Colombia company structures: at a glance

Hawksford

Last updated: 15 December 2025 |

Americas | Colombia

Options for registering companies in Colombia

Colombia is a key economy in South America, attracting foreign investment with a modern corporate structure and the flexible SAS. The general corporate tax rate is 35%, but this is reduced for entities operating in free zones.

Colombia offers international companies the following legal structures for establishing a local presence:

Simplified stock corporation (Sociedad por Acciones Simplificada - SAS)

Colombian SAS is the most popular and flexible entity for foreign investors since its creation in 2008.
It can be formed with a minimum of one shareholder (natural person or legal entity), allowing for 100% foreign ownership.
Shareholders benefit from limited liability up to the amount of their capital contribution.
The structure allows for highly flexible governance defined in the company's bylaws.
It must appoint a legal representative (representante legal).

Corporation (Sociedad Anónima - SA)

Colombian corporation is the traditional corporate structure used by large enterprises and financial institutions.
Requires a minimum of five shareholders and has a complex and rigid governance structure.
Liability is limited to the capital contributed by shareholders.
The appointment of a board of directors and a statutory auditor (revisor fiscal) is mandatory.
The capital amount required is variable. At least one-third of the subscribed capital must be paid up at the time of incorporation.

Branch office of a foreign company (Sucursal de Sociedad Extranjera)

The branch is a permanent establishment and an extension of the foreign parent company, lacking separate legal personality.
It is fully permitted to carry out commercial activities and generate revenue in Colombia.
The foreign parent company retains full and unlimited liability for all the branch's operations and debts in Colombia.
Requires a mandatory assigned capital and the appointment of a legal representative who must reside in Colombia.
Must register with the Colombian Chamber of Commerce via a public deed.

Free zone company (Zona Franca - ZF)

Companies that establish as industrial users of goods or services within designated Colombian free zones benefit from a special tax and customs regime.
Subject to a corporate income tax rate of 20% when certain conditions are met.
Exempt from VAT and tariffs on foreign goods introduced into the free zone.
The company must meet specific investment and employment requirements defined by the free zone regulations.

To help you choose the right structure, we have created an ‘at a glance’ summary table for the common company types that outlines key differences in formation processes, requirements and timelines. It serves as a valuable resource for foreign companies looking to setup or expand a business in Colombia.

Comparison of the common types of companies in Colombia

Key information	Simplified stock corporation	Branch	Corporation	Free zone company
Commonly used for	All purposes	Centralised oversight from headquarters	IPO or immediate large-scale operations	Manufacture goods by processing raw materials or semi-finished products
Minimum capitalisation (US$)	$1	Not applicable	Variable	from $10,000 (recommended)
Limited liability	Yes	No	Yes	Yes
Time to incorporate	Eight weeks	Ten weeks	Eight weeks	Ten weeks
Tax rate (CIT)	35%	35%	35%	20% if certain conditions are met
Resident management	Yes	Yes	Yes	Yes
Cost indication (US$)	$13,500	$18,000	$14,500	$16,000