SPIN-OFF OF THE AGENCY FOR REGULATION AND CONTROL OF NON-RENEWABLE ENERGY AND NATURAL RESOURCES
By Executive Decree No. 256 dated May 8, 2024, the President of the Republic ordered the spin off (division) of the Agency for Regulation and Control of Non-Renewable Energy and Natural Resources ("ARCERNNR") into three new agencies, attached to the Ministry of Energy and Mines:
- Mining Regulation and Control Agency ("ARCOM")
- Electricity Regulation and Control Agency ("ARCONEL"); and,
- Hydrocarbons Regulation and Control Agency ("ARCH").
The Board of each of these agencies will be composed of: (i) the minister in charge of the sector or his permanent delegate, who will preside over it; (ii) a permanent delegate of the President of the Republic; and (iii) the National Planning Secretary or his permanent delegate.
The spin-off process must be completed within a maximum period of three (3) months from the issuance of Executive Decree No. 256, that is, by August 8, 2024.
The resulting entities will assume the assets, liabilities, rights, and obligations acquired by the split ARCERNNR within the scope of their respective competencies, and in case it is not feasible to identify a specific sector, in order to continue the contractual obligations acquired, the Executive Decree designated the newly created ARCONEL as the entity that will continue the contractual relationships until their completion.
In our opinion, this necessary process is of paramount importance for the country, as the resulting agencies will regulate and control in a technical, efficient, and focused manner each of the mining, electricity, and hydrocarbon sectors, which are fundamental pillars of Ecuador's economic management.
Should you require further information or need our assistance or legal advice regarding administrative processes previously handled by the now-defunct ARCERNNR or the newly formed agencies, please do not hesitate to contact us!