Publications

The illusion of exit: Colombia, ICSID, and the politics of investment reform

By Daniel Peña Valenzuela, partner Peña Mancero Abogados

Since the 1990s, Colombia relied on bilateral investment treaties (BITs), ceding partial jurisdictional sovereignty to international arbitration tribunals, especially ICSID.

Withdrawal from ICSID or BITs does not eliminate obligations: survival clauses extend protections for 10–20 years, ensuring ongoing claims and enforceable awards.

Regional precedents (Bolivia, Ecuador, Venezuela) show that denunciation did not prevent litigation or financial liability; states continued to face numerous claims and costly awards.

Academic studies confirm BITs are not decisive in attracting foreign direct investment; structural variables such as economic size, per capita income, and geographic distance matter far more.

Investor-friendly clauses (fair and equitable treatment, umbrella provisions, intellectual property protections) have constrained national sovereignty, limiting policy space in areas like environment, health, and education.

Colombia’s participation in UNCITRAL negotiations since 2017 reflects broader reform efforts, aiming to establish a permanent multilateral investment court with independent judges.

The current debate is more political than practical: withdrawal does not alter the immediate status quo but opens space to reconsider Colombia’s long-term investment policy.

Legal obligations non-profit organizations (ESALES) 2026

OBLIGACIONES-LEGALES ESALES en-US

Legal obligations complete guide to tax, labor, and corporate obligations for the year 2026 in Colombia

Cartilla_Obligaciones_Sociedades_PMA_2026_English

International Arbitral Awards and Their Enforcement: Lessons from Colombia’s Article 28 of Law 2540 (2025) in Comparative Perspective

By Daniel Peña Valenzuela, Partner Peña Mancero Abogado

Introduction

The enforcement of arbitral awards remains one of the most critical dimensions of arbitration, as it determines whether the adjudicatory process achieves practical effectiveness. While the New York Convention (1958) established a global framework for the recognition and enforcement of foreign arbitral awards, national legislations continue to innovate in regulating the execution of domestic and international awards. Colombia’s Law 2540 of 2025, which will enter into force on February 27, 2026, introduces significant reforms in this regard. Article 28 of the statute allows domestic arbitral awards to be executed before the same arbitral tribunal that rendered them, provided the request is made within ten business days of notification. This reform contrasts with the previous regime under Law 1563 of 2012, which required parties to seek enforcement before ordinary courts.

This paper examines the Colombian innovation, situates it within the broader international landscape, and compares it with practices in jurisdictions such as France, the United States, and Singapore. The analysis highlights both the potential efficiencies and the limitations of Colombia’s approach, particularly in relation to international arbitral awards and matters involving public entities.

The Colombian Reform: Article 28 of Law 2540 (2025)

  • Scope of Application: Domestic arbitral awards, conciliations, and settlements approved by arbitral tribunals may be executed before the same tribunal, subject to a strict ten-day deadline.

  • Procedural Mechanism:

    • In tribunals of three arbitrators, the president acts as executor, or another arbitrator in alphabetical order if the president declines.

    • In sole-arbitrator tribunals, the arbitrator may act as executor upon acceptance.

    • If no arbitrator accepts, the arbitration center designates an executor from its roster.

  • Limitations:

    • Execution is only possible if the arbitration agreement expressly provides for an arbitral enforcement procedure.

    • If the deadline lapses, a new arbitral tribunal must be convened to enforce the award.

    • Awards involving public entities or administrative functions are excluded from execution before the same tribunal.

This framework reflects a hybrid model: it strengthens arbitral autonomy while preserving judicial oversight in cases where deadlines expire or public interests are implicated.

Comparative Perspectives

  • France: French law requires arbitral awards to be declared enforceable by the juge de l’exequatur. The arbitral tribunal itself does not execute its award; judicial intervention is mandatory, ensuring uniformity and public control.

  • United States: Under the Federal Arbitration Act (FAA), arbitral awards must be confirmed by federal or state courts to become enforceable judgments. The arbitral tribunal has no role in execution, reflecting a strong reliance on judicial authority.

