SALE CONTRACT IN BOLIVIA

ESSENTIAL REQUIREMENTS OF THE SALE CONTRACT IN BOLIVIA

CONTRACTUAL CAPACITY AND LEGAL RESTRICTIONS

The Bolivian Civil Code regulates the sale contract through Articles 584 to 650, establishing its essential components for validity and enforceability. Among the key legal requirements are:

Legal capacity of the parties: Certain individuals are restricted from entering into sale contracts in Bolivia. These include spouses (in specific cases), minors, and interdicted persons.

Specific prohibitions also apply to public servants regarding public assets under their management, government officials for assets sold by their ministries, judicial authorities over disputed assets under their jurisdiction, attorneys for assets involved in ongoing litigation where they represent a party, and agents or guardians administering third-party property.

OBJECT OF THE CONTRACT

The object of the contract must be lawful. Only goods or assets that are legally salable, existing or expected to exist, and clearly identifiable within commercial circulation can be subject to a sale contract in Bolivia.

It is important to clarify that certain goods are excluded from commerce—such as public squares or churches—and thus cannot be sold.

Furthermore, the Civil Code permits the sale of partially or entirely third-party property. In such cases, the seller agrees to acquire and transfer the good to the buyer. If the buyer was unaware of the third-party ownership and the seller failed to disclose it, the buyer may seek contract termination and compensation. If the buyer was aware of the situation, they may only request a refund of the agreed price.

FORMAL ELEMENTS OF THE SALE CONTRACT IN BOLIVIA

Bolivian law prescribes specific formalities depending on the type of asset involved:

REAL ESTATE

Real estate refers to immovable property inherently attached to the ground. For real estate sales, Bolivian law requires a notarized sales agreement, formalized through a public deed before a notary public. To make the transfer of ownership effective against third parties, the buyer must register the transaction with the Real Property Registry (Derechos Reales).

MOVABLE PROPERTY

Movable property includes assets that can be physically transferred. For certain types of movable goods—such as vehicles, aircraft, and vessels—Bolivian law mandates public documentation and registration to ensure legal effects before third parties. Registration must be done as follows:

• Vehicles: with the local municipal government
• Aircraft: with the General Directorate of Civil Aviation
• Vessels: with the Bolivian International Ship Registry

For movable assets not subject to mandatory registration, the sale contract does not require formalization and may be executed privately, verbally, or in any form agreed upon by the parties.

TYPES OF SALE CONTRACTS IN BOLIVIA

SALE WITH RETENTION OF OWNERSHIP

In this type of contract, payment is made in installments. The buyer receives possession of the good, but ownership is transferred only upon completion of the final payment.

SALE OF GENERIC GOODS

Ownership is acquired upon identification of the item, which may be specified at a later stage. A “generic good” refers to items identified by general characteristics of their kind, such as “a quintal of rice,” without brand or quality specifications.

SALE SUBJECT TO SATISFACTION

Here, ownership is transferred once the buyer formally expresses satisfaction with the purchased item.

SALE OF FUTURE GOODS

This contract involves the sale of an asset that does not yet exist but is expected to. According to legal scholar Pastor Ortiz Mattos in “De los bienes y de los modos de adquirir la propiedad”, there are two traditional forms:

• “Venditio rei speratae” (sale of expected goods): If the good does not materialize, the sale is void.
• “Emptio spei” (sale of hope): The buyer assumes the risk and must pay the price regardless of whether the item comes into existence.

SALE OF THIRD-PARTY PROPERTY

This contract covers the sale of an asset not owned by the seller, who nonetheless commits to acquiring and transferring it to the buyer. Ownership is conferred to the buyer once the seller acquires the asset from the actual owner.

Unlike other types of contracts, the sale contract in Bolivia has real effects, meaning that ownership is transferred solely by mutual consent, provided that consent is validly expressed without coercion or error. Delivery of the good is merely a consequence of the contract, representing one of its main obligations. However, to have legal effect against third parties, registration is required for real estate and registrable movable assets.