Ecuador’s New Immigration Law: Snowbirding Just Got Easier

Ecuador’s National Assembly voted unanimously on January 5, 2017 to pass a new immigration law called “La Ley Orgánica de Movilidad Humana.” The law (number 60 of  the 2013-2017 legislative period) has not yet been published in the official registry so we haven’t yet been able to access the full 90 page version. This post will summarize what information we have been able to gather until the law is officially published.

Ecuador National Assembly

Ecuador’s National Assembly passed the new immigration law on January 5, 2017. Photo from El Telegrafo

Some broad-sweeping points of this new law (as translated from the opening arguments from the head of the Committee who helped draft  the new law) are that it will recognize the equality of rights between Ecuadorians and foreigners and emphasizes that no human being can be qualified as illegal in Ecuador because of their migratory status. The new law largely addresses Ecuadorians living abroad, Ecuadorians returning home after living abroad, and refugees, stateless persons, and victims of trafficking.

However, there are also changes that will affect foreign residents in Ecuador, either as tourists or permanent residents.

My in-laws have been enjoying their Ecuadorian residency since 2012.

My in-laws have been enjoying their Ecuadorian residency since 2012.

A notable change that has implications for foreigners is the extension of a tourist visa from the previous 90 days to 180 days. This “tourist visa” is simply the stamp you receive in your passport upon entering the country. This extension for up to 6 months is great news for folks who want to split their time between living in Ecuador and their home country (grandparents, snowbirds, and many others will no doubt celebrate this change!). Previously, acquisition of another visa was required to extend one’s time in Ecuador beyond 90 days (for example a 12-IX visa which is fairly costly and can be time-consuming). There is apparently the option now to also obtain a special tourist visa that would be good for up to 1 year (but which will be limited to using once every 5 years).

And for foreign residents of Ecuador who are excited about exploring other regions of South America, they will now be able to do so as part of the Union of South American Nations (UNASUR) by only presenting their Ecuador ID card (“cédula”) instead of being required to show both their passport and cédula.

Another significant change is that proof of health care insurance will be required for tourists entering Ecuador. It will be interesting to see how this rule is actually enforced and applied; however, this change will NOT apply to foreigners who are permanent residents in Ecuador.

Once we have access to the public record of this new immigration law, we will add the link here.

Information Sources:

New Ecuador “Capital Gains Tax” Explained

The Ecuadorian government just passed a new law titled “Tax on Speculation on the Value of Land” (“El Impuesto a la Especulación sobre el Valor de las Tierras”) which takes effect now in the new year (2017).  This law has been referred to as “The New Capital Gains Tax” or the “Ley de Plusvalia”.  The concept behind the creation of this law is to prevent a future speculative bubble in real estate prices (which many of us from the US can attest might be useful).

For retirees who plan to live here for 3+ years, investors who plan to own and rent over a 3+ year period, or for those who buy land and build a home, this new law will generally save them quite a bit of money as fairly substantial gains can be realized tax-free.  Even those purchasing relatively inexpensive lots in the $39,000 range and flipping the land in less than a year can receive up to a 22% return on investment before they would have to pay a single cent of Capital Gains or Appreciation Tax under the new law.

For those planning to buy large pieces of land to flip over a short time period without making improvements… this tax is meant to make you think twice and advice from a lawyer on how best to structure your purchase and sale is recommended.  Creative short term investors will still find solutions such as buying and selling “purchase options” on a property, transferring their rights via a “promise of sale agreement”, or by creating development partnerships with project developers to be paid upon completion and final sale of the developed property.

Whether or not this new law will actually stick after the presidential elections in February remains to be seen but, not surprisingly, various interpretations of the law are being spun by different parties for their own interests.  This is especially the case as election day nears in Ecuador.

The purpose of this post is to provide you with a detailed, cut and dry summary taken directly from the government website and includes a translation of their sample calculation.  This is the scoop on the new tax law minus the sensationalism.

capital-gains

The “sensational talking point” of the new law is that sellers will be taxed 75% on their “illegitimate” capital gains. What the whaaat?!?  That was our initial response as well. But let’s take a closer look.

If you purchased your Ecuador property prior to 2017 when the law goes into effect, this new capital gains law will not apply to you when you sell.

For properties purchased in 2017 and beyond (assuming the law remains in place), here are some standards used for determining the basis for the new capital gains tax:

  1. There is a standard allowance of $8,784 of profit that is not taxable on any purchase and sale over any time frame.
  2. There is an allowance of 7.52% compounding annual appreciation that is not taxable and that appreciates on the total of your purchase value PLUS improvements.

