Colombia client case studies in 2024

• US headquartered IT staffing company establishes a company in Colombia

  Background

  • Our Client, a California based headhunting and staff augmentation company provides IT consulting companies with experts at Project Management, Product Engineering as well as Business Process Outsourcing Services.
  • The Firm already has a strong presence in India and Asia and one entity already setup in Mexico. However, our Client was looking at expanding the company’s footprint in Latin America by opening an office in Colombia to serve its international customers local offices.

  Engagement planning

  • Kunal recommended our Client register a Sociedad Anonima Simple (SAS) as this legal entity is the simplest structure to form for any foreign owned company.
  • Kunal also advised i) appointing a Colombian resident legal representative is mandatory requirement for every entity and ii) each foreign individual who is required to have online banking access is required to obtain a local fiscal number (RUT), residence permit and/or ID before they can be appointed as bank signatory.
  • To keep the engagement simple and fast obtain company numbers, our Client and Kunal agreed to proceed with a nominee structure. Consequently, Healy Consultants Group will initially register our Client’s company by appointing our Colombian attorney as the sole shareholder, director, legal representative and bank signatory.
  • Kunal and our Client agreed engagement fees to be settled in 2 instalments i) to complete company registration and ii) to advance bank account opening and corporate structure changes to appoint our Client as sole shareholder and director.

  Company registration

  • Due to the global Covid-19 pandemic and our Client’s busy schedule attending other internal company matters, the engagement was initially slow to kick off as it took our Client over 3 months to revert to us with a signed engagement letter and basic due diligence documentation to complete our internal customer onboarding procedures.
  • When our Client reverted with the required KYC information and documentation, Kunal immediately commenced the company registration process and coordinated with our Colombian team to fast track the nominee company registration information to be submitted to the Chamber of Commerce and National Directorate of Tax and Customs.
  • Within 1 week, the preferred company name was reserved.
  • While we waited for the Chamber of Commerce to approve the company registration application, Kunal and the Colombia legal team applied for our Client’s Colombian individual fiscal number (RUT).
  • Within 1 week i) our Client’s RUT was approved but ii) the Chamber of Commerce unexpectedly reverted requesting the company’s proposed articles of association to be changed.
  • Within 48 hours, our legal team confirmed with the Chamber of Commerce the amendments to the articles that satisfied the Chamber of Commerce and resubmitted the same.
  • Within 5 business days the Colombian company and tax registration was completed, and the Corporate Identification Number (NIT) was issued.

  Corporate bank account opening

  • Immediately after settlement of the second instalment, the designated resident legal representative submitted an account opening application to one of Colombia’s largest banks along with the company’s legal registration documents.
  • Within 2 weeks from submission of the application, the bank approved and issues the Colombian pesos (COP) account.
  • Until our Client does not secure a local work permit or ID, our Colombian attorney will be the custodian to the bank account.
  • Further, as Colombian banks only open foreign currency (USD) corporate bank accounts after 6 months of trading activity through the COP account, Healy Consultants Group offered our client to open a USD account with a local brokerage and exchange house and shared relevant forms for our Client to thumbprint, sign and return to Colombian by courier.
  • Within 6 to 8 weeks, assuming the exchange house is satisfied with the application, the USD account will be opened.

  Engagement completion

  • If required, until our Client decides to travel to Colombia to secure his residence permit and ID, Healy Consultants Group’s attorney will remain as the local bank signatory and offer our Client treasury and banking support services to ensure supplier payments, payroll and tax obligations, and utilities are timely settled.

• A Chinese crypto assets investor based in UK establishes a SAS in Colombia for arbitrage trading with proprietary funds

  Background

  • Having found Healy Consultants Group business website through Google, our Client connected with a Chinese speaking staff in April 2018 to determine the best business setup solution in Colombia to conduct speculative trading with proprietary funds. Colombia is one the preferred jurisdictions selected by our Client due to the Government’s support to the digital currency trading industry and growing number of exchange platforms;
  • After expert analysis and deliberations with Healy Consultants team, our Client decided to proceed and engage Healy Consultants Group for the setup of a simplified limited company known as the Sociedad por Acciones Simplificada (SAS).

  Engagement Planning

  • Healy Consultants Group prepared and emailed our Client an engagement advancement proposal including a formal invoice with instalment payment plan for the agreed services including i) resident legal representative, ii) personal and corporate tax ID application (RUT) and iii) Colombian visa application;
  • Thereafter, Healy Consultants Group prepared a detailed engagement project plan mapping out a step by step plan to engagement completion as well as a quality business plan to assist with crypto friendly corporate bank account opening in Colombia.

  Company registration

  • Healy Consultants Group prepared a power of attorney for local representation in Colombia and a draft resolution to appoint a corporate shareholder for the Colombian entity and emailed the same to our Client for signature, notarization in UK, apostille and courier return together with corporate due diligence documents.
  • Despite weekly follow up by Healy Consultants staff, the signature, attestation of documents was delayed by our Client due to conflict in with his professional schedule, causing an initial engagement delay of 6 weeks. Our Client decided to attest the required documentation during his business travels to Guangzhou, China and couriered the same to our attorney office in Medellin;
  • During the waiting period, the dedicated project manager approached multiple local banks including: Bancolombia, Banco Davivienda and BBVA to secure interest in onboarding our client’s crypto business;
  • Upon receipt of attested documents, Healy Consultants support staff translated the same in English and Chinese to Spanish by a sworn translator before the complete set can be presented before the Chamber of Commerce (Camara de Comercio). Within 10 working days of application submission, Healy Consultants Group obtained approval and immediately emailed our Client a scan copy of the Certificate of Incorporation and the company RUT.

  Corporate bank account opening

  • After company registration completion and receipt of the next instalment, Healy Consultants Group approached Bancolombia to advance bank account opening procedure. The bank requested a KYC face to face meeting with the company shareholder or director in order to sign forms and advance the account opening application;
  • Due to a delay in the client’s ability to travel, the resident legal representative attended the bank meeting. Within 2 weeks, Bancolombia confirmed our clients account had been successfully opened. The bank couriered the online banking tokens to company registered office address;
  • Upon receipt of the online banking tokens received in Colombia, the same were kept safely until the Client travels to Colombia for the appointment as bank signatory.

  Visa application and visiting Colombia

  • To obtain an individual RUT in order to be appointed as legal representative of the company, our Client had to visit Colombia in person to capture his biometrics;
  • This part of the process was particularly challenging for our Client as the Colombian Consulate in China required substantial proof that our Client had a legitimate reason to obtain a travel visa to Colombia. Despite supplying an affidavit by our Colombian lawyers confirming the existence of a newly formed business within the country, the Colombian consul in Guangzhou refused to timely process the visa application delaying the same by 3 months;
  • Healy Consultants recommended our Client secure a Colombian visit visa through an alternate route by applying for a USA visit visa which will enable our Client also to enter into Colombia and apply for a residence visa and RUT from within the country. After our Client agreed, the 90-day US visit visa application was submitted and processed within 3 weeks!
  • Due to a busy schedule in November and December, our Client only travelled to Medellin, Colombia in late January 2019. Once in the country Healy Consultants support staff accompanied our Client to the local Public Notary and the Immigration Office to complete the formalities to submit Colombian visa application and obtain the cedula (ID) which was obtained within 17 working days.

  Engagement completion

  To finalize business setup process, our Client’s information as new legal representative was submitted to the Chamber of Commerce. The new company extract was issued within 10 days which was then submitted to Bancolombia to update their internal records and issue new banking tokens within 3 days. The complete company was collected by our Client, completing the engagement.