Título V. De lo contencioso administrativo

Against the decisions on the applications for revocation and the appeals for reconsideration issued by the Tax Administration and the Ministry of Public Finance, the Contentious Administrative appeal shall lie, which shall be filed before the corresponding Chamber of the Tribunal of Contentious Administrative Matters composed preferably of Magistrates specialized in tax matters. The time limit for filing the Contentious Administrative appeal shall be thirty (30) business days, counted from the business day following the date on which the last notification of the decision on the application for revocation or the appeal for reconsideration, as applicable, was made.

The memorial of claim shall contain all the minimum requirements established in Article 28 of the Contentious Administrative Law.*

*Amended by Article 31 of Decree of Congress Number 29-2001 on 10-08-2001 *Action of unconstitutionality granted in File Number 1441-2001 on 20-03-2003

The Tax Administration may request before the Contentious-Administrative Chamber hearing the appeal that the interim protective measures it deems necessary be ordered to secure the interests of the Treasury, in the timely collection of the taxes, interest and fines due to it, as well as in the proper verification and audit mandated to it by law, when there is resistance, fraud or risk to the collection of the taxes, interest and fines, and the Chamber shall decree them for this purpose.

When several contentious-administrative appeals have been filed against the same decision, the respective Chamber shall consolidate them on its own initiative or at the request of a party, for the purpose of deciding them in a single judgment.

* Amended by Article 34 of Decree of the Congress Number 29-2001 on 10-08-2001 * Amended by Article 25 of Decree of the Congress Number 03-04 on 22-01-2004 * Article 25 of Decree Number 03-04 of the Congress of the Republic provisionally suspended, by File Number 112 and 122-2004 on 20-02-2004 * Article 25 of Decree Number 03-04 of the Congress of the Republic repealed, by Article 68 of Decree 20-2006 on 06-07-2006 * Proceeding of the partial general unconstitutionality action concerning Article 25 of Decree Number 03-04 of the Congress of the Republic definitively suspended, by File Number 112-2004 and 122-2004, on 23-06-2008

The judgment that terminates this appeal shall determine whether the appealed decision was in accordance with the law and the legal principles applicable to the actions of the Tax Administration and shall make an analysis of each of them in its reasoning section.

It shall thereafter proceed to declare the confirmation, modification, revocation or annulment of the appealed decision and to impose payment of costs on the losing party in the proceedings, except in those cases in which the tribunal finds sufficient reasons to exempt them partially or totally.

To challenge administrative decisions in tax matters, no prior payment nor any guarantee shall be required of the taxpayer.

The use of the denominations "contentious-administrative appeal" or "contentious-administrative proceedings" to challenge decisions of the public administration has the same meaning.

In all matters not provided for in this Law for deciding the administrative-litigation appeal, the rules contained in the Administrative Litigation Law, Decree Number 119-96 of the Congress of the Republic, and supplementarily the Civil and Commercial Procedural Code, Decree Law 107 of the Head of State, and the Law of the Judicial Branch, Decree Number 2-89 of the Congress of the Republic, and their amendments, shall apply.

Against the decisions and orders that terminate the proceedings, an appeal in cassation lies. Said appeal shall be filed, admitted and processed in accordance with the provisions of the Code of Civil and Commercial Procedure.

The Tax Administration may request before the Trial Courts of economic-coercive jurisdiction or of ordinary jurisdiction that the interim protective measures it deems necessary be ordered to secure the interests of the Treasury in the timely collection of the taxes, interest and fines owed to it, as well as to allow the due verification and audit required of it by law, when there is resistance, fraud or risk in the collection of the taxes, interest and fines.

In exceptional cases, for reasons of hours or on non-working days it may request them before the Trial Court of Peace of the Criminal Branch on duty, which shall assess and grant them, timely transferring the proceedings to the tribunal that must ordinarily hear the matter. In all cases the Tax Administration shall substantiate the risk justifying the request.

It may also request the urgent measures that, according to the circumstances, are most suitable to provisionally secure the effects of the decision on the merits, in accordance with what is established in Article 530 of the Civil and Commercial Procedural Code.

At the request of the person affected by the measures, the judge may reduce them or substitute them with other sufficient property, guarantees or credits that fully guarantee compliance with the tax obligations and payment of the interest and costs.

The State, through the Tax Administration, is relieved from providing a guarantee, furnishing a bond or security of any nature, when it requests such measures, but shall be liable for the costs, damage and losses caused.

The competent judge who favorably decides the request of the Tax Administration related to a precautionary measure aimed at allowing the verification and audit mandated to it by law, shall require the taxpayer or responsible party to comply with what was decided by the Tax Administration within a time limit of ten days counted from the notification of the decision by the executing officer, under warning that if he fails to do so the pertinent matters shall be certified against him.

The certification of the pertinent matters, when appropriate, shall be issued by the judge within a time limit of ten days counted from the end of the aforementioned time limit.

The economic-coercive procedure is a means by which tax debts are collected in executive form.

It has as its own characteristics: brevity, ex officio action and specialty.

Economic-Coercive execution shall proceed only by virtue of an enforcement title concerning final, liquidated and enforceable tax debts.

The Economic-Coercive procedure may also be initiated to claim payment of bonds with which payment of tax arrears or customs duties constituted in favor of the Tax Administration has been guaranteed. As the sole prior requirement for collection of the bond through this means, the Tax Administration must demand payment of the bond in writing in a reasoned manner, and the surety company shall incur default if it does not pay within the time limit of ten days. In no case shall it be necessary to resort to arbitration.

