Foreign investment

What is the prevailing attitude towards foreign investment?

After decades of prevailing government protectionism in which the developing countries in Latin America imposed strong restrictions and controls, the early 1990s witnessed Colombian economic liberalisation reforms, which provided for national treatment of foreign investors, lifted controls on remittance of profits and capital, and allowed foreign investment in most sectors.

Furthermore, since 1991, and as a result of the enactment of the country’s current Constitution, Colombia has implemented a strategy to promote foreign investment that includes a series of regulatory changes, including the Constitution itself, and the conclusion of various agreements aimed at promoting and protecting foreign investment. The result of these actions has been a significant increase in foreign capital in the country.

Among the relevant changes implemented since 1991, Colombia enacted Law 9 of 1991 empowering the National Economic and Social Policy Council (CONPES), a government consulting agency, to issue regulation in relation to foreign investment. In the same year, CONPES issued Resolution 51, which set the basis for foreign investment regulation in Colombia.

Foreign investment in Colombia has stable regulation developed through laws and decrees, as well as specific resolutions that offer protection and guarantees not only for the investment, but also its origin and the destination to which the foreign capital is directed. Foreign investment in Colombia is governed by the principles of equality in treatment, universality, automaticity and stability, which results in a friendly and favourable environment for investors.

Moreover, the investment regime promotes and guarantees investor confidence through the development of stable investment conditions that are aimed at protecting exchange rights, which are simply rights to re-invest, withdraw, reimburse or capitalise the investment made in Colombian territory. However, in recent years, several investors have brought claims against Colombia under various investment protection treaties. To date, the Colombian government is facing about 12 international arbitration proceedings initiated by major companies and investors seeking compensation for damages under bilateral or multilateral investment treaties. Claimants form a part of the significant sectors of Colombian economy (such as hydrocarbons, mining and telecommunications).

Following the general election in July 2018, Ivan Duque, the former senator from the Democratic Centre party, was elected President of Colombia. As part of his election manifesto, he strongly advocated in favour of promoting the growth of foreign investment into the country. To achieve this, he indicated the importance of regaining investor confidence in the legal system and government agencies by pursuing the following:

  • restricting the Tutela constitutional action - a constitutional action seeking immediate relief of claimant’s fundamental rights - in order to thwart its abusive use;
  • unification of rulings issued by the appeals courts; and
  • regulation for popular consultations with regard to projects of national interest such as hydrocarbon and mining projects.

During the past few years, most foreign direct investment into Colombia has been directed at sectors such as mining and oil. Since the fall in oil prices, business opportunities have diversified at growing rate, with the Central Bank reporting in 2017 that out of US$13.9 billion that entered the country, approximately US$9.8 billion was invested in sectors such as water, gas and electricity, business and financial services, transportation, manufacturing, communications and storage, representing about 70 per cent of foreign direct investment.

What are the main sectors for foreign investment in the state?

The Central Bank recently reported that, as of 2017, the main sectors attracting foreign investment, with a total of US$13.9 billion, compared with the US$13.8 billion reported in 2016, are:

  • oil (US$3.1 billion);
  • transportation, storage and communications (US$3.1 billion);
  • financial services (US$1.6 billion); and
  • manufacturing (US$2.5 billion).

For the first quarter of 2018, foreign investment slightly decreased with a total of US$2.1 billion, compared with US$2.5 billion during the same period in 2017.

According to the Central Bank, the following countries have been Colombia’s main investors since 2017:

  • Spain (US$2.6 billion);
  • the United States (US$2.2 billion);
  • Mexico (US$1.5 billion);
  • Panama (US$1.4 billion); and
  • the United Kingdom (US$1.2 billion).

Is there a net inflow or outflow of foreign direct investment?

