Colombia

4. What is the nature of the sanctions regime in Colombia?

In relation to the UN sanctions regime and its enforcement in Colombia, authorities such as superintendencies have instructed companies obliged to implement AML policies, to report directly to the General Attorney’s office and the UIAF (administrative agency of the Colombian government in charge of revising and analysing suspicious operations reported by commercial companies regarding money laundering and financing of terrorism and determining if a case must be reported to the General Attorney’s office) the engagement, contact, or any information in relation to counterparties who are included in the UN sanctions resolutions or their commodities, goods, or assets.

In relation to the restrictive lists issued by Colombian authorities, some Colombian authorities such as the National Police, National Prosecutor’s Office, and National Comptroller’s Office have their own “restrictive lists” in which entities and individuals are included due to (i) conviction of crimes, (ii) failure to comply with legal and contractual obligations in relation to public contracts, (iii) contractual sanctions or revocations of contracts executed with governmental entities, (iv) fiscal or disciplinary responsibility before Colombian authorities, etc.

The inclusion in those national restrictive lists depends on a criminal, fiscal, or disciplinary responsibility duly established by the Colombian authorities in a formal decision after a judicial or administrative proceeding. Therefore, the inclusion on those restrictive lists, legally and under the current regulation, is not a voluntary or discretionary act made by any public official.

Governmental entities that open tenders for public procurement, usually prohibit individuals and companies included in those lists to present an offer, as entering into agreement with those entities and individuals may represent a breach of law in Colombia by governmental entities due to the restriction of entering into agreement with individuals or entities who were criminal, disciplinary, or fiscal responsible. Additionally, in the private sector, being included in such “restrictive lists” represents a warning signal, and some private companies may determine voluntarily not to contract with such entities and individuals. We must clarify that in the private sector these restrictive lists are not compulsory and not necessarily represent a barrier to enter into agreements, but a warning signal that must be analyzed by the compliance officer.

Aside from the aforementioned restrictive lists, in January of 2020, the Colombian National Security Council and the Colombian President issued a new official restrictive list aimed to combat terrorist groups around the world. Therefore, the Colombian government implemented a restrictive list in which terrorist groups around the world (i.e. ETA, Al-Qaida) are included. The information and terrorist groups included in such list will be the same as the (i) U.S. restrictive list in relation to terrorist groups, and (ii) E.U restrictive list in relation to terrorist groups and persons. As a consequence, this restrictive list will be updated periodically as the U.S. and E.U. governments update their own lists.

The immediate legal consequences in Colombia of being included in such restrictive list are the following: (i) being reported to the Colombian governmental entity named Financial Analysis and Information Unit (UIAF) by third counterparties who are obliged to report suspicious operations, and (ii) the reputational risk that is triggered for the entities included in such restrictive lists.