Private property, both non-real estate and real estate, is recognized and protected in El Salvador. Mortgages and real property liens exist. Companies that plan to buy land or other real estate are advised to hire competent local legal counsel to guide them on the property’s title prior to purchase.
No single natural or legal person–whether national or foreign–can own more than 245 hectares (605 acres) of land. Per the Constitution, a principle of reciprocity is applied regarding the ownership of rural land, i.e., there are no restrictions on the ownership of rural land by foreigners in El Salvador, unless this restriction is applied to Salvadoran nationals in the corresponding states. If the rural land is to be used for industrial purposes, however, the reciprocity requirement is lifted.
Real property can be transferred without government authorization. For title transfer to be valid regarding third parties, however, it needs to be properly registered. Real estate lease law tends to heavily protect the interests of tenants, e.g., the law allows tenants to remain on property after their lease expires, provided they continue to pay rent. Likewise, the law limits the amount of rent that can be charged and makes eviction processes extremely difficult.
Squatters occupying private property in good faith can eventually acquire title. If the owner of the property is unknown, squatters can acquire title after 20 years of good faith possession through a judicial procedure; if the owner is known, squatters can acquire title after 30 years.
Squatters may never acquire title to public land, although municipalities often grant the right of use to the squatter.
Zoning is regulated by municipal rules. Municipalities have broad power regarding the use of property within their jurisdiction. Zoning maps, if they exist, are generally not available to the public.
The perceived ineffectiveness of the judicial system discourages investments in real estate and makes execution of real estate guarantees difficult. While the real property lease law provides extensive protection to tenants, landowners’ interests often go unprotected. Securitization of real estate guarantees or titles is legally permissible but does not occur frequently in practice.
In April 2012, the Legislative Assembly passed a constitutional reform recognizing the existence and the rights of indigenous peoples. However, there are no provisions for traditional use of lands or for indigenous peoples to share in revenue from exploitation of natural resources, as the government does not specifically demarcate any lands as belonging to indigenous communities.
According to the latest agricultural census (2007-2008), agricultural land in El Salvador totals 2,283,444.48 acres, of which 1,695,653.4 acres are owned and not rented out (74 percent), 478,127.32 acres are rented (21 percent), and 109,665.48 acres (5 percent) are not clearly defined. Website: http://www.censos.gob.sv/ .
El Salvador ranks 69th of 190 economies on the World Bank’s Doing Business 2018 report in the Ease of Registering Property category. According to the collected data, registering a property takes an average of five steps over a period of 31 days, and costs 3.8 percent of the reported value of the property.
Intellectual Property Rights
El Salvador’s legal structure is strong, as El Salvador revised several laws to comply with CAFTA-DR’s provisions on intellectual property rights (IPR). The Intellectual Property Promotion and Protection Law (1993, revised in 2005), Law of Trademarks and Other Distinctive Signs (2002, revised in 2005), and Penal Code establish the legal framework to protect IPR. Investors can register trademarks, patents, copyrights, and other forms of intellectual property with the National Registry Center’s Intellectual Property Office. Reforms extended the copyright term from 50 to 70 years. In 2008, the government enacted test data exclusivity regulations for pharmaceuticals and agrochemicals, which are protected for five and 10 years respectively, and ratified an international agreement extending protection to satellite signals.
The National Directorate of Medicines (NDM) has registered 63 products for data protection since 2008, including seven in 2016 and three in 2017. The NDM protects the confidentiality of relevant test data and the list of such protected medications is available at the NDM’s website: http://www.medicamentos.gob.sv/index.php/es/servicios-m/informes/unidad-de-registro-y-visado/listado-de-productos-farmaceuticos-con-proteccion-de-datos-de-prueba .
El Salvador’s enforcement of IPR protections falls short of its written policies. Salvadoran authorities have limited resources to dedicate to IPR issues and enforcement of existing laws. The Salvadoran Intellectual Property Association (Asociacion Salvadorena de Propiedad Intelectual, ASPI) notes that piracy is common in El Salvador because the police focus on investigating criminal networks rather than points of sale. The contraband and piracy of medicines and software also remain a problem, as well as the purchase of drugs online, whereby unlicensed or counterfeit products are imported to El Salvador.