  • Singapore: The Singapore International Arbitration Act allows for swift enforcement of awards through the High Court, which issues enforcement orders. Efficiency is achieved through streamlined judicial procedures rather than arbitral self-execution.

  • Colombia’s Distinction: Unlike these jurisdictions, Colombia’s reform empowers arbitral tribunals to enforce their own awards, albeit within narrow procedural confines. This innovation seeks to reduce reliance on ordinary courts, but its strict deadlines and exclusions may limit practical effectiveness.

Conclusions

Colombia’s Article 28 of Law 2540 (2025) represents a bold experiment in arbitral self-enforcement. By allowing tribunals to execute their own awards, the reform enhances efficiency and reinforces party autonomy. However, its effectiveness depends on careful drafting of arbitration agreements and strict compliance with procedural deadlines.

Comparatively, most jurisdictions—France, the United States, Singapore—retain judicial involvement as a safeguard, prioritizing uniformity and public oversight over arbitral autonomy. Colombia’s model thus stands out as an innovative but cautious departure, balancing efficiency with limitations.

For international arbitration, the exclusion of awards involving public entities and the continued reliance on judicial enforcement for foreign awards align Colombia with global standards. Yet, the Colombian experiment may inspire debate on whether arbitral tribunals should play a more active role in enforcement, particularly in domestic contexts where efficiency gains are most needed.

PM LEGAL NEWS – JANUARY 2026

Government of Colombia – declaration of economic and social emergency.

The Government of Colombia, through Decree 1390 of December 22, 2025, has declared a State of Economic and Social Emergency across the national territory for an initial period of 30 days, extendable up to 90 days. This extraordinary measure has been adopted to address a severe fiscal deficit and to ensure the availability of resources for healthcare, public security, and disaster response.

The declaration is based on the following considerations:

  1. Increase in the Capitation Payment Unit (UPC) to Health Promotion Entities (EPS).
  2. Recent public order crisis.
  3. Threats and attacks against social leaders, with an estimated impact of COP 2.5 trillion.
  4. Withdrawal of financing bills for 2025 and 2026, which sought to raise COP 12 trillion and COP 16.3 trillion, respectively.
  5. Impact of the winter season, estimated at COP 0.5 trillion.
  6. Pending judicial rulings requiring payment of COP 1.5 trillion.
  7. Overdue contractual obligations amounting to COP 1.6 trillion.
  8. Restrictions on borrowing by the National Treasury.

During the emergency period, the Government is authorized to issue legislative decrees with the force of law. Once the initial term concludes, Congress will exercise political oversight and review the measures within ten days.

Although the decree does not immediately introduce new taxes or modify existing ones, it enables the issuance of decrees that may include fiscal or administrative measures to reduce the deficit. According to official figures, the fiscal deficit closed at 6.7% of GDP in 2024 and is projected to reach 7.1% of GDP in 2025, thereby justifying the declaration.

The Government of Colombia reaffirms its commitment to safeguarding economic stability, protecting social welfare, and ensuring the continuity of essential public services. Citizens and institutions are urged to remain attentive to forthcoming legislative decrees that may be enacted under this emergency framework.

Minimum wage and transportation allowance for the year 2026

Decrees 1469 and 1470, December 29, 2025

The legal monthly minimum wage for 2026 has been set at ONE MILLION SEVEN HUNDRED AND FIFTY THOUSAND NINE HUNDRED AND FIVE PESOS ($1,750,905).

The transportation allowance has been set at TWO HUNDRED FORTY-NINE THOUSAND NINETY-FIVE PESOS ($249,095).

Tax measures for 2026

Decree 1474, December 29, 2025, adopts temporary tax measures within the framework of the State of Economic, Social, and Ecological Emergency declared by the Government, with the objective of addressing the 2026 budget shortfall.

