S.A.S. of the archipelago

Twelve years ago, when the last version of the bill that would give birth to the simplified joint stock companies -S.A.S. s- was being discussed in the Congress of the Republic (Law 1258 of 2008), another bill that never had much impact was sinking in the Chamber of Deputies: Bill 067 of 2008, which added Law 915 of 2004 to Law 915 of 2004. (Law 1258 of 2008), another bill was sinking in the Chamber, in parallel, which never had much echo: Bill 067 of 2008 by which Law 915 of 2004 ("Border Statute for the economic and social development of the archipelago department of San Andres, Providencia and Santa Catalina") was added to the regime of the simplified joint stock companies of the archipelago.

This bill timidly intended to generate a corporate vehicle that could serve as an investment platform for the International Financial Center referred to in Article 41 of Law 47 of 1993. As special characteristics, at that moment, it was established that: i) the S.A.S. of the archipelago could be incorporated by electronic means (and registration fees could also be paid by such means); ii) the act of incorporation "could be exempted from the departmental registration tax, as well as from any other national or departmental tax"; iii) the Chamber of Commerce of San Andres would be entrusted, together with the processing of the RUT, the management of the foreign investment registrations before the Bank of the Republic, as applicable; iv) the electronic certificate would be enabled as the only proof of existence of the company; v) they would not be obliged, in any case (not even for the amount of their income or assets), to have a statutory auditor; vi) arbitration would be adopted as a mandatory mechanism for the resolution of disputes.

The devastation caused by Hurricane Iota has led the Government to consider profound changes in the legislation to reactivate the economy of the archipelago.

So far, the approval of the bill that would reactivate tourism in the region is known and that, as tax measures to that effect, until December 31, 2021, would reduce the VAT on air tickets from 19% to 5% and the consumption tax to 0% and would exempt hotel and tourism services from VAT. This, although positive, is not enough.

We must stop thinking that this Caribbean region should only live from tourism and we must bet on its development as an International Financial Center, for which it would be worthwhile to rescue this project and, taking into account that the Government will present a new tax reform in the first quarter of next year, update it with the new world trends in terms of attracting investment and providing value-added professional services.

Some simple ideas to adapt a S.A.S. of the archipelago to this purpose would be, in addition to the above: (i) that they have preference to list their bonds and shares in the stock market for SMEs created by Article 162 of Law 1955 of 2019; (ii) that they could be admitted to a special free zone for goods and services, such as the E-Zone of Curaçao; iii) that they could grant special immigration incentives for high net worth individuals with the commitment to establish their family offices and Colombian Holding Companies (CHC) on the island and employ personnel there; iv) that they could function as captive reinsurers; and v) that they could register ships, yachts and boats to compete with jurisdictions such as Panama and Liberia.