Foreign investment in Colombia had a 4.8 per cent increase in 2017 compared with 2016, with a net inflow of US$14.5 billion in 2018, positioning the country as the third host economy in the region. Nevertheless, in contrast to 2016 when Colombia increased its outflow of foreign direct investment by 7.1 per cent, its outflow decreased by a significant 18.3 per cent, decreasing from US$4.5 billion in 2016 to US$3.7 billion, dropping Colombia to the third-largest economy in the region. During the same period, foreign direct investment flows to Latin America and the Caribbean had a 8.3 per cent increase compared to 2016, representing 10.6 per cent of global share.

Investment agreement legislation

Describe domestic legislation governing investment agreements with the state or state-owned entities.

There is no legislation governing investment agreements between foreign investors and the state or state-owned entities. However, on 18 March 2018, the President issued Presidential Order No. 04 that limited international arbitration clauses for commercial arbitration in contracts entered into by state-owned companies. Therefore, unless the director of the National Legal Agency for the Defence of the State specifically issues a favourable concept regarding an international arbitration clause, the international arbitration clause contained in contracts entered into by state entities will be presumed to be domestic instead of international. Further, as of the issuance of Presidential Order No. 4, state-owned companies are barred from entering into arbitration clauses under International Centre for Settlement of Investment Disputes (ICSID) Rules.

International legal obligations

Investment treaties

Identify and give brief details of the bilateral or multilateral investment treaties to which the state is a party, also indicating whether they are in force.

To date, Colombia is a party to eight BITs and eight free trade agreements (FTAs that include investment chapters), for a total of 17 international investment agreements (IIAs). Further, the FTA with Israel has already been approved by Congress and is being studied by the Constitutional Court. The Colombia-United Arab Emirates BIT was signed on 13 November 2017 and is still pending internal approval. Furthermore, there are several other agreements already negotiated and signed but that are not in force yet. The table below shows all BITs and FTAs with investment chapters.


Entry into force

Approving law

Current status

Chapter XVII of the FTA G2 (Mexico and Colombia)


Law No. 172 of 1994

Standing agreement.Decision of constitutionality C-178 of 1995

BIT Peru


Law No. 279 of 1996 (Modifying Protocol Law No. 801 of 2003)

Standing agreement.Decisions of constitutionality C-008 of 1997 and C-961 of 2003

Chapter IX of the Chile FTA


Law No. 1,189 of 2008

Standing agreement.Decision of constitutionality C-031 of 2009

BIT Spain


Law No. 1,069 of 2006

Standing agreement.Decision of constitutionality C-309 of 2007

Chapter XII of the Northern Triangle FTA (Guatemala, El Salvador and Honduras)

Guatemala: 2009 El Salvador: 2010 Honduras: 2010

Law No. 1,241 of 2008

Standing agreement.Decision of constitutionality C-446 of 2009

BIT Switzerland


Law No. 1,198 of 2008

Standing agreement.Decision of constitutionality C-150 of 2009

BIT Peru (broadened)


Law 1,342 of 2009

Standing agreement.Decision of constitutionality C-377 of 2010

Chapter V of the EFTA FTA

Switzerland and Liechtenstein since 1 July 2011. Norway since 1 September 2014. Iceland since 1 October 2014.

Law No. 1,372 of 2010

Standing agreement.Decision of constitutionality C-941 of 2010

Chapter VIII of the Canadian FTA


Law No. 1,363 of 2009

Standing agreement.Decision of constitutionality C-608 of 2010

Chapter X of the United States FTA


Law No. 1143 of 2007 (Protocol of amendment Law 1,166 of 2007)

Standing agreement.Decision of constitutionality C-750 and 751 of 2008

BIT China


Law No. 1,462 of 2011

Standing agreement.Decision of constitutionality C-199 of 2012

BIT India


Law No. 1,449 of 2011

Standing agreement.Decision of constitutionality C-123 of 2012

BIT United Kingdom


Law No. 1,464 of 2011

Standing agreement.Decision of constitutionality C-169 of 2012

BIT Japan


Law No. 1,720 of 2014

Standing agreement.Decision of Constitutionality C-286 of 2015

Chapter 10 of the Pacific Alliance FTA (Colombia, Chile, Mexico and Peru)


