Obligation Ecuador 0.5% ( XS1626768730 ) en USD

Ecuador

52.75 % ⇌

Equateur

XS1626768730 ( en USD )

0.5% par an ( paiement semestriel ) - Obligation en défaut, paiements suspendus

02/06/2023 - Obligation échue

Prospectus brochure de l'obligation Ecuador XS1626768730 en USD 0.5%, échue

200 000 USD

2 485 627 000 USD

L'Obligation émise par Ecuador ( Equateur ) , en USD, avec le code ISIN XS1626768730, paye un coupon de 0.5% par an.
Le paiement des coupons est semestriel et la maturité de l'Obligation est le 02/06/2023

OFFERING CIRCULAR SUPPLEMENT

The Republic of Ecuador
U.S.$610,359,000 8.750% Notes due 2023
U.S.$611,870,000 9.650% Notes due 2026

The Republic of Ecuador (the "Republic" or "Ecuador") and The Bank of New York Mellon, as trustee (the "Trustee") have entered into (i)
the indenture dated June 2, 2017, as amended and supplemented on December 28, 2018, with respect to the 2023 Notes (as defined below)
(the "2023 Indenture"), and (ii) the indenture dated December 13, 2016, as amended and supplemented on December 28, 2018, with respect
to the 2026 Notes (as defined below) (the "2026 Indenture", and together with the 2023 Indenture, the "Indentures"). Pursuant to the
respective Indentures, the Republic has issued (i) an initial U.S.$1,000,000,000, an additional U.S.$187,000,000 and an additional
U.S.$688,268,000 of its 8.750% Notes due 2023 (together, the "2023 Notes") and (ii) an initial U.S.$750,000,000, an additional
U.S.$1,000,000,000 and an additional U.S.$ 41,000,000 of its 9.650% Notes due 2026 (together, the "2026 Notes", and together with the
2023 Notes, the "Original Notes").

The Republic is issuing (i) an additional U.S.$610,359,000 aggregate principal amount of its 8.750% 2023 Notes (the "Additional 2023
Notes"), and (ii) an additional U.S.$611,870,000 aggregate principal amount of its 9.650% Notes due 2026 (the "Additional 2026 Notes", and
together with the Additional 2023 Notes, the "Additional Notes"). The Additional Notes will be additional notes issued under each
respective Indenture. Each series of Additional Notes will have identical terms and conditions as its respective series of Original Notes, other
than issue date and issue price, and each will be consolidated and form a single series with their respective series of Original Notes (the
Additional Notes and the Original Notes, together the "Notes"). Each series of Additional Notes will vote together as a single class with its
respective series of Original Notes. Upon issuance of the Additional Notes, the aggregate principal amount of (i) 2023 Notes will be
U.S.$2,485,627,000, and (ii) 2026 Notes will be U.S.$2,402,870,000.

This Offering Circular Supplement (the "Supplement") is supplemental to and should be read in conjunction with (i) the Offering Circular
dated May 30, 2017, and its supplements dated October 11, 2017 and May 29, 2019, with respect to the 2023 Notes (the "2023 Offering
Circular"), and (ii) the Offering Circular dated December 13, 2016, and its supplements dated January 13, 2017 and October 11, 2017, with
respect to the 2026 Notes (the "2026 Offering Circular", and together with the 2023 Offering Circular, the "Offering Circulars"), attached as
Appendix A and Appendix B, respectively, to this Supplement. Terms defined in the Offering Circulars shall have the same meaning in this
Supplement. With effect from the date of this Supplement, the information appearing in the Offering Circulars shall be amended and/or
supplemented in the manner described in this Supplement.

There is currently no public market for the Additional Notes. Application has been made to list the Additional Notes on the Official List of
the Luxembourg Stock Exchange and to have the Additional Notes admitted to trading on the Euro MTF Market. This Supplement, together
with the Offering Circulars, constitutes a prospectus for the purpose of the Luxembourg Law dated July 16, 2019 on prospectuses for
securities, as amended. The Additional Notes are and will be issued in registered form and, in limited circumstances, definitive form in
minimum denominations of U.S.$200,000 and integral multiples of U.S.$1,000 in excess thereof.

