There are three common forms of organizing your business in Colombia: a corporation, a limited liability partnership, and a branch or subsidiary of a foreign corporation. The Bogotá Chamber of Commerce’s new program has simplified considerably the process of establishing a business in Colombia. The Chamber developed this program with the support of the Inter American Development Bank (IDB) and several Colombian public and private entities. U.S. firms should obtain legal and tax related advice from a Colombian law firm or accounting firm. The U.S. Commercial Service office has a list of attorneys and accountants on its website: www.buyusa.gov/colombia/en
A branch office of a foreign corporation must operate under the rules applicable to Colombian corporations. Its liability is limited to assigned capital and it must be registered with a Notary Public in its place of domicile. The following documents also must be registered with the Notary Public: copies of the incorporation documents, bylaws, the resolution or act agreeing to the establishment of the branch, and documents providing evidence of the business and legal representation. Be sure to check with your legal representative of the Colombian Embassy in Washington, DC about whether specific documents originating in the United States require an apostille from the Colombian Consulate or Embassy to validate their use in Colombia.
All companies (including branches of foreign companies domiciled in Colombia) must register themselves and their accounting books, meeting minutes, and other required documents by law in the Commercial Register of the chamber of commerce in the cities where they are located.
Companies should follow these additional steps, at a minimum, when establishing a business in Colombia:
- Appoint a legal representative in Colombia who will be responsible for preparing documents and carrying out all necessary steps with a Notary Public and chambers of commerce. There should be a corresponding Act for this appointment that is registered with a Notary Public. This can be a law office.
- Prepare company by-laws (Escritura Pública) and register the entity with a Notary Public, (Notario) stating the purpose of the firm, capital, legal representative, etc. This step takes two to three days and costs approximately 0.0027 percent of the amount of capital being registered. A 16 percent Value-Added Tax (VAT) will be charged.
- Register and legalize the company with a chamber of commerce, which can take up to four days including the time for obtaining an Income Tax Identification Number (NIT). A payment of a 0.7 percent fee on the capital registered plus other minor charges will be charged.
- Complete all other banking and currency operations. There are forms and paperwork with minimum charges and processing time to cover opening bank accounts, foreign currency transfer, etc. In total, it should take no more than three weeks to incorporate a company in Colombia.