Category: Uncategorized

The Colombian Commercial Code establishes that in cases where the decision-making power of a company is subject to the will of another person or persons, there exists a “situation of control” that, in accordance with article 30 of Law 222 of 1995, must be registered before the Chamber of Commerce within 30 days following the existence of this situation. In the event that this registration is not carried out within the established time, the Superintendence of Corporations may declare the existence of this “situation of control”, order the corresponding registration and impose fines of up to 200 monthly minimum wages for this omission. However, this authority that the superintendence has to impose fines expires after five (5) years in accordance with the provisions of article 235 of Law 222 of 1995.

In consideration of this, through Official Document 220-003089 of January 14th, 2022, the Superintendence of Corporations reminded companies of their obligation to make this registration in the aforementioned terms, as this is information that serves the public interest. Therefore, the superintendence specified that despite the fact that the possibility of imposing fines expires in time, this term cannot be calculated from the beginning of the breach but from the time it ceases. In other words, the authority that the superintendence has to impose penalties that may be applicable for not complying with this registration duty does not expires after five (5) years starting from when the company failed to make the corresponding registration but from the time the registration is actually made or the “situation of control” ceases to exist.

Thus, it is not possible to conclude that if the “situation of control” was configured more than five (5) years ago and has not yet been registered, there will not be any fines, thinking the authority of the superintendence to enforce them has already expired. On the contrary, while a company continues in breach of its obligation, the imposition of penalties will continue to be possible for five (5) years after the corresponding registration is made or the existence of the “situation of control” ceases.

Remember to fully comply with your company’s legal obligations and avoid the imposition of penalties. In case you have doubts regarding this or any other obligation, at BéndiksenLaw we can advise you. Contact Us.

On January 13th of this year, the Ministries of Labor and Health and Social Protection issued Joint Document No. 004 of 2022, which promotes new preventive measures against the increase in COVID-19 infections that has been occurring in the country due to the spread of the Omicron variant, in order to guarantee the health and biosecurity of workers and to reduce the demand for health services. Thus, new guidelines were issued regarding mandatory isolation that must be complied with immediately by those who have symptoms as well as those who are asymptomatic but have been in close contact with a confirmed case of COVID-19.

Consequently, symptomatic people, regardless of their vaccination status, health risk factors or their age, must isolate themselves for seven (7) days from the onset of symptoms without requiring a diagnostic test which, in accordance with the guidelines for the use of diagnostic tests for COVID-19 in Colombia, are reserved for people over 60 years old, children under three (3) years of age and those with health risk factors. Thus, the onset of symptoms is enough for isolation to be necessary, without this preventing individuals from going to a health care professional to receive attention.

Similarly, people who are asymptomatic but who have had close contact with a confirmed case of COVID-19 and who have not completed their vaccination, should also isolate for a period of seven (7) days from the first day of exposure. In the event that the person cannot perform telework or remote work, they can go to a health care professional who can order the diagnostic test to clarify their situation and avoid the spread of the virus among their co-workers. However, in cases were individuals have completed their vaccination, they need not comply with the isolation order nor have the diagnostic test performed, they must only refrain from participating in events that involve crowds and must avoid close contact with people over 60 years, children under three (3) years or with people who have any risk factor for a period of seven (7) days from the day of exposition.

In summary, this is how the mandatory isolation and diagnostic testing will proceed:

It is important that employers take into account that once the worker complies with this mandatory isolation, they may return to their work activities without it being necessary for them to present a diagnostic test for COVID-19. Lastly, these new measures do not authorize non-compliance with the labor protection measures that have been previously adopted by the Ministry of Labor in terms of employment protection in the context of the health emergency.

At BéndiksenLaw we are aware of the regulatory changes relevant to your company. If you have any questions about how this mandatory isolation operates or any other measure that may affect your company in the framework of COVID-19, please contact us.

On November 17th, the Senate of the Republic of Colombia approved in last debate the Right to Disconnect bill that seeks to guarantee respect of workers’ free time and breaks so that they can fully enjoy these spaces and reconcile personal and family life with work. This bill will enter into force once it is sanctioned by the President and published.

This initiative establishes that employers will not be able to contact their workers for work issues through any means at hours that are not part of the work schedule, nor in workers’ vacations, leaves, permits or breaks. In the event that this is breached, workers may use the means provided by the employer to file the corresponding complaint. However, this does not prevent workers from also resorting to Labor Inspectors, or to the Attorney General’s Office in the case of public servants, considering that the persistent or recurrent infringement of this right may be understood as workplace harassment. Likewise, employers must bear in mind that they may not demand compliance of any type of agreement or pact that does not respect this right and non-compliance by workers may not be considered as a breach of their labor obligations, which is why penalties of any kind or dismissal may not be imposed on those who make use of their right to disconnect.