Let’s take a look at the example provided by the government website (see our translated image below). For this example, a property is purchased for $85,000 in 2017 and sold for $135,000 in 2020.  Property tax (“Plusvalia”) due at the time of sale would only be $1,437.72, not 75% of the total difference in purchase and sale price. In fact, the capital gains tax for this example is actually less expensive than what it would have been based on the previous law ($2,975 versus $1,437).

Let’s find out the specifics for how this new capital gains tax gets calculated.

  • Purchase Price in 2017 of $85,000
  • Sum of renovations, improvement costs, etc. = $15,000
  • Initial investment ($100,000) plus interest compounded at 7.25% over 3 years = $124,299
  • Plus a set profit allowance of $8,784 brings us to a total NON-TAXABLE property value of $133,183.
  • Sales price in 2020 is $135,000
  • Difference between the sales price of $135,000 minus the non-taxable property value of $133,183 is $1,917.
  • 75% of $1,917 is $1,437.72.

plusvalia

The government provides a capital gains calculator here. It should be noted that the property value used for calculating capital gains is the amount shown on the property title (“escritura”).  In many cases, the property value on the title is the municipal value, which tends to be significantly lower than the actual purchase or sale price.  It’s worth discussing options with your accountant or lawyer prior to sale to make sure that you are making the best decision for your given situation.

So will this new law affect foreign investments in Ecuador?

capital-gain

The new law will discourage those looking to do relatively large, short-term (less than 1 year) flips with no investment in improvements and who seek to earn significantly more than the standard tax-free profit allowance of $8,784.

The new law will actually tend to benefit most others, in particular, those who own their property for any length of time.  Property value plus money spent on improvements can appreciate at a rate of 7.52%, compounded annually, tax-free.  The accumulated compounded appreciation is above and beyond the automatic $8,784 of allowable tax-free appreciation.  Based on the 7.52% compounding interest rate, the property can double in value over 10 years and the owner would pay ZERO in capital gains tax or “Plusvalia” upon sale.

The new law also does not apply to the first sale of a property. In other words,  those who build their own homes (either as individuals or companies), or develop their properties will be completely exempt from paying capital gains tax when they sell their homes.  That means that if you purchase a beachfront lot at a great price and build a home, you will pay zero capital gains tax upon the sale of that property.

In addition, there are no capital gains collected on the transfer of a property as a result of an inheritance, prize winnings, or donations. There is also a statement in the new law that foreign institutions and international organizations are exempt from paying capital gains, something warranting further investigation.

Overall, the law allows for solid tax-free gains via property appreciation and should help to limit the speculative appreciation of prices.  While this new law may temper gains from short-term, high-value property flips, it should also prevent the formation of a real estate bubble that would leave buyers underwater.

Following Election – Interest in Moving/Investing in Ecuador Peaks

Below is an article Tom published on his LinkedIn page on November 9, 2016.

Change multiplies uncertainty. Now, as greater uncertainty comes into play, US Citizens and International Investors seek ways to hedge existing bets on the direction and volatility of the US and World economy.

The labyrinth of unknowns instantly created by the results of the latest election cycle have brought “thoughtful pause” to many of us looking for a safe, solid ROI and a high quality of life today and through our retirement years. After being blindsided by bubbles and bailouts, we seek presently-undervalued real assets that will maintain or increase their value despite, or as a result of, the ups and downs around us.

Ecuador has been described as Costa Rica with real estate prices 40 years behind the curve. Ecuador recently received a HUGE upgrade in terms of infrastructure (new roads, new hydro plants, new refinery, new airport) and international recognition as the world’s highest-value retirement destination by CNBC, Forbes, International Living Magazine and the New York Times. The official currency of Ecuador is the US Dollar and its two main cities of Quito and Guayaquil are a short (4 hour), direct flight from Miami or Ft. Lauderdale (via Jetblue). Ecuador’s time zone coincides with either EST and CST depending on daylight savings time in the US, making it a viable base for the digitally mobile worker.

Despite all the recent attention and upgrades, Ecuador still has many undeveloped beachfront destinations. You can still have large undeveloped beachfront lots at prices ranging from $35,000-$100,000. Investors can still find large parcels with beachfront at very low prices such as this property we will soon be announcing near the surf town of Canoa:

29-Acres of Gorgeous Beachfront for Sale

This gorgeous property has a brand-new concrete road designed and built complete with a bike-lane by a national government focused on developing tourism along its coastline. Here is a look at the road and the property looking to the north:

Gorgeous beachfront property for sale in Ecuador

 

For those looking to move down soon or buy now and rent until retirement, beachfront condos can provide exceptional value and appreciation. New condo projects are just beginning to become available for the forward thinking retirees and investors along the beaches just outside of the busy cities. One example is our Ensenada del Pacifico project located in San Clemente, Manabi that is now nearing completion. Demand for the first phase of the project was strong and only two units are available as resales at only $154,000. The majority of the project was sold prior to completion.

