819 law (July 9) 2003 Official Journal No. 45.243, of 9 July 2003 public power - legislative branch which are issued organic standards in terms of budget and fiscal transparency, accountability, and enacting other provisions.
COLOMBIA CONGRESS DECREES: CHAPTER I. ORGANIC STANDARDS OF BUDGET TRANSPARENCY FISCAL AND MACROECONOMIC STABILITY.
Article 1 Medium-term FISCAL framework. Before 15 June of each fiscal term, the national Government, it will present the economic committees of the Senate and the House of representatives, a Fiscal framework of medium-term, which will be studied and discussed with priority during the first debate annual enforcement budget.
This framework will contain, as a minimum: a) Financial Plan contained in article 4 of the Act 38 of 1989, modified by subsection 5 of article 55 of the law 179 of 1994;
(b) a multiannual macroeconomic programme;
(c) the goals of primary surplus referred to in article 2 of this law, as well as the level of public debt and an analysis of its sustainability;
(d) a report of the previous fiscal term macroeconomic and fiscal results. This report must include, in the event of failure to comply with the targets set in the Fiscal framework of medium-term of the previous year, an explanation of any deviation from the targets and measures to correct them. If it is has failed to fulfil the goal of primary surplus of the previous year, the new Fiscal framework of medium-term should reflect an adjustment that ensures the sustainability of the public debt;
(e) an evaluation of the main activities carried out by the public sector; quasi-fiscal
(f) an estimate of the fiscal cost of exemptions, deductions, or existing tax discounts;
(g) the fiscal cost of the laws sanctioned in the previous fiscal period;
(h) a statement of contingent liabilities that could affect the financial situation of the nation;
(i) any budget should include indicators of budget management and result of the objectives, plans and programmes disaggregated for greater control of the budget.
Article 2nd Primary surplus and sustainability. Each year the national Government determined for next fiscal period a goal of primary surplus for the non-financial public sector consistent with the macroeconomic programme, and indicative targets for the primary surplus of the ten (10) following fiscal validity. All this in order to ensure the sustainability of the debt and economic growth. This goal shall be approved by the National Council of economic and Social policy, Conpes, prior concept of the Superior Council of Fiscal policy, Confis.
The goals of primary surplus adjusted for the economic cycle, on average, may not be lower than the structural primary surplus which guarantees the sustainability of the debt.
The development of the primary surplus target will take into account macroeconomic assumptions, such as interest rates, inflation, economic growth and exchange rate, determined by the Ministry of finance and public credit, the National Planning Department, and the Central Bank.
Without prejudice to the limits on operating costs set out in the Law 617 of 2000, or laws that modify it or added, the departments, districts and municipalities of special categories, 1 and 2 should establish a goal of primary surplus for each term in order to ensure the sustainability of their respective debt in accordance with provisions in the law 358 of 1997 or in those laws that modify it or added. The goal of primary surplus which guarantees the sustainability of the debt will be set by the Confis or by the Secretariat of finance appropriate and approved and revised by the Governing Council.
PARAGRAPH. Primary surplus means that positive value resulting from the difference between the amount of ordinary income and capital resources, different credit disbursements, privatizations, capitalization, profits of the Bank of the Republic (in the case of the nation), and the sum of investment, commercial operating expenses and operating costs.
Article 3 CONTINGENT liabilities. The valuations of the new contingent liabilities resulting from the conclusion of operations of public credit, other administrative contracts and statements and reconciliations whose improvement is carried out subsequent to the entry into force of the law 448 of 1998, will be approved by the Directorate General of public credit for the Ministry of finance and public credit and will be handled in accordance with the provisions of this law. The assessment of contingent liabilities perfected prior to the entry into force of the aforementioned Law 448 of 1998, will be conducted by the National Planning Department, based on procedures established by this entity.
Concordances article 4o. consistency of the budget. The draft General budget of the nation and the budget proposals of the States with budgetary regime of industrial and commercial State enterprises engaged in activities not financial and mixed economy companies assimilated these must be consistent with the literal to), b), c) of article 1 of this law.
Similarly, amendments or additions to the annual laws of budget approved by the Congress of the Republic shall comply with the Fiscal framework of medium-term planning in the adoption and discussion of the law that is intended to modify or add.
Article 5 Territorial entities medium-term FISCAL framework. Annually, in the departments, districts and municipalities of special category, 1 and 2, from the entry into force of this law, and in the municipalities of categories 3, 4, 5 and 6 from the 2005 term, Governor or mayor shall submit to the respective Assembly or Council, for information, a medium-term Fiscal Framework.
