TITLE V. ECONOMIC ORDER
Article 101
The economic order shall essentially answer to principles of social justice that tend to ensure to all inhabitants of the country a dignified existence of the human being.
The State shall promote the economic and social development through the increase of production, productivity and the rational utilization of the resources. With the same end, it shall foment the diverse sectors of production and shall defend the interest of the consumers.
Article 102
Economic freedom is guaranteed, insofar as it does not oppose the social interest.
The State shall foment and protect the private initiative, within the necessary conditions to increase national wealth and to assure the benefits from it to the greatest number of inhabitants of the country.
Article 103
The right to private property is recognized and guaranteed as a social function.
Likewise, intellectual and artistic property is also recognized, for the time and in the form determined by the law.
The subsoil pertains to the State, which may grant concessions for its exploitation.
Article 104
The State’s real property (bienes inmuebles) may be transferred to natural or juridical people within the limits and in the form established by law.
The rural state property with agricultural or livestock (agropecuaria) vocation, which is not indispensable for the activities proper of the State, shall be transferred by means of corresponding payment to the beneficiaries of the Agrarian Reform. It may also be transferred to corporations of public utility.
Article 105
The State recognizes, foments and guarantees the right to private property over farmland (tierra rústica), be it individual, cooperative, communal or in any other associative form, and it shall not, by any concept, reduce the maximum extension of land that is established by this Constitution as a right of property.
The maximum extension of farmland belonging to one same natural or juridical person shall not exceed two hundred and forty-five hectares. This limitation shall not be applicable to cooperative or communal peasant associations.
The owners of land to whom the second paragraph of this Article refers, may freely transfer, abandon, distribute (partir), divide or rent the land. The land, property of the cooperative associations, peasant communities and beneficiaries of the Agrarian Reform, shall be subject to a special regime.
The owners of farmland with an extension of more than two hundred and forty-five hectares shall have the right to immediately determine the part of the land they wish to retain, segregating it and registering it separately in the corresponding Register of Real Estate and Mortgages.
The farm real estate (inmuebles rústicos), which exceeds the limits established by this Constitution and is encountered in common ownership (proindivisión), may be the object of partition among its co-owners.
The lands which exceed the extension established by this Constitution may be transferred under any title to peasants, small farmers, cooperative corporations (sociedades) and associations and peasant communities. The transfer referred to by this paragraph shall be realized within a period of three years. A special law shall determine the destiny of the lands which have not been transferred at the end of the previously established period.
In no case may the exceeding lands referred to in the prior paragraph be transferred under any title to relatives within the fourth degree of consanguinity or the second degree of affinity.
The State shall foment the establishment, financing and development of the agro-industry in the different departments of the Republic, to the end of guaranteeing the employment of labor and the transformation of raw materials produced by the national agricultural and livestock sector.
Article 106
Expropriation shall proceed because of public utility or of social interest, legally proven, and after a just indemnification.
When expropriation is motivated by causes arising from war, public disaster or if it is has the objective of supplying water or electric energy, or for the construction of housing or highways, roads or public streets of any kind, compensation need not be in advance.
When justified by the amount of indemnification to be recognized for properties expropriated in conformity with the previous paragraphs, the payment may be made in installments which shall not exceed as a whole fifteen years, in which case the expropriated person shall be paid the corresponding bank interest. The said payment shall be preferably made in cash.
Entities that have been created with public funds may be expropriated without indemnification.
Confiscation as a penalty or in any other concept is prohibited. Authorities which contravene this precept shall answer at all times with their persons and their properties to the damage inferred. Confiscated properties are imprescriptible.
Article 107
All kinds of entailment (vinculación) are prohibited, except:
- Trusts constituted in favor of the State, the municipalities, public entities, beneficent or cultural institutions and the legally disabled;
- Trusts constituted for a period that does not exceed that established by the law and whose management is under the charge of legally authorized banks or credit institutions;
- The good of the family.
Article 108
No civil or ecclesiastical corporation or foundation, regardless of its denomination or objective, shall have legal capacity to preserve or administer real estate (bienes raíces), with the exception of those immediately and directly destined to the service or objective of the institution.
Article 109
The property of rural real estate shall not be acquired by foreigners in whose countries of origin Salvadorans do not have equal rights, except in the case of land for industrial establishments.
Foreign and Salvadoran companies to which the second paragraph of Article 95 of this Constitution refers, shall be subject to this rule.
Article 110
No monopoly shall be authorized except in favor of the State or the Municipalities when social interest makes it indispensable. Stores for selling government monopolized goods (estancos) may be established in favor of the State.
To the end of guaranteeing free enterprise and to protect the consumer, monopolistic practices are prohibited.
Privileges shall be granted for a limited time to discoverers and inventors and to the people who improve (perfeccionadores) productive processes.
The State may assume responsibility (tomar a su cargo) for public services when the social interests require, providing them directly by means of autonomous official institutions or of the municipalities. It also (también le corresponde) regulates and oversees (vigilar) the public services provided by private enterprises and the approval of their rates (tarifas), except those which are established in conformity with international treaties and conventions; Salvadoran enterprises of public services must have their centers of work and bases of operation in El Salvador.
Article 111
The power to emit currency corresponds exclusively to the State, which shall exercise it directly or through an issuing institution of a public character. The monetary, banking, and credit regimes shall be regulated by law.
The State shall orient monetary policy to the end of promoting and maintaining the conditions most favorable to an orderly development of the national economy.
Article 112
The State shall administer the businesses that render essential services to the community, with the objective of maintaining continuity of services, when the owners or operators resist obeying legal dispositions on economic and social organization.
The State may also exercise control over (intervenir) property belonging to nationals of countries with which El Salvador encounters itself at war.
Article 113
Associations of an economic nature that tend to increase the national wealth through a better use of natural and human resources, and to promote a fair distribution of the benefits originating from their activities, shall be fomented and protected. In addition to private individuals, the State, municipalities, and entities of public utility may participate in this class of associations.
Article 114
The State shall protect and foment cooperative associations, facilitating their organization, expansion and financing.
Article 115
Commerce, industry and small service provision are patrimony of Salvadorans by birth and native Central Americans. Their protection, promotion (fomento) and development shall be the object of a law.
Article 116
The State shall foment the development of small rural properties. It shall facilitate access for the small producer to technical assistance, credits, and other means necessary for the acquirement and better use of his lands.
Article 117
It shall be the State’s duty to protect the natural resources, as well as the diversity and integrity of the environment, and to guarantee sustainable development.
The protection, conservation, rational enjoyment, and the restoration or replacement of natural resources is hereby declared to be of social interest in accordance with the terms established by law.
The introduction of nuclear residues and toxic waste into the national territory is hereby prohibited.
Article 118
The State shall adopt population policies to the end of assuring the greatest well-being to the inhabitants of the Republic.
Article 119
The construction of housing is declared to be of social interest. The State shall endeavor so the greatest possible number of Salvadoran families become the owners of their home. It shall promote that every rural farm owner provide a sanitary and comfortable home for resident workers, and adequate installations for temporary workers; and for this purpose, shall promote the access (facilitará) of small property owners to the necessary means.
Article 120
In every concession granted by the State for the establishment of docks, railroads, canals, or other material works of public service, there shall be stipulated as an essential condition, that after a certain time has lapsed, of not more than fifty years, such works shall pass by operation of law in perfect working condition into the control of the State without compensation of any kind.
These concessions shall be submitted to the cognizance of the Legislative Assembly for its approval.
