Action to protect Ecuador: the constitutional guarantee that every company must know
A closure of the Internal Revenue Service (SRI) without prior notification. A penalty based on a non-existent rule. An administrative decision that immediately paralyzes the activity of a company. When administrative action compromises constitutional rights, time is a critical factor.
For these scenarios there is a specific jurisdictional tool: Protection Action, provided for in article 88 of the Constitution of the Republic of Ecuador and developed in the Organic Law on Jurisdictional Guarantees and Constitutional Control (LOGJCC). This article explains what is, when appropriate, when not, and why knowing it in time can be the difference between a business crisis and a controlled contingency.
What is the Action of Protection?
The Action for Protection is a judicial guarantee of constitutional status designed to directly and effectively protect the rights recognized in the Constitution, when they are violated by acts or omissions of a non-judicial public authority.
Unlike an ordinary trial against the State, which may take years to resolve, the Action for Protection is designed as an expeditious means: informal procedure, oral procedure, short time limits and the possibility for the judge to order interim measures to stop the violation immediately.
Its purpose is not limited to declaring the violation. The judgment, where favourable, must provide for the complete repair the damage caused: measures which may include restitution to the previous state, financial compensation for property damage suffered, and compensation for material damage such as reputational damage.
When do you proceed against a decision affecting the company?
Article 41 of the LOGJCC provides that the Protection Action shall, inter alia:
- Any act or omission of a non-judicial public authority which violates constitutional rights (Internal Income Service (SRI), Ministry of Labour, Municipalities, National Agency for Regulation, Control and Health Surveillance (ARCSA), Superintendences, etc.).
- All public policynational or local, which deprives the enjoyment or exercise of a constitutional right.
- Acts of individuals which provide improper public services, where there is subordination or defenceless.
In the business context, the typical scenarios in which this action is active are:
Vulneration of due process
Completures, penalties or administrative decisions executed without having guaranteed the right of defence, without valid notification, or without allowing the company to exercise contradiction over the facts.
Lack of legal certainty
Sanctions imposed on the basis of non-existing, repealed or applied rules with interpretations that deviate from the legal text and constitutional precedents.
Restrictions on freedom of enterprise
Administrative decisions which, without clear regulatory support, prevent commercial operation, suspend activities or impose conditions that empty the right to conduct a lawful economic activity.
When the Protection Action is not appropriate
There is frequent confusion in the business field: to assume that any adverse administrative action can be challenged in this way. The Protection Action has a specific scope that should be specified.
The case law of the Constitutional Court of Ecuador and article 42 of the LOGJCC are clear: the Action for Protection does not apply when:
- The question is: mere legality and does not involve a real violation of constitutional rights.
- There is a adequate and effective ordinary judicial procedure to challenge the act (for example, the administrative courts for the sanctions of public bodies, the tax courts for SRI matters, or the labour courts), unless it is shown that the law is not adequately protected.
- The claim is to obtain, through the Constitution, the recognition of a right that must actually be discussed through an ordinary process. The Protection Action protects existing constitutional rights, does not replace the ordinary process for resolving disputes specific to other matters.
- This is about Judicial orders (for such cases there is extraordinary protection action).
This distinction is critical. Activating a Protection Action without the proper constitutional support does not only lead to the rejection of the demand: it can set up a denatured use of the guarantee and weaken the company's legal position against the true way of challenging.
How to structure a well-put constitutional defence
A solid constitutional defence requires a prior technical analysis that distinguishes the constitutional plane from the ordinary level of legality. In Iurisred Legal ExpertiseThis action is addressed from three integrated fronts:
- Constitutional analysis
Before filing any application, it is assessed whether the case meets the requirements of article 40 of the LOGJCC, the constitutional right violated is precisely identified and it is verified that the constitutional path is indeed appropriate. If another procedural route is appropriate, this is indicated.
- Strategic litigation
The case is built with arguments of constitutional rank, not of mere legality. This requires mastery of the binding jurisprudence of the Constitutional Court, the precedents in tax, administrative and labour matters, and the technique of the oral hearing of the judicial guarantees.
- Comprehensive repair
The defence does not end with a stop to the contested action. The decision is intended to order specific measures: lifting of closures, lifting of sanctions, restoration of permits, and financial compensation for property damage to the operation where appropriate.
Iurisred Legal Expert is an Ecuadorian legal firm with professionals specialized in corporate, administrative and constitutional law, which accompanies managers and companies throughout the country in prevention, strategic litigation and defence against administrative actions that compromise fundamental rights.
The Constitution sets the limits for any administrative action. Knowing these limits in time is what separates a business crisis from a controlled contingency.
For a technical assessment of such a case, Iurisred's equipment is available.
