Presidential Decrees Nos. 2,459 and 2,460 (hereinafter, the "Decrees") (Official Gazette No. 40,995 of September 23, 2016) exonerated from income tax liability the Venezuelan source net taxable income that (i) legal entities domiciled or not in Venezuela obtain for the provision of services related to the implementation of Misión A Toda Vida Venezuela and the Comisión por la Paz y la Vida (http://www.misionatodavidavenezuela.gob.ve/), executed by Propatria 2000 Foundation (Decree No. 2,459) and (ii) legal entities domiciled or not in Venezuela and Venezuelan resident individuals obtain for the provision of services related to the execution of projects established in the Emergency Organic Law for Lands And Housing, Gran Misión Vivienda Venezuela (http://www.minhvi.gob.ve/), and Gran Misión Barrio Nuevo Barrio Tricolor (http://www.barriotricolor.gob.ve/) (Decree No. 2,460).

The Decrees entered into force on September 23, 2016 and will apply to the open fiscal years as of that date.

The exoneration established on Decree No. 2,459 will last until September 23, 2018. The Minister of the People's Power for Banking and Finance, in coordination with the Minister of the People's Power of the Presidency Bureau and the Monitoring of the Governance Control will be in charge of the execution of Decree No. 2,459.

The exoneration established on Decree No. 2,460 will last until December 31, 2019. The Minister of the People's Power for Banking and Finance, in coordination with the Minister of the People's Power for Habitat and Housing will be in charge of the execution of Decree No. 2,460.

Decree No. 2,460 established three conditions for the exoneration. The beneficiaries: (i) must comply with the requirements established on Decree No. 2,460; (ii) must register before the National Integrated Service of Customs and Tax Administration and file a request with a certificate provided by the Ministry of the People's Power for the Housing and Habitat certifying that the projects are framed under the Emergency Organic Law for Landing and Housing; and (iii) must destine 100% of the income tax liability to pay direct investments in capital goods necessary to develop and increase their construction capacity, unless it is a temporary legal entity created by foreign investors for a specific housing project. The beneficiaries that do not comply with obligations and requirements established in Decree 2,460 will lose the exoneration.

The Decrees will apply according to the Income Tax Law and its Regulations, taking into consideration the determination of the exonerated income, terms and conditions, requirements and obligations. The beneficiaries must file their annual income tax return with their taxable and exonerated global net income. Losses generated due to the exonerated activity during the validity of the Decrees, cannot be offset against the income derived from taxable activities. When the taxpayer makes taxable and exonerated activities, it must prorate common costs and expenses.