CHAPTER III : MARKET ENTRY IN COLOMBIA
31 DIAN. The import declaration and the value declaration can be requested at any DIAN
regional office or directly downloaded from the DIAN homepage.62
Beyond these standard procedures, special provisions apply for sensitive products. For many of these, specific import permissions (vistos buenos) have to be requested from the respective government authority.
Table 5. Import Permissions for Sensitive Products
Product Responsible Entity
Precious stones Petroleum products
Ministerio de Minas y Energía www.minminas.gov.co
Dangerous goods Instituto Colombiano de Geología y Minería www.ingeominas.gov.co
Living substances for medical diagnosis Sanitary tissues
Cleaning products Alcohol beverages Human organs
Primary goods for human use or consumption Medical or odontological equipment
Instituto Nacional de Vigilancia de Medicamen-tos y AlimenMedicamen-tos
www.invima.gov.co
Fish products Instituto Colombiano para el Desarrollo Rural www.incoder.gov.co
Animal products and living animals
Biological products for analyzing animal dis-eases
Agricultural inputs and rice
Instituto Colombiano Agropecuario www.ica.gov.co
Products according to Decree 2439 of 1994 Ministerio de Agricultura www.minagricultura.gov.co Art, culture and archaeology Ministerio de la Cultura
www.mincultura.gov.co
Gold Banco de la República
www.banrep.gov.co
Automobiles Ministerio de Transporte
www.mintransporte.gov.co Endangered flora and fauna
Refrigerators
Automobiles and auto parts
Ministerio de Ambiente, Vivienda y Desarrollo Territorial
www.minambiente.gov.co Vigilance and surveillance instruments
Superintendencia de Vigilancia y de Seguridad Privada
www.supervigilanciaprivada.gov.co Ether, acetone and chloroform Dirección Nacional de Estupefacientes
www.dnecolombia.gov.co Dynamite and other explosives Ministerio de Defensa
www.mindefensa.gov.co
Source: Cámara de Comercio de Bogotá.
62 Import declaration: www.dian.gov.co/descargas/Formularios/2009/500-2009.pdf; value declaration www.dian.gov.co/descargas/Formularios/2009/560-2009.pdf.
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Box 7. Import Steps
1. Market and feasibility study on the product to be imported. (Mincomercio)
2. Licenses, authorization and procedures with specific agencies at the Foreign Trade Window: http://www.vuce.gov.co (Mincomercio, electronically)
3. Import registration or licensing at the Foreign Trade Window:
http://www.vuce.gov.co (Mincomercio, electronically)
4. Payment for the item to be imported. This includes a request for a letter of credit, an exchange declaration, a deposit, and registration of the transaction with the Central Bank (Banco de la República), if the financing is for more than six months. A certifying agency must be engaged to issue a certificate of in-spection prior to shipment, if required. (Importer)
5. Dispatch, shipment and delivery of the merchandise to a bonded warehouse.
(Mincomercio, Banks)
6. Inward customs clearance on the part of the importer, the permanent customs user, the customs broker or the bonded warehouse. This includes completion of the Andean Declaration of Value, if the value is USD 5'000 or more, completion of an import declaration, payment of customs duties, presentation of bonded warehouse documents, registration of the documents with DIAN, and physical inspection of the documents and the merchandise, depending on the system.
(Mincomercio, Invima)
7. Release of the item and preservation of the following documents for at least five years: import license or registration, Andean Declaration of Value, import decla-ration, certificate of origin, commercial invoice, certificates and authorizations, inspection certificate, and authorization to conduct import procedures. (Min-comercio)
3. Investment Regulations
In recent years, Colombia has undertaken significant efforts to attract foreign invest-ment. Under the current constitution and investment legislation, foreign investors shall receive the same treatment as Colombians. The Swiss-Colombian Agreement on the Promotion and Reciprocal Protection of Investments and the EFTA-Colombia FTA fur-ther reinforce the national treatment principle.
Colombian legislation on foreign investment is based on four principles:
Equal Treatment: In principle, foreign investments are subject to the same treat-ment as investtreat-ments by Colombian nationals. There is no discriminatory treattreat-ment based on the origin of the investment.
Universality: Foreign investment is permitted in every sector of the economy ex-cept in areas relevant to national security or identified by the National Economic and Social Policy Council (CONPES)63.