The following documents constitute an enforcement title concerning final, liquidated and enforceable tax debts:

1.Certification or administratively legalized copy of the judgment or decision determining the tax, interest, surcharges, fines and arrears with definitive character.

2.Contract or agreement recording the tax obligation to be collected.

3.Certification of the acknowledgment of the tax obligation made by the taxpayer or liable party, before a competent authority or public official.

4.Policy containing a bond guaranteeing payment of tax arrears or customs duties in favor of the Tax Administration.

5.Certification of the debtor balance of the tax current account for liquidated and enforceable obligations.

6.Other documents evidencing tax debts which under legal provisions have enforcement force.

For administrative documents to constitute an enforcement title for collection, they shall meet the following requirements:

1.Place and date of issuance.

2.Full first and last names of the obligor, business name or denomination of the tax debtor and their tax identification number.

3.Amount of the liquid, enforceable credit with expired time limit.

4.Tax domicile.

5.Precise indication of the concept of the credit with specification, where applicable, of the tax, interest, surcharges or fines and of the tax period to which it corresponds.

6.First and last names and signature of the public official who issued the document and indication of the position held even when issued in the form established by Article 125 of this Code.

7.Seal of the administrative office.

Once the enforcement proceedings have been initiated, the judge shall assess the title on which they are based and, if he deems it sufficient and the amount claimed is liquidated and enforceable, shall issue the writ of execution and order the demand for payment to the obligor and the attachment of property where applicable.

In the same decision, he shall grant a hearing to the person subject to enforcement for a time limit of five (5) working days, to oppose or assert his defenses.

In the case of enforcement of a judgment, only defenses arising after the same shall be admitted.

Requests for reports on individual or juridical persons and on registered documents, acts, property or rights; the annotation and lifting of interim protective measures addressed to public registries, financial institutions and third-party holders, requested or ordered by Trial Courts of Economic-Coercive Matters, may be expedited through the use of computerized systems and means of communication, as established in this chapter, when such systems exist and are available.

Once the economic-coercive claim has been received, the competent judge shall decide within the forty-eight hours following receipt; if he considers to be appropriate the precautionary measures requested by the claimant party and among which attachment of bank deposit accounts, salaries, credits, shares or investments in the name of the defendant is requested, he shall proceed to prepare the attachment order, issuing the same preferably by electronic means, sending the order via Internet or other communication network to the email address provided for such purpose by the banks of the system or, failing that, in writing, sending the orders by the most expeditious means.

The banking entity that has received the attachment order electronically or in writing on paper shall proceed immediately to send the response acknowledging receipt of the order and, within the forty-eight hours following receipt, shall also send, by any means, confirmation of whether or not the respective attachment has been effected.

If the judgment debtor fails to appear to assert or file defenses, the judge shall issue a judgment in which the judge shall declare, as appropriate, whether or not execution is warranted and shall order the auction sale of property or payment, as applicable.

If the enforcement debtor objects, they shall state the grounds for the opposition and, if necessary, offer the pertinent evidence. Without these requirements, the judge shall not process the opposition.

If the defendant has defenses to assert, they shall raise all of them in the written opposition.

The judge shall hear the Tax Administration for five (5) working days and, with its answer or without it, shall order evidence to be taken within a time limit of ten (10) working days common to both parties, if either of them requests it or the judge deems it necessary.

In no case shall an extraordinary time limit for evidence be granted.

Only the following defenses shall be admitted at any stage of the proceedings:

1.Payment.

2.Settlement authorized by Government Agreement.

3.Release duly granted.

4.Limitation period.

5.Lapse.

6.Those arising after the answer to the claim and which destroy the effectiveness of the title.

Upon expiration of the time limit to oppose or the time limit for evidence, as applicable, the judge shall rule on the opposition and the defenses raised.

In addition, the judge shall declare whether or not there is cause to order the sale and auction of the attached property, or payment, as applicable, of the tax debt and court costs.

Only third-party claims excluding ownership or claiming payment preference may be interposed, which shall be processed as incidents before the same judge who hears the economic-coercive proceeding.

Ownership-excluding third-party claims shall be filed before the deed transferring ownership is executed, and payment-preference third-party claims before such payment has been made.

Once an exclusionary third-party ownership claim is filed, the procedure shall be suspended until the third-party claim is decided.

Costs awarded in favor of the Tax Administration shall form part of its privative income, to cover costs and expenses incurred.

In the Economic Coercive procedure, against the order denying admission of the claim, the orders deciding third-party claims, the final decision, the judgment and the order approving the liquidation, the following remedies lie:

1.Clarification and amplification, which must be filed within the two (2) days following the day on which notification of the challenged decision was effected.

2.Appeal, which must be filed within three (3) days following the date of notification of the decision.

Against the other decisions issued within the Economic Coercive procedure, the remedies and actions established in the Code of Civil and Commercial Procedure and the Law of the Judicial Branch may be filed.

The Tribunal of Second Instance of Accounts shall hear appeals.

Once the appeal has been filed, the first-instance tribunal shall grant it, if admissible, and shall elevate the record to the superior Tribunal, which shall set a day for the hearing within a time limit not exceeding five (5) days, after which it shall decide within the following ten (10) working days, under penalty of liability.

To the extent that they do not contravene the provisions of this Code and in all matters not provided for in this section, the rules of the Code of Civil and Mercantile Procedure and the Law of the Judicial Branch shall apply.