Key Benefits:
801 OF 2003
(March 13)
Official Journal No. 45,131 of 18 March 2003
By means of which the "Amending Protocol to the Convention on the Promotion and Reciprocal Protection of Investments between the Government of the Republic of Colombia and the Government of the Republic of Peru" is approved, Lima the seven (7) of May two thousand one (2001).
COLOMBIA CONGRESS
Having regard to the text of the "Additional Amending Protocol to the Convention on the Promotion and Reciprocal Protection of Investments between the Government of the Republic of Colombia and the Government of the Republic of Peru", made in Lima on 7 May mil uno (2001).
(To be transcribed: photocopy of the full text of the International Instrument mentioned).
BILL NUMBER 133 OF 2001 SENATE.
by means of which the "Additional Amending Protocol to the Convention on the Promotion and Reciprocal Protection of Investments between the Government of the Republic of Colombia and the Government of the Republic of Peru" is approved, Lima the seven (7) of May two thousand one (2001).
COLOMBIA CONGRESS
Having regard to the text of the "Additional Amending Protocol to the Convention on the Promotion and Reciprocal Protection of Investments between the Government of the Republic of Colombia and the Government of the Republic of Peru", made in Lima on 7 May mil uno (2001).
(To be transcribed: photocopy of the full text of the International Instrument mentioned).
" ADDITIONAL AMENDING PROTOCOL TO THE CONVENTION ON THE PROMOTION AND RECIPROCAL PROTECTION OF INVESTMENTS BETWEEN THE GOVERNMENT OF THE REPUBLIC OF COLOMBIA AND THE GOVERNMENT OF THE REPUBLIC OF PERU
The Government of the Republic of Colombia and the Government of the Republic of Peru;
In order to create favorable conditions for investments made by investors from each of the Contracting Parties in the territory of the other;
Recognizing that the promotion and protection of investments, serves to stimulate individual trade initiative and increase prosperity in both states; and,
In order to bring into force the Convention between the Government of the Republic of Colombia and the Government of the Republic of Peru on the Promotion and Reciprocal Protection of Investments, held in Lima on April 26, 1994.
You have agreed to the following:
Article 7o. of the Convention between the Government of the Republic of Colombia and the Government of the Republic of Peru on the Promotion and Reciprocal Protection of Investments shall remain so:
EXPROPRIATIONS AND EQUIVALENT MEASURES
(1) Investments by nationals or undertakings of any Contracting Party shall not be subject, in the territory of the other Contracting Party, to:
a) nationalization or equivalent measures, by means of which one of the Contracting Parties takes control of certain activities considered to be strategic in accordance with its domestic law, or services; or
(b) any other form of expropriation or measures having an equivalent effect.
Unless any such measure is made in accordance with the law, in a non-discriminatory manner, for reasons expressly provided for in the respective Constitutions and referred to in the Ad Article (7) (1) the attached Protocol, related to the internal needs of that Party and with prompt, appropriate and effective compensation.
(2) The compensation for the acts referred to in paragraphs (1) (a) and (b) of this Article, in accordance with the principles of international law, shall amount to the genuine value of the investment immediately before the measures were taken or before the imminent measures were public knowledge, whichever comes first. It must include interest up to the day of payment, must be paid without undue delay, be effectively realisable and freely transferable, in accordance with the rules laid down in Article (6) on the repatriation of capital and capital investment gains, provided that, even in the event of exceptional balance of payments difficulties, the transfer of at least one third annual part is guaranteed.
(3) The affected national or company shall be entitled, in accordance with the Law of the Contracting Party that adopts the relevant measure, to an early review, by the competent authority of that Party, of its case and the valuation of its investment, in accordance with the principles laid down in paragraphs (1) and (2) of this Article.
(4) If a Contracting Party takes any of the measures referred to in paragraphs (1) (a) and (b) of this Article, in relation to the assets of a company incorporated or incorporated in accordance with the law in force in any part of its territory, in which nationals or undertakings of the other Contracting Party are owners of shares, shall ensure that the provisions of paragraphs (1) to (3) of this Article are applied in such a way as to ensure prompt, adequate and effective compensation with respect to the investment of these nationals or companies of the other Contracting Party, owners of the actions.
(5) In no case shall the provisions of this Convention require any Contracting Party to protect investments made with capital or assets that are determined in accordance with the law of each Contracting Party, criminal activities.