Said framework will be presented in the same period in which the proposed budget should occur and should contain as a minimum: a) Financial Plan contained in article 4 of Act 38 of 1989, modified by subsection 5 of the law 179 of 1994;
(b) the goals of primary surplus referred to in article 2 of this law, as well as the level of public debt and an analysis of its sustainability;
(c) the actions and specific measures which underpins the achievement of the targets, with their corresponding schedules of execution;
(d) a report of fiscal results of the previous fiscal term. This report must include, in the event of failure to comply with the targets set in the Fiscal framework of medium-term of the previous year, an explanation of any deviation from the targets and measures to correct them. If it is has failed to fulfil the goal of primary surplus of the previous year, the new Fiscal framework of medium-term should reflect an adjustment that ensures the sustainability of the public debt;
(e) an estimate of the fiscal cost of tax exemptions in the previous period;
(f) a relationship of demandable liabilities and contingent liabilities that may affect the financial situation of the territorial entity;
(g) the fiscal cost of the projects of Ordinance or agreement sanctioned in the previous fiscal term.
Concordances article 6o. consistency of the budget for territorial entities. The draft General budget of the territorial entity and proposed budgets of entities on the territorial agenda with budget system of State trading and industrial companies and mixed economy companies assimilated these must be consistent with provisions in literals a, b and c of the preceding article.
Concordances article 7. analysis of the impact tax rules. At all times, the fiscal impact of any proposed law, Ordinance or agreement, that direct spending or that grant tax benefits, it must be explicit and must be compatible with the Fiscal framework of medium-term.
For these purposes, must be included expressly in the explanatory statement and in the respective proceedings papers the fiscal costs of the initiative and the source of additional income generated for the financing of the cost.
The Ministry of finance and public credit, at any time during the respective proceedings in the Congress of the Republic, must file its concept to the consistency of the provisions of the preceding paragraph. In any case this concept may be at cross purposes of the Fiscal framework of medium-term. This report will be published in the Gazette of the Congress.
The Bills of Government initiative, raised an additional expenditure or a reduction in income, must contain the corresponding replacement source for decrease in spending or increases in revenue, which must be analyzed and approved by the Ministry of finance and public credit.
In territorial entities, the procedure provided for in the preceding paragraph will be stocked before the respective Secretary of Treasury or whoever does their times.
Editor concordances jurisprudence consistent chapter II notes.
ORGANIC STANDARDS BUDGET OF FISCAL DISCIPLINE.
Article 8 Regulations to budget programming. The preparation and development of the nation's general budget and of the territorial entities, must agree to the corresponding Marcos Fiscales medium term so that budget appropriations adopted by the Congress of the Republic, the assemblies and councils, can run in its entirety during the corresponding fiscal term.
Events that is pending a tender, merit-based, or any other process of selection of the contractor with all legal requirements, including the budget availability, and its further development takes place in the next fiscal period, the fulfillment of budget adjustments will assist with the previous budget of this last term.
Concordances transitional paragraph. Provisions of this article will begin to govern, once is completed the following transition: thirty per cent (30%) of the reserves of the General budget of the nation and the territorial entities which constitute at the end of the 2004 fiscal period will be met from the budget of the year 2005. At the same time, seventy percent (70%) stocks of the General budget of the nation and of the territorial entities which constitute at the end of the 2005 fiscal period will be met from the budget of the an or 2006.
For which the national Government and the territorial Governments, respectively they will do by Decree the corresponding settings.
Concordances article 9th. mandatory information. The companies or societies where the nation or its decentralized entities to participate in their social capital greater than fifty percent (50%) must report, within their competence, the Ministry of finance and public credit and the National Planning Department, the information of financial and budget character that is required in order to give effect to this Act.
ARTICLE 10. ORDINARY FUTURE LIFETIMES. The 9th article of the law 179 of 1994 will be thus: the Confis may authorize the assumption of obligations affecting budgets of future lifetimes when execution is started with the effective ongoing budget and the purpose of the commitment is carried out in each one of them provided is satisfied that: a) the maximum amount of future lifetimes , the term and the conditions thereof see multiannual targets of the Fiscal framework of medium-term covered by article 1 of this law;
((b) as a minimum, the future validity requested must have with appropriation of the fifteen percent (15%) in the tax period in which they are authorized; c) in the case of national investment projects must obtain the prior and favourable concept of the National Department of planning and the Ministry of industry.
Approval by the Confis to commit budget to charge to future validity may not exceed the respective Government period. Except for projects of investment expenditure in those cases in which the Conpes previously to declare them strategic importance.
