380/19, which corresponds to the fiscal year initiated on January 1st 2020. Also, they may extend the payments corresponding to the fiscal year of 2019 that are pending liquidation. This extension will not be applicable to withholding agents. 

-Fiscal Credits: The suspension of new orders of returns for fiscal credits is established, as well as the suspension of the resolution of the pending requests.

-IDU retention- The deadline for performing the withholding of the Tax on Utilities and Dividends (IDU for its Spanish acronym) is extended until August 31st at the computer systems of the SET. 

CORPORATIONS

-Assemblies: Extension of the deadline for convoking Ordinary General Assemblies up to June 30th of 2020. The deadline for informing said assemblies to the Abogacía del Tesoro has also been extended up to August 31st of 2020. 

LABOR

-Telework: The legal regime of telework in situations of dependency is implemented, as long as the nature of the work allows so. 

-Subsidy: A subsidy of 25% of the minimum wage is established, which must be granted to the self-employed workers or to dependents of MIPYMES that meet certain requirements. To that end, a Social Fund with contributions of the Executive Branch administered by the Ministry of Treasury will be created. 

SOCIAL SECURITY INSTITUTE (IPS for its Spanish acronym):

-The IPS will continue to take care of their insured patients during the emergency, independently of the received contributions. These payments may be refinanced in up to 18 months. 

-The Ministry of Treasury will give a contribution to the IPS of USD 99.718.750, for costs related to the Subsidy of Rest for Disease and for the compensation to the workers affected by the cease of activities and the suspension of labor contracts. 

ADMINISTRATIVE

General Suspension: All the Institutions and dependencies of the Executive Branch may suspend, until June 30th of 2020, the deadlines for the initiated administrative procedures. The suspension of the deadlines must be communicated by the means established in the procedural dispositions that govern said institutions.