(6) As far as Colombia is concerned, nothing in this Convention will prohibit, in accordance with the law, for the purpose of public or social interest, monopolies as a rentistic arbitration, after full compensation of the investors who are deprived of the exercise of lawful economic activity taking into account the applicable conditions of this Article.
Nothing in the Agreement between the Government of the Republic of Colombia and the Government of the Republic of Peru for which investments are promoted and protected, held in Lima on April 26, 1994, or the provisions of the present Protocol shall be construed as preventing a party from adopting or maintaining measures intended to preserve public order.
This Protocol is an integral part of the Convention between the Government of the Republic of Colombia and the Government of the Republic of Peru on the Promotion and Reciprocal Protection of Investments, held in Lima, on 26 April 1994 and shall enter into The Convention shall be effective at the date of the said Convention.
Made in Lima, seven days of the month of May 2001, in two copies of the same tenor, in id ioma Castellano, being both equally identical.
By the Government of the Republic of Colombia,
DOCTOR GUILLERMO FERNANDEZ DE SOTO,
Minister of Foreign Affairs.
By the Government of the Republic of Peru,
AMBASSADOR JAVIER PEREZ DE CUELLAR,
President of the Council of Ministers and Minister of Foreign Affairs.
EXECUTIVE BRANCH OF PUBLIC POWER
PRESIDENCY OF THE REPUBLIC
Bogotá, D. C., September 18, 2001.
Approved. Submit to the consideration of the honorable National Congress for the constitutional effects.
(Fdo.) ANDRES PASTRANA ARANGO
The Deputy Minister of America and Territorial Sovereignty, in charge of the functions of the Office of the Minister of Foreign Affairs,
(Fdo.) LENIENCY FORERO UCROS.
DECRETA:
ARTICLE 1o. Approve the "Additional Amending Protocol to the Convention on the Promotion and Reciprocal Protection of Investments between the Government of the Republic of Colombia and the Government of the Republic of Peru", made in Lima on May 7 (7) of two thousand one (2001).
ARTICLE 2o. In accordance with the provisions of Article 1o. of Law 7a. In 1944, the "Additional Amending Protocol to the Convention on the Promotion and Reciprocal Protection of Investments between the Government of the Republic of Colombia and the Government of the Republic of Peru", made in Lima on May 7, (2001), which by the first article of this law is approved, will force the country from the date on which the international link with respect to it is perfected.
ARTICLE 3o. This law governs from the date of its publication.
Dada en Bogotá, D. C., a los ..
Presented to the honorable Congress of the Republic by the undersigned Minister of Foreign Affairs and Minister of Foreign Trade.
GUILLERMO FERNANDEZ DE SOTO,
Minister of Foreign Affairs.
MARTHA LUCIA RAMIREZ DE RINCON,
Minister of Foreign Trade.
ADDITIONAL AMENDING PROTOCOL TO THE CONVENTION ON THE PROMOTION AND RECIPROCAL PROTECTION OF INVESTMENTS BETWEEN THE GOVERNMENT OF THE REPULICA OF COLOMBIA AND THE GOVERNMENT OF THE REPUBLIC OF PERU,
made in Lima the seven (7) of May two thousand one (2001).
Honorable Senators and Representatives:
On behalf of the National Government and in compliance with the provisions of Articles 150 numeral 16 and 189 numeral 2 of the Constitution Politics of the Republic of Colombia, I have the honor to submit to your consideration the Bill by means of which the "Amending Protocol to the Convention on the Promotion and Reciprocal Protection of Investments between the Government" is approved of the Republic of Colombia and the Government of the Republic of Peru ", made in Lima on 7 (7) May two thousand one (2001).
Introduction
The Governments of the Republics of Colombia and Peru, in the spirit of putting into effect the Convention on the Promotion and Reciprocal Protection of Investments, held in Lima on April 26, 1994, which was declared partially inexequable by the Constitutional Court (by judgment Case C-08-97 1997), signed in Lima, on 7 May of the current year, the Additional Amending Protocol to the Convention on the Promotion and Reciprocal Protection of Investments between the Government of the Republic of Peru and the Government of the Republic of Colombia.
This Agreement is part of the forecasts of the National Development Plan "Change to Build Peace" 1998-2002, in which chapter 5o. It is established that foreign capital will play a leading role in the construction of a modern and focused productive apparatus on international markets, given the capacity it has to transfer technology and knowledge 1. There, it is stated that the government will encourage the installation of foreign companies in Colombia to use our territory as an export platform for their products to Latin America, in clear development of the model of openness and policies of internationalisation of your economy.
