The amendment to the International Services Act was published in the Official Gazette on January 14, 2026, adjusting the framework that regulates incentives applicable to companies that provide services from El Salvador to foreign countries.
The core change is conceptual but has significant practical impact: the minimum investment required for direct users providing business process services, medical and hospital services, care for the elderly and convalescents, information technologies, and cinematography no longer must be made within the first six months or within the first year of operations, but rather “starting from the first year of operations.”
The amendment allows applicants for the benefits of the law to carry out one or more eligible activities. Companies that already have an authorized activity may also add new ones, provided they meet the investment requirements, job creation thresholds, and other conditions applicable to each activity.
According to the Ministry of Economy, the objective is to promote investment and facilitate the expansion of existing investments, avoiding rigid timing requirements that could discourage projects in their start-up phase.
Who is directly affected?
The amendment mainly impacts:
- Companies that are about to begin operations and wish to qualify for the benefits and tax incentives under the law.
- Direct users and service centers already qualified under the regime that plan to expand, diversify, or restructure their operations.
- Corporate groups evaluating phased projects where investment is executed progressively.
- Investors who condition their entry into the country on greater regulatory flexibility.
Practical implications companies should be evaluating today
From a practical standpoint, the amendment raises at least four key considerations:
- Greater flexibility in investment execution: The requirement “starting from the first year of operations” allows companies to structure their investment progressively, without the risk of non-compliance due to having to complete it within a relatively short and fixed timeframe.
- Review of execution timelines: Early-stage projects should reassess spending schedules, building lease agreements, permanent staff hiring plans, acquisition of assets, working capital injections, and intra-group commitments.
- Expansion of eligible activities: The amendment enables companies already benefiting from the regime to add one or more activities, opening expansion opportunities without the need to create new legal entities.
- Flexibility regarding green areas: For the development of service parks, the required 30% green area of the total land may be distributed as 10% within the park or in an adjacent area, and the remaining 20% within or outside the park, reducing physical constraints on growth.
Risks of inaction (or acting without proper analysis)
The main risk is assuming that the change eliminates controls or requirements. It does not. Common mistakes may include:
- Executing investments without proper temporal traceability and a defined plan.
- Failing to adequately document compliance “starting from” the beginning of operations.
- Expanding activities without formally validating their inclusion under the regime or without meeting the legal requirements applicable to each activity.
- Underestimating the impact of these changes in future audits or oversight processes.
Companies operating under the International Services Law should immediately review their investment structure, timelines, and growth projections, particularly if they plan to begin operations or expand in the short term.
This is an opportune moment to align business strategy with the new regulatory framework, avoiding unnecessary risks and taking advantage of a more flexible environment to invest and grow.
