Branch offices are a possibility for companies headquartered in foreign countries, and they have been attractive options to foreign investors in mining and hydrocarbons because of foreign exchange benefits within those sectors. From a purely legal point of view, Colombian law views the branch office of a foreign company and its parent company as the same legal entity.
- Parent company is therefore liable for the entire obligations of the branch.
- Branch must be registered in Colombia by way of a public deed.
- Bylaws and corporate stakeholders are the same as those of the parent company.
- Statutory auditor must be appointed.
There are a number of unique scenarios that could apply to any particular legal structure, so your company strategy and needs will determine the most appropriate option for you. A local partner with expertise in this area can help you identify tax saving measures in advance, so you would be well-advised to seek help and ensure you don’t make an expensive mistake that has to be corrected down the road, especially after you’ve already lost tens of thousands of dollars in unnecessary taxes.