Citizenship and Business in Ecuador

Relaxed Businessman

From our 3rd Q&A Session: Cuenca – May 20, 2013​

1. What is the process for getting an Ecuadorian Passport/Citizenship? When and How do I start the process?

First of all, to qualify for naturalization you must have resided continuously in Ecuador for at least three years from the date of issue of your Cedula (Ecuadorian Identification Card).

The application requirements established in Article 4 of the regulatory document to the Law of Naturalization are:

a) Applicant’s birth certificate, properly legalized and translated

b) Passport from country of current citizenship and Ecuadorian Cedula

c) Certificate issued by the General Director of Consular and Foreign Affairs, if in Quito or by the Provincial Governor, if anywhere else in country, stating that the applicant speaks and writes in the Spanish language and has general knowledge of Ecuadorian History and Geography, as well as the Political Constitution of the Republic

d) Criminal Background Check

e) Certificate issued by the Treasury, Municipality (in place of residency) and the Ecuadorian Social Security Institute, stating that the applicant does not owe any taxes or other payments

f) Medical certificate stating that the applicant is in good health and not suffering from chronic or contagious disease. This certificate must be issued by a hospital or clinic recognized by the State, to be determined in each case by the Minister of Foreign Affairs if in Quito or by the Governor of the Province if anywhere else in the country

g) Three statements from personal acquaintances, to the satisfaction of the Minister of Foreign Affairs, declaring that the applicant 1. Has not been sentenced to prison time 2. Is capable of honorably earning sufficient means to care for him/herself and any dependents 3. Does not promote or spread doctrines that could alter the system of government of the Republic 4. Does not habitually practice illegal activities

i) Any other important document referring to services rendered by the applicant to public institutions or the country in general

j) Five passport photos

After the above naturalization process is completed, you can obtain a passport from your provincial government by presenting your cedula, voting certificate and 70 USD.

2. Can a US citizen/Ecuador permanent resident avoid getting a visa for Brazil?

Unfortunately not. The ALALC (Latin American FREE TRADE Association) does have an agreement that eliminates the requirement of obtaining a visa for travel between certain South American countries, including Brazil. However this only benefits citizens of Latin American countries, thus you must be Ecuadorian by birth or complete the citizenship process in order to enjoy those rights.

3. How do I start an LLC?

There are a number of different types of companies that can be formed in Ecuador. The three types that EcuaAssist primarily works with are the following:

  • A Sociedad Anónima, or Anonymous Partnership, is the type of company that is most commonly used by investors seeking to form further partnerships in the future or to sell shares of the company to other investors; the liability of shareholders is proportional to the amount of their investment in the company’s capital.

  • A Compañía Limitada, or Limited Liability Company (LLC), imposes more limitations on the addition of new partners in the future, as it requires the unanimous approval of the company’s shareholders to allow a third party member to invest as a partner.

  • A Sociedad de Hecho is specifically constituted for a single commercial activity and is easy to manage. Unlike the previous two types of companies, this type does not have its accounting records regulated by the Superintendence of Companies. The liability of each member is proportional to the amount of ownership. In general, companies based on this model are much simpler to start and easier to manage.

To start a Sociedad de Hecho you must:

1) Draft the constitutive bylaws of the company and sign them before an Ecuadorian notary public2) Register the bylaws in the “Registro Mercantil”3) Get a RUC (Tax ID) number for the company from the SRI (Internal Revenue Service)