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On July 24, 2025, the Constitutional Court of Ecuador issued Judgment No. 3364-21-EP/25, ruling on an extraordinary action for protection filed by a shareholder against the precautionary measures imposed by the Ecuadorian Social Security Institute’s (IESS).
This decision sets an important precedent on the boundaries of administrative authority and the protection of fundamental rights during enforcement proceedings.
Case Summary:
A former shareholder of a liquidated company filed an extraordinary action for protection against the precautionary measures ordered by the IESS, including a travel ban, as well as against the subsequent judicial decisions that upheld those measures.
The enforcement proceedings began in 2007 to recover unpaid social security contributions. During this process, the IESS enforcement officer extended liability to the company´s shareholders without providing adequate notice or obtaining a judicial decision to lift the corporate veil.
The claimant alleged violations of her rights of freedom of movement, due process, and legal certainty.
After the ordinary courts dismissed her claims, she filed an extraordinary action for protection before the Constitutional Court.
Decision of the Constitutional Court:
The Constitutional Court partially upheld the action, finding that the judgment violated the principle of legal certainty. Liability in enforcement proceedings cannot be extended to shareholders or partners without a prior judicial ruling expressly authorizing the lifting of the corporate veil.
Additionally, the Court confirmed that only judicial authorities may restrict fundamental rights, such as the right to freedom of movement. Therefore, the IESS enforcement officer acted ultra vires by imposing a travel ban without judicial authorization.
Conclusion:
This decision reinforces that public institutions must act strictly within constitutional limits, observing binding precedents and safeguard fundamental rights.
By doing so, the Constitutional Court draws clear boundaries on administrative powers in enforcement proceedings, thereby protecting legal certainty and due process.
© TobarZVS
This publication contains information of general interest and does not constitute legal opinion on specific issues. Any analysis will require legal advice from the Firm.