19. In view of the foregoing, the State acknowledged the following facts: 1. The Ecuadorian judicial bodies handed down a criminal judgment of three years imprisonment and a civil penalty of 30 million United States dollars for the commission of the crime of “serious slanderous insult against authority” against the journalist Emilio Palacio Urrutia and the directors of El Universo newspaper, Carlos Nicolás Pérez Lapentti, César Enrique Pérez Barriga and Carlos Eduardo Pérez Barriga (hereinafter "the directors of El Universo newspaper"), for the publication of an editorial article on a matter of public interest. Similarly, a civil judgment of 10 million United States dollars was established against the legal entity that published El Universo. 2. The Ecuadorian State recognizes that the criminal sanction imposed on Emilio Palacio Urrutia and the directors of El Universo newspaper, as well as the civil compensation ordered in the framework of the aforementioned criminal proceedings, were not justified by a social interest imperative, therefore they were unnecessary and disproportionate and, although they were not carried out, they could have had the effect of intimidating those involved in the case. 3. The ambiguity and scope of the Articles of the Criminal Code applied in this case implied a breach of the requirement of strict legality in the imposition of restrictions on the rights to freedom of expression of Emilio Palacio Urrutia and the directors of El Universo newspaper. 4. Articles 489, 490, 491 and 493 of the Ecuadorian Criminal Code, in force at the time of the events, "did not establish clear parameters that could conceptualize the prohibited conduct and its elements," a situation that caused the judges who heard the case to make an interpretation, qualifying the actions of Emilio Palacio Urrutia under the criminal category of serious slanderous insult against public authorities. 5. The framework of the criminal process revealed actions by the Ecuadorian State contradictory to the guarantee of the victims’ right to be judged by an independent and impartial judge or court and their right to defense within the framework of an effective judicial process. Therefore: • The public statements made by then President Rafael Correa Delgado, through state media, placed "the parties in an unequal position, seriously affecting the guarantees of independence and impartiality of the judicial body." “(…) The then President Correa had at his disposal ample space in the media, in official acts and even repeatedly relied on the national network, to defend his positions and even to answer journalists and the media." • The first instance judgment did not clearly specify the configuration of the elements of the criminal offense for which the victims in the case were sentenced. "From the evidence provided, there is no participation of the media outlet’s directors in the preparation of the column, (...) the courts acted arbitrarily by extending criminal liability to those who did not participate, under the criminal code that was (...) in force." • The possibility of criminally prosecuting a legal entity was not clearly and precisely established in the law. Accordingly, the fact that criminal 9

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