Puerto Rico Agencies Issue Guidance Clarifying Executive Order on COVID-19 Shutdown and Curfew Measures

In the wake of Governor Wanda Vázquez-Garced’s March 15, 2020 Executive Order (EO 2020-023) enacted to facilitate the private and public closings necessary to combat the effects of the coronavirus (COVID-19) and control the risk of contagion, there has been much confusion within the private business sector regarding its scope and exceptions. The state of confusion was exacerbated by statements the Governor made during press conferences, which seemed to contradict the text of the EO and police mobilization to ensure compliance with its terms.1 To this end, on March 15 and 17, the Puerto Rico Bureau of Telecommunications, the Puerto Rico Department of Economic Development and Commerce, the Puerto Rico Tourism Company, and Puerto Rico Treasury Department, issued an Administrative Order, Circular Letters, and an Internal Revenue Informative Bulletin, respectively, meant to provide some clarification.  We summarize them below.

Puerto Rico Bureau of Telecommunications, Administrative Order of March 15, 2020

On March 15, Puerto Rico’s Telecommunications Bureau issued an Administrative Order (AO) intended to clarify the extent of EO 2020-23 for the telecommunications industry.  Recognizing that these services are essential and in the public interest, the AO stresses the need to maintain a robust telecommunications infrastructure and to immediately correct any service disruption. The AO clarifies that in the context of EO 2020-023, the term “critical infrastructure” refers to critical telecommunications infrastructure, such as: telecommunications, antennas, microwaves, headquarters, network surveillance centers, cable, fiber optics and modems. Therefore, employees of any telecommunications, cable television and VoIp companies providing services under EO 2020-23 are authorized to use public roads to and from work activities during whatever time is necessary when installing, repairing, or working on underground fiber optic lines.

In addition, facilities providing telecommunications services to the public must do so through a drive-through system. Interestingly, while the AO states that call centers may continue to operate, taking appropriate safeguards to prevent the spread of COVID-19, Circular Letter 2020-02 issued by the P.R. Department of Economic Development and Commerce, further discussed below, limits the EO 2020-23 exemption to call centers “for direct health services and other exempt industries.” Finally, and in order to ensure due process of law, all deadlines for cases pending before the Telecommunications Bureau are extended by three days following the date upon which the Bureau returns to operations. All hearings scheduled during the period in which the Bureau is to remain closed shall be rescheduled. 

Puerto Rico Department of Economic Development and Commerce, Circular Letter 2020-02 of March 17, 2020, to the Industrial, Commercial and Business Sector and accompanying letter to the Textile Industry

The Secretary of the Department of Economic Development and Commerce, Hon. Manuel A. Laboy, explained that Circular Letter 2020-02 provides additional guidance to the industrial, commercial and business sector regarding the applicability of the EO and its exemptions.  After providing some background context and a brief summary of the EO, the Secretary proceeds to group the operations exempted by the EO into seven major groups:  (1) health, (2) food, (3) fuels (processing, sales and distribution), (4) critical infrastructure, (5) local and national security, (6) goods and services, and (7) supply chain.  Within each such heading, the Circular Letter further lists specific situations where the exemption applies. Employers and business that believe that they fall under any one of the EO’s exemptions should carefully review this list.

These exempt entities can continue to operate during regular hours, and are not subject to the EO’s curfew hours, even those that operate 24/7. The Circular Letter also advises that, even if exempt, companies must make adjustments to their contingency plans in order to comply with measures to avoid the spread of the virus and the congregation of employees, and to provide for remote work when possible.

Regarding textile companies, the Secretary issued a separate letter, making clear they are to remain closed in compliance with the EO, without exception. The clarification is squarely aimed at federal contractors within the textile industry.  This, inasmuch as the Secretary acknowledged that it was initially believed that every contractor of the U.S. Department of Defense (presumably including all textile and military apparel contractors), would be exempt from complying with the EO.  Nevertheless, in order to prioritize the health of Puerto Ricans, it has now been clarified that even those companies must remain closed.

In both letters, Mr. Laboy recognized the economic impact this unprecedented situation will have on Puerto Rico and made a commitment to provide the necessary assistance to restore operations after the challenge is overcome.  Employers that believe their business should be exempt for reasons of health or national security should e-mail a document explaining the relevant circumstances to emergency@ddec.pr.gov.