The National Civil Police (PNC) has an Intellectual Property Section with seven investigators, while the Attorney General’s Office (FGR) has 13 prosecutors in its Private Property division that also has responsibility for other property crimes including cases of extortion. According to ASPI, the PNC section coordinates well with other government and private entities. Nevertheless, the PNC admits that a lack of resources and expertise (e.g., regarding information technology) hinders its effectiveness in combatting IPR crimes. Most PNC operations focused on copyright infringement, and there were only 28 arrests in 2017. During the year, the police seized a total of 5,780 pirated optical media discs (CDs and DVDs). The police also seized tens of thousands of counterfeit products, including 114,660 fake Disney toys (“Cars”), and purported Disney, Marvel, and Nickelodeon toothbrushes (9,000) and backpacks (4,860). Other commonly counterfeited brands included Tommy Hilfiger, Calvin Klein, Levis, Polo Ralph Lauren, Sony, Dell, HP, Converse, Puma, and Hello Kitty.
Contraband and counterfeit products, especially cigarettes, liquor, toothpaste and cooking oil, remain widespread. The Distributors Association of El Salvador (ADES) estimates that around 50 percent of the liquor consumed in El Salvador is smuggled. Most contraband cigarettes come in from China, Panama, and Paraguay and undercut legitimately-imported cigarettes, which are subject to a 39 percent tariff. According to ADES, most contraband cigarettes are smuggled in by gangs, with the complicity of Salvadoran authorities. A February 2017 study by CID Gallup Latin America, noting the link between contraband cigarettes and gang finances, estimated that 32 percent of the 940 million cigarettes consumed annually in El Salvador are contraband. Gallup estimated that, during 2014, the GOES lost USD 15 million in tax revenue due to cigarette smuggling.
According to GOES officials, most of the presumably counterfeit products are imported from other countries. While the country of origin is often impossible to ascertain, many products, including cigarettes, come from China via Panama and Belize. To a lesser extent, Customs officials have identified some products arriving directly from China through the Salvadoran seaport of Acajutla. In 2017, Customs officials seized 25 shipments based on the presumption of containing fake products. These shipments primarily involved clothing (e.g., Levi’s, John Deere and Polo Ralph Lauren), footwear (e.g., Adidas and VANS), cosmetics (e.g., Avon) and reproductions of purportedly “officially licensed” products (e.g., Spiderman, Disney, Real Madrid, and Barcelona F.C.).
The national Intellectual Property Registry has 11 registered geographical indications for El Salvador (in 2017 seven new geographic indications were registered and six of these new Denominations of Origin involve regional varieties of coffee, Alotepec, Cacahuatique, Tecapa Chinameca, Apaneca-Ilamatepec and Balsamo Quezaltepeque). Additionally El Salvador has registered “Balsamo de El Salvador” (balm for medical, cosmetic, and gastronomic uses – registered since 1935), “Cafe Ilamatepec” (coffee – registered in 2010), “Chaparro” (Salvadoran hard liquor- registered in December 2016), and “Pupusa de Arroz de Olocuilta” (traditional food – registered in March 2018). “Jocote Baron Rojo” is in the process of registration.
El Salvador is not listed in the notorious market report nor Special 301 list. There are no IP-related laws pending.
El Salvador is a signatory of the Berne Convention for the Protection of Literary and Artistic Works; the Paris Convention for the Protection of Industrial Property; the Geneva Convention for the Protection of Producers of Phonograms Against Unauthorized Duplication; the World Intellectual Property Organization (WIPO) Copyright Treaty; the WIPO Performance and Phonograms Treaty; the Rome Convention for the Protection of Performers, Phonogram Producers, and Broadcasting Organizations; and the Beijing Treaty on Audiovisual Performances (2012), which grants performing artists certain economic rights (such as rights over broadcast, reproduction, and distribution) of live and recorded works.
For additional information about treaty obligations and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/details.jsp?country_code=SV .