See "Risk Factors" section of this Supplement regarding certain risk factors you should consider before investing in the Additional
Notes.
___________________
Additional 2023 Notes Price: 107.291% plus accrued interest from June 2, 2019 to but excluding August 6, 2019
Additional 2026 Notes Price: 107.026% plus accrued interest from June 13, 2019 to but excluding August 6, 2019

Delivery of the Additional Notes was made on or about August 6, 2019.

The Additional Notes have not been and will not be registered under the Securities Act of 1933, as amended (the "Securities Act").
The Additional Notes may not be sold within the United States or to U.S. persons except to qualified institutional buyers in reliance
on the exemption from registration provided by Rule 144A under the Securities Act and may be offered and sold to certain persons
in offshore transactions in reliance on Regulation S under the Securities Act ("Regulation S"). There are no Additional Notes being
offered and sold in the United States or to U.S. persons.

The Additional Notes will be represented by one or more permanent global notes in fully registered form without interest coupons, deposited
with a common depositary for Euroclear Bank S.A./N.V. ("Euroclear") and Clearstream Banking, société anonyme ("Clearstream").
Beneficial interests of Euroclear participants in the global notes will be shown on, and transfers thereof between Euroclear participants will
be effected only through, records maintained by Euroclear and its direct and indirect participants, including Clearstream.

ANY OFFER OR SALE OF NOTES IN ANY MEMBER STATE OF THE EUROPEAN ECONOMIC AREA (THE "EEA") THAT HAS
IMPLEMENTED PROSPECTUS REGULATION (EU) 2017/1129 (THE "PROSPECTUS REGULATION") MUST BE ADDRESSED TO
QUALIFIED INVESTORS (AS DEFINED IN THE PROSPECTUS REGULATION).

The date of this Supplement is August 9, 2019.

IN MAKING AN INVESTMENT DECISION, INVESTORS MUST RELY ON THEIR OWN
EXAMINATION OF THE REPUBLIC OF ECUADOR AND THE TERMS OF THE OFFERING,
INCLUDING THE MERITS AND THE RISKS INVOLVED.
Investors should rely only on the information contained in the Offering Circulars and this
Supplement or to which the Republic of Ecuador has referred them. Ecuador has not authorized anyone to
provide information that is different from the information contained in the Offering Circulars and this
Supplement. This Supplement and the Offering Circulars may only be used where it is legal to sell these
Additional Notes. The information in this Supplement may only be accurate on the date of this Supplement.
This Supplement may only be used for the purposes for which it has been published.
_________________
TABLE OF CONTENTS
Page

THE ADDITIONAL NOTES OFFERING .............................................................................................................. 1
RISK FACTORS .................................................................................................................................................... 4
Risk Factors Relating to the Additional Notes ........................................................................................... 4
Risk Factors Relating to Ecuador .............................................................................................................. 7
USE OF PROCEEDS ........................................................................................................................................... 22
THE REPUBLIC OF ECUADOR ......................................................................................................................... 23
Territory, Population and Society ............................................................................................................ 23
Pedernales Earthquake ............................................................................................................................ 24
Historical Background ............................................................................................................................ 26
Form of Government .............................................................................................................................. 26
Memberships in International Organizations and International Relations .................................................. 39
THE ECUADORIAN ECONOMY ....................................................................................................................... 46
Gross Domestic Product .......................................................................................................................... 46
Economic and Social Policies.................................................................................................................. 49
Strategic Sectors of the Economy ............................................................................................................ 68
Other Sectors of the Economy ................................................................................................................. 82
LEGAL PROCEEDINGS ..................................................................................................................................... 92
BALANCE OF PAYMENTS AND FOREIGN TRADE ..................................................................................... 102
Balance of Payments ............................................................................................................................. 102
Current Account ................................................................................................................................... 106
Capital and Financial Account .............................................................................................................. 107
International Reserves ........................................................................................................................... 108
Foreign Trade ....................................................................................................................................... 109
Foreign Direct Investment ..................................................................................................................... 115
MONETARY SYSTEM ..................................................................................................................................... 118
The Central Bank .................................................................................................................................. 118
Financial Sector .................................................................................................................................... 119
Banking System .................................................................................................................................... 123
Banking Sector ..................................................................................................................................... 127
Cooperative Banks ................................................................................................................................ 128
Capital Markets .................................................................................................................................... 129
Interest Rates and Money Supply .......................................................................................................... 130
Inflation ................................................................................................................................................ 133
PUBLIC SECTOR FINANCES .......................................................................................................................... 135
Overview .............................................................................................................................................. 135
i

