Imagen Key aspects of the tools for foreign direct investment in colombia

Key aspects of the tools for foreign direct investment in Colombia

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Scola Abogados share with you this paper to serve as a presentation of these tools, with the purpose of guiding foreign investors who are thinking of starting businesses in Colombia.

The Executive Order 1644 of 2021 introduces two new tools to the country to facilitate foreign direct investment as follows: (i) The “Ventanilla Única de Inversion” (Business Single Office) – hereinafter VUI – and; (ii) the “Servicio de Facilitación de la Inversión Extranjera Directa” (Assistance Service for Foreign Direct Investment) – hereinafter SIED-.

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The Country has been striving to streamline procedures before its organization, with the purpose to  facilitate management and improving business dynamics.

The forementioned tools serves as part of a policy called “Red Carpet” which is part of a governmental strategy that unites various policies seeking to incentivize foreign investment.

Such as a portfolio of business projects strategic for the development of the Country in, a database with information for the acquisition of supplies.

In line with these eforts, regulations were issued to reduce and expedite procedures in the country, such as the Executive Order 019 of 2012 and Law 2052 of 2020. Along with the creation of the National Competitiveness and Innovation System through Law 1955 of 2019. In fact, it is within the framework of the work carried out by this system that the initiative for the tools subject of this paper.

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Highlighting the case of the “Ventanilla Única Empresarial” (Business Single Office), Executive Order 1875 of 2017. Tool that allows companies to proceed through a single system their procedures before the authorities, finding information and tools to comply with the requirements established by law for their operation.

The forementioned tool serves a similar purpose to that of the ones created by the Executive Order 1644 of 2021. Hence the tools created through the “Red Carpet” policy seek to concentrate the services for foreign investors in one system.

Thus, this Executive Order aims to create the VUI, which fulfills a role similar to that of its predecessor, to the point that it is integrated with it and takes it as a starting point. So, it aims not only to centralize the information, procedures and petitions those foreign investors require or may have, but also to provide a new user experience focused on fulfilling their needs.

The VUI will be a tool that allows the governmental organizations to ofer relevant information to foreign investors in Colombia. Thus, it will serve them by concentrating legal procedures and processes related to their investment in the Country facilitating compliance with local Law.

Therefore, it mainly difers from its predecessor by focusing on an audience that does not know the Colombian regulatory system, and that requires attention in its own language. These are some of the main vows and advantages that the implementation of this tool will bring to the investor.

Colombia is not the first example implementing a tool like the VUI, not even in the Region. Countries like Nicaragua and Costa Rica had already implemented a VUI to serve foreign investors.

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Before continuing with the paper, it is important to solve a question that the reader may have at this point. ¿What is the scope of what Colombian law understands as direct foreign investment? Since it is to that type of investment that the tools subject of this paper were created to facilitate.

The tools created by the Executive Order 1644 of 2021 seek to serve the foreign investor that intends to make business in the Country, becoming part of an existing Colombian compony or creating a new one with the intent of keeping business in the Country.

If the VUI is the tool to centralize the information and petitions of the foreign investor, the SIED corresponds to the governmental organization in charge of operating through the VUI. Therefore, they oversee the response to the petitions submitted by investors.

Thus, the SIED will be provide the investors with a model of stagger attention for the management of the petitions submitted by foreign investors. The investor will issue his petition through the VUI and the SIED will analyze it, and depending on the specialty it will be classified and directed to competent governmental organization.

Hence, the Ministry of Commerce, Industry and tourism with Procolombia will manage the petitions that does not require any special management from a governmental organization that serves the facilitation of foreign investment in Colombia.

The SIED will transfer those petitions that, due to their specialty, must be resolved by a particular entity. Thus, the investor will only have to approach the VUI with his need and wait for a response, since all the burden of determining the organization and the person in charge of solving it will correspond to the SIED.

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The SIED will also promote strategies to further facilitate foreign investment. And at the same time, it will oversee the institutional responses to the petitions of investors. The SIED shall keep record of the responses, analyze them and issue recommendations to the organizations.

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Author: Juan Sebastián Bohórquez.
Contact: [email protected] , [email protected]
Publication date: February 17, 2022.

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