The government, in execution of its National Development Plan, has been working to provide greater legal certainty and better conditions for foreign investment in the country. Within this context we can refer to the following events.
-The National Government Expressed the "General Regime of Foreign Capital Investments in Colombia and Colombian Capital Abroad" (Decree 2080 of 2000), by which the legal framework for investment is unified, simplified and consolidated. foreign investment in the country and investments abroad.
-The presidential sanction, on July 30, 2001, of Law 672 of 2001 approving the Bilateral Agreement for the Promotion and Protection of Investments, signed between Colombia and Chile, which constitutes a important in the process of ratification of such an agreement.
-During the first half of 2001, different negotiation meetings for the Agreements on Protection and Promotion of International Investments were held with the delegations of China, Spain, and Finland.
-Within the framework of the FTAA, our country has been participating in the investment negotiation group. This group identified 12 key themes that will be part of the investment chapter. The themes selected are: basic definitions, scope, national treatment, most favoured nation treatment, fair and equitable treatment, expropriation and compensation, compensation for losses, key personnel, transfers, requirements of performance, general exceptions and reservations and dispute settlement. In the face of these issues, the countries presented proposals and approaches are being made in relation to the positions presented at the negotiating table.
-Observing the success of China's economy in attracting Foreign Investment to high-tech sectors, the Ministry of Foreign Trade has pushed the project on Special Export Economic Zones, which will have a special treatment for the work, the tax and the customs, in order to offer favorable conditions for the development of investment plans to be established in the four special zones (Buenaventura, Cucuta, Ipiales and Valledupar).
Foreign investment trends
The process of globalisation, understood as the long-term shift towards a single universal market, has become the driving force behind the expansion of transnationals2. These companies, through their international production3, have accessed the markets of countries that have undertaken structural changes in their economies through processes of liberalization, deregulation and privatization; while Colombia is within this group of nations.
This process does not stop and will continue to move forward regardless of the circumstances in which a country like Colombia is located, for this reason we must prepare to face the changes that this global process will entail, so that it will well-being and development at the years4.
The trend toward the liberalization of regulatory regimes for the promotion of Foreign Investment has continued. According to figures provided by the Unctad, during 1999 the number of agreements continued the growth path of previous years, with a total of 96 signatory countries: 30 in Asia, 20 in Latin America and the Caribbean, 13 in Africa, 11 in Europe Central and Eastern Europe, 4 in developing Europe and 18 in industrialized countries. About half of the agreements signed took place between developing countries, and 43 were given with countries in the first world.
The expansion of transnational corporations through foreign direct investment is one of the central phenomena of the ongoing economic globalization process. Thus, during the 1990s, the sales of the subsidiaries of transnational companies grew much more rapidly than global exports, and their production levels expanded from 5% of global GDP in 1982 to 10% in 2002. 1999. Foreign investment, on the other hand, went from representing 2% of gross global fixed capital formation in 1980 to 14% in 1999 (Unctad, 2000). Foreign direct investment recorded particularly explosive growth in the second half of the 1990s. Indeed, according to Unctad estimates, global investment flows in 2000 exceeded 1.1 trillion dollars.
Mergers and acquisitions of companies are the most important driving force behind modern foreign investment. This form of Foreign Investment has been mainly given between companies in the United States and the European Union since 1998. In turn, the importance of strategic alliances has increased, which can be a reflection of the development of the foreign investor's thinking, when looking for a partner that knows the local market and culture, and who in turn shares the risk (especially in developing countries, whose economies have shown a particular vulnerability in the last few years of the last decade).
In the words of the Cepal, " Foreign direct investment flows-the IED- to the developing world-remained at the same level as for 1999, around $190 billion. Of these, 95% went to Asian countries (especially China) and Latin America and the Caribbean. In the latter region, the main recipients were Brazil, with 30 billion dollars-very concentrated in the restructuring of services-and Mexico, with 13 billion dollars, in investments in the manufacturing and procurement sectors in Brazil. Some Andean countries, such as Colombia and Peru, were below the average of previous years, reflecting their recent political and economic instability, while flows to Venezuela increased acquisitions in the area of services. In Central America and the Caribbean, the Dominican Republic received 25% of the sub-regional total. "
Latin America has not been oblivious to this process of globalization, the countries of the region have implemented structural changes and, therefore, the presence of the multinationals in the area has been strengthened.
Latin America managed to circumvent the adverse circumstances that affected capital flows to developing economies due to the Asian crisis, Brazil's and the Rusa5 Confederation. Despite these turbulence in the financial markets, foreign investment flows to Latin America and the Caribbean in 2000 were more than $74.191 billion.