Non-Financial Public Sector Revenues and Expenditures ...................................................................... 139
Central Government Revenues and Expenditures ................................................................................... 142
Taxation and Customs........................................................................................................................... 144
Foreign Aid .......................................................................................................................................... 146
Central Government Expenditures ......................................................................................................... 146
2018 and 2019 Budgets ......................................................................................................................... 147
PUBLIC DEBT .................................................................................................................................................. 148
General ................................................................................................................................................. 148
External Debt ....................................................................................................................................... 150
Internal Debt......................................................................................................................................... 157
Methodology for Calculating the Public Debt to GDP Ratio .................................................................. 159
Review and Audit by the Office of the Comptroller General .................................................................. 161
Organic Law for Productive Development, Investment, Employment and Fiscal Stability ...................... 163
IMF's Extended Fund Facility ............................................................................................................... 165
Debt Obligations ................................................................................................................................... 168
PLAN OF DISTRIBUTION ............................................................................................................................... 184
Notice to Ecuadorian Residents ............................................................................................................. 184
VALIDITY OF THE ADDITIONAL NOTES .................................................................................................... 185
GENERAL INFORMATION ............................................................................................................................. 186

APPENDIX A - Original Offering Circular dated May 30, 2017, and its supplements dated October 11, 2017 and
May 31, 2019, with respect to the 2023 Notes.

APPENDIX B - Original Offering Circular dated December 13, 2016, and its supplements dated January 13, 2017
and October 11, 2017, with respect to the 2026 Notes.
_________________

ii

The Additional Notes will be general, direct, unsecured, unsubordinated and unconditional obligations of
Ecuador, will be backed by the full faith and credit of Ecuador and will rank equally in terms of priority with
Ecuador's External Indebtedness (other than Excluded Indebtedness), as defined in "Description of the Notes" in
each Offering Circular, provided that such ranking is in terms of priority only and does not require that Ecuador
make ratable payments on the Additional Notes with payments made on its other External Indebtedness.
The Additional Notes will be issued in registered form only. Additional Notes sold in offshore transactions
in reliance on Regulation S under the Securities Act ("Regulation S") will be represented by one or more permanent
global notes in fully registered form without interest coupons (the "Regulation S Global Note") and Additional
Notes sold in the United States, if any, to qualified institutional buyers (each a "qualified institutional buyer") as
defined in, and in reliance on, Rule 144A under the Securities Act ("Rule 144A") will be represented by one or more
permanent global notes in fully registered form without interest coupons (the "Restricted Global Note" and, together
with the Regulation S Global Note, the "Global Notes"), in each case deposited with a common depositary for, and
registered in the nominee name of a common depositary for Euroclear for the respective accounts at Euroclear as
such subscribers may direct. Beneficial interests of Euroclear participants (as defined under "Book-Entry Settlement
and Clearance" in each Offering Circular) in the Global Notes will be shown on, and transfers thereof between
Euroclear participants will be effected only through, records maintained by Euroclear and its direct and indirect
participants, including Clearstream. Except as described herein, definitive Additional Notes will not be issued in
exchange for beneficial interests in the Global Notes in each relevant Offering Circular.
The Republic has taken reasonable care to ensure that the information contained in this Supplement is true
and correct in all material respects and not misleading as of the date hereof, and that, to the best of the knowledge
and belief of the Republic, there has been no omission of information which, in the context of the issue of the
Additional Notes, would make this Supplement as a whole or any information included in this Supplement,
misleading in any material respect. The Republic accepts responsibility accordingly.
This Supplement does not constitute an offer by, or an invitation by or on behalf of, the Republic to
subscribe to or purchase any of the Additional Notes. Each recipient will be deemed to have made its own
investigation and appraisal of the financial condition of the Republic. The distribution of this Supplement or any
part of it and the offering, possession, sale and delivery of the Additional Notes in certain jurisdictions may be
restricted by law. Persons into whose possession this Supplement comes are required by the Republic to inform
themselves about and to observe any such restrictions. See "Transfer Restrictions" in each Offering Circular for a
description of further restrictions on the offer, sale and delivery of Additional Notes, the distribution of this
Supplement, and other offering material relating to the Additional Notes.
Each purchaser of the Additional Notes sold outside the United States in reliance on Regulation S will be
deemed to have represented that it is not purchasing the Additional Notes with a view to distribution thereof in the
United States. With respect to the offer and sale of the Additional Notes by the Republic, no Additional Notes will
be offered and sold in the United States or to U.S. persons.

