Emerging Markets Rates and Currencies Handbook

Remittance Policies There are no restrictions placed on investment remittances. The Caribbean Financial Action Task Force’s Ninth Follow-Up report on El Salvador ( https://www.cfatf-gafic.org/ind ex. php/m ember- countries/el-salvador) noted that El Salvador has strengthened its remittances regime, prohibiting anonymous accounts and limiting suspicious transactions. In 2015, the Legislature approved reforms to the Law of Supervision and Regulation of the Financial System so that any entity sending or receiving systematic or substantial amounts of money by any means, at the national and international level, falls under the jurisdiction of the Superintendence of the Financial System. Sovereign Wealth Funds El Salvador does not have a sovereign wealth fund. License Requirements None required for clients. Law of Banks Dated September 2, 1999. The banks law is intend to regulate financial intermediation and other bank operations, fostering a transparent, reliable and agile service that contributes to the nation’s development. Documentation Requirements For cross border payments, the Central Bank requires an inflow/outflow form, according to Article 64 of the Organic Law of the Institution. Mafer Hernandez Markets Corporate FX Sales Tel: +(502) 2313-2589 Fax: 2211-2828/2223–8851 Edificio Palic Alameda Manuel E. Araujo, Col. Escalón 2do Nivel San Salvador, El Salvador mafer.hernandez@citi.com Tax Summary – El Salvador El Salvador W/H Tax • 20% WHT • 25% if the provider isnt in a tax haven • 10% WTH if the lender is qualified by the Central Bank • 20% WHT on Inter- Company loans s or if it’s not qualified by Central Bank • 25% if paid to entity domiciled in Tax Haven jurisdiction. • No WHT • 20% WHT • 25% WHT if paid to entity in Tax Haven jurisdiction. • 5% WHT on dividends paid or credited. • 25% if paid to Tax Haven jurisdiction. Deductibility of interests • Deductibility of interests General deductibility • General deductibility rules must be met. • N/A Country Tax Deductibility and Considerations Inter-Co Debt Offshore Derivatives Equities Local Borrowing Bank Loans Offshore