Importance of foreign investment
Worldwide, in the last ten years foreign investment flows have grown significantly. Flows originating in developed countries and heading towards developing countries have shown the same trend. For the latter, FDI has become an essential source for development financing. This has led governments to make great efforts to attract more FDI flows, further sustaining the recognised effects of FDI on growth and economic development.
Foreign investment in general, and transnational companies in particular, are important players in the global economy and a fundamental piece in the active participation of developing countries. Foreign investment can contribute to a country's development by complementing domestic investment, strengthening trade ties, export capacity, generating technology transfer, and disseminating skills and knowledge. specialized.
Thus, the foreign investor can enter new and modern technologies that, due to the development and research capacity of developing economies, would not be available in the absence of such investment. Similarly, foreign direct investment can boost access to export markets for goods and services that are produced in investment-recipient countries, helping them to switch from domestic markets to international markets. taking advantage of the comparative advantages of each country. On the other hand, foreign investment creates jobs and training of officials. Investors can have access to individuals with advanced knowledge who can transfer these skills and knowledge to their overseas branches by bringing in experts and giving their staff the respective training.
In the case of Colombia, the recent evolution of international markets with the presence of foreign investment creates two important opportunities for entrepreneurs. Firstly, to partner with companies from abroad and to be part of a large integrated system of production, distribution and marketing that multinational companies have been developing in a globalised market. Secondly, there is the opportunity to increase manufacturing exports to the world's markets through partnership and alliances in the process of penetration of new markets or in the process of acquiring technologies that do not tenen6.
On the other hand, foreign investment is a fundamental tool in the development of the energy, transport and communications infrastructure that Colombia requires in the 21st century. This infrastructure has been designed with private investment of foreign origin. The linking of foreign investors is vital for the development of a modern infrastructure that will align production costs for domestic consumption and for export.
As a result of foreign investment in Colombia, our country has in recent years become a regional center and an export platform for some transnational companies. These companies have carried out rationalization processes and have centralized their administrative, production, marketing and service centers (accounting, advertising, etc.) for the company. It is imperative that Colombia expand its participation in the global structure of these companies, through an aggressive policy of promoting foreign investment.
Competition from foreign capital flows has accelerated sharply and Colombia cannot lag behind. Our country must improve its performance in attracting investment, because otherwise the development tasks undertaken by the current administration and in which the participation of all Colombians is needed will take us more time, leaving us behind in the international race.
The development goal
The priority objective of developing economies such as the Colombian economy includes the achievement of sustained income growth. This is achieved by increasing investment, strengthening technological capabilities and improving the competitiveness of exports in global markets7. To improve competitiveness, it is necessary for countries to be able to encourage new value-added activities in the production of goods and services in open markets, for which foreign investment can be an agent. Important promoter.
The growing political instability in some Latin American countries, as well as the decline in privatization processes, the reduction of economic growth levels, and the fall in commodity prices made for the year 2000 the foreign investment of the Latin American region has decreased. In addition, the growth of Asian economies has made competition for foreign investment flows more intense for developing economies. The reduction in investment flows to developing countries, the increased perception of risk in these economies, and the increased competition, leads to the need to develop an aggressive policy of promoting foreign investment in developing countries. Colombia.
Foreign investment should be attracted through a coherent policy that generates an investment-friendly environment, implemented through the design of a development strategy based on the identification of competitive views for define activities that are considered relevant to attract foreign capital flows.
Foreign investment in Colombia
The deteriorating security conditions and the economic situation in the country have had an impact on foreign investment flows. While in 1998 it had entered the country almost US$ 4 billion, in the first 3 months of the year, only $1,119 million was linked. Some investors have suspended operations in the country, while others have halted or cancelled new investment projects or reduced their operations in the country. Additionally, and as is expected given the nature of these flows, the investment funds in portfolio showed a net disinvestment over the last two years.
Despite the above, it is noteworthy that foreign investment in the financial sector showed an important dynamism during the year 20009. This was the sector that received the most investment during that year, and the increase in investments in the following subsectors is notable:
Subsectors with higher foreign investments in the year 2000
In dollars, no oil
Other financial institutions 308,319,902
Financial Services 252,546,989
Communications 223,743,665
Non-alcoholic beverage and gaseous water industries 120,393,427
Wholesale trade (exports) 97,249,973
Manufacture of soaps and cleaning preparations,
perfumes, cosmetics and other 94,748,380
Technical and architectural services 73,364,388
Financial Establishments 69,869,484
Exploitation of coal mines 65,196,089
Manufacture of packaging and paper and cardboard boxes 56,361,094
Manufacturing of pharmaceuticals and medicines 48.098.625
Real Estate 46,717,823
Source: foreign investment records, Banco de la República.