THE ADDITIONAL NOTES OFFERING
The following summary does not purport to be complete and is qualified in its entirety by, and is subject to,
the detailed information appearing elsewhere in this Supplement and in the attached Offering Circulars, in
particular in the sections entitled the "Offering" and "Description of the Notes" in each attached Offering Circular.
Each series of Additional Notes will have identical terms and conditions as its respective series of Original Notes,
other than the issue date and issue price as described below.
Issuer:
The Republic of Ecuador.
Additional Notes Issue Amount:
Additional 2023 Notes: U.S.$610,359,000. Upon issuance of the
Additional 2023 Notes, the aggregate principal amount of the 2023 Notes
will be U.S.$2,485,627,000.
Additional 2026 Notes: U.S.$611,870,000. Upon issuance of the
Additional 2026 Notes, the aggregate principal amount of the 2026 Notes
will be U.S.$2,402,870,000.
Securities Offered:
U.S.$610,359,000 principal amount of 8.750% notes due 2023.
Consolidated with and forming a single series, from and including the
Issue Date, with the 2023 Notes issued originally on June 2, 2017 and
reopened on October 16, 2017, and on May 29, 2019, in the aggregate
principal amount of U.S.$1,875,268,000.
U.S.$611,870,000 principal amount of 9.650% notes due 2026.
Consolidated with and forming a single series, from and including the
Issue Date, with the 2026 Notes originally issued on December 13, 2016,
and reopened on January 13, 2017 and on October 16, 2017, in the
aggregate principal amount of U.S.$1,791,000,000.
Issue Format:
Rule 144A/Regulation S; however, with respect to the offer and sale of the
Additional Notes by the Republic, no Additional Notes will be offered and
sold in the United States or to U.S. persons.
Issue Price:
For the Additional 2023 Notes, 107.291% plus accrued interest from June
2, 2019 to but excluding August 6, 2019, which equals U.S.$15.555556
per U.S.$1,000 principal amount of 2023 Notes for a total of
U.S.$1,088.465556.
For the Additional 2026 Notes, 107.026% plus accrued interest from June
13, 2019 to but excluding August 6, 2019, which equals U.S.$14.206944
per U.S.$1,000 principal amount of Notes for a total of
U.S.$1,084.466944.
Issue Date:
August 6, 2019.
Maturity Date:
2023 Notes: June 2, 2023.
2026 Notes: December 13, 2026.
1

Interest:
2023 Notes: 8.750% per annum, computed on the basis of a 360-day year
of twelve 30-day months.
2026 Notes: 9.650% per annum, computed on the basis of a 360-day year
of twelve 30-day months.
Interest Payment Dates:
2023 Notes: Each June 2 and December 2, commencing on December 2,
2019.
2026 Notes: Each June 13 and December 13, commencing on December
13, 2019.
Form:
The Additional Notes will be represented in the form of global notes,
without coupons, registered in the nominee name of the common
depositary for Euroclear and Clearstream for the accounts of its
participants. Additional Notes in definitive certificated form will not be
issued in exchange for the global notes except under limited
circumstances.
Denominations:
The Republic will issue the Additional Notes only in denominations of
U.S.$200,000 and integral multiples of U.S.$1,000 in excess thereof.
Ranking:
The Additional Notes will be general, direct, unsecured, unsubordinated
and unconditional obligations of Ecuador, will be backed by the full faith
and credit of Ecuador and will rank equally in terms of priority with
Ecuador's External Indebtedness (other than Excluded Indebtedness),
provided, that, such ranking is in terms of priority only and does not
require that Ecuador make ratable payments on the Additional Notes with
payments made on its other External Indebtedness.
Use of Proceeds:
The Additional Notes are being issued for the purpose of a substitution
with CS Reopened Notes in accordance with the provisions of the October
2018 CS-Ecuador Repurchase Transaction (defined in this Supplement), as
further described in "Use of Proceeds" on page 22 of this Supplement and
"The Republic of EcuadorPublic DebtCS Repo Transaction" on page
176 of this Supplement.
Trustee, Registrar and Transfer
The Bank of New York Mellon.
Agent:
London Paying Agent and Account The Bank of New York Mellon, London Branch.
Bank:
Luxembourg Listing Agent and
Luxembourg Paying Agent:
The Bank of New York Mellon SA/NV, Luxembourg Branch.
2