Additionally, in order to ensure effective compliance with these provisions, a labor disconnection policy must be implemented by all employers. This policy must refer to the way in which this right is guaranteed and exercised and the guidelines regarding the use of Information and Communications Technologies. Likewise, it must establish the means available to workers to file complaints in their own name or anonymously, in case they consider that their right to disconnect from work is being ignored or affected. Such complaints should be dealt with through a special procedure that ensures due process, the resolution of the dispute and the cessation of the breaching conduct.

However, workers and public servants who hold positions of direction, trust and management and those who perform tasks that require their permanent availability, may not benefit from the provisions of this bill. Likewise, employers may contact their workers after working hours or during their rest times when situations of force majeure or fortuitous events required it, during which the continuity of the business and its correct operation are threatened. However, these situations must be duly justified.

At BéndiksenLaw we are aware of the legislative changes relevant to your company. If you have any questions about the application of the right to disconnect from work, please contact us.

In August of this year, the “ongoing business hypothesis” was adopted as a cause for the dissolution of commercial companies, repealing those provisions that referred to losses that reduced the company’s equity by certain percentages, depending on the type of company. With the ongoing business hypothesis, instead of establishing a certain percentage of losses, the intention, but above all the capacity, that the company has to continue with its operations in the future is taken into account, and the highest corporate body is the one called to analyze the situation and make the corresponding decisions regarding the continuity of the company’s operations.

However, on October 28, Decree 1378 of 2021 was issued and it modified the criteria on equity loss and insolvency risks in commercial companies. These new criteria allow directors to monitor the financial situation and make projections of the company in light of specific indicators to determine if there are possible equity losses and / or insolvency risks that must be reported in a timely manner to the highest body of the company.

According to these modifications, in the event that the total assets of the company are less than $0 a loss of equity is to be understood. Likewise, there is a loss of equity when negative profits are obtained in the results of two consecutive corporate years. On the other hand, there will be a risk of insolvency when during two consecutive corporate years a result of less than 1.0 is obtained from dividing current assets by current liabilities for each year. With these indicators, and others that are applicable depending on the business model and the economic sector in which the company does business, directors must determine if calling a meeting of the highest corporate body to decide on the dissolution of the company is necessary.

BéndiksenLaw provides comprehensive legal counsel on corporate issues. If you have doubts regarding any of these issues, do not hesitate to contact us.

Law 2155 of 2021 or the Social Investment Law created an incentive that will be in force until August 2023 that benefits employers that create new jobs in their companies either for young or older people. Accordingly, the National Government will provide a financial contribution equal to 25% of a monthly minimum for each worker between the ages of 18 and 28, 15% of the minimum wage for employing women over 28 years of age and 10% for hiring men over 28 years of age. However, in the case of people over 28 years of age, their income should not exceed three minimum wages.

It should be noted that while this incentive is in force, each employer may only receive a maximum of twelve payments, receiving a monthly payment with the sum total of the contributions corresponding to the number of new employees. Additionally, this incentive will only be compatible with contributions received under the Formal Employment Support Program (“PAEF” in Spanish), provided to those companies that have had a decrease of 20% or more of their income. Additionally, entities that have state ownership of more than 50% and individuals that are classified as Politically Exposed Persons, in accordance with Decree 830 of 2021, will be excluded from this benefit.

In order to access this benefit, employers must file the required paperwork before the bank where they have their bank account, including a form of intention and application as a beneficiary and a certification of having met all requirements. Additionally, social security payments must be up to date and certified since based on the number of workers for which employers have previously paid, the calculation of the number of new workers will be made. Those employers who have met these conditions for the months of September and October, must apply in November to receive this contribution.

If you have any doubts regarding this or any other of the incentives or benefits created by the National Government to guarantee economic reactivation, please contact BéndiksenLaw so that we may help you.

Shortly before the first of three days established to offer and acquire certain goods with Colombian Value Added Tax or “VAT” exemptions, the Superintendence of Industry and Commerce (“SIC”) has issued Authoritative Document No. 006. This document contains instructions to suppliers who will be part of this government initiative, either brick-and-mortar or through electronic commerce, to guarantee the rights of consumers during what is popularly known as “Days Without VAT”.

It is important to remember that this measure will apply only on October 28th, November 19th, and December 3rd of the current year, in accordance with Decree 1314 of 2021. Likewise, the VAT exemption will only apply to certain goods and under the fulfillment of specific requirements with respect to recipients, means of payment, delivery times of the goods acquired, limit of units available, warranties, and invoicing, among others, included in articles 38 and 39 of Law 2155. Considering the above, the SIC issued the following instructions that all suppliers participating in this event must follow:

• They must publish in their shops and/or media information regarding turn order, access links, and prior registration, among others, at least two (2) days prior. Likewise, they must inform if the initial conditions vary and if the buyer will have to incur in expenses that are not included in the benefit of VAT exemption.

• They must also inform the possible date of delivery for products in cases of online purchases and for those products that, for some reason, the buyers cannot immediately take with them. In any case, the delivery date may not exceed two (2) weeks following the purchase.

