I. INTRODUCTION

The development of international transactions between related parties generates the need to observe a series of aspects that must be harmoniously evaluated at the time of planning and executing the business models.

Aspects such as the type of corporate vehicle and/or partnership-collaboration agreement that will be used to enter the various territories in which the related parties will operate, the applicable tax treatments, the pricing policies in accordance with the principle of full competition, the operational particularities that affect the customs valuation of imported goods, the transfer of the risk of loss and/or damage of the goods during the international journey, the determination of the laws applicable to the contracts of international sale of goods, the mechanisms agreed upon for the extinction of the intercompany monetary obligations, among many others, undoubtedly require an adequate synchronization to achieve, under a controlled risk environment, the results projected by the stakeholders.

In the globalized and increasingly digital world in which we live, as a result of the fourth industrial revolution, the aforementioned aspects are governed by supranational instruments, with the force of law and/or commercial custom, emanating from equally supranational organizations such as the OECD, UNCITRAL, WTO, ICC, FATF, among others, which have gradually been incorporated into the domestic legal bodies of the various countries of the world.

Colombia, as a member country of the OECD and other supranational governing bodies, has gradually included in its positive legislation the above guidelines, in order to standardize words, procedures and substantive provisions, which ultimately allow it to interact with its counterparts in similar conditions, without this meaning to leave aside the existing asymmetries.

Within the universe of aspects mentioned, we highlight in this opportunity the mechanisms agreed for the extinction of intercompany monetary obligations, to the extent that, from the perspective of international trade law, the parties, under the principle of free will, may determine the mechanisms through which the economic obligations arising on the occasion of the international purchase and sale transactions entered into by them will be extinguished.

However, the autonomy given to the parties, in the case of international purchase and sale contracts, does not necessarily maintain homogeneity with the Exchange Regimes in force in the different countries where the related parties operate, for which reason, below, we point out some exchange aspects, which we consider relevant to consider when planning cross-border intercompany operations.

II. COLOMBIAN EXCHANGE REGIME APPLICABLE TO INTERCOMPANY TRANSACTIONS

The Colombian Exchange Regime establishes the obligation to channel foreign currency through the exchange market when the following transactions are entered into a) imports and exports of goods, b) active and passive foreign indebtedness, c) foreign direct investments - FDI, d) Colombian investments abroad, e) guarantees and collateral, and f) derivative transactions.

Cross-border operations, other than those mentioned above, belong to the free market.

The compliance with the obligation of channeling must be given with strict observance of the so-called principle of identity, consisting in the fact that only the obliged subject may transfer and/or reintegrate the foreign currency inherent to the operation, with which, it is noted that mandates are not appropriate in this type of transactions.

The Exchange Regime does not admit the extinction of exchange operations through crypto assets.

Colombia distinguishes in its Exchange Regime the operations entered by companies belonging to the hydrocarbons and mining sector from those carried out by companies belonging to other sectors of the economy.

1. Companies in the hydrocarbons and mining sector have a special and general Exchange Regime.

The following are subject to the special Exchange Regime: a) branches of foreign companies whose purpose is to develop activities of exploration and exploitation of oil, natural gas, coal, ferronickel or uranium, and b) branches of foreign companies exclusively engaged in rendering services inherent to the hydrocarbons sector.

The branches of foreign companies subject to the special Exchange Regime may not resort to the exchange market for any concept, except for the exceptions that in an exhaustive manner are contemplated in the same Regime.

These branches must follow the exchange procedure established to register and channel the foreign currency of the assigned capital and the supplementary investment to the assigned capital.

On the other hand, the following companies belong to the general Exchange Regime: a) national companies and companies with foreign capital that carry out activities of exploration and exploitation of oil, natural gas, coal, ferronickel or uranium, and b) national companies and companies with foreign capital that are exclusively engaged in the rendering of services inherent to the hydrocarbons sector.

The companies belonging to the general Exchange Regime must resort to the exchange market to channel the foreign currency derived from the operations of mandatory channeling.

2. Companies not belonging to the hydrocarbons and mining sectors

Companies not belonging to the hydrocarbons and mining sector are governed by the general provisions of the Exchange Regime, therefore, they must resort to the exchange market to channel the foreign currency derived from the exchange operations they carry out.

It should be noted that the Exchange Regime only allows the transfer of foreign currency between a foreign company and its branch in Colombia for: a) transfer of assigned or supplementary capital, b) reimbursement of profits and assigned or supplementary capital, c) payment for reimbursable operations of foreign trade of goods, in accordance with customs and tax regulations, and d) payment for services, in accordance with tax regulations.

III. CONCLUSIONS

Considering the provisions governing the Exchange Regime in Colombia, it is highly advisable that prior to the development of exchange operations by related parties located in the Colombian territory, it should be evaluated at the time of planning the business models, whether the projected mechanisms for the extinction of intercompany monetary obligations are aligned with those allowed by the Colombian Exchange Regime.

The foregoing, to the extent that the provisions of the Exchange Regime may not be disregarded, under the argument of the existence of intercompany contracts, which establish in their terms, mechanisms different from those authorized for the extinction of its monetary obligations.

Thus, it is evident from the above, how the exchange aspect within all international planning is of major importance, even more so, if it is considered that its non-observance in Colombia may generate contingencies of up to 200% of the amount of the proven exchange violation.

Let us remember that an adequate planning reduces uncertainties and minimizes corporate risks.

Best regards.

Erwin