Puerto Rico Tourism Company’s Updated Guidance for Tourism Businesses and Travelers of March 17, 2020

In connection to the application of EO 2020-023 to tourism operations, the Executive Director of the Puerto Rico Tourism Company, Carla Campos, issued the following guidance:

  • Airports:  Remain open for inbound and outbound travel in accordance with U.S. government restrictions. Usual operations are not affected by the curfew; retail and restaurant operations inside the airport, however, are subject to the same restrictions as the rest of the Island, allowing only for essential businesses to remain open.
  • Tourism industry workforce:  Employees may transit to and from work outside curfew hours.  Employers are strongly encouraged to provide to employees whose shifts extend beyond curfew hours with a certification that they can present to law enforcement personnel if necessary.
  • Cruise operations:  The San Juan Bay is currently closed for cruise ship vessels.
  • Hotels:  Remain open but public spaces and amenities, including the beach, must remain closed.  Hotel staff must responsibly provide guests with guidance regarding EO 2020-023 and the penalties for violations; guests must remain in their rooms unless leaving the premises for an authorized activity per the terms of the EO; back-office support to maintain essential hotel operations running is allowed; non-essential maintenance work (such as remodeling, painting or building up-keep) is not allowed.
  • Short-term rentals:  Remain open under essentially the same terms as hotels.
  • Casinos:  Closed through March 30, 2020.
  • Restaurants:  Will remain open but limited to drive-through, carry-out and delivery.  Bars inside restaurants must remain closed; sale of alcoholic beverages in goods and beverage establishments is only authorized through take-out or delivery.
  • Restaurants inside hotels:  Will remain open under the same terms as established in the EO for other restaurants, that is, carry-out or delivery.
  • Attractions:  All should remain closed except for essential services as established in the EO.
  • Tours:  All should remain closed except for essential services as established in the EO.
  • Transportation providers:  Transportation is an essential service; Uber and taxi drivers will be allowed to operate subject to Section 3 of the EO.
  • Travel agencies:  Storefront operations will remain closed; travel agents are authorized to work remotely until further notice. 

Puerto Rico Treasury Department Internal Review Administrative Bulletin 20-09 of March 17, 2020 (BI-RI 20-09) to all taxpayers and authorized representatives authorizing release/lift of merchandise

Informative Bulletin 20-09 issued on March 17, 2020, by the Secretary of the Department of Treasury, states that pursuant to the EO 2020-023, all offices will remain closed until March 30.  All services provided through the “Internal Revenue Unified System” (SURI, for its acronym in Spanish) and the electronic filing systems are working as usual and taxpayers are encouraged to use it to conduct all transactions that are ordinarily carried out at the Department's offices or Service Centers, such as tax debt payments, requests for automatic payment plans and debt certifications, and filing of returns. The Informative Bulletin further states that inasmuch as the import declaration process and the corresponding payment are carried out electronically, the merchandise declaration process continues to operate normally.

Importantly, the Bulletin clarifies that personnel dedicated to the release/lift of merchandise received at the ports and the transportation of goods and food from the ports to importers’ warehouses and premises are exempt from the EO 2020-023 inasmuch as they fall within the exemption of section 7 (“Personnel working in the wholesale food and product manufacturing and supply chain, from their origin to consumer retail outlets”). Notably, the Bulletin states that in the case of importers engaged in the wholesale manufacturing or distribution of goods and food, the collection and transportation of goods from the ports to the importer's warehouse or business premises is considered an essential service, exempted from the curfew imposed under the EO 2020-023. Conversely, merchants or importers of products not authorized to be sold under the EO 2020-023, must comply with its requirements (including the curfew) and while they may lift the merchandise from the ports, they must store the same until March 30. This suggests that even those companies whose operations must remain closed due to the EO 2020-23, may have warehouses employees unloading and storing merchandise from 5 a.m.-9 p.m.

The merchandise release/lift procedure will follow its normal course and all merchants will be allowed to pick up their merchandise at the ports, once they have completed the import declaration process through SURI.

Finally, the Bulletin specifically orders all individuals who will be transporting goods from the ports to merchants’ warehouses or premises during the hours allowed by EO 2020-23, to keep a copy of the Informative Bulletin so that in the event they are stopped by law enforcement officers, they can verify that the activity they are carrying out is exempt from the curfew.

See Footnotes

1 On March 17, 2020, the Governor issued an Executive Summary of OE-2020-023 which restates and explains the scope of the closure and curfew measures.  The Governor places particular emphasis on the fact that every person on the Island shall remain at home 24 hours a day, 7 days a week, until March 30, 2020, except for the particular circumstances excepted in the EO.  The Executive Summary further provides that each entity of the executive branch is responsible for maintaining communication with their respective sectors to promote a better understanding and strict compliance with the provisions of EO.  

Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.