Law No. 1,721 and 1,746 of 2014

Standing agreement

FTA European Union (not including the countries that have ratified FTAs with Colombia)

Provisional application since July 2013. Currently stayed by an order of the Constitutional Court

Law No. 1,669 of 2013

Standing agreement.Decision of constitutionality C-335 of 2014

FTA Costa Rica


Law No. 1,763 of 2015

Standing agreement.Decision of constitutionality C-157 of 2016

FTA Panama



Signed on 20 September 2013. Pending internal approval

BIT Korea


Restricted application due to Constitutional Court decision.

Law No. 1,747 of 2014

Standing agreement.Decision of constitutionality C-184 of 2016

FTA Israel


Law No. 1,841 of 2017

Signed on 30 September 2013. Pending internal approval

BIT Belgium and Luxembourg



Signed. Pending internal agreement of all parties

BIT Singapore



Signed on 17 July 2013. Pending internal approval

BIT Turkey



Signed on 28 July 2014. Pending internal approval

BIT France



Signed on 10 July 2014. Pending internal approval

BIT Uruguay



Under negotiation

BIT Qatar



Under negotiation

BIT Azerbaijan



Under negotiation

BIT Russia



Under negotiation

BIT Kuwait



Under negotiation

BIT United Arab Emirates



Signed on 12 November 2017. Pending internal approval

If applicable, indicate whether the bilateral or multilateral investment treaties to which the state is a party extend to overseas territories.

Not applicable.

Has the state amended or entered into additional protocols affecting bilateral or multilateral investment treaties to which it is a party?


Has the state unilaterally terminated any bilateral or multilateral investment treaties to which it is a party?


Has the state entered into multiple bilateral or multilateral investment treaties with overlapping membership?


ICSID Convention

Is the state party to the ICSID Convention?

Yes. On 18 May 1993, Colombia signed the ICSID Convention 1965, followed by its ratification on 15 July 1997 and entering into force on 14 August 1997.

Mauritius Convention

Is the state a party to the UN Convention on Transparency in Treaty-based Investor-State Arbitration (Mauritius Convention)?


Investment treaty programme

Does the state have an investment treaty programme?

The Colombian investment treaty programme was first implemented in 2001 by way of National Council of Economic and Social Policy (CONPES) Document No. 3135, which established policy guidelines for the negotiation of IIAs.

Since the CONPES first addressed the matter of foreign investment in 2001, updates have been issued by it in the form of National Development Plans (NDPs) for the following years:

  • 2002 for NDP 2002 to 2006 (later enacted into Law No. 812 of 2003);
  • 2006 for NDP 2006 to 2010 (later enacted into Law No. 1151 of 2007);
  • 2010 for NDP 2010 to 2014; and
  • 2014 for NDP 2014 to 2018 (later enacted into Law No. 1753 of 2015).

The latest CONPES document, which was issued in 2014 for NDP 2014 to 2018, intended to create public policy that would raise foreign investment protection standards and would encourage and attract foreign investment to the least developed areas of the country.

Regulation of inbound foreign investment

Government investment promotion programmes

Does the state have a foreign investment promotion programme?

The Colombian government actively encourages foreign direct investment (FDI). As a result of the legal reforms undertaken by the Colombian government between 1990 and 1994, which aimed to internationalise and liberalise the economy, FDI became a priority because it was considered necessary for the incorporation of new technologies and the increase in productivity and competitiveness of domestic production. Pursuant to Decree No. 210 of 2003, the promotion of foreign investment is among the objectives and functions of the Ministry of Commerce, Industry and Tourism.

To date, foreign investment is allowed in all sectors of the economy, except for national security and disposal of hazardous toxic waste, where prior government authorisation is needed.

Applicable domestic laws

Identify the domestic laws that apply to foreign investors and foreign investment, including any requirements of admission or registration of investments.

