CenAm Watch: El Salvador acquisition approval, Costa Rica card rules

El Salvador's competition watchdog (CDSC) authorized Grupo Perinversiones’ purchase of Banco Azteca de El Salvador, giving a positive response to the petition made October 22 last year.

Local financial group Perinversiones will purchase 100% of Azteca’s El Salvador operations.

According to the most recent data from the banking sector regulator (SSF), Banco Azteca de El Salvador held US$68.0mn in assets at the end of 2018, up 4.5% from 2017.

In its approval the CDSC said, “The analysis concluded that this economic concentration is horizontal in nature, that is, it is carried out between agents operating in the same sector, in this case, the financial sector.”

"The research carried out on the services and products offered by Banco Azteca and Perinversiones, especially through S.A.C. Constelación, showed that, despite being direct competitors in financial intermediation services, the concentration does not represent a risk for competition,” it added.

Perinversiones owns a large number of companies in a wide range of businesses, including the investment, education, logistics, hotel, real estate, food, trading, and auto sectors.

Banco Azteca de México is the majority shareholder of the El Salvador-based Banco Azteca, with a 91% stake. Both banks form part of Mexican specialty retailer and financial services giant Grupo Elektra.

Costa Rica pushes plastic

Starting in July, Costa Rican businesses will be forced to accept credit card, debit card or “other alternative payment method” or face fines of 446,000 colones (US$754).

With the new regulation, the finance ministry is attempting to ensure that most payments are digital and guarantee better control over taxpayers, preventing tax evasion.

"It is important that businesses and those who provide services in general are up to speed on this measure obliging electronic payments as well as [the regulations] on income with the new VAT law, precisely to avoid sanctions," said Silvia González, tax manager at accounting firm Grant Thorton, as cited in local daily CRHoy.

Additional examples of the broader efforts to crack down on tax evasion is the implementation of electronic vouchers and the online tax payment portal that allows for the management of taxpayer records and tax returns.

"The strategy of the treasury makes sense because not only these forms of electronic payment have become a means of effective collection, since there are withholdings or advances of the general tax on sales – the soon-to-be VAT – and income tax,” added González.