This provision shall also apply to entities covered by article 9 of this law. The Government shall regulate the matter.
The Ministry of finance and public credit, Directorate General of the budget public, will include projects budget allocations necessary to comply to the provisions of this article.
PARAGRAPH. These functions may be delegated by the Confis in the Directorate General of the budget public national of the Ministry of finance and public credit in the case of the bodies that make up the General budget of the nation and in joints or tip executives for entities covered by paragraph 4 of article 10 of the law 179 of 1994. The national Government shall regulate the matter.
In case of such delegation, who is delegated by the Confis shall submit a quarterly report to the Council on the future lifetimes in the immediately preceding quarter.
ARTICLE 11. EXCEPTIONAL FUTURE LIFETIMES. Article 3 of law 225 of 1995 will be thus: the Superior Council of Fiscal policy, Confis, in exceptional cases for works of infrastructure, energy, communications, aeronautics, defence and security, as well as guarantees to concessions, may authorize is to assume obligations that affect the future lifetimes without appropriation and budget budget l of the year in which the authorization is granted. The maximum amount of future lifetimes, the term and the conditions thereof should consult the multi-year goals of the Fiscal framework of medium-term which is article 1 of this law.
The Executive Secretary of the Confis sent quarterly to the economic committees of the Congress a list of authorizations approved by the Council, for these cases.
To take on obligations affecting budgets of future lifetimes, loan contracts and to counterparts in these is stipulated not require the authorization of the Higher Council of Fiscal policy, Confis. These contracts shall be governed by the rules governing the operations of public credit.
ARTICLE 12. ORDINARY FUTURE LIFETIMES FOR TERRITORIAL ENTITIES. In territorial entities, authorizations to commit future lifetimes will be taught by the Assembly or respective Council, at the initiative of the local government, approval by the Confis territorial or organ that makes their times.
The assumption of obligations affecting budgets of future lifetimes when execution is started with the effective ongoing budget and the purpose of the commitment is carried out in each one of them provided is satisfied that may be authorized: a) the maximum amount of future lifetimes, the term and the conditions thereof see multiannual targets of the Fiscal framework of medium-term covered by article 1 of this law;
(b) as a minimum, the future validity requested must have with appropriation of fifteen percent (15%) in the tax period in which they are authorized;
c) in the case of projects involving domestic investment should be obtained prior and favourable concept of the National Planning Department.
Popular choice Corporation will not grant authorization if the projects of the future entry into force are not recorded in the respective Development Plan and if you added all the commitments which they intend to purchase for this modality and its future maintenance or administration costs, its borrowing capacity is exceeded.
Approval by the Confis to commit budget to charge to future validity may not exceed the respective Government period. Except for projects of investment expenditure in those cases in which the Governing Council previously to declare them strategic importance.
In territorial entities, the approval of any future force, in the last year of Government of the respective Mayor or Governor, except for the celebration of public credit-related operation is prohibited.
Transitional paragraph. The prohibition provided for in the preceding paragraph will not apply to the present period of Governors and mayors, provided that this is necessary for the implementation of regional development projects approved in the National Development Plan.
ARTICLE 13. FISCAL RESPONSIBILITY IN THE RECRUITMENT OF STAFF FOR PROVISION OF SERVICES. The public servant responsible for the recruitment of staff by providing services that leave unattended in the Law 617 of 2000 and 715 of 2001 will be fiscally responsible.
RULING ON TERRITORIAL DEBT.
ARTICLE 14. CAPACITY TO PAY OF THE TERRITORIAL ENTITIES. The ability to pay of the territorial entities must be checked for all the period of credit contracted and when doing so, either of the two values enshrined in article 6 of the law 358 of 1997 located above the limits there, the territorial entity shall follow the procedures set out in the Act.
PARAGRAPH. For these purposes, the projection of the interests and the balance of the debt shall take into account the percentages of hedging of rate of interest and exchange rate will be set on a quarterly basis by the Superintendence of banks.
ARTICLE 15. CREDITS FROM TREASURY TERRITORIAL INSTITUTIONS. Treasury loans granted by banks to local authorities will be allocated exclusively to meet failure of temporary character during the fiscal term box and must comply with the following requirements: to) Treasury appropriations may not exceed the doceava of the current revenues of the fiscal year;
(b) they shall be paid with different credit resources;
c) must be paid with interest and other financial charges before December 20 of the same term in which are contracted;
(d) not may shrink as soon as there are credits of Treasury in mora or overdrafts.
