Colombia Update: Changes in the criteria for the implementation of a Transparency and Ethical Program.

On October 2nd, 2020, the Colombian Superintendence of Companies issued Resolution No 100-006261 (the “Resolution”) modifying the criteria for determining whether a company is obliged or not to implement a “Transparency and Corporate Ethical Program” against international bribery (the “TCE Program”).

According to the Resolution, the new criteria will be effective as of January 1st, 2021. The former criteria and the term for its implementation (Resolutions 100-00657 of July 25th, 2016 and 200-000558 of July 19th, 2018) were revoked.

New criteria

As of January 1st, 2021, the companies that comply with all the following criteria will be obliged to implement a TCE Program:

• The company must be under the surveillance of the Superintendence of Companies.
• The company must have carried out International Businesses or Transactions, directly or through an intermediary, contractor or through a subordinated company or branch, within the immediate previous year.
• The International Businesses or Transactions must be equal or higher (jointly or individually considered) of one hundred (100) monthly legal minimum wages (for 2020 COP$87,780,200 – USD$23,200 approx.), and
• The company must have a total income or total assets equal or higher than forty thousand monthly legal minimum wages (for 2020 COP$35,112,080,000 – USD$9,363,222 approx.).

International Businesses or Transactions

According to the Resolution, the International Businesses or Transactions are understood as “businesses or transactions of any nature with foreign individuals or corporations of public or private law.”

New term for implementation

The companies that as of December 31st comply with the above criteria, must implement a TCE Program no later than April 30th of the following year.

The Superintendence may verify the compliance of this duty at any time.

What’s changed?

The Resolution sets forth the following changes to the current regulation:

• It eliminated the need that the International Businesses or Transactions have been carried out “on a habitual basis”.
• Allows that the International Businesses or Transactions may have been carried out directly by the company and not only through third parties.
• It eliminates the different criteria depending on the economic sector. Therefore, any company that falls within the above criteria will be obliged to comply with this duty, regardless of its economic sector.
• It eliminates the criteria based on the number of direct employees.
• It lowers the amount of income and total assets required for being obliged.
• It reduces the term for the implementation to four (4) months.

Sanctions for not complying

If a company obliged to implement a TCE Program fails to do so within the required term, could face an administrative investigation by the Superintendence of Companies that could lead to the imposition of fines up to two hundred (200) monthly legal minimum wages (for 2020 COP$175,560,400 – USD$46,829 approx.)

By Daniel Berdugo, LLOREDA CAMACHO & CO, Colombia, a Transatlantic Law International Affiliated Firm. 

For further information or for any assistance please contact colombia@transatlanticlaw.com 

Disclaimer: Transatlantic Law International Limited is a UK registered limited liability company providing international business and legal solutions through its own resources and the expertise of over 105 affiliated independent law firms in over 95 countries worldwide. This article is for background information only and provided in the context of the applicable law when published and does not constitute legal advice and cannot be relied on as such for any matter. Legal advice may be provided subject to the retention of Transatlantic Law International Limited’s services and its governing terms and conditions of service. Transatlantic Law International Limited, based at 42 Brook Street, London W1K 5DB, United Kingdom, is registered with Companies House, Reg Nr. 361484, with its registered address at 83 Cambridge Street, London SW1V 4PS, United Kingdom.