In May 2011, the Law of Exchangeable Invoices (Ley de Factura Cambiaria) entered into force in Nicaragua. The same was published in Gazette Number 234 of November 2010, and has as its main purpose the facilitation of immediate access to cash for the commercial sector.
According to this Law, the invoice is a credit instrument, which grants rights over goods that have been delivered but not yet cancelled. It guarantees a credit operation such as a sale of goods or sale of services.
The exchangeable invoice is a nominative and endorsable credit instrument; it represents both credit rights originated by the commercial transaction and a first preference security right over the merchandise subject to the same document. The merchandise subject to the invoice has been differed in its payment and will be used as security for the payment. The exchangeable invoice is a copy of the commercial invoice, without a tax value, which must comply with the requirements established by law and must be accepted by the acquirer of the merchandise or services in order to produce the effects established by the law. The acceptance of the exchangeable invoice is considered fulfilled upon the signature of the buyer.
The accepter of the exchangeable invoice will have a period of five days to accept or deny the merchandise and/or the exchangeable invoice, or to request payment against the products. If the accepter does not act within said period the exchangeable invoice will be considered accepted in itself.
Interest for default payment can also be established in the exchangeable invoice; however, this interest will be ruled according to the Law of Loans granted by non-regulated institutions taking into consideration the monthly average interest rate published by the Central Bank of Nicaragua.
One of the most important benefits granted by the Law of Exchangeable Invoices is the facility to seek better opportunities and faster money sources; this facility is provided by the easy assignment of credit.
The novelty of this law is the right of execution without prior recognition of defendant's signature or the authorised person, facilitating the collection contained in it.
To enforce the right of execution arising from the exchangeable invoice, it will be necessary to make a declaration (protest) within 60 days after the expiration date. If the protest is not made, the actions that can be performed for the exchangeable invoice will expire. In such event the credit can be recovered by other means, however.