Beachfront condos for sale in Ecuador

Click here for the listing

And for those seeking a quiet single-family home on or near the beach, we have a number of house listings well-under the $200K mark, including a newly constructed 2 bedroom/2 bath beachfront home in a stunning location:

Beachfront home for sale in Ecuador

Click here for the listing

With the ups and downs of the US and World Economy, purchasing tangible assets in Ecuador in the form of land, investment, or an income-producing vacation property that is presently well-undervalued in the global market might be just the right move for you.

If you are looking for more information about Ecuador for retirement, investment, or both – enter your email by following the link below so we can send you our “Know Before You Go” guide that reviews each town on the Central Coast and provides vital tips for the foreign traveler planning a visit:

"Know Before You Go" trip guide

“Know Before You Go” Guide

Also, please take a look at our Frequently Asked Questions page for answers to questions like, “Can foreigners own clear title to property in Ecuador?”:

Frequently Asked Questions

 

Perks for Being 65 and Over in Ecuador

Ecuador was ranked as the #1 retirement destination in the world in 2014 and again in 2015 (and #2 in 2016). Apart from the great weather, inexpensive cost of living, and a host of other attractive advantages, Ecuador also boasts some great perks for people aged 65 and over.

beach retirement

Photo from the US News and World Report, “The 5 Best Places to Retire on the Beach in 2016.”

While government-mandated incentives for people of “tercera edad” (the equivalent of “senior citizens”) are geared towards its own citizens, foreign residents are afforded the same rights as nationals so all of these advantages apply to expats with Ecuadorian residency.

 

Here are some of the benefits you are eligible for as a senior citizen living in Ecuador:

No Waiting in Lines

Senior citizens automatically may go to the front of lines. Isn’t that great? The same applies to pregnant women and women with infants in their arms (which has been quite handy in my case!).

50% off Certain Forms of Transportation

This discount applies to public service transportation via buses and flights. My in-laws usually have to “remind” the money collector on local buses to get their 50% discount: “Disculpe, soy de tercera edad.” (“Excuse me, I’m a senior citizen”).

For flights, you must purchase your plane ticket at one of the in-country agency offices (Avianca, Tame, Copa). Unfortunately, you are not able to get the senior discount if you make your purchase online. Even if the tickets are on sale, you are eligible for the discount. The discount is NOT applied to taxes and fees.

When making your reservation you will need to show your cedula (the national ID card that you will receive once you are a resident).

It’s worthy to note that these flight discounts include trips to the Galapagos as well as round trip international flights initiating in Ecuador.

Note: This discount does NOT apply to other forms of transportation such as taxis, rental vehicles, boats, and trains.

Discount

Your 50% discount includes airfare to the Galapagos.  As residents (of any age) you will also enjoy $6 park admission compared to $100 for non-residents.

 

50% Off Utility Bills and Free Landline Telephone Service

Senior citizens are eligible for discounts on their electric, water, and landline telephones. To sign up to receive the discount, you must go to the service provider and show your cedula when you set up your account. The discount will then be automatically applied to your future monthly bills with the following usage limits:

  • 50% off electric on one electric meter up to 120 kWh/month
  • 50% off water up to 20 cubic meters/month
  • Free basic landline telephone services on one landline (does not include long-distance calls and other services)

If you exceed any of these monthly limits, you will still receive the discount up to the specified limit and then you will pay 100% on the excess consumption.

You may receive this benefit as a renter as long as your name is on the utility bills.

 

50% Off Entertainment Events

Folks who are 65 and over also receive 50% off tickets for cultural and sporting events, including movies. Again, you will likely be required to present your cedula as proof of age and residency status.

Quito-FootballFlag

Attending a game of soccer (“fútbol”) in Ecuador is an experience to be remembered!

 

Reimbursement of Sales Tax

Senior citizens are eligible to receive an reimbursement of their sales tax. Ecuador’s sales tax on most goods and services is 12%. It is called IVA (“impuestos de valores agregados”) and is the equivalent of “value-added tax” or VAT. You will see this IVA charge added to your restaurant, grocery, hotel bills, etc..

There is another sales tax, ICE (“impuestos de consumos especiales”), whose value varies significantly, from 10% for soft drinks to 300% for firearms.

Senior citizens are eligible to receive a reimbursement of their IVA and ICE; for 2016 the maximum annual amount is currently $1,830.

Seniors can submit their reimbursement forms online and receive their monthly reimbursement in a matter of days as a direct deposit to their Ecuadorian bank account.

Senior citizens are eligible to get sales tax back up

Senior citizens are eligible to get their sales tax reimbursed each month for their food, housing items, clothing, transportation, communication, and cultural and sporting events.

