New Rules on Trusts, Leasing, and Factoring in Nicaragua.

The Monetary and Financial Council (CDMF for its acronym in Spanish) approved several rules regarding the regulation and authorization of financial service entities within the Nicaraguan economic framework. These entities include those providing trust, leasing, and factoring services.

These resolutions were published in La Gaceta, Diario Oficial, Number 125, on Thursday, July 10, 2025:

• Rule No. CDMF-XIX-2-25 "Rule on Authorization and Regulation of Non-Banking Trust Service Providers".

• Rule No. CDMF-XIX-3-25 "Rule on Authorization and Regulation of Financial Leasing Entities".

• Rule No. CDMF-XIX-4-25 "Rule on Authorization and Regulation of Factoring Entities".

The rules have a similar structure in terms of the order and content of their provisions, including similar legal definitions, except for the specific concepts of each legal-financial institution.

First, the requirements for authorizing and implementing the operation of each entity are established. The most significant requirement is the incorporation of each entity as a corporation with a single corporate purpose. Each entity must submit a formal, written request to the Superintendent of Banks and Other Financial Institutions (SIBOIF for its acronym in Spanish) that must include the legal documentation, feasibility studies, and documentation proving the legal origin of the patrimony that will be invested in the new company. The competent authority may request additional documents or information to grant the required authorization to operate.

Second, once all the relevant documentation has been received, the Board of Directors will decide whether to grant or deny authorization within 120 days of the application's submission.

Finally, the edition of La Gaceta in which the authorization resolution was published must be mentioned, and the resolution must be inserted into the certification that will be part of the public deed of incorporation. This is necessary in order to register the company in the Commercial Public Registry.

To begin operations, the requirements established by the SIBOIF must be met, including legal formalization, contract models, and other aspects. If the application for operation does not demonstrate compliance with the requirements within 180 days of the incorporation authorization resolution, the authorization will be invalid.

Once all requirements are met, the SIBOIF will grant operating authorization within 15 business days. The institution may grant an additional 5 business days to correct any omissions. Once the requirements have been corrected, authorization will be granted within five working days. Subsequently, the authorization will be registered in the Public Registry, and a certified copy of the registration as a regulated entity before the Financial Analysis Unit (UAF for its acronym in Spanish) must be submitted to the Superintendency.

One notable difference in the authorization process is the minimum capital stock: It is C$20,000,000.00 for companies providing financial leasing and factoring and C$5,500,000.00 for non-bank trust service providers.

The rules contain a section on control aspects (excluding trusts of non-bank financial institutions), which includes the duty to implement internal or external audit mechanisms.

The Supervision section handles leasing and factoring contracts with the same sections regarding provisions that regulate inspections and corrective measures, as well as legal indications on the cessation of operations. On the other hand, the trust institution has new, specific scopes for this legal figure: information requirements, prohibitions, cancellation of registration, and maintenance of a bond or insurance policy for trustees.

Finally, the financial leasing contract is the only institution covered by the regulations in force that has a detailed description of the minimum elements it must contain, pursuant to Art. 10 of the respective rule.

The final provisions establish an obligation for companies already providing such services to register within 90 days of each regulation's effective date. Additionally, the Superintendent is empowered to establish minimum guidelines for managing each institution's operations, including issuing provisions to implement the rules.

With the rules taking effect on June 18, 2025, trust, leasing, and factoring service providers will receive clearer guidance on incorporation, start-up, and control.