ARTICLE 16. QUALIFICATION OF LOCAL AUTHORITIES AS ELIGIBLE FOR CREDIT. Without prejudice to the provisions of the preceding articles, and the provisions contained in the rules of territorial indebtedness, for the recruitment of new lending by the departments, districts and municipalities of special categories, 1 and 2 will be presentation of an evaluation prepared by a risk rating, supervised by the Superintendency that credited the ability to collapse the new indebtedness.
PARAGRAPH. The application of this article shall be enforced from 1st January of the year 2005.
ARTICLE 17. PLACEMENT OF EXCESS LIQUIDITY. Local authorities will need to invest their transient excess liquidity in public internal debt of the nation titles or titles that have a high credit rating or that are deposited in qualified banks as of low credit risk.
PARAGRAPH. Local authorities can continue placing their excess liquidity in institutes of development and development while the latter obtained the qualification of low credit risk, which will have a term of one (1) year from the entry into force of this law.
ARTICLE 18. LIMIT THE REALIZATION OF CROSS-CREDITS. Promotion and development institutions or financial institutions owned by local authorities may be active operations of credit with local authorities provided they do so under the same parameters that apply to financial institutions supervised by the Superintendence of banks.
ARTICLE 19. RESTRICTIONS ON THE SUPPORT OF THE NATION. Without prejudice to the restrictions laid down in other regulations, prohibited the nation granting direct or indirect financial support to local authorities that do not comply with the provisions of the law 358 of 1997 and the present law. As a result, the nation may not provide resources, co-finance projects, guarantee public credit operations or transfer any kind of resources, other than those specified in the Constitution.
ARTICLE 20. LIMITS ON BORROWING FOR DEBT WITH THE NATION. No territorial entity may make public lending operations which increase its net debt when they are in arrears by public credit operations contracted with the National Central Government or guaranteed by it.
ARTICLE 21. CONDITIONS OF CREDIT. Financial institutions and institutes of development and territorial development to make loans to local authorities, will require compliance with the conditions and limits established the law 358 of 1997, the Law 617 of 2000 and this law. The credits granted from the entry into force of this law, in violation of the provisions, will have no validity and beneficiary local authorities will proceed to its cancellation through the capital return, being prohibited the payment of interest and other financial charges to the creditor. While there is no cancellation shall apply the restrictions set forth in this Act.
ARTICLE 22. LIABILITY CLAIMS AGAINST PUBLIC ENTITIES IN LIQUIDATION.
Jurisprudence validity previous legislation article 23. COERCIVE COLLECTION OF SURPLUS. The documents that the National Council of economic and Social policy, Conpes, issued under the articles 5 and 6 of the 225 law of 1995, will lend merit Executive for the payment of capital and their corresponding interests of mora. For the determination of the amount of the interests of mora, the Conpes asked the respective information to the General direction of the national treasure of the Ministry of finance and public credit.
In these cases, the Ministry of finance and public credit is the competent entity to advance the performance of coercive collection.
ARTICLE 24. REPRESENTATION OF THE INTERESTS OF THE NATION IN PUBLIC UTILITIES COMPANIES. In the assemblies and boards of public companies in which the nation has shareholding, the interests of the nation will be represented by officials of the plant's staff of the Ministry of finance and public credit. These officials shall submit reports on decisions in which she had participated when they requested it by the Minister.
ARTICLE 25. PORTFOLIO RESTRUCTURING IN FISCAL RESPONSIBILITY. Financial institutions of a public character to carry out restructuring of credits, reductions or cancellations of interest to their delinquent debtors must be done in accordance with the General conditions of the financial market and in order to: recover its portfolio, prevent the deterioration of its financial structure and budget, and promote advocacy, profitability and recovery of public assets.
ARTICLE 26. NON-COMPLIANCE. Breach of this law by the responsible public servants, at the corresponding level of the public administration, will be considered as disciplinary lack, in accordance with the provisions of Act 734 of 2002 for the effect.
ARTICLE 27. TRAINING AND TECHNICAL ASSISTANCE TO LOCAL AUTHORITIES. The proper application of this law, will be in charge of the Ministry of finance and public credit and the National Department of planning, training and technical assistance to local authorities.
ARTICLE 28. VALIDITY AND DEROGATORY. This law governs the date of its promulgation.
The President of the honorable Senate of the Republic, LUIS ALFREDO RAMOS BOTERO.
The Secretary General of the honorable 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 LIZCANO RIVERA.
REPUBLIC OF COLOMBIA - NATIONAL GOVERNMENT PUBLISHED AND ENFORCED.
Given in Bogotá, D. C., on July 9, 2003.
ÁLVARO URIBE VÉLEZ the Minister of finance and public credit, ALBERTO CARRASQUILLA BARRERA.