To set up your account with the SRI (the equivalent of the IRS), you are required to have a cedula, a copy of your Certificate of Visa Registration (“Certificado de Empadronamiento”) and proof of an Ecuadorian bank account in your name. When you register, you will be given a pin to access the website. Your receipts (“facturas”) must be in your name with your cedula number. Details can be found on SRI’s website (in Spanish).

Note: If you are renting, you shouldn’t be charged IVA. Nor are you charged IVA for purchasing property. You do need to pay IVA if you rent out a space for commercial use.

 

Reduction of Income Tax

Income tax rates in Ecuador are based on one’s annual salary. This tax is paid when an individual’s net yearly income exceeds a certain limit and is called the “Impuesto a la Fracción Excedente.” For people over 65, the minimum income limit is doubled. For example, the minimum limit for 2016 is $11,170. In other words, senior citizens with a yearly income under $22,340 will not be required to pay any income taxes.

 

Exemption of Municipal Taxes

When selling property, the seller is typically responsible for paying a municipal capital gains tax called “Alcabalas.” Senior citizens have the advantage of being exempt from paying alcabalas for the sale of a property valued at $183,000 or less (the equivalent of 500 times the monthly minimum wage, which for 2016 is currently $366/month). If the property value exceeds this amount, taxes are paid on only the excess.

An interesting case study to be aware of is the example of a property owned by spouses, one of whom is 65+ and the other is under 65. According to Ecuadorian law, the property is automatically owned equally by each spouse, and thus each spouse in theory is responsible for paying 50% of the acabalas at closing. However, according to law, the 65+ spouse would be exempt so the actual cost of this tax would be half of the declared amount.

My in-laws have been enjoying their Ecuadorian residency since 2012.

My in-laws have been enjoying their Ecuadorian residency here on the coast since 2012.

 

Note: This post was created in April 2016 and any information provided here may be subject to change!

Wherever You Go…There You Are

The U.S. News & World Report ran an article on August 26, 2015 reporting that according to a survey of 14,000 expats in 64 countries, Ecuador topped the list of best countries to live in as an expat. This is the 2nd year that Ecuador made the number 1 spot. Click HERE to read the article.

August 26, 2015 Article in U.S. News & World Report

August 26, 2015 Article in U.S. News & World Report

 

The survey was conducted by InterNations, a social network for expats with over two million online members around the world. Ecuador received the highest scores for the following subcategories: “personal happiness,” “feeling welcome,” “personal finance,” and “cost of living.”

As full time expats first coming to Ecuador in 2005 and then running a business and raising a family here since 2010, Tom and I have a pretty well-rounded perspective of life here on the coast of Ecuador. We can attest that, in our  own experiences, Ecuador deserves high marks for these subcategories. We have witnessed many clients who arrive here in fairly poor health and often stretched to the limit with stress, that, a year or so later, are hardly recognizable to their former selves, having lost a considerable amount of weight and donning flip flops, a golden tan, and a relaxed smile.

The caveat? Ecuador may well score high on these kinds of surveys, but there is absolutely no guarantee that relocating to Ecuador be will be the solution to your problems. We have seen firsthand that this is especially true for those expats who come here strictly seeking a lower cost of living.

“Wherever you go, there you are.” ~ Jon Kabat-Zinn

If you tend to be more of an optimist you will see the smiling, welcoming faces as you wave. You will see families laughing and playing volleyball or soccer together at the end of the day. You will notice the lack of beggars (at least here on the coast) despite there being evident poverty. You will see a gorgeous coastline with warm water and breathtaking sunsets. You will quickly make friends who welcome you, arms wide open, to dinner in their home at a moment’s notice.

If you tend to be more of a pessimist, you can be in the exact same time and space and experience an entirely different reality. You will see what you perceive as poor people lounging about in hammocks in front of their unfinished shack-like homes. You will see trash. You will see countless dogs roaming the streets and notice with alarm men walking around town with machetes in hand. If you do not tend to trust people, you will be suspicious, questioning people’s motives for being friendly to you. You will focus on the lack of efficiency, how “they” do “everything” here backwards compared to where you are from.

Speaking of which, an article came out yesterday in Cuenca High Life that provoked considerable commentary from its readers, entitled “The Arrogant Expat: Let me tell you how we do things in the USA.”  Important Note: If you come to Ecuador and attempt to change what you perceive to be wrong with it, you will drive yourself crazy.