• Consumers must have access to the advertised price of the products, and it must be specified whether it includes the VAT discount. In addition, both the price of the purchased goods and the VAT discount must always be included in the invoice.

• Promotions, offers or additional incentives can be made on the goods on which the VAT exemption applies, so several discounts may be applied simultaneously but this must always be included on the sales invoice. This way, consumers must be able to fully identify the price of the product without discounts, the value of the discount due to the VAT exemption and the value that corresponds to the promotional or additional discounts offered by the supplier.

• In advertising pieces, both physical and digital, the terms, conditions, and restrictions of the current promotions must be informed, and it must be clarified that the VAT discount does not correspond to an offer by the supplier but is an incentive created by the National Government. As such, they should avoid including phrases or expressions that may mislead, deceive, or confuse buyers.

• The proper processing of consumers’ personal data must be ensured in accordance with Law 1581 of 2012 (Habeas Data) at all times.

• Finally, if suppliers offer their products through brick-and-mortar shops, they must guarantee compliance with all the biosecurity measures established by the National Government and by the corresponding local authorities, mitigating the risk of infection and spread of COVID-19.

If you have any questions related to the protection of consumer rights, please contact BéndiksenLaw for counsel.

On August 25 the Court of Justice of the Andean Community issued a prejudicial interpretation regarding the Claim Against Infringement of Industrial Property Rights and the deadlines that trademark owners must comply with to access this protection. In its interpretation, the Court reminded that the owner of a trademark registration has the right, among others, to prevent third parties from making commercial use of an identical or similar sign, without their authorization, in relation to any product or service when it presents a risk of confusion or association among consumers with respect to the owner of the trademark. In this case, the owner of the trademark may initiate the Claim Against Infringement of Industrial Property Rights. However, it is important to make use of this protection as soon as the infringement becomes known, since in order to protect the principle of legal certainty in the market, this claim expires, as such it is not possible to take legal action at any and all times.

Decision 486 of the Andean Community Commission in its article 244 establishes that this claim has an expiration period of two years from the moment in which the owner of the trademark became aware of the infringement or five years after the infringement was last committed. After the expiration of these terms, the claim becomes unenforceable. In this regard, the Court of Justice of the Andean Community clarified that the two-year term is calculated from the time the rights holder became aware of the infringing act, regardless of the type of infringement in question. On the contrary, for the five-year term the type of infringement committed must be taken into consideration. Consequently, depending on whether it is an instantaneous, continuous, permanent, or complex infringement, the date from which the five years will be calculated varies as follows:

• Since instantaneous infractions require only that a single act that configures the infringement be performed, the term is computed from the moment in which the act is consummated.
• Regarding continuous infringements, which are understood as identical acts that are continuously repeated over time and that are part of a single process, the expiration term is calculated from the date of completion of the last identical act.
• In the case of permanent infractions, or single acts that have a prolonged duration in time, the term of five years is calculated from the moment in which the conduct ceases.
• Finally, complex infringements, which are series of multiple acts whose purpose is to achieve a single purpose, the term is computed from the date of completion of the last act that consummates the infringement.

Finally, it is important to bear in mind that if the owner of the trademark does not initiate the claim within the two-year term from when they became aware of the infringement, they will not be able to resort to the five-year term, since the assumptions that allows its initiation are different. Therefore, if the defendant proves that the owner already knew about the infringement, they may invoke the expiration of the claim which will then be unenforceable, generating the impossibility of resorting to the five-year expiration term.

If you or your company are facing a possible trademark infringement, do not hesitate to contact BéndiksenLaw for assistance.

(Public Accounting Technical Council, Opinion 1080)

The Public Accounting Technical Council issued an opinion that in order to calculate a company’s gross assets, to determine it’s obligation to establish a statutory auditor, all recognized income must be included, made up of oridinary income, financial income, income from the changes in fair value, exchange rate differences, profit from the sale of non-current assets, and other income. As a reminder, Law 43 of 1990 established the obligation to have a statury auditor for all commercial corporations whose gross assets where equal to or exceeded 5,000 minum wages and/or whose gross income was equal to or exceeded 3,000 minum wages in the previous year.

Contact us for more information.

The Ministy of Labor issued an opinion regarding salaries set in foreing currency. The opinion explains that in labor contracts stipulating the salary in a foreing currency is valid. However, due to the general rule that states that transactions in foreign currency which are not exchange operations must be paid in Colombian legal tender, salaries set in foreing currency must be payed in Colombian pesos. As such, the parties may use the representative market rate at the day of payment or a fixed rate set in the labor contract, provided the fixed rate is not set below the representative market rate.

(Superintendence of Corporations, Opinion 220-116049, 10/23/2019)

The Superintendence of Corporations issued an opinion stating that a partner o shareholder cannot act jointly with their attorney at meetings of partners or the shareholders’ assembly. However, this does not mean attorneys cannot be present, but only in their role of advisors and cannot participate or vote in such meetings.