After signing the Bilateral Investment Treaties (“BITs”) with Turkey on July 28 and with France on July 10, and ratifying the BIT with Japan on June 25, Colombia significantly moves forward on the protection of foreign investments. These agreements pursue the establishment of a fair, safe and transparent juridical framework in order to draw foreign investors to Colombia and bolster Colombian investments abroad. 

Last July 10, 2014, the British Parliament announced the termination of the ratification process of the BIT between Colombia and United Kingdom, which will be completed after September 1, 2014. The treaty has already been approved by Colombia’s Congress (Law 1464 of 2011) and has been declared valid by the Constitutional Court. Amongst other regulations, the treaty provides that investors that suffer losses due to war, armed conflict or civil strife, will receive the same treatment that the host State accords to its nationals in regard to compensation and restitution.  The treaty will enter into force for a 10-year period, 60 days after the parties notify the completion of their internal procedure. However, the investments undertaken prior to the termination of the treaty will be protected for a further 15 years.

The BIT between Colombia and France was signed on July 10, 2014. The obligations set forth in the treaty are related to the principle of no discrimination, prohibition of expropriation without adequate and effective compensation, and liberty of currency transfers. The agreement will now be reviewed by the legislative bodies of both countries and afterwards will be reviewed by the Constitutional Court in the case of Colombia. The treaty will enter into force when both States have notified of the completion of their internal procedures.  From this moment on the agreement will be in force for 10 years.

In the same way, the BIT between Colombia and Japan was approved by the Colombian Congress and incorporated into national legislation by Law 1720 of June 25, 2014. The agreement provides international standards such as national treatment and no discrimination, and will enter into force once it is validated by Colombia’s Constitutional Court. 

The BIT between Colombia and Turkey was signed on July 28, 2014. The objective of the treaty is to provide a fair treatment to investors, guarantee access to justice, and regulate foreign currency transfer and compensation for expropriation. Commercial relations between Colombia and Turkey have increased in the last years from US$271 million in 2010 to US$792 million in 2013 and with the signing of the agreement, a larger amount of bilateral investments are expected. Imust should be recalled that the agreement still needs to be ratified by the Colombian Congress and reviewed by the Constitutional Court before it enters into force.

Currently, Colombia has BITs in force with Spain, Peru and Switzerland, and has signed agreements with China and India that are pending approval in the Parliaments of these countries. These treaties establish undertakings related to national treatment, most favored nation, minimum standard of treatment, promotion and protection of investments, compensation in case of expropriation, currency transfers, and dispute resolution mechanisms. In addition to these agreements, the FTAs with Chile, Canada, EFTA, Mexico, El Salvador, Guatemala, Honduras and United States embed chapters specifically aimed at the protection of investments and related standards.

The signing and ratification of these treaties marks significant progress in protecting foreign investment. This is as an essential element adopted by Colombia within the framework of International Organizations such as the World Trade Organization.

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