A couple of related insider tips and insights:

  • In the U.S. there is a culture of becoming snide, loud, and even threatening towards employees in an attempt to get them to affect whatever it is that you want/need done. In Ecuador, this approach will not work. It will back-fire and they will simply move on to the next person in line (believe me, I ashamedly admit that I learned this early on firsthand). Instead, try to befriend and empower people whose assistance you are seeking. Ask calmly and with a [genuine] smile if there’s anything they might possibly be able to do to assist with the situation. While not foolproof, it’s amazing the difference it can make.
  • When facing a frustrating, mind-numbingly “illogical” situation (and there will be many!), instead of  banging your head against a brick wall, try your best to reflect upon the experience as an opportunity to strengthen your patience “muscle.” (Think how strong you’ll get to be after a year or so-Yay!).  Our friend  Kris used to refer to our province of Manabí as “mañana-bí.” And there is the famous saying here that mañana doesn’t necessarily mean tomorrow (or even next week, for that matter). Always try to find the humor in the situation and with yourself. It just makes life easier that way.
  • Consider the possibility that there might actually be logic behind what you perceive as illogical or a faulty way of doing something. A classic example we often use to illustrate this point is getting the bill at a restaurant. Newbies to Ecuador are quick to complain that the server never brings them the check. They are unaware that it is considered rude here to “rush” clientele out of the restaurant. When you are ready to leave, you simply request the bill.  (And even then, it might take a while to get the check. And then they might not have change for your $20 so they’ll have to send their 10 year old son out to go find you change). Remember, you’re building your patience muscle!
  • Pick up a copy of the book CultureShock Ecuador: A Survival Guide to Customs and Etiquette  by Nicholas Crowder

 

While some of our clients have thrived as coastal Ecuador expats, there are others for whom Ecuador simply wasn’t a good match, high expat survey scores notwithstanding. Some arrived here and immediately did an about-face because their Ecuador experience did not match their expectations.

Then there are others who, like most of us, first delighted in Ecuador (the “honeymoon phase” of the widely accepted “stages of cultural adaptation“).

Proposed stages of cultural adaptation (taken from xx)

Four proposed stages of cultural adaptation (image taken from this site). I would venture to say that the realistic length of time for adapting is more like a year or two for most Ecuador expats.

 

During the honeymoon phase, newcomers appreciate and even celebrate the myriad differences in culture, food, and can find the humor in not being about to communicate well in the local language, at waking up at 4am to the crowing of a rooster in the city, or not being able to find products they were used to having back home.

However, as time passes, the honeymoon inevitably comes to a crashing halt and a new stage begins. Now the focus becomes disproportionately on what is wrong, instead of what is good and new. For some, this so-called “hostility stage” is but a passing phase as they continue to move through the ups and downs of adapting to a new culture and life. Those who eventually adapt arrive at a middle of the road experience where they generally accept and enjoy their new life. That is not to say there are no longer challenges, delays, or frustrations. But by now they have learned to better navigate the obstacles and move on.

There are others, however, who may stay stuck in the “hostility” phase. Their negative perception of their reality can become further compounded if they have already sold or moved everything they previously owned, cannot afford to return, and now feel trapped in a place where they are just as unhappy (or more so) than they were before relocating.

So if you have been considering becoming an expat in Ecuador:

(1) Do your due diligence and visit/rent first to make sure Ecuador will be a good match for you before you make the official leap;

(2) Come with an open mind and an open heart. Don’t assume you know better than the “locals.” There is a good chance that your perceived “solution” does not fit with the context in the same way it would back in your home country. Often, there actually is some semblance of logic where many new expats assume there to be none;

(3) Expect that, like anywhere in the world, you will face many unexpected challenges, especially as you are adapt culturally. Try your best to embrace the inevitable hurdles as they arrive and view them as opportunities for growth.

(4) Ecuador is no panacea for one’s problems. If you were unhappy in your home country, chances are you will find reasons to be unhappy here as well.  “Wherever you go, there you are. You take yourself with you.”

places you'll go

Ecuador’s Advances its Capacity for Dealing with Emergencies

Over the last couple of years, Ecuador has significantly advanced security measures to prevent and to better respond to crimes and other emergency situations.

As of October 2013, Ecuador has operated a nationwide 911 emergency call and response system, referred to as SIS-ECU 911.

An advanced, nationwide 911 emergency response system has been in operation since October 2013.

 

As in the US and elsewhere, all 911 calls are free. There are eight call centers throughout Ecuador, representing different regions of the country, with the closest to us in the nearby city of Portoviejo (40 minutes from San Clemente).

The ECU 911 service integrates a host of institutions including the national police, the armed forces, local fire departments, the National Transit System, Ministry of Health, Ecuador’s institute for social security, the Secretary of Risk Management, and the Red Cross as well as other local organizations.

The modern ECU 911 call center in Portoviejo

 

An integral component of the ECU 911 system is the “Transporte Seguro” (“Safe Transit”) program. This program was created in coordination with the National Transit System to reduce the number of road-related emergencies through monitoring and control of commercial transportation services. Part of this program was to install “Kits de Seguridad” (Security Kits) in all public buses and registered taxis in major cities across Ecuador.