Governing Law:
The Additional Notes will be governed by the laws of the State of New
York, except for the terms concerning submissions to arbitration which
will be governed by English law.
Further Issues:
The Republic may, from time to time, without the consent of the holders
of the Additional Notes, create and issue additional notes having the same
terms and conditions as the Additional Notes in all respects (or in all
respects except for the amount of the first interest payment and the issue
price) provided that:
(a)
the notes are consolidated and form a single series with
the outstanding Notes, and
(b)
such additional notes do not have, for purposes of U.S.
federal income taxation, a greater amount of original
issue discount than the outstanding Additional Notes
have as of the date of the issue of such additional notes
(regardless of whether any holders of such Notes are
subject to U.S. federal income taxation).
3

RISK FACTORS
This section describes certain risks associated with investing in the Additional Notes. Investors should
consult their financial and legal advisors about the risk of investing in the Additional Notes. Ecuador disclaims any
responsibility for advising investors on these matters.
Risk Factors Relating to the Additional Notes
There may be no active trading market for the Additional Notes, or the trading market for the Additional
Notes may be volatile and may be adversely affected by many factors.
The Additional Notes did not have any established trading market when issued, and there can be no
assurance that an active trading market for the Additional Notes will develop, or, if one does develop, that it will be
maintained. If an active trading market for the Additional Notes does not develop or is not maintained, investors
may not be able to sell their Additional Notes easily or at prices that will provide them with a yield comparable to
similar investments that have a developed secondary market, and the market or trading price and liquidity of the
Additional Notes may be adversely affected. Even if a trading market for the Additional Notes develops, the
Additional Notes may trade at a discount to their initial offering price, depending upon prevailing interest rates, the
market for similar securities, general economic conditions, and the financial condition of Ecuador. Although
application has been made to list the Additional Notes on the Official List of the Luxembourg Stock Exchange, and
to have the Additional Notes admitted to trading on the Euro MTF Market, there can be no assurance that such
application will be accepted or that an active trading market will develop. Illiquidity may have a material adverse
effect on the market value of the Additional Notes.
The price at which the Additional Notes will trade in the secondary market is uncertain.
Application has been made to list the Additional Notes on the Official List of the Luxembourg Stock
Exchange and to have the Additional Notes admitted to trading on the Euro MTF Market. No assurance can be
given as to the liquidity of the trading market for the Additional Notes. The price at which the Additional Notes will
trade in the secondary market is uncertain.
The Additional Notes contain provisions that allow the payment terms to be amended without the consent of
all holders.
The Additional Notes contain provisions, commonly known as "collective action clauses," regarding
acceleration of the applicable series of Notes and voting on future amendments, modifications and waivers to the
terms and conditions of such Notes. Under these provisions, which are described in the sections entitled
"Description of the Notes--Events of Default" and "Description of the Notes--Modifications--Collective Action"
in the Offering Circulars, Ecuador may: (a) amend the payment provisions of the Notes and certain other reserved
matters with the consent of the holders of 75% of the aggregate amount of the outstanding Notes and other non-
reserved matters with the consent of the holders of 66 % of the aggregate amount of the outstanding Notes; (b) make
reserved matter modifications affecting two or more series of debt securities with the consent of (x) holders of at
least 66% of the aggregate principal amount of the outstanding debt securities of all series that would be affected
by that reserved matter modification (taken in aggregate) and (y) holders of more than 50% of the aggregate
principal amount of the outstanding debt securities of each affected series (taken individually); or (c) make reserved
matter modifications affecting two or more series of debt securities with the consent of holders of at least 75% of the
aggregate principal amount of the outstanding debt securities of all affected series (taken in aggregate), provided that
the Uniformly Applicable condition is satisfied.
Recent federal court decisions in the United States create uncertainty regarding the meaning of ranking
provisions and could potentially reduce or hinder the ability of sovereign issuers to restructure their public sector
debt.
4