To date, the main laws applicable to foreign investors and foreign investment are as follows:

  • Law No. 9 of 1991 (on foreign exchange);
  • Law No. 31 of 1991 (on the nature and functions of the Central Bank);
  • Decree No. 1,735 of 1993 (on foreign exchange regulations);
  • Decree No. 2,080 of 2000 and its amendments (general regime of foreign investment in Colombia and of Colombian investment abroad);
  • Decree No. 2245 of 2011 (on the penalty regime and exchange administrative proceeding applicable by the foreign exchange authority);
  • Decree No. 1939 of 2013 (on how to address investment-related disputes);
  • Resolution No. 305 of 2014 of the Ministry of Commerce, Industry and Tourism (establishing the proceedings to address international invested-related disputes);
  • External Resolution No. 8 of 2000 of the Board of Directors of the Central Bank and its amendments (complements the Foreign Exchange Regime);
  • Regulatory Circular DCIN-83 (Chapter 7) (updated on 25 May 2018); and
  • Decree No. 119 of 2017 (the most recent decree regulating foreign investment).

In addition, the Constitution protects private ownership (article 58) and expressly indicates that investment in Colombia receives the same treatment as an investment made by Colombian nationals (article 100).

Relevant regulatory agency

Identify the state agency that regulates and promotes inbound foreign investment.

Although not a government agency per se, Procolombia is the government entity that promotes international tourism, foreign investment and non-traditional exports in Colombia. Procolombia assists foreign companies and investors that want to participate in the Colombian market and addresses specific needs, such as identifying contacts in the public and private sectors, organising visit agendas, and accompanying companies during visits to Colombia. All services are free of charge and confidential.

Relevant dispute agency

Identify the state agency that must be served with process in a dispute with a foreign investor.

The Directorate of Foreign Investment and Services at the Ministry of Commerce, Industry and Tourism is the entity that is usually designated in Colombian IIAs as the entity to be served in foreign investment disputes.

Investment treaty practice

Model BIT

Does the state have a model BIT?

Colombia has adopted three model BITs in the past 17 years and were published in 2003, 2006 and 2008. Since 2015, the government has worked on the new model BIT in order to adapt it to the latest updates in international investment law.

The current BIT (2008) can be found at: The principal advantages are:

  • a more detailed definition of investment, excluding procedural matters from the most favoured nation clause;
  • it extends the concept of indirect expropriation;
  • it includes clauses advocating greater guarantees of regulatory powers;
  • it confers binding force to the interpretative declarations issued by the treaty parties; and
  • it establishes a statute of limitations.

Preparatory materials

Does the state have a central repository of treaty preparatory materials? Are such materials publicly available?

The Colombian Ministry of Foreign Affairs has a centralised database in which all treaties concluded by Colombia are stored and publicly available. The Ministry’s library in relation to international treaties provides information such as the date the treaty was concluded, the place where the treaty was adopted, ratification and date of entry into force (see: In relation to BITs and FTAs, the Ministry of Commerce, Industry and Tourism has established a website containing information in relation to all preparatory materials of each treaty (see:

Scope and coverage

What is the typical scope of coverage of investment treaties?

Colombia’s BIT model intends to accord protection to investors under the standards of international law, while enabling the state to perform an appropriate defence in case of investor-state arbitration.

Colombia’s foreign investment system comprises direct and portfolio investments from individuals, legal entities or trust holding investment.

Colombia’s BITs and FTAs usually employ an inclusive, board and comprehensive definition for investment, which typically refers and covers ‘every type of asset’ with the generally accepted characteristics of investments such as commitment of capital or other resources, expectation of gain or profit and investor’s assumption of risk.


What substantive protections are typically available?

Pursuant to the Constitution, foreign investment is subject to the same treatment and benefits of national investment. The substantive protection that is typically included in investment treaties to which Colombia is a party are as follows:

  • most favoured nation treatment;
  • national treatment;
  • fair and equitable treatment;
  • full protection and security;
  • prohibition of expropriation without compensation;
  • guarantee of free transfers related to investments; and
  • compensation for losses.