Each of these security kits contains two video recording and infrared surveillance cameras and a panic button equipped with a GPS tracking device that immediately notifies 911 responders with the exact location of the vehicle. The system has a battery pack as a back up source of power. Buses are also equipped with sensors to remotely open and close the doors.

So far,  over 17,000 buses and 38,000 taxis have had security kits installed throughout Ecuador.

Schematic of the “Transporte Segura” program designed in part to reduce incidence of crime in public transportation.

 

Another innovative component of the ECU 911 system is a free smartphone app to quickly report emergencies utilizing a smartphone’s geo-referencing capabilities.  The app is called ECU 911 and is available for iPhones, Androids and Blackberries.

I discovered this app when doing research for this post and just installed it on Tom’s and my phone.  It can be programmed in English or Spanish. You do not have to be an Ecuadorian resident or citizen to use it so I would highly recommend visitors to set it up in advance of their trip.  To set it up, I had to input my name, passport or Ecuador cedula number, cell number, emergency contact name and number, select my blood type from a pull-down menu, and list any physical disabilities or allergies.  This app is an excellent option for residents and visitors who are not fluent in Spanish.

View of the new smartphone app to report categorized emergencies to ECU 911. The app is free, easy to use, and immediately sends your exact location to the appropriate emergency responders.

 

And another interesting security advancement I recently learned about was the programming of a panic button on any kind of cell phone. To do this, you take your phone into the nearest police station where they register your phone and your specific home address (well, as specific as possible, anyways). In the event of an emergency at or near where you live, you press a single digit on your phone and it immediately notifies the local police. The cost is a mere $0.05. A recent newspaper article reported an average response time of 3 minutes in Quito! So, in a small town like San Clemente, we should expect a rapid response time as well.

Police station located in San Jacinto with jurisdiction over the towns of San Jacinto and San Clemete.

 

Like in so many other sectors of Ecuador,  technological advances are being made rapidly. As Tom was saying today, some of these changes are taking place so quickly we don’t even find out about them until a few months after the fact! It truly has been fascinating to watch the development that’s taken place inEcuador since we first came in 2006 and we look forward to all that is surely still to come.

Getting Your 12-IX Visa: A Recent Real-Life Experience

When you first arrive to Ecuador, you will receive a T-3 tourist stamp in your passport that allows you stay in the country for up to 90 days per year. In some countries, one can simply cross a border and return with a new passport stamp to renew their stay. This is not the case in Ecuador.

If you wish to stay in Ecuador beyond 90 days you may apply for the 12-IX visa (read 12-9). Typically this visa allows you to extend your stay for an additional 180 days. If you plan to obtain your permanent residency, you are required to have the 12-IX visa when you file the application for your resident visa.

There are LOTS of online sources for how to go about obtaining this visa and once you start sifting through it all you’ll discover there is a lot of differing and contradictory information regarding the requirements, where you need to go to process the application, and if you need to hire a lawyer. It is horribly confusing.

I just went through this specific visa process this past week with an American expat couple and thought I’d share their experience.

**DISCLAIMER: Please be aware that Ecuador’s visa laws can and do change in a moment’s notice and may even differ depending upon which official or which office you talk to (and hence all the varied information online), so be sure to double check all requirements, etc. before initiating this process yourself. Here I describe a single, recent experience (September 2012).***

 

A TYPICAL EXPAT SCENARIO REQUIRING THE 12-IX VISA:

A retired U.S. couple arrives to Ecuador and decide to rent first to make sure they like it here before they make the plunge to buy coastal real estate. Their 90 day tourist stamp is about 3 weeks from expiring and they have decided they want to stay and eventually apply for their permanent residency that will be based on their monthly pension. As a first step, they need to get their 12-IX visa.

WHERE THEY WENT:

Many people are told they must go to Quito or Guayaquil to apply for the 12-IX visa or that it needs to be done at the Ecuadorian consulate in your home country. Maybe that was the case in the past, but now Manta has a Ministry of Foreign Relations office (Ministerio de Relaciones Exteriores) which receives and processes visa applications and can have the 12-IX visa ready for you in just a few days. That this may be done in Manta is a major convenience for expats living in this area.

DOCUMENTS THAT WERE NEEDED

Many information sources state that you will need a official copies of your birth certificate, a recent police record, a record of an HIV test (that is negative), bank records demonstrating solvency, and a marriage certificate (if applying with a spouse), among any other number of documents, all of which must be translated into Spanish and apostilled in order to be legally recognized in Ecuador.