In litigation in federal courts in New York captioned NML Capital, Ltd. v. Republic of Argentina, the U.S.
Court of Appeals for the Second Circuit ruled on August 23, 2013 that the ranking clause (which included ratable
payment language) in certain defaulted notes issued by Argentina, prevents Argentina from making payments in
respect of new performing notes that it issued in exchange for the defaulted notes in a restructuring in which a
certain minority of holders elected not to participate, unless it makes pro rata payments in respect of the defaulted
notes that rank pari passu with new notes. The defaulted notes in this case did not contain the "collective action
clauses" referred to in the preceding risk factor. While the U.S. Court of Appeals for the Second Circuit's decision
was narrowly tailored to the facts of the case, including the conduct of Argentina and the specific wording of the
pari passu clause in the defaulted notes, the implication from this case is that it may be more difficult for sovereign
debtors to restructure their debts.
On February 18, 2014, the Republic of Argentina filed a petition in the U.S. Supreme Court seeking review
of the Second Circuit's August 2013 ruling. On June 16, 2014, the U.S. Supreme Court denied the Republic of
Argentina's petition for review, thereby letting stand the Second Circuit's August 2013 ruling. On July 22, 2014,
the U.S. District Court for the Southern District of New York enforced the ruling and barred the international trustee
from making a U.S.$539 million payment to bondholders of the new performing notes that Argentina issued in
exchange for the defaulted notes. On the same date, the U.S. District Court ordered Argentina to undergo
continuous mediation and settlement talks with holders of the defaulted notes.
On June 16, 2014, the U.S. Supreme Court issued an opinion in a related case, ruling that the Republic of
Argentina is not immune from complying with a judgment creditor's discovery demands seeking information about
its assets outside the United States. On August 11, 2014, the U.S. District Court for Nevada granted NML Capital,
Ltd's motion to compel discovery of information regarding Argentine assets in the United States.
On February 25, 2015, the U.S. District Court for the Southern District of New York ordered Deutsche
Bank and JPMorgan Chase and Co. to deliver the documents relevant to Argentina's planned new issuance of dollar-
denominated debt to the court and NML Capital, Ltd.
On December 10, 2015, Mauricio Macri became the new president of Argentina. Under his administration,
Argentina negotiated and reached settlements with a group of holdout creditors for U.S.$1.35 billion on February 2,
2016, and a group of six other holdout creditors for U.S.$1.1 billion on February 18, 2016. On February 19, 2016,
the U.S. District Court lifted its ban on payments to creditors on the condition that Argentina repeal two laws
enacted for the purpose of blocking agreements with holdout creditors and agree to pay remaining holdouts by a
certain date. Argentina's congress repealed the two laws on March 31, 2016. The U.S. Court of Appeals for the
Second Circuit voted to confirm the lifting of the ban on April 13, 2016. Argentina proceeded with a sale of
U.S.$16.5 billion in sovereign bonds on April 19, 2016.
On December 22, 2016, the U.S. District Court for the Southern District of New York issued an opinion
dismissing claims by certain institutional investors that had not participated in the February 2016 settlements,
rejecting their claims based upon the breach of the pari passu clause and any claims that accrued outside of the six-
year statute of limitations. In this new decision, the U.S. District Court held that Argentina's payments to creditors
who participated in the settlement were not a violation of the rights of the non-settling investors. The U.S. District
Court also found that even if the pari passu clause had been breached, monetary damages would be barred as
duplicative of the damages from failure to pay, and an injunction would be granted only in extraordinary
circumstances. The December 22, 2016 decision by the U.S. District Court appears to limit the application of the
prior rulings in the litigation relating to the defaulted notes, although it is difficult to predict what impact, if any, the
December 22, 2016 decision will have on sovereign issuers such as Ecuador.
Despite the above recent developments and settlement agreements between the Republic of Argentina and
its creditors, Ecuador cannot predict what impact, if any, the above U.S. court rulings will have on sovereign issuers
such as Ecuador.
5

