Doing business in Colombia

Colombia is a unitary republic with a codified civil-law system. Key authorities for an incoming business are the DIAN (tax and customs), the chambers of commerce (company registration), the Banco de la República (exchange regime and foreign investment registration), the Superintendencia de Sociedades (companies and insolvency), the Superintendencia Financiera (financial sector), the SIC (competition, data protection and industrial property) and the Ministry of Labour. ProColombia promotes investment.

Key facts

Corporate income tax

35% general rate, with a 15% minimum effective rate

VAT

19% standard rate

Dividends to non-residents

20% withholding on taxed profits

Main entity form

SAS (a single shareholder is enough)

Foreign investment

Equal treatment; registration with the central bank

Exchange regime

Investment, foreign debt and trade in goods through the exchange market

Data protection

Law 1581 of 2012; regulator SIC

New York Convention

In force since 24 December 1979

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Colombia gives foreign investors the same treatment as nationals and bars foreign investment only in defence and security and in handling hazardous waste from abroad. Most foreign investors use a simplified stock company (SAS), registered with the chamber of commerce, which can have a single shareholder.

Key facts

• Foreign investors get the same treatment as nationals; only defence and security and the handling of hazardous waste from abroad are closed.

• The SAS is the usual vehicle: one shareholder is enough, subscribed shares can be paid within two years, and it is registered in the chamber of commerce commercial registry.

• A foreign company with permanent activities in Colombia must register a branch rather than operate directly.

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• Register foreign investment with the central bank so that profits and capital can later be repatriated through the exchange market.

• Ultimate beneficial owners, who must be individuals, are registered in the single registry kept by the DIAN; naming the parent company is not enough.

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Colombia's general corporate income tax rate is 35%, with surcharges for financial institutions and oil and coal producers and a 15% minimum effective tax rate applying since 2023. Dividends paid abroad out of taxed profits bear 20% withholding, VAT is 19%, and municipalities levy an industry and commerce tax on revenue. VAT and excise taxpayers must use electronic invoices.

Key facts

• Plan on 35% corporate tax and check whether the 15% minimum effective tax rule triggers a top-up.

• Dividends to foreign shareholders bear 20% withholding, unless a treaty reduces it.

• VAT is 19%, and the municipal ICA turnover tax adds a local layer that varies by city.

• VAT and excise taxpayers must issue electronic invoices, and payroll expenses also need electronic support to be deductible.

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Key facts

• The working week has been 42 hours since 15 July 2026; rosters, overtime and pay need to reflect it.

• Total employment cost includes pension (12% employer, 4% employee), health (8.5% employer only above ten minimum wages, 4% employee) and 9% of payroll levies.

• The 2025 labour reform makes work from 7.01pm night work and sets night overtime at 75% above the ordinary rate.

Who handles this in ColombiaEmployment, payroll and immigrationContracts and commercial law

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Several Superintendencias regulate company law, finance and industry. Foreigners can generally own real estate.

Key facts

• Free trade zones can lower corporate tax to 20%; outside offshore, onshore and logistics zone companies, this depends on an approved export-oriented plan.

• Government contracts are tendered on SECOP.

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• Foreigners can buy property, but should register the investment with the central bank.

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Colombia has a floating peso and a managed exchange regime: imports and exports of goods, foreign debt, foreign investment and some other operations must be channelled through the regulated exchange market. Registered foreign investment gives access to the exchange market to remit dividends and repatriate capital.

Key facts

• Plan cross-border flows around the exchange market rules: investment, foreign debt, goods trade, guarantees and derivatives go through an exchange intermediary or a registered compensation account.

• Registered foreign investment can remit dividends and repatriate capital through the exchange market, after tax.

• Factor in the 0.4% financial transactions tax on outgoing payments.

• Banks apply detailed SARLAFT due diligence at onboarding, including beneficial ownership.

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Who handles this in ColombiaBanking and capitalPayments and currencyAnti-bribery, sanctions and compliance

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Colombia is a member of the Andean Community and the Pacific Alliance, has a trade promotion agreement with the United States in force since 2012 and a trade agreement with the EU provisionally applied since 2013. Customs is administered by the DIAN, and imports go through the VUCE single window. Food, medicines and cosmetics need sanitary registration with INVIMA.

Key facts

• Andean Community and Pacific Alliance membership, the US agreement (in force since 15 May 2012) and the EU agreement (provisionally applied since 1 August 2013) give wide preferential access.

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• Health products need INVIMA registration before they can be marketed.

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Who handles this in ColombiaCustoms, trade and export controls

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Key facts

• Law 1581 applies broadly, and the SIC actively enforces it.

• Companies and non-profits with total assets above 100,000 UVT must register their databases in the RNBD.

• International transfers need an adequate destination or an exception; transmission agreements with processors are common.

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Industrial property is registered with the SIC under Andean Community Decision 486, and copyright is the responsibility of the Dirección Nacional de Derecho de Autor. Colombia is a member of the Madrid Protocol (since 2012), the PCT and the Paris Convention.

Key facts

• Trademarks and patents are filed with the SIC, under the common Andean regime.

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• Foreign owners can designate Colombia through the Madrid system or enter via the PCT.

• Trademarks last 10 years and can be renewed.

• Copyright matters are handled by the Dirección Nacional de Derecho de Autor.

Who handles this in ColombiaTrade marks, patents and brandsContracts and commercial law

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Insolvency is governed by Law 1116 of 2006 and handled mainly by the Superintendencia de Sociedades. Listed company deals fall under Superintendencia Financiera rules.

Key facts

• Check SIC thresholds early: deals above them need authorisation before closing, with a short-form notification where all relevant market shares are below 20%.

• Distressed deals may proceed within reorganisation proceedings before the Superintendencia de Sociedades.

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• Listed company acquisitions may trigger tender offer obligations.

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Companies face administrative liability for foreign bribery under Law 1778 of 2016, enforced by the Superintendencia de Sociedades, and companies meeting certain criteria must run compliance programmes against money laundering, corruption and transnational bribery. Colombia is a party to the OECD Anti-Bribery Convention.

Key facts

• Check whether the company meets the criteria that make anti-money laundering, anti-corruption and transnational bribery compliance programmes mandatory.

• Domestic anti-corruption rules apply to dealings with public officials and private bribery.

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Commercial disputes go to the ordinary courts, and the Superintendencia de Sociedades also has judicial powers in company disputes. Arbitration is governed by Law 1563 of 2012, whose international part is based on the UNCITRAL Model Law, and Colombia is a party to the New York Convention. Conciliation is common and often a precondition to litigation.

Key facts

• Colombia is a Model Law jurisdiction for international arbitration and a New York Convention state.

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• Foreign judgments need exequatur from the Supreme Court of Justice.

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• The Bogotá Chamber of Commerce centre administers many commercial arbitrations.

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• Expect conciliation before litigation in many cases, and company disputes may go to the Superintendencia de Sociedades.

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Who handles this in ColombiaDisputes and arbitrationContracts and commercial law