Here is the sum total of what was needed to apply for the 12-IX visa in this particular case in Manta:

  • Passports (valid for at least 6 months prior to entry to Ecuador)
  • Color copies of the passports , including the page with their entry stamp
  • Official marriage certificate that was translated and then notarized (no apostille was required)
  • A print-out of plane reservations exiting Ecuador (this reservation was later canceled as the couple had not yet decided when/if they planned to leave the country)
  • A print-out of a bank statement showing they had money in their bank account
  • Passport photos
  • Visa application (signed by each applicant)

 

HIRE A LAWYER?

You could run all the paperwork yourself and save money on not hiring a lawyer.  Hiring a lawyer is NOT required but it sure can be useful, especially if you do not have good command of the Spanish language.

This particular couple decided to hire a lawyer who went over the requirements with them, got their marriage certificate translated and notarized, helped them get their passport photos, went to a travel agency to get their plane reservations, filled out their visa application and picked them up at their home and took them to the Manta office to apply for the visa.

THE APPLICATION PROCESS AND COSTS

The couple and the lawyer went to the Foreign Relations office in downtown Manta the afternoon of Wednesday, Sept 5. Because in this case, the couple was married, one spouse was able to apply for the visa and have the other spouse apply for the visa as a dependent which is less expensive.

More photos were taken there at the office and the paperwork including the couple’s passports were submitted.  After waiting about an hour, all of the documents for the visa application were reviewed and approved. They were told that their passports with their 12-IX visas were likely to be ready for pick up the following afternoon.

Here is a breakdown of the costs:

  • $500 Lawyer fees, including translation and notarization of their marriage certificate
  • $200 12-IX visa fee (for primary spouse)
  • $50 12-IX visa fee (for dependent spouse)
  • $60 Application fees ($30 for each applicant)
  • $20 Airplane reservation made via a travel agency
  • $8 passport photos ($4 each)
  • $4 Official registration of the visas “Empadronamiento

 

AN [EXPECTED] UNEXPECTED BUREAUCRATIC ROAD BUMP:

It is best to expect the unexpected, as always, but especially in Ecuador.

Upon leaving the Foreign Relations office, the lawyer was notified that because the couple were renting and did not have a sales agreement or a deed for a property in Ecuador, they would only grant them a 90 day extension instead of the usual 180 days.  A recent change to the law was vaguely cited as the reason.

The lawyer met with the couple and presented them with the option of accepting the 90 day extension  OR if they wanted the full 180 days, he would create for them a fictitious property purchase agreement that would be destroyed once the visas were received. The [understandably surprised and baffled] couple agreed to the latter to get the full 180 days.  The lawyer told them he would charge an additional $250 to create the necessary documents that same night, bring the documents to them to sign the following morning and then take the documents to Manta to submit them with the visa application.

They were told the visas should be ready for pick up sometime on Friday. Not too surprisingly, they weren’t, so they went on Monday, Sept 10 instead. The visas were indeed ready but despite the attempted legal work-around, the couple was still not granted the 180 days and instead received 91 days.

This scenario is probably a good demonstration of the “roll of the dice” luck involved in Ecuadorean bureaucracy: They might have received the normal 180 days had there been someone else in the office that first day or last day but as luck would have it, the “wrong” person was there instead.

Fortunately, the lawyer only charged them $50 of his whole $250 fee for his time in creating and submitting the legalized purchase agreement.

So, in the end, their final cost for both of their 12-IX visas amounted to $942 and it only took only 3 work days to get a 91 day extension. While it was not the desired 180 days it nevertheless buys them the time to gather the necessary paperwork to begin the application process for the pensioners resident visa. Fodder for a future blog.

 

A couple of useful visa links:

A good summary of different visa options summarized by International Living

Official website for the Ministry of Foreign Affairs (Ministerio de Relaciones Exteriores)

Moving your Pets to Ecuador

Getting current and reliable information regarding real-life logistics of bringing your pet to Ecuador can be a bit daunting. So I thought I’d share details provided to me by some friends who recently (May 2012) moved to Ecuador from the US with their three dogs (1 extra large, 2 small). I’ll focus on dogs here but I assume that the same general rules would apply to cats as well.

Please note: Ecuador’s rules and requirements can and DO change so be sure to triple check everything before leaving your home country with your pets!

It basically boils down to this: there are 2 options for bringing in dogs (1) as cargo and (2) as baggage. I’ll go over those in a second but we’ll start off with the general requirements for bringing in pets to Ecuador.

GENERAL PET REGULATIONS AND REQUIREMENTS

As the law currently stands, you are allowed to bring two dogs per person. There is apparently a new rule in place too that if you bring more than 2 dogs then a special permit is required. I was told that it in this case, it would be easier to pay a friend to fly down as your surrogate pet parent to avoid the permit process.

There are 3 steps for fulfilling the basic paperwork for traveling with your pet:

  1. Get your vet to fill out an international health certificate that verifies that your pet is up-to-date with its shots, etc.
  2. Send the health certificate to the USDA for their endorsement.
  3. Send the endorsed health certificate to the Ecuadorian consulate to be legalized.