The ability of holders to transfer Additional Notes in the United States and certain other jurisdictions will
be limited.
The Additional Notes will not be registered under the Securities Act and, therefore, may not be offered or
sold in the United States except pursuant to an exemption from the registration requirements of the Securities Act
and applicable U.S. state securities laws. Offers and sales of the Additional Notes may also be subject to transfer
restrictions in other jurisdictions. Investors should consult their financial or legal advisors for advice concerning
applicable transfer restrictions with respect to the Additional Notes.
Sovereign credit ratings may not reflect all risks of investment in the Additional Notes.
Sovereign credit ratings are an assessment by rating agencies of Ecuador's ability to pay its debts when
due. Consequently, real or anticipated changes in Ecuador's sovereign credit ratings will generally affect the market
value of the Additional Notes. These credit ratings may not reflect the potential impact of risks relating to structure
or marketing of the Additional Notes. Credit ratings are not a recommendation to buy, sell or hold any security, and
may be revised or withdrawn at any time by the issuing organization. Each agency's rating should be evaluated
independently of any other agency's rating.
The effects of the United Kingdom's vote to exit from the European Union and its impact on the economy
and fiscal conditions of Ecuador and the trading market of the Additional Notes are uncertain.
On June 23, 2016 the United Kingdom voted to leave the European Union in a referendum (the "Brexit
Vote") and on March 29, 2017 the United Kingdom gave formal notice (the "Article 50 Notice") under Article 50 of
the Treaty on European Union ("Article 50") of its intention to leave the European Union.
The timing of the United Kingdom's exit from the European Union remains subject to some uncertainty.
Article 50 provides that the European Union treaties will cease to apply to the United Kingdom two years after the
Article 50 Notice unless a withdrawal agreement enters into force earlier or the two year period is extended by
unanimous agreement of the United Kingdom and the European Council.
The terms of the United Kingdom's exit from the European Union are also unclear and will be determined
by the negotiations taking place following the Article 50 Notice. It is possible that the United Kingdom will leave
the European Union with no withdrawal agreement in place if no agreement can be reached and approved by all
relevant parties before the deadline, as extended. If the United Kingdom leaves the European Union with no
withdrawal agreement, it is likely that a high degree of political, legal, economic and other uncertainty will result.
On March 23, 2018, the European Union announced that an agreement in principle had been reached on a
transition period running from the United Kingdom's withdrawal from the European Union in March 2019 to the
end of 2020, during which the United Kingdom would retain access to the European Union Internal Market and
Customs Union on its current terms. This agreement is only political in nature and will not be legally binding until
any withdrawal agreement is formally agreed and ratified.
On November 25, 2018, the European Council endorsed the withdrawal agreement laying out the terms of
the relationship between the European Union and the United Kingdom during the transition period. Ratification by
the respective European Union and United Kingdom parliaments is required. Under United Kingdom law, the
United Kingdom parliament must hold a "meaningful vote" on the withdrawal agreement before it reaches the
European Union Parliament. On December 11 and 12, 2018, both the President of the European Commission and
the European Union Conference of Presidents, respectively, reconfirmed that the current withdrawal agreement is
the only deal possible. Despite this, on January 15, 2019, the United Kingdom Parliament rejected the proposed
withdrawal agreement. On March 12, 2019, the United Kingdom Parliament held another `meaningful vote' and
once again rejected the proposed withdrawal agreement. In days following the vote, the United Kingdom
Parliament voted in favor of requesting the European Union a short deadline extension. On March 21, 2019, the
European Union agreed to extend the deadline until May 22, 2019, provided the United Kingdom Parliament
approved the withdrawal agreement by April 12, 2019. Not having approved the withdrawal agreement, on April 11,
2019 a new deadline extension until October 31, 2019 was agreed between the European Union and the United
6