October 6th, 2015 by Juan Sebastian Perez Villarreal
Since Colombia started to develop Private Equity industry in 2005, the sector and its ecosystem have been grown rapidly and have been strengthened by important national and international players. In fact, a funds association called Colcapital has been created. Also, BANCOLDEX, entrepreneurial development bank, has supported the industry development with the objective of being a key investor for local funds by creating an investment instrument called BANCOLDEX CAPITAL. Currently, this entity is under a transformation program to become fund of funds.
The objective of these initiatives have focalized on offering companies access to new financing alternatives and promoting best practices activities in order to facilitate the industry understanding to investors and companies. Colombia has an environment composed by small and medium size companies and most of them have a familiar structure. Some of these enterprises have a difficult banking access and others need resources for internationalization process.
Colombian government has implemented programs to promote entrepreneurs, e.g. Innpulsa, in order to sponsor start –up and issued other laws (Decree 2555 of 2010) which have allowed local pension funds to invest in private equity. Also, Insurance companies and local endowments are in the involving process to become part of domestic ecosystem.
With regard to growth economy, Colombia registered 4,6% by 2014 and according to the last report of the IMF, the forecast is 3,4% for 2015, which is higher than other countries in the region. In terms of Gross Domestic Product, it has increased three times in only one decade, from USD 2.261 by 2003 to USD 8.031 by 2013.
Under this framework, Colombia is still an investment attractive country as long as it has been pointed within the twenty main destinations for direct foreign investment by UNCTAD – World Investment Report 2013 and 2014. Also, it is a country with more than 47 million inhabitants with a middle class under growing process. To date, almost 30% of population is part of the middle class, the forecast, is to get 37% by 2020, according to Fedesarrollo.
Nevertheless, private equity and venture capital industry is still not a mature sector in the economy by reason of most of funds are still under the investment period. Many companies are attractive for investment due their excellent economic performance in spite of there is not much track record to be showed.
In addition, Colombia established legislative tools to attract private equity investors, in this sense, Decree 2555 of 2010, modified by Decree 1242 of 2013 were issued to regulate the incorporation and management of funds. Immediately, it has allowed the growth of this industry, from one fund by 2005 to 57 funds by 2015. Also, Colombia has stablished laws for minority shareholders rights and for corporative government by Law 222 of 1995, Law 275 of 2001, among others.
Regarding the incorporation of a Private Equity fund in Colombia, it requires at least two investors and it does not need approval for existence from the Financial Superintendence of Colombia (“SFC for its acronym in Spanish), it is necessary to notice at least 15 working days prior the Private Equity Fund has been created, by showing the following documents:
- Bylaws model
- Professional Manager profile
- Copy of the minute of the board of directors of the Management Company by which the bylaws model is approved
- Certificate issued by Management Company documenting the compliance with legal requirements
Furthermore, bylaws must contain investments criteria and management policies, characteristics and organic structure of the fund, thus:
- Managers companies: It is an entity that must be brokerage companies, trust firms or assets management companies. This election depends on the General Partner decision at the moment of arranging the business structure. It is a party in charge of managing and administrating the fund.
- Professional Manager: It is individual or entity responsible for administration and management of assets. Also, it is in charge of doing capital calls, approval of investors, and selection of portfolios, among others.
- Investment Committee: It is responsible for analyzing and determining investments quotas. Purchases and liquidation processes must be approval by this board.
- Monitoring and controlling Committee: It is in charge of attending compliance of the duties assigned to the Management Company and Professional Manager. It also check that investments decisions are made in accordance with the investment criteria, among others.
- General Investment Meeting: It is composed by all the investors involved in the business. Most duties are stablished in the bylaws.
Moreover, Financial Superintendence is the entity responsible for controlling and monitoring the Managers Companies which are in charge of preparing reports before this controlling organism.
In reference to taxation, according to Tax Code (Estatuto Tributario in Spanish), Private Equity Funds are considered as a transparent vehicle for tax purposes, it means, these funds are not taxpayers of income tax.
In consequence, Colombia has been ranked in the 4th position among 12 countries in Latam and the Caribbean since 2010 to update, by Latin American Private Equity & Venture Capital Association (LAVCA), because it is a country that has made a lot of legal and economic measures and created good conditions for private equity and venture capital environment. Also, there is a large number of opportunities for worldwide funds to take advantage of companies and to use the country as a hub for internationalizing enterprises in the region.
