Minister Lee to the Secretary of State.

Sir: I have the honor to inclose herewith (in duplicate) a résumé of a decree issued by the Government of Ecuador for the purpose of [Page 628] fostering industries, manufactures, agriculture, pisciculture, and other similar enterprises in the Republic.

This decree is looked upon by the people as a very important measure, and it is hoped that ample results will follow.

I have, etc.,

Joseph W. J. Lee.

decree for the protection of industries, manufactures, agriculture, pisciculture, and other similar enterprises in ecuador.

Considering that it is necessary to encourage the introduction and development of new industries in Ecuador; that agriculture in its several branches merits special protection; that the numerous mountain streams and waterfalls in the country offer abundant means of providing motive power and electric lights, favorable to the economical establishment of manufacturing industries; that it is indispensable to grant such guarantees and security as may inspire confidence and attract foreign capital for investment in the Republic; it is decreed:

  • Article 1. To concede the free use of the streams, waterfalls, and all natural waterways to all who may start in the country new manufactories employing hydraulic or electric force. This concession not to interfere with existing rights nor with the right to draw off water for irrigation purposes, as provided by the civil code.
  • Art. 2. To grant all such establishments concessions of vacant government lands up to 25 hectares of land with at least 200 meters frontage on the water supply used by the enterprise. If the factory be started upon private lands these can be expropriated legally by paying the value of such land as may be acquired, according to the valuation of two appraisers, as provided by law.
  • Art. 3. To grant 200 hectares of land to all who agree to start the cultivation of sisal hemp, ramie, flax maguey, or other plant which produces material for textile fabrics.
  • Art. 4. Those who dedicate themselves to the cultivation of cereals or vines will have the concession of 50 hectares of land.
  • Art. 5. Those who engage in the raising of swine shall have permission to import animals for breeding purposes free of fiscal or municipal dues for the space of ten years.
  • Art. 6. All permanent lakes in the provinces of the interior which are more than 100 meters in extent shall be considered as national property and their use shall be conceded for a term of ten years to those who devote themselves to pisciculture. The lakes of Yaguarocha and San Pablo which are already stocked with fish are excepted from this concession. After the expiration of ten years fishing in the lakes will be open to the public. It shall be prohibited to draw off water for irrigation, etc., from such lakes.
  • Art. 7. Admits free importation of seeds and plants for ten years, but should such seeds and plants be offered for consumption, otherwise than for planting, they shall be considered contraband.
  • Art. 8. Exemption from military services of owners and employees of such factories, except as regards Ecuadorean citizens in case of foreign war.
  • Art. 9. From January 1, 1907, and for ten years thereafter, import dues and surcharges on manufactured articles imported into the country shall not be reduced in any case where similar goods are manufactured in the country already.
  • Art. 10. The same condition as in article 9 applies to any new industry which may be established hereafter from the date of its beginning and for ten years thereafter.
  • Art. 11. Refers to the same question of import dues.
  • Arts. 12 and 13. Provide that duties on raw materials required for manufactures established or to be established in Ecuador shall not be raised or altered for a period of ten years.
  • Art. 14. Provides that goods manufactured in Ecuador can not be taxed to an extent more than 50 per cent of the total import duties charged on similar foreign goods and that goods produced from raw material grown in Ecuador shall not be liable to any tax or impost whatever for ten years from January 1, 1907, except in the case of sugar cane and tobacco products.
  • Art. 15. Provides that all people who have obtained concessions of government lands on the pretext of establishing industrial factories and who do not fulfill their project within two years of the date of the grant shall lose their concessions and the land shall revert to the Government.
  • Art. 16. Provides for registry of such industries, etc.
  • Art. 17. Provides for the exhibition of the products of such factories, etc., once in every three years.
  • Art. 18. That a government commission be appointed to study and encourage the establishment of new branches of industry.
  • Art. 19 to 21. Certain provisions as to cases where concessions are applied for by two or more persons, or by persons without sufficient capital, etc.
  • Art. 22. Provides that so far as may be applicable this decree shall be considered as incorporated in the custom-house law.

Eloy Alfaro,
Supreme Chief of Ecuador.