The measures include the following:

  1. Liquor will be subject to a 19% value‑added tax (VAT) on sales.
  2. Taxation of gambling conducted online, whether operated domestically or from abroad, is adjusted.
  3. VAT is excluded for postal traffic related to express deliveries.
  4. Goods for motor vehicles and motorcycles will be taxed at a 19% rate.
  5. The income tax rate applicable to the financial sector will be increased by fifteen percentage points.
  6. A temporary tax is established on the extraction of hydrocarbons and coal within the national territory.
  7. Financial considerations in the form of royalties referred to in Articles 360 and 361 of the Constitution shall not constitute a cost or deduction for taxpayers subject to them.
  8. Provisions regarding the excise tax on cigarettes and manufactured tobacco are added.
  9. Mechanisms are established for the temporary reduction of penalties and interest on arrears for persons subject to tax, customs, and exchange obligations administered by the DIAN, provided full payment is made from the effective date of this decree until March 31, 2026.
  10. The DIAN is authorized to carry out reconciliation processes in administrative litigation proceedings concerning tax, customs, and exchange matters, subject to specified litigation criteria.
  11. A tax for tax normalization is created, applying a 19% rate to assets that were omitted, not included in national tax returns despite a legal obligation to declare them, or that were undervalued.

Regulatory Convergence in the Digital Era: The Impact of the U.S. GENIUS Act on Stablecoins and Colombia’s Decree 1069 on Low-Value Payment Systems

By Daniel Peña Valenzuela, Partner Peña Mancero Abogados

1. Introduction

The rapid evolution of financial technologies has prompted governments worldwide to reassess their regulatory frameworks. This paper examines the intersection between the United States’ GENIUS Act—an ambitious legislative effort to regulate stablecoins—and Colombia’s Decree 1069 of October 2025, which modernizes the country’s low-value payment systems. By analyzing the implications of these two instruments, the paper explores how cross-border regulatory developments influence domestic financial ecosystems, particularly in emerging markets such as Colombia.

The digitization of financial services has catalyzed a paradigm shift in how payments are processed, assets are stored, and trust is established in economic transactions. In response, governments have begun to craft legislation that addresses the challenges and opportunities posed by digital currencies and decentralized payment infrastructures. The GENIUS Act in the United States and Colombia’s Decree 1069 represent two such efforts, each tailored to its respective jurisdiction yet sharing common regulatory aspirations. This paper investigates the potential synergies and tensions between these frameworks and their implications for Colombia’s financial sector.

2. The GENIUS Act: A New Regulatory Framework for Stablecoins

Enacted in July 2025, the GENIUS Act (Guaranteeing Essential National Infrastructure Using Stablecoins) constitutes the first comprehensive federal legislation in the United States aimed at regulating the issuance, circulation, and oversight of stablecoins. Key provisions of the Act include:

  • Mandatory asset backing for stablecoin issuers, with reserves held in highly liquid instruments such as U.S. Treasury securities.
  • Licensing requirements under the Federal Reserve and Securities and Exchange Commission (SEC), depending on the nature of the stablecoin.
  • Obligations for interoperability with existing payment systems and digital wallets.
  • Consumer protection mandates, including transparency in transaction fees, dispute resolution mechanisms, and data privacy safeguards.

The GENIUS Act positions stablecoins as legitimate instruments within the broader financial system, potentially paving the way for their integration into mainstream payment infrastructures. Its extraterritorial influence is particularly relevant for countries with strong financial ties to the U.S. or with significant remittance flows denominated in dollars.

3. Colombia’s Decree 1069: Reforming Low-Value Payment Systems

In October 2025, Colombia’s Ministry of Finance issued Decree 1069, a landmark regulation aimed at enhancing the efficiency, security, and accessibility of low-value payment systems. The decree mandates:

  • Real-time interoperability among financial institutions with over 1.5 million active accounts.
  • Minimum service availability thresholds of 99% per month for payment platforms.
  • Standardized procedures for error correction and fraud mitigation.
  • The establishment of the National Payments Council, a multi-stakeholder advisory body comprising representatives from the public and private sectors.

Decree 1069 reflects Colombia’s commitment to fostering financial inclusion and digital transformation. By prioritizing low-value transactions, the regulation targets the everyday financial needs of consumers and small businesses, which are often underserved by traditional banking models.