Juan Sebastian Perez Villarreal
Attoney from Externado University of Colombia, specialized in Contract Law and candidate to ProjectManagement Master at Valecia University in Spain. Currently, Mister Perez -Villarreal is working for Invest in Bogota as Business Developer Officer. In addition, He has worked for Procolombia (Promoation Agency of the Colombian government)as Investment Specialist for Private Equity and Tourism Infrastructure industries and he has performed as a lawyer advisor for other companies, such as, Energy Transmission of Bogotá Company, Fiduciaria Bogota and Suramericana Insurance Company. Email: firstname.lastname@example.org
October 6th, 2015 by Camilo Vicaria
As a booster or a sort of “rubber ring” for multinational companies the Economics Section of BBC news in 2012 referred to Latin America because in this region is possible to earn profits that are not possible elsewhere, not even in their country of origin. An increase in consumption and GDP are just among other reasons to explain this phenomenon.
The article points out that Gilmar Masiero, expert on Internationalization of Companies of the Faculty of Economics and Business Administration of Sao Paolo University, said that in this region there is more economic dynamism than there is in the countries of origin of these companies, that it is more likely to find protection in latin markets and that there is less competition.
This article also highlighted that according to a survey that the PwC, the biggest firm of professional services in the world, conducted to 1.200 CEOs from the five continents showed that Latin America is one of the regions were world multinationals expect to grow this year.
Facts seem to confirm these assertions. According to the Section of Global Perspective of the Strategy+Business Magazine: “Between 1991 and 2001, the ownership of the 500 largest companies in Latin America changed dramatically, with non-Latin multinational ownership growing to 39 percent from 27 percent”.
According to this magazine, this Multinational Boom took place in Latin America, among other reasons, because of the economic integration and trade accords, including the Mercosur and Andean pacts and the North American Free Trade Agreement (NAFTA). These agreements created regional markets that stimulated trade and investment flows and made it feasible for the first time for companies in Latin America to coordinate operations in adjacent countries to achieve economies of scale and scope.
Foreign Multinational Companies had real incentives to grow their subregional and panregional operations. Also, because GDP and per capita income grew rapidly, as did the size of the middle-and low-income consumer groups that are critical to the growth of global and local companies.
Is it desirable to world multinational companies to come to Latin America? The conditions that previously trigger a boom and that largely beneficiated multinational companies once before are now reaching higher and even historical numbers. The World Bank stated that in the past decade the middle class hit historic high in Latin America growing 50%, and now representing 30% of the population.
Also, liberalization in Latin America is reaching a new level. Latin American Bank of Development analyzed that currently there is not only liberalization in an intra regional level, but a number of countries as Colombia, Perú and Chile have agreements with emerging countries as China and industrialized ones as European Union and United States.
There are also negotiations of Free Trade Agreements with Asian countries and initiatives as the Trans-Pacific Partnership Agreement (TPP) that will particularly change the face of trade and opportunities in a dynamic and fast growing market as that of Latin America.
For example in Colombia, the Colombian Newspaper “El Tiempo” noted that in this country the growing demand on the economy has attracted in just three months at least 35 new multinational companies trough franchise contracts, trade associations and acquisitions. The number considered in the rest of months of the year and in the rest of countries in Latin America show that this region currently is and will increase its interest to foreign multinational companies.
- Gerardo Lissardy, “America Latina, un flotador para multinacionales”, 15 Frebraury 2012, Rio de Janeiro. http://www.bbc.com/mundo/noticias/2012/02/120208_america_latina_multinacionales_ganancias_crisis.shtml
- Martinez, Alonso, de Souza Ivan. Liu, Francis. Multinationals vs. Multilatinas: Latin America´s Great Race. Fall 2003 / Issue 32 (originally published by Booz & Company), GLOBAL PERSPECTIVE Section, http://www.strategy-business.com/article/03307?pg=0.
- World Bank Group, News, FEATURE STORY, Latin America: Middle Class hits Historic High, http://www.worldbank.org/en/news/feature/2012/11/13/crecimiento-clase-media-america-latina.
- Miguel Rodriguez Mendoza, Free Trade Agreements in South America. Trends, prospects and challenges. Public Policy and Productive Transformation Series N 7, 2012. http://scioteca.caf.com/bitstream/handle/123456789/365/caf_tomo_7_.pdf?sequence=1&isAllowed=y
- El Tiempo with Agencias y GDA , Las marcas extranjeras que llegarán en el 2015, 25 January 2015, , http://www.eltiempo.com/economia/empresas/empresas-extranjeras-que-llegaran-en-el-2015/15143796.
September 30th, 2015 by Linda Gomez Millan
BR Latin America is keeping you updated on some of the changes applied in the Powers of Attorney in four countries of Latin America. It is our duty to provide a quality service to our clients.
A power of attorney (POA) is a written authorization to represent or act on another’s behalf in private affairs, business, or some other legal matter. Every country in Latin America has its own Power of Attorney with different ways to fill out the form. Therefore, there have been some particular changes in four of our countries. Keep them in mind in case you want to proceed in any of these countries.