FOREIGN INVESTMENT IN COLOMBIA (US$ miles)
1994 1995 1996 1997 1998 1999 2000 2001
(March)
Activities not OK
specified 5,803 7,840 1,102 126---
Agriculture, hunting,
forestry and fisheries 12,433 29,780 25,881 26,767 23,223 65,809 13,919 1,608
Exploitation of me-
nas and quarries 25,446 109,814 45,533 289,444 101,131 34,994 67,001 245,894
manufac industries-
turries 364,773 582,284 652,745 640,254 576,559 1,473,852 224,580 99,448
Electricity, gas,
water 6,255 8,383 145,390 947,004 1,84,242 818,593 (1,204,100) 19,859
Construction 33.449 31,954 22,561 44,668 21,782 117,608 14,461 2,442
Wholesale trade-
yor and retail 81,214 131,554 150,862 143,166 239,599 380,395 128,715 48,998
Transport stores-
lie and communicate. 157,166 217,161 157,858 360,355 69,293 546,496 239,894 40,185
1994 1995 1996 1997 1998 1999 2000 2001
(March)
Fi Establishments-
nanciers, insurance,
etc. 113,436 193,555 667,020 455,027 1,309,544 523,214 770,472 643,815
communal services
social and personal 1,805 9,091 11,104 26,118 11,034 41,133 18,063 16,764
Portfolio 587,675 242,221 292,154 561,761 (234,182) (27,586) 15,098 4,317
Total 1,389,456 1,563,136 2,172,209 3,494,689 3,952,225 3,974,507 288,192 1,123,328
It is to be noted that the United States is the main investor in Colombia, followed by countries in the European Union without taking into account the so-called tax havens. Over the last few years there has been an increase in investments, mainly from Spain to the financial services and energy sectors.
25 Main investors in Colombia to 2000.
Country Stock in millions of dollars
1 United States 5,307,324
2 Cayman Islands 2,566,407
3 Panama 1.965,891
4 Spain 1.946.826
5 Netherlands 1,448,265
6 British Virgin Islands 1,132,936
7 Bermuda 861,050
8 Germany 515,509
9 Switzerland 501,253
10 England 459,248
11 France 434,496
12 Venezuela 335,742
13 Bahamas 310,561
14 Japan 246,636
15 Chile 212,195
16 Canada 193,728
17 Dutch Antilles 160,294
18 Mexico 143,286
19 Italy 140,123
20 Sweden 104,843
21 Ecuador 101,266
22 Peru 63,091
23 Uruguay 60.929
24 Brazil 60,670
25 Luxembourg 56,970
The benefits of foreign investment have been noted above. However, for the case of Colombia, its benefits are multiplying in the face of the economic crisis that the country is going through, and the need to have private resources to finance necessary investment when faced with a deficit situation in the country. public finances.
On the other hand, the linking of foreign capital to companies that have been affected by the recession, but which are economically viable, can offer companies in difficulty a capital that will enable them to recover their financial situation and Therefore, their ability to continue exercising their economic activity, with the creation of employment and resulting welfare. In addition, linking foreign capital to clusters and especially dynamic sectors of our economy is important to achieve its continued development and internationalisation.
Importance of the Subscription of a Bilateral Agreement on the Promotion and Reciprocal Protection of Investments with Peru
The signing of the agreement would create a favorable atmosphere for Colombian businessmen to seek new market niches in Peru, and the climate of security and confidence for investments coming from the neighboring country will be strengthened. The current situation provides an important opportunity for Colombia, through this Agreement, to promote the inflow of investment flows as a mechanism for promoting the economy.
For the above arguments, it is very beneficial for our country to subscribe to the Investment Agreement to the extent that the economic ties between the two nations are narrowing.