As a matter of policy, Colombia has been consistent in rejecting the inclusion of umbrella clauses in its IIAs. Nevertheless, typical umbrella clauses have been included in some treaties, such as:

  • the Colombia-US FTA (2006);
  • the Colombia-Switzerland FTA (2007); and
  • the Colombia-Japan FTA (2001).

Dispute resolution

What are the most commonly used dispute resolution options for investment disputes between foreign investors and your state?

The most common dispute resolution options for investment disputes are ICSID, United Nations Commission on International Trade Law and ICSID’s additional facility rules.


Does the state have an established practice of requiring confidentiality in investment arbitration?



Does the state have an investment insurance agency or programme?


Investment arbitration history

Number of arbitrations

How many known investment treaty arbitrations has the state been involved in?

Colombia is currently involved in 12 investment treaty arbitrations, all of them are still pending.

The latest request for arbitration was notified by Odebrecht Latinvest Transport Colombia SL on 2 August 2018.

Industries and sectors

Do the investment arbitrations involving the state usually concern specific industries or investment sectors?

Mining, oil and gas, and telecommunications are the prevalent sectors in investor claims.

Selecting arbitrator

Does the state have a history of using default mechanisms for appointment of arbitral tribunals or does the state have a history of appointing specific arbitrators?

To date, and to the best of our knowledge, the Colombian state has not adopted any type of policy or mechanism for the appointment of arbitrators.


Does the state typically defend itself against investment claims? Give details of the state’s internal counsel for investment disputes.

In accordance with Colombian law, the defence of the state’s interests in investment-related disputes corresponds to the Ministry of Commerce, Industry and Tourism. The National Legal Agency for the Defence of the State assists in defending the state. Nevertheless, Colombia has retained external counsel for its representation before different investment-related disputes.

Enforcement of awards against the state

Enforcement agreements

Is the state party to any international agreements regarding enforcement, such as the 1958 UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards?

Colombia is a party to the following international agreements:

  • the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention);
  • the Inter-American Convention on International Commercial Arbitration 1975 (Panama Convention); and
  • the Inter-American Convention on Extraterritorial Validity of Foreign Judgments and Arbitral Awards 1979 (Montevideo Convention).

Award compliance

Does the state usually comply voluntarily with investment treaty awards rendered against it?

To date, there have been no awards rendered against the Colombian state, therefore, there is no indication on whether or not the state will comply voluntarily with an award rendered against it.

Unfavourable awards

If not, does the state appeal to its domestic courts or the courts where the arbitration was seated against unfavourable awards?

There have been no awards issued in any of the cases in which Colombia acts respondent.

Provisions hindering enforcement

Give details of any domestic legal provisions that may hinder the enforcement of awards against the state within its territory.

Under the ICSID Convention, ICSID awards require no recognition in order to be enforceable.

Foreign awards, that is, awards rendered by arbitration tribunals seated outside of Colombia, require recognition under the rules established in Law No. 1,563 of 2012, which essentially replicates the provisions of the New York Convention. It provides that awards are generally enforceable unless the party against which the award was rendered raises claims in relation to either:

(i) the invalidity or nullity of the arbitration agreement;

(ii) the lack of or improper notice of the arbitration proceedings;

(iii) the subject matter of the arbitration whenever the award deals with a difference not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration;

(iv) the composition of the arbitral authority or the arbitral procedure was not in accordance with the agreement of the parties;

(v) the award is not yet binding on the parties;

(vi) the subject matter of the difference is not capable of settlement by arbitration under Colombian law; or

(vii) the recognition or enforcement of the award would be contrary to the public policy of Colombia.

The defences stated in (i) to (v) require the interested party to request the Supreme Court of Justice to deny the recognition and enforcement of the arbitral award. Defences stated in (vi) and (vii) can be declared ex officio.