You do not have to notarize the Power of Attorney for Trademarks and Patents in Bolivia.
You can fill out just ONE Power of Attorney for Trademarks and Patents in Chile.
In Paraguay it is accepted to apostille the Power of Attorney.
These updates will help you in case you need to fill out a Power of Attorney form, if you have further questions about these new updates or about the instructions of Powers of Attorneys from any other country in Latin America, contact us at email@example.com and we will help you with any legal service.
September 30th, 2015 by Linda Gomez Millan
If you are planning to file a trademark in more than one country in Latin America, you need to fulfill the Power of Attorney (POA) requirement; therefore, you have two options to do this process. There is a long way, that may cost you more time and money, and there is an easier way, both available with B&R Latin America.
The long way is doing it by yourself. We will send individual POAs for each country where you wish to file your application. For each single country where you want to protect your trademark you will have to comply with specific local regulations.
In some cases, you or the legal representative of the company will need to notarize the documents and get an apostille. For other countries, you will need to legalize the documents before a consulate and sometimes they are not near. Once you have the documents you will need to send them to our local associate firm.
Unfortunately, dealing with these time consuming formalities is a requirement we need to comply with for a successful application.
But do we have make it this complicated?
B&R Latin America has a great, optimized and efficient solution for you. We will do everything for you!
The only procedure that you will have to do is to complete one Power Of Attorney. We will complete all other formalities and will grant power to our associates in each country. By choosing this service, we will save you time and money; this service includes all legalizations, notarizations and courier-related costs. No red-tape for you.
If you are interested in this new service that BR Latin America offers you, get in touch with us and find out more about this great deal we have to offer. Our clients are our priority, giving you an efficient service is our main goal.
Contact us at firstname.lastname@example.org
September 1st, 2015 by Linda Gomez Millan
The Trademark Direction of the National Institute of Industrial Property in Argentina decreed that the trademark fees will rise from October of 2015.
This changes will be applied with the aim of providing greater agility, economy and efficiency in the trademark registration process, also to replace the nomenclature of products and services, according to the guidelines of the International Classification of Products and Services approved by The World Intellectual Property Organization (WIPO).
It is important to distinguish this fees applications to register trademarks, oppositions and other parts relating to the procedures in the Authority’s Application of the law No. 22.362, since every registration must be submitted and shall be subject to the payment of the duties provided for in Annex III of the Decree No. 260 dated March 20, 1996. If the applicants do not pay these fees, the Trademark Direction of Argentina will not receive any process whose application is not accompanied by the respective proof of payment.
These are some of the procedures that they will increase its fee in Argentina:
ARGENTINE PESO (ARS)
ARGENTINE PESO (ARS)
|Trademark Application filling:||$690||$760|
|Trademark renewal application:||$870||$960|
|Phonetic search for a single class of products or services:||$90||$100|
|Response to requirements on formalities:||$100||$110|
Procedures related to the registration of trademarks can be done by the applicants; individuals or legal; their representatives with sufficient power or a power of attorney to represent them in the National Public Administration and in the Industrial Property office where they are registered. If you have any question about these fees contact us and we will provide the accurate information.
For more information about these fees in Argentina contact us at: email@example.com
July 23rd, 2015 by Linda Gomez Millan
It is now easier and faster to claim the priority of a Community Trade mark in The Office for Harmonization of The Internal Market in Argentina (OHIM).
A new resolution was decree at the National Institute of Industrial property in Argentina, from the articles set out in the Paris Convention, ratified by the law not 17.011, establishing that when the priority of a Community trade mark (is any trademark which is pending registration or has been registered in the European Union as a whole) is claimed in Argentina and registered with the Office of Harmonization in the Internal Market (OHIM) will be able to check the priority document online in their web page.
For the on-line verification of the priority document without the need for incurring expenses of legalization, the applicant shall, within a period of three (3) months, from the date in which it had been the Declaration of priority, attach a copy of the application for the mark certified by the owner, agent or authorized agent, together with the identification code of the priority document.
In the event that the priority requested for a Community trade mark deposit at the Office of Harmonization in the Internal Market (OHIM) does not comply so finished with what was said above they will consider it by not presented.
Digital technology has evolved more and more, and this has allowed several institutions and companies to reduce the time and labor that goes into some administrative processes. The legal processes that are carried out on entities that manage intellectual property issues are optimizing their processes thanks to the new digital era.
This new implementations confirms how the technological development helps streamline processes and how entities as OHIM, have change their legal processes from working with procedures and documentation only in physical, then with CD-ROM and now with digital platforms.