The following is a list of countries that have signed agreements to protect investments with Peru, the date of the signing of the respective agreements is also transcribed:
Date Signatory Country
Argentina (10.10.94)
Bolivia (30.07.93)
China (09.06.94)
Czech Republic (16.03.94)
Denmark (23.11.94)
El Salvador (13.06.96)
Finland (02.05.95)
France (06.10.93)
Germany (30.06.95)
Italy (05.5.94)
Korea (03.06.93)
Malaysia (13.12.95)
Netherlands (27.12.94)
Norway (10.03.95)
Colombia (26.04.94)
Spain (02.10.91)
Germany (21.10.91)
Switzerland (11.11.91)
France (14.07.92)
Belgium (15.07.92)
Italy (08.03.93)
Sweden (24.05.93)
Finland (27.05.93)
Paraguay (31.06.94)
Portugal (22.11.94)
Romania (16.05.95)
Czech Republic (24.04.95)
Spain (17.11.94)
Switzerland (03.05.94)
Sweden (22.11.91)
Thailand (15.11.91)
United Kingdom (04.10.93)
Foreign investment flows between our two countries have gained some momentum in recent years, and this Agreement will be an additional element of strengthening our bilateral economic relations.
COLOMBIA INVESTMENT IN PERU
DOES NOT INCLUDE OIL, IN DOLLARS
Sectors 1994 1995 1996 1997 1998 1999 2000
Agriculture, hunting,
forestry and fisheries--2,414-16,789,967 240,387
Manufac Industries-
turries 17,827 4,929,836 7,645,443 9,633,731 2,984,772 7,287,860 2,126,332
Construction 259,445 216,772---1,114,470 4,733,646
Trade to the by
greater and the by
lower 40,000 10,000 879,000 1,617,000 2,774,433 26,929,022 1,263,116
Transport, Soul-
cenching and co-
munication------
Stb. Financ.
Insurance, etc. 611,257 1,427,720 688,781-297,000 1,054,880 41,745
Total 930,523 6,586,323 9,215,220 11,255,142 6,058,203 53,178,198 8,407,226
The economic evolution of Peru during 1999 was determined, to a large extent, by the repercussions of the external impulses that affected the country in the course of the year 98. The product returned to a moderate growth path, with a rate of 3.8%. In terms of inflation, there was also a favorable outcome, with a record low of 3.7%. However, the economic revival was in the primary sector, while the rest of the economy continued to suffer the aftermath of the previous year's recession. The credit austerity that led to the exit of short-term external capital initiated at the end of 1998, the financial difficulties in some sectors of activity and the persistence of adverse expectations during much of the year In the case of a reduction in employment (-6%) and a crisis in the financial sector, a reduction in domestic demand (-3%) was determined. The privatization process lost momentum and less than half of the program initially planned for 1999 could be executed.
complex political situation that has been unleashed in Peru since the first months of 2000 has discouraged domestic investment, resulting in a cooling of economic activity in the second half of the year. Growth was higher than in 1999, but it does not appear to have resulted in improvements in urban employment or real wages. Although the fiscal target could not be achieved, inflation remained under control and the external gap narrowed again. The precariousness of the financial situation forced the launch of a third program of rescue of the enterprises and the credit to the private sector was again contracted. The prevailing uncertainty hampered the progress of the privatization and concessions program, with major operations being recorded in early and early years.
Despite the above economic outlook, Peru's investments in Colombia have increased year-on-year (as noted in the chart below), which is another reason to highlight the importance of this agreement, which together with the Other instruments and integration actions will contribute to the dynamism and strengthening of relations between Colombia and Peru.
FOREIGN INVESTMENT FROM PERU IN COLOMBIA
DOES NOT INCLUDE OIL, IN DOLLARS
Sectors 1994 1995 1996 1997 1998 1999 2000
Activities not
well specified 174,075-----
Manu Industries-
billers 132,602 874,703 215,632 1,139,062 266-, 528 1,333,356 838,718
Construction 13,298----200,000-
Trade to the by
greater and the by
lower 41,309 147,326 140,660 446,149 121,085 254,935 958,675
Transport, Soul-
cenching and
communications-----5,100
Stb. Financ.
Insurance, etc. 1,878,082 11,134 49,471 8,211,328 86,814 16,269,992 21,565,492
Comu Services-
social nals and
personal 14,930-----
Total 2,227,700 1,03,163 405,763 9,796,539 58,629 15,391,571 23,367,985
The Agreement on the Promotion and Reciprocal Protection of Investments between Peru and Colombia
The recent developments, both in the world and in the hemisphere, generate important challenges in the field of the right to which the design of instruments, including the Promotion and Protection Agreements, is indispensable. Investments that, while maintaining their compatibility with internal regulations, especially the constitutional ones, allow for the increase of the flow of goods, services, technology and capitals10.