4. Points of Convergence: Regulatory Synergies and Strategic Alignment

Despite their distinct scopes and jurisdictions, the GENIUS Act and Decree 1069 exhibit notable areas of convergence. These include:

a. Interoperability as a Strategic Imperative

Both regulations underscore the importance of interoperability. The GENIUS Act requires stablecoins to integrate seamlessly with existing payment networks, while Decree 1069 enforces real-time interoperability among Colombian financial institutions. This shared emphasis facilitates cross-border transactions and lays the groundwork for stablecoin adoption in Colombia’s domestic payment landscape.

b. Consumer Protection and Trust

The GENIUS Act and Decree 1069 both prioritize consumer protection. The former mandates transparency and dispute resolution for stablecoin users, while the latter introduces protocols for error correction and fraud prevention in low-value payments. These provisions are essential for building trust in digital financial services, particularly among populations with limited financial literacy.

c. Institutional Coordination and Governance

The creation of the National Payments Council in Colombia and the dual oversight of stablecoins by U.S. regulatory agencies reflect a broader trend toward collaborative governance. Such institutional arrangements enable regulators to respond dynamically to technological innovations and market developments, while also fostering international dialogue on best practices.

5. Implications for Colombia’s Financial Ecosystem

The GENIUS Act’s enactment has several implications for Colombia, both direct and indirect:

a. Catalyzing Fintech Innovation

The regulatory clarity provided by the GENIUS Act may encourage U.S.-based stablecoin issuers to expand into emerging markets, including Colombia. This could stimulate competition and innovation within the Colombian fintech sector, particularly in areas such as remittances, peer-to-peer payments, and digital savings.

b. Risk of Disintermediation

The proliferation of stablecoins as payment instruments may challenge the traditional role of banks as intermediaries. Decree 1069 seeks to mitigate this risk by compelling banks to modernize their payment infrastructures and offer competitive digital services.

c. Regulatory Gaps and the Need for Harmonization

Colombia currently lacks a dedicated legal framework for stablecoins. The GENIUS Act may serve as a model for future legislation, helping Colombian regulators to define the legal status, operational requirements, and supervisory mechanisms for stablecoin issuers operating domestically.

6. Challenges and Opportunities

Challenges

  • Regulatory Fragmentation: The absence of global standards for stablecoins may lead to jurisdictional conflicts and compliance burdens for cross-border operators.
  • Technological Readiness: Colombian financial institutions must invest in infrastructure upgrades to meet the interoperability and availability standards set by Decree 1069.
  • Public Awareness: The adoption of digital payment instruments requires robust consumer education initiatives to ensure informed usage and risk mitigation.

Opportunities

  • Financial Inclusion: Stablecoins and low-value digital payments can extend financial services to underserved populations, particularly in rural and informal sectors.
  • Cost Efficiency: Digital transactions reduce operational costs for businesses and consumers, enhancing economic productivity.
  • Foreign Investment: A coherent and forward-looking regulatory environment may attract international fintech firms seeking expansion opportunities in Latin America.

7. Policy Recommendations

To capitalize on the regulatory momentum generated by the GENIUS Act and Decree 1069, Colombian policymakers should consider the following actions:

  • Draft a comprehensive stablecoin law, incorporating lessons from the GENIUS Act and tailored to Colombia’s economic and technological context.
  • Strengthen cybersecurity protocols for digital payment platforms, including mandatory audits and incident reporting mechanisms.
  • Promote regional regulatory harmonization, particularly within the Pacific Alliance, to facilitate cross-border financial integration.
  • Launch nationwide financial literacy campaigns, focusing on digital payments, data privacy, and fraud prevention.

Conclusion

The GENIUS Act and Decree 1069 represent pivotal steps in the global and local regulation of digital financial instruments. Their convergence illustrates a shared commitment to modernizing payment systems, enhancing consumer protection, and fostering innovation. For Colombia, the challenge lies in translating these regulatory developments into tangible improvements in financial inclusion, technological resilience, and economic competitiveness. By aligning domestic policy with international best practices, Colombia can position itself as a regional leader in the digital finance revolution.

Colombia: recent case law regarding commercial agency vs distribution contracts

by: Gabriela Mancero-Bucheli

In one of the most recent cases regarding commercial agency agreements in Colombia, the Superior Court of Bogotá clarified that economic risk does not, in itself, exclude the existence of a commercial agency. However, it is a determining factor when accompanied by operational independence, freedom to set prices, and absence of instructions from the contractor.

