Colombia on the move with various international agreements
The Colombian government has been very active in negotiating agreements that enhance its economic expansion, improving incentives to attract foreign investments in a competitive and transparent way following the global trend. In addition to the recent tax reform, the following agreements were recently negotiated:
A Tax Information Exchange Agreement (TIEA) between Colombia and Curaçao will enable Colombia and Curaçao to exchange relevant information. Before it enters into force several steps must be completed within different governmental entities from both countries. The agreement must be approved by the Minister Council of the Government of the Netherlands as well as the Colombian Congress, and then reviewed by its Constitutional Court.
Last month, Colombia and the United States started negotiations to complete a TIEA to provide required tax information between agencies (DIAN and the IRS). The agreement implies that the DIAN could request information about Colombian citizens in the US, and in turn the IRS may seek information about the operations and activities of US tax residents in Colombia.
Colombia also negotiated a commercial trade agreement with the European Union. This agreement is part of Colombia’s policy of economic internationalization aimed at achieving increased growth and economic development through a permanent relationship with the largest trade bloc in the world.
The new Colombian policies and recent tax reforms make it of the utmost importance to use legal structures compatible with current legislation, including structures that take advantage of the tax benefits within the agreements between the various countries. Current negotiations and exchange of information agreements are the prelude to agreements to avoid double taxation, which in turn will enable us to offer our clients more structure options.