These Agreements are nothing other than the mutual commitment between countries to maintain and protect certain guiding principles of foreign investment between them, the most favored national and nation-wide treatment, non-expropriation, freedom of rights exchange and international jurisdiction among others. They are the most suitable international instruments for bilateral regulation of foreign investment11.
While Colombia and Peru are members of the CAN and therefore have a Common Foreign Capital Treatment Regime established in Decision 291, this constitutes the general framework in this field, the Agreement for the Promotion and Protection of investments the call to reflect the fundamental principles in terms of guarantees of treatment to the investment is and to provide an essential element in the decision of the investor, that is, that of the stability in the rules of gambling or the validity of minimum guarantees for the realization of foreign investments.
With this Protocol to the Convention, the agreement is sought to bring into force the agreement in which the Government of Colombia and the Government of Peru undertake to give a treatment to the investors, in accordance with the rules of international law, and to guarantee the stability of the principles enshrined in Colombian law. These rights relate to:
-The treatment of these once established in Colombia (national treatment, most favored nation).
-The exchange rate guarantee.
-Rules regarding expropriation and
-Conflict resolution.
The law approving the Agreement for the Promotion and Protection of Investments signed by the governments of Peru and Colombia, once the respective procedure before the Congress of the Republic, was reviewed, was reviewed by the Constitutional Court, and The 1997 C-08-97 statement made it partially inexequable.
In the ruling, the Court touched on two issues, the first of which refers to the expropriation without compensation contained in the then article 58 of the Constitution, article subsequently reformed, and the content of which must be respected by the treaty in point.
The second was because article 100 of the Constitution states that while foreigners must enjoy the same civil rights granted to Colombians, it is equally clear. that "the law may, for reasons of public order, subordinate to special conditions or deny the exercise of certain civil rights to foreigners."
Therefore, an international treaty cannot prevent the Colombian legislator from making use of this attribution, so it was necessary to make clear in the Agreement signed with Peru on this matter.
The clauses that develop the commitments acquired with the Protocol are listed below:
ARTICLE 1o. EXPROPRIATION AND INDEMNIFICATION. In this article it is established that in the event of an expropriation or equivalent measure, the State shall provide prompt, adequate and effective compensation together with interest until the day on which it is make the payment.
ARTICLE 2o. Indicates that nothing in the Agreement or in the Protocol shall be construed as preventing a party from adopting or maintaining measures intended to preserve public order, concordance with what is established in article 100 of our Constitution.
Conclusions
After having precipitated the deepest depression of the 20th century in 1999, with a drop of 4.3% in the product, the Colombian economy experienced a moderate recovery (2.8%) in the year 2000, led mainly by exports, in particular the oil companies. However, the rebound was insufficient to bring down unemployment which remained at a high 20% in the seven metropolitan areas.
Other macroeconomic indicators developed favorably. Inflation continued its declining trajectory, and at the end of the year it is expected to be below 8%, below the target set by the authorities. Performance improvements are expected from the fiscal accounts, as high international oil prices and internal recovery, which resulted in an increase in imports, will contribute to the compliance of the IMF agreement with the IMF. International, signed in December 1999.
Considering this scenario for Colombia, foreign investment is essential to innovate, transfer technology to the productive apparatus, and recover economic growth, increase manufacturing exports, develop the service sectors and generate income from foreign currency to the nation.
Colombia has undertaken a policy to improve the investment climate in the country in order to guarantee conditions of stability and legal security for investments. This policy includes the modernization of legislation, participation in negotiations at both bilateral and multilateral level, and the development of a culture within the Public Administration that will contribute to facilitating investments in and foreign investment in particular.
The importance of foreign investment for developing countries, the increasing level of economic integration between countries and globalization make the commitments that are acquired in the field of investments increasingly demanding, greater security for the investor and an international framework for legal stability in the rules for countries receiving investment will be generated.
Colombia has a strategic geographic position in the continent, it is a country favored by nature and we have an exceptional human quality. However, isolated factors of violence have turned our country's foreign investment away. The above does not amuse the work of the current administration and the joint effort that we must make so that the existing foreign investment is consolidated and serves as a promotion for future investment.
For the reasons explained, this Protocol is a tool that gives stability to Peruvian investments in Colombia and vice versa. It is also a mechanism for promoting investment, as it encourages and promotes Peruvian investments in our territory. The benefits that these investments would generate for the Colombian economy are innumerable. Given the characteristics of the Peruvian economy, these investments will bring to our economy technological innovation, greater knowledge of the export markets, transfer of knowledge and job creation that contribute to the development economic and social of the country, thus achieving to consolidate the process of modernization of the Colombian economy and the appropriate insertion of the country to the globalized market.