Automatic Authorization: Foreign investments do not require prior approval or au-thorization.
63 E.g. defence and national security matters and processing and disposal of hazardous waste not pro-duced within the country.
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Stability: The conditions for repayment of the investment and remittance of profits that are effective when the investment is registered may not be changed in a way that is unfavourable to the investor, unless if international reserves fall below a level equivalent to three months of merchandise imports.
The foreign investment regime has been further eased in September 2008: foreign in-vestors are no longer required to deposit 50% of their portfolio investment at the Co-lombian Central Bank and the two-year minimal investment duration was abolished.64
3.1. Restrictions
Only a few industry-sector-specific investment restrictions remain in force for:
national defence and security
processing and disposal of toxic, hazardous or radioactive waste from third countries
private security
Furthermore, in several sectors, investments are subject to special regulations:
Finance and Insurance: Supervision by the Superintendencia Financiera if the vestment leads to the acquisition of more than 5 or 10% (according to the kind of in-vestment) of an entity.
Hydrocarbons and Mining: Strict foreign exchange regulations apply. Except for eign company branches, all companies are required to bring back to Colombia the for-eign exchange resulting from export of hydrocarbons and mining products.
Television: A foreign investor may not acquire more than 40% of the total corporate capital of a provider of open television service. Furthermore, the possibility to invest in the television sector is conditional on the reciprocal right in the foreign country.
3.2. Registration
All foreign investments have to be registered with the Central Bank of Colombia. Regis-tration procedure is simple and can be conducted by the foreign investor, by his attor-ney or by any other legal representative.
Deadlines and conditions for registration vary depending on the kind of investment and on how it is made. The general rule is that the registration of a foreign investment is au-tomatic upon submitting the foreign exchange statement for international investments to the Foreign Exchange Market Intermediary. When the foreign currency is channeled through a clearing current account, the registration is made upon making the initial de-posit in the account and preparing the foreign exchange statement. In all other cases, it requires the submission of an application and the corresponding support documents to the Central Bank or an application plus evidence that all requirements have been met.65
64 Announcement by the Alta Consejería para la Competitividad y las Regiones of September 1st, 2008.
65 You may find all necessary forms (only in Spanish) on the home page of the Central Bank of Colombia:
https://quimbaya.banrep.gov.co/secinternet/operaciones.jsp?opcion=inversion.
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When selling its investment, the foreign investor must file a tax return statement with an authorized commercial bank and pay the tax accrued on the corresponding opera-tion. A tax return must be filed even if no taxes have to be paid.66
Information for Investors: The Invest in Colombia Corporation (COINVERTIR) pro-motes and facilitates foreign investment in the country by providing current and poten-tial investors with general and up-to-date information on the economy, legal matters and business opportunities. COINVERTIR recently merged with the Colombian Export Promotion Agency (Proexport)67.
Box 8. Foreign Exchange Entitlements and Other Guarantees Foreign investors are entitled to:
Reinvestment of profits or retention as surplus of undistributed profits, with remit-tance rights.
Capitalization of amounts entitled to remittance and originating with obligations derived from the investment.
Foreign remittance, in freely convertible currency, of proven net profits generated regularly by the investment, pursuant to the financial statements presented at the end of each accounting period - on the basis of these statements and the record or contract governing the investment in the case of resources invested directly, and on the basis of the manager's closing accounts in the case of portfolio in-vestments.
Foreign remittance, in freely convertible currency, of sums received from sale of the investment within the country, or from liquidation of the company or the port-folio, or from a reduction in its capital.
4. Labour Regulations
The Colombian legislation sets out rules for three different types of employment con-tracts:
The employment contract for the duration of a specific job is valid for the pe-riod required to carry out a certain temporary assignment.
The employment contract for a fixed period is valid for a specified duration. The initial term of duration of such a contract cannot exceed three years and the non-renewal must be notified within 30 days before its expiration.
The employment contract for an indefinite term of duration is only terminated upon notice by any of the parties. The trial period for this contract may not last more than two months; within this period the employee may be dismissed without previous notice and without legal compensation.
66 For further information on the investment regime in Colombia see Proexport 2008, pp. 3-15.
67 For further information: www.inviertaencolombia.com.co.
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