Company Registration in Colombia

Legal Structures for Company Registration in Colombia

1. The Colombian Simplified Limited Company (SAS)

The Simplified Limited Company (SAS), also known as a simplified stock company, is a popular and flexible structure for company incorporation in Colombia. Foreign investors and entrepreneurs prefer it.

• Incorporation: Can be incorporated using a private document filed with the local Colombian Chamber of Commerce.
• Requirements: Minimum of one shareholder and one director of any nationality, and a legal representative who must be a permanent resident of Colombia.
• Liability: Liability depends on the amount invested, protecting personal assets.
• Flexibility: Allows flexible company bylaws and governance rules, including an indefinite term of existence.

2. The Colombian Limited Liability Company (Ltda.)

The Limited Liability Company (Ltda.) is preferred for regional partnerships and joint ventures. Its popularity has declined after SAS introduction.

• Incorporation: Requires preparing a public deed and registering with the Colombian Chamber of Commerce.
• Requirements: Minimum two shareholders and maximum 25, two directors of any nationality; a legal auditor is needed if company assets exceed thresholds.
• Liability: Limited to contributions, though tax and labor liabilities depend on partners.

3. The Colombian Public Limited Company (SA)

Preferred by large corporations or companies seeking capital investment through public offerings.

• Incorporation: Must be incorporated through a public deed and registered with the Colombian Chamber of Commerce.
• Requirements: Minimum five shareholders, six directors, and a legal auditor.
• Liability: Limited to the amount contributed to the company.
• Capital: At least one-third of the required capital must be paid for a public limited company.

4. The Colombian Branch Office of a Foreign Company (Sucursal)

A branch office allows foreign companies to operate in Colombia but is not a separate legal entity; it remains part of the parent company.

• Incorporation: Legal resolution by parent company, standardized into a public deed and registered with the Chamber of Commerce.
• Liability: Fully dependent on the parent company.
• Control: Managed by parent company headquarters.
• Ownership: 100% foreign ownership allowed.

5. The Colombian Representative Office of a Foreign Company

Used to expand business operations without conducting commercial activities or generating profit.

• Liability: Entirely upon the parent company.
• Incorporation: Parent company submits incorporation certificate and board resolution authorizing the office.
• Control and Ownership: Controlled by parent company; 100% foreign ownership allowed.
• Restrictions: Cannot conduct profit-generating activities; limited to market research and promotion of parent company services/products.

Key Contributions to the Economy

• Domestic Demand: Strong demand for private consumption and domestic demand, which is the key factor for the economy.
• Services Sector: The services sector in Colombia is the main contributor to the country, also known as the backbone of the economy.
• Agriculture: The agriculture sector, including coffee, banana, and palm oil, has contributed significantly to the economy in early 2025.

Detailed Information on Share Capital

• No Minimum Share Capital: Company registration in Colombia does not have any minimum share capital requirement.
• Payment of Agreed Capital: A minimum of 25% of the agreed capital must be deposited into the company’s corporate bank account.
• Timeline for Payment: Any capital payment for company registration in Colombia or issuance of new shares must be completed within two years of incorporation.
• Recommendations: Enterworld advises registering your company with a specific capital amount. While not mandatory, it helps authorities gain confidence in your business.

Requirements for Foreigners in Colombia

• 100% Foreign Ownership: Foreign entrepreneurs are allowed full ownership of their companies in Colombia without any restrictions.
• Company Registration: Register your foreign company with the Banco de la República to legally operate in the country and enable dividend and capital repatriation.
• Visa and Immigration: If you plan to manage your business operations in Colombia, you must apply for a valid work or investment visa.
• Industry Restrictions: The only restriction on foreign ownership applies to national broadcast television companies, where foreign entities can own up to 40%.
• Legal Representative: All foreign companies must appoint a legal representative who is a permanent resident of Colombia to act on their behalf.

General Corporate Income Tax in Peru

• 15% Minimum Corporate Income Tax: A 15% minimum corporate income tax applies to specific industries, such as agribusinesses and companies with annual income below 1,700 tax units (UIT).
• 35% Corporate Income Tax: The standard corporate tax rate in Peru is 35%, applicable to resident companies, non-resident permanent establishments, and foreign taxpayers earning income sourced in Peru.
• 10% or 0% Corporate Income Tax: Companies operating in the Amazon region engaged in fishing, agriculture, livestock, aquaculture, manufacturing, or tourism may qualify for reduced rates of 15%, 10%, or even 0%, depending on business activity.

Key Responsibilities of a Local Representative in Colombia

• Official Representative: A local representative provides official representation and a legal presence in Colombia, acting on behalf of your company in all formal matters.
• Accountability: The local representative is responsible for ensuring compliance with legal and tax obligations in Colombia and is also accountable for the company’s financial activities.
• Simplifies Operations: Having a legal representative simplifies business operations, allowing foreign owners to manage the company remotely while ensuring ongoing compliance.
• Official Duties: The representative is authorized to sign legal documents, attend official meetings, and assist in opening a corporate bank account for the company.