 

Here are the nuts and bolts of this process:

You are required to bring an international health certificate filled out by your vet not more than 10 days in advance of your arrival to Ecuador. Be sure to ask your vet before making your appointment whether they are accredited by the APHIS USDA to fill out the form; if they are not, then they need to refer you to a vet who is. Each pet must have its own certification completed which will be linked to its owner’s passport name. Double check with the Ecuadorian Consul office closest to you for any updates on requirements, shots, external and internal parasites.

The international health certificate must then be sent to the APHIS USDA nearest you for certification. Generally speaking you must set up an appointment in advance. However, as in the recent case of my friends with the 3 dogs, their closest USDA was out-of-state so they sent their health certificates to their area office via overnight FedEx with the USDA’s prior notification and approval. This certification cost $37 per pet.

This certified form then must then be legalized at the nearest Ecuadorian consulate and costs $50 per pet. If the nearest office is far away, you may again use a courier service and include a prepaid mailer to have it returned to you. Our friends actually included two prepaid mailers when they sent their certificates to the USDA (one to the Ecuadorian consulate, the other to their own address) so that the once the USDA certified the health certificate, they mailed it direct to the consulate and then the consulate sent it back to their home address.  Again, make sure to notify the consulate in advance so they are expecting your paperwork.  **Important: The stamped certification it’s only good for 10 days** so plan accordingly!

You will also need to provide the airlines with a separate vet certification for each dog. You will present these when you check in for your flight.  If you’re flying on multiple airlines, each will require these so make sure you have enough for your route.  The certifications are also required for domestic flights within Ecuador.  In the case of our friends, they needed three certificates for each dog (2 in the US since they flew on both Delta and Copa Airlines and then a third for their flight from Quito to Manta).

 

CARGO VERSUS BAGGAGE

There are two ways to bring dogs in to the country.   One is via air cargo. Our friends spent a lot of time talking with professional pet relocation companies and they all recommended not going this route if possible.  However, due to temperature restrictions (85 degrees F), dog weights, and heights for certain airlines, etc. it may be the only choice some people may have.

CARGO

If you go with the cargo option, get in touch with Sandra (Sandy) Baquero who is a highly recommended customs agent who will explain the process to you, check your cargo bookings, and help you to get in to see your beloved(s) while they are being cleared through customs and agricultural departments. Another friend of ours used Sandy’s services in April 2012 and was very pleased.  She arrived to Quito at 9:17pm and her dogs were released to her before 5pm the following day. Note: We know other folks who had to wait several days before their dogs were released.

Sandra Baquero
cell (as dialed within Ecuador): 099690583

 

BAGGAGE

The option most recommended for traveling with your pet is on your flight either as checked baggage or in-cabin if possible (in-cabin weight including the carrier restricted to 20 lbs). The reason this option is recommended instead of cargo is that your dog will arrive as your personal baggage and thus will go through airport customs, not cargo customs meaning there is no 24 hour hold and no customs agent required to get your dog through.

Airport camping with three dogs and seven pieces of luggage

Our friends sent their extra large dog as checked baggage and their 2 small dogs in-cabin in carriers that fit below their seats.

Temperature restrictions

Our friends bypassed the temperature restrictions for their large dog Bela by flying at a time of year before Delta airline’s temperature restrictions were in place for their Seattle-Miami flight. However, Delta’s restriction was already in effect for their Miami-Quito flight so they switched airlines to Copa whose temperature restriction had yet to go into effect.

Size restrictions

For Bela’s size, US regulations required her to travel in an extra large 700-series crate required by US regulations from Seattle to Miami.  However, Copa Airlines restricted crate height to a 500-series carrier (and 100 lbs) for their Miami-Quito flight. Our friends worked around this restriction by cargoing a 500-series crate as extra baggage and then switching Bela to that one before checking in for their Miami-Quito flight (leaving the larger crate behind at the airport). They overnighted in the Miami airport which gave them time for a break between flights.

Other Pet Policies

Just as with temperature and size restrictions, different airlines have differing policies regarding making flight reservations for your pet. Our friends chose Delta Airlines because they allow dog reservations to be made 14 days in advance while other airlines allowed  only 48 hours.

Final recommendations

Check on everything before you book your flight as timing is everything and you don’t want to get bumped from a flight and have your health certificate run out before your arrival date. Also, you can check on each flight to make sure your dog has boarded too.

Helpful Links

A very clear and succinct description (and they have a cat in case you have any cat-specific questions).

A place to learn more and submit your own questions (a pet relocation website)

USDA’s page about international travel with your pet

More helpful details from Gary Scott’s site (regarding taxes, breed restrictions, etc.)