This article will discuss decision No. 11001 3103 045 2021 00461 01 by the Superior Court of Bogotá issued on May 12, 20251.1

Background of the case

MTBASE S.A.S. filed a lawsuit against SAP Colombia S.A.S., claiming that there was a commercial agency agreement between the two companies with an uninterrupted, continuous, and indefinite term from June 2, 1993, to December 31, 2019.

The plaintiff argued that the essential elements of an agency agreement were present, asserting that it had been entrusted with the promotion and market positioning of the product, in addition to carrying out technical functions associated with the commercialization of software licenses.

First Instance Judgment

The 45th Civil Court of the Bogotá Circuit ruled in favor of the plaintiff, finding that the primary purpose of the contracts was the distribution of software for resale, which could include support and complementary services offered directly by the plaintiff. The Court also noted that no contractual clause imposed agency duties on the plaintiff to act on behalf of the defendant for the purpose of positioning or growing the business in the software market, nor was there evidence that the plaintiff engaged in market development activities for the defendant’s benefit.

Appeal

The plaintiff appealed the first-instance judgment, arguing that, since the commercial agency agreement involved artistic works or creations (software), the legal transaction should have been registered with the National Copyright Office—evidence that the plaintiff never operated as a legal entity separate from the defendant. Furthermore, the technical support provided by the plaintiff to customers was delivered following training by the defendant, suggesting that “there was no distinction between the plaintiff and the defendant from the perspective of customers and the market”.

Superior Court of Bogota’s Analysis

The Superior Court of Bogotá analyzed the evidence and found that, contrary to what the appellant suggests, the case file shows that the contractual behavior of the parties, which lasted for 26 years, is consistent with the nature and content of a distribution contract.

The Court concluded that it was established that the plaintiff assumed the risks inherent in purchasing for resale, thereby undermining both the promotion of another’s business and the receipt of remuneration—elements intrinsic to a commercial agency contract. This was evidenced by sales invoices showing that customers acquired the software licenses directly from the plaintiff. Accordingly, the defendant did not pay commissions to the appellant; rather, its remuneration derived from the difference between the purchase price of the software licenses and the higher resale price charged to the consumers.

The decision stated:

““It is not without reason that case law has emphasized that, ‘although the essential elements of agency have been identified as the permanence or stability of the assignment, the independence of the agent, and the intermediary functions aimed at acquiring, retaining, expanding, or recovering customers for the principal, much of the doctrine agrees that it is the promotion of the conclusion of business—where the principal assumes the economic risk—that constitutes the typical content distinguishing the agency contract from other contractual arrangements, as the other elements may also be present in different types of agreements (…).’ Acting in the name and on behalf of a third party has been highlighted by this Chamber’s case law as the most decisive characteristic in determining whether the contract binding on the parties constitutes a commercial agency agreement. (CSJ, judgment of September 30, 2015, file 2004 00027)”.

The Court also emphasized that there is no written document or supporting evidence to substantiate the plaintiff’s claims. On the contrary, there is ample documentary evidence—including purchase invoices—supporting the first-instance judge’s conclusion that the plaintiff primarily acted by purchasing products from SAP COLOMBIA S.A.S. for resale to third parties.

Furthermore, as previously noted, the evidence shows that MTBASE S.A.S. remained silent for over two decades, thereby implicitly accepting the performance of services characteristic of a software license distribution agreement, rather than those of a commercial agency. This conduct runs contrary to fundamental legal principles, including the prohibition against acting in contradiction to one’s own prior conduct (venire contra factum proprium).

Conclusion

The Court concluded that no commercial agency agreement existed between the parties, as the plaintiff acted as an independent distributor, received no remuneration from the defendant since Its profit was derived not from a commission, but from the margin between the purchase and resale prices, and bore all business risks. Moreover, the plaintiff purchased licenses directly from the defendant and resold them under its own name, without any mandate of representation or direction from the defendant.

The decision clearly emphasized that economic risk is not incidental but an essential element, as its continuous presence precludes the existence of an agency relationship.

Gabriela Mancero-Bucheli, IDI Country Expert for agency and distribution in Colombia
Andrea Sánchez Gallardo

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