Colombia is offering foreign investors with the ratification of this Protocol, a clear message of acceptance of international standards for the protection of investments. This is one of the first messages issued by our country since the reform of Article 58 of the Charter and will become the one that promotes Colombia as a country with the help of the Foreign investment will face the challenges of the present century.
In view of the above, the National Government of the Republic of Colombia, through the Foreign Affairs and Foreign Trade Ministers, requests the honorable National Congress to approve the " Additional Amending Protocol to the Convention on the Promotion and Reciprocal Protection of Investments between the Government of the Republic of Colombia and the Government of the Republic of Peru ", made in Lima on May 7 (2001).
Of the honorable Senators and Representatives,
GUILLERMO FERNANDEZ DE SOTO,
Minister of Foreign Affairs.
MARTHA LUCIA RAMIREZ DE RINCON,
Minister of Foreign Trade.
1998 Law 424
(January 13)
by which international conventions are ordered to follow
subscribed by Colombia.
COLOMBIA CONGRESS
DECRETA:
ARTICLE 1o. The National Government through the Foreign Ministry will submit annually to the Senate and Chamber of Foreign Relations Committees, and within the first thirty days of the the legislative period beginning every July 20, a detailed report on how the existing International Conventions signed by Colombia with other States are being complied with and developed.
ARTICLE 2o. Each dependency of the national government responsible for implementing the International Treaties of its competence and requiring reciprocity in them, will transfer the relevant information to the Ministry Foreign and East Relations, to the Commissions Seconds.
ARTICLE 3o. The full text of this law shall be incorporated as an annex to any and all International Conventions that the Ministry of Foreign Affairs presents to the Congress.
ARTICLE 4. This law governs from its enactment.
The President of the honorable Senate of the Republic,
AMYLKAR ACOSTA MEDINA.
The Secretary General of the honorable Senate of the Republic,
PEDRO PUMAREJO VEGA.
The President of the honorable House of Representatives,
CARLOS SQUIRLA BALLESTEROS.
The Secretary General of the honorable House of Representatives,
DIEGO VIVAS TAFUR.
COLOMBIA-NATIONAL GOVERNMENT
PUBLISH AND EXECUTE.
Dada en Santa Fe de Bogota, D. C., on January 13, 1998.
ERNESTO SAMPER PIZANO
The Foreign Minister,
MARIA EMMA MEJIA VELEZ.
EXECUTIVE BRANCH OF PUBLIC POWER
PRESIDENCY OF THE REPUBLIC
Bogotá, D. C., September 18, 2001
Approved. Submit to the consideration of the honorable National Congress for the constitutional effects.
(Fdo.) ANDRES PASTRANA ARANGO
The Deputy Minister of America and Territorial Sovereignty in charge of the functions of the Office of the Minister of Foreign Affairs,
(Fdo.) LENIENCY FORERO UCROS.
DECRETA:
ARTICLE 1o. Approve the "Additional Amending Protocol to the Convention on the Promotion and Reciprocal Protection of Investments between the Government of the Republic of Colombia and the Government of the Republic of Peru", made in Lima on May 7 (7) of two thousand one (2001).
ARTICLE 2o. In accordance with the provisions of Article 1o. of Law 7a. In 1944, the "Additional Amending Protocol to the Convention on the Promotion and Reciprocal Protection of Investments between the Government of the Republic of Colombia and the Government of the Republic of Peru", made in Lima on May 7, (2001), which by the first article of this law is adopted, will force the country from the date on which the international link with respect to it is perfected.
ARTICLE 3o. This law governs from the date of its publication.
The President of the honorable Senate of the Republic,
LUIS ALFREDO RAMOS BOTERO
The Secretary of the Honourable Senate of the Republic,
EMILIO RAMON OTERO DAJUD
The President of the honorable House of Representatives,
WILLIAM VELEZ MESA
The Secretary General of the honorable House of Representatives,
ANGELINO LIZANO RIVERA
COLOMBIA-NATIONAL GOVERNMENT
COMMUNICATE AND COMPLY.
Execute, upon revision of the Constitutional Court, in accordance with article 241-10 of the Political Constitution.
Dada en Bogotá, D. C., a 13 de marzo de 2003.
ALVARO URIBE VELEZ
The Foreign Minister,
CAROLINA BOAT ISAKSON.
The Minister of Commerce, Industry and Tourism,
JORGE HUMBERTO BOTERO ANGULO.
