Colombia

Starting a Business in

Montería - Colombia

Below is a detailed summary of the bureaucratic and legal hurdles an entrepreneur must overcome in order to incorporate and register a new firm, along with their associated time and set-up costs. It examines the procedures, time and cost involved in launching a commercial or industrial firm with up to 50 employees and start-up capital of 10 times the economy's per-capita gross national income.

The information appearing on this page was collected as part of the Doing Business subnational project in Colombia. Download this Doing Business report or explore other cities and topics.

No. Procedure Time to Complete Associated Costs
1 Purchase the company books

The company’s books can be purchased at a commercial establishment or from the Chamber of Commerce.
Limited liability companies shall use the following three books:
1. Inventory and balance sheet book: An inventory and a general balance must be made when initiating activities and at least once per year to get to know in a clear and concise manner the state of company’s assets and liabilities
2. Ledger book: In this book the operations of the accounts are entered using the double entry system; this allows the company to summarize on a monthly basis all its operations for each account
3. Cash Book - daily: In this book the accounting operations are entered in chronological order, either individually or by summaries not to exceed one month
Once the company has been registered, its owner, or legal representative must present and request the registry of the commerce books through a letter addressed to the Chamber of Commerce, and fill in the respective application form; the duly numbered book or pages must be presented. The first page in each book or set of pages should be labeled in pencil in the upper side with the name of the company and function given to each book; the pages must be consecutively numbered and have no accounting entries
1 day COP 10,500 [3 books (COP 3,500 per book, COP 35 per page, 100 pages per book)]
2 Obtain a Provisional Unified Tax Registry (pre-RUT) from DIAN

Before registering the company at the Chamber of Commerce, the company’s legal representative must go personally to the DIAN’s office to request a pre-RUT, for which the articles of incorporation of the company are required. The pre-RUT is approved and assigned immediately. If the legal representative cannot go personally, he may present this request through a proxy.
1 day No cost
3 Register the company before the Mercantile Registry, obtain the certificate of existence and legal representation, register the company’s books, and obtain the Unified tax Registry (RUT) from the Chamber of Commerce

There are no Business Service Centers (CAEs) in Monteria.
The procedural steps required from the Chamber of Commerce are:
-Present the format, the letter, and the company’s books before any of the booths
-Pay the rights to register the books. A payment received is given with which the company can claim the books
Once the company has been registered, its owner or legal representative, must present and request the registry of the commerce books through a letter addressed to the Chamber of Commerce, and fill out the application form; the books or pages duly numbered must also be presented. The first page in each book or set of pages should be labeled in pencil in the upper side with the name of the company and purpose given to each book; the pages must be consecutively numbered and have no accounting entries.
The application form for registering the company is filled out by advisors from the Chamber of Commerce, who also provide the NIT.
5 days COP 1,524,810 [COP 718,010: departmental registration tax (0.7% of the company’s initial capital); COP 665,000: commercial license (133.92% of the legal minimum monthly wage); COP 83,000: commercial establishment fee; COP 3,500: registration form; COP 26,000: inscription in the Chamber of Commerce and registration of the document of incorporation; COP 3,500: certificate of existence and legal representation; COP 25,800: cost of registering the company’s books (COP 8,600 each book)]
4 Open a bank account

The company needs to open an account at a commercial bank in order to operate. Opening a savings account only takes a few minutes, but opening a checking account may take up to three days, because the bank is required to verify the applicant’s data before approving the account. Each financial entity may have its own additional requirements for opening an account, such as a minimum deposit amount. In general, a checking account can be opened with a minimum deposit of COP 100,000, and a savings account can be opened with the equivalent of one legal monthly minimum wage, which is currently COP 496,900.
1 day No cost
* 5 Obtain a certificate from the fire department

If the company complies with their safety standards, it can obtain the certificate in one day.
1 day COP 15,000
* 6 Obtain a land use certificate

Obtaining a land use certificate from the municipal authorities is required for operating a business. The entrepreneur requests the land use certificate from the Planning Secretariat, which sends inspectors to visit the company; then the urban curator issues the certificate. A certificate of existence and legal representation is required.
2 days COP 70,000
* 7 Obtain the sanitation certificate

Commercial establishments must comply with specific sanitation requirements. To obtain this certificate, the entrepreneur has to present the certificate of existence and legal representation to the Municipal Health department.
2 days No cost
* 8 Register the company for the payment of Industry and Commerce tax

This procedure constitutes the local fiscal registration. To register, the entrepreneur must obtain an application form at the Municipal Government, submit the filled out form, and attach a certificate of existence and legal representation, copy of the RUT and copy of the identification card of the legal representative.
1 day No cost
9 Register the company with a family compensation fund (caja de compensación familiar), the National Training Service (SENA) and the Colombian Family Welfare Institute (ICBF)

Once it is registered, the company must pay these payroll-based contributions within the first eight days of each month. The contribution is then distributed internally between SENA and ICBF. The registration procedure at a family compensation fund only takes a few minutes, but the request is subject to evaluation for approval or rejection.
The documents that must be submitted include: registration form, certificate of existence and legal representation issued by the Chamber of Commerce, photocopy of the legal representative’s identification card and the payroll list, with copies of the employees’ identification cards and documentation related to their children.
Decree 3667 of November 8, 2004, establishes that self-liquidation and payment of the contribution to the Comprehensive Social Security System and parafiscal contributions must be carried out through a sole comprehensive form, and all employers must effect the payment of parafiscal contributions to the family compensation funds, the SENA, the ICBF, and ESAP, industrial schools and technical institutes, and the contributions to the Comprehensive Social Security in the locations determined by the administrating entities, within a calendar month following the worked period.
4 days No cost
* 10 Affiliate the company to an Occupational Risk Management Company (ARP)

The Occupational Risk Management Company (ARP) insures against risks due to work accidents and disability due to occupational illnesses. The company must affiliate its employees to a public or private ARP of its choice. The registration procedure before the ARP takes a few minutes and consists of the presentation of the form but the coverage begins as of the next day. Monthly payments are made through the Comprehensive Form of Liquidation and Contributions of Social Security (PILA).
1 day No cost
* 11 Affiliate employees to the public pensions system

The company must affiliate its employees to a pension fund, which may be either the government’s Social Security Institute (ISS) or a private pension fund. Employees may select the fund of their choice. The application process to the ISS takes one day and is completed once the appropriate form is submitted. However, the ISS may take, on average, 5 days to confirm the affiliation. An agent from the public pension fund may visit the company and complete the registration procedure.
5 days No cost
* 12 Affiliate employees to a private pension fund

When employees select a private fund, a representative of the fund will generally visit the company to assist in filling out the forms and expediting the registration process. There are six private funds operating in the city.
1 day No cost
* 13 Affiliate employees to a mandatory healthcare plan

The company is required to affiliate its employees to a Mandatory Healthcare Plan (POS) through a Healthcare Promotion Entity (EPS). Each employee has the right to select the EPS of his or her choice, and companies are required to register the employee at the selected EPS. The employee registration process varies depending on the EPS and the employee’s records.
The EPS representative visits the company’s facilities, obtains the information required for affiliation and submits the request to the EPS. Requirements: copy of the identity card of each employee, fill out the form, copy of work contract; when the employee has family, copy of the civil registration of the offspring and identity card of the spouse or life partner.
In August of 2008, a new EPS named Nueva EPS S.A. was created as a result of the exceptional transfer of the affiliates of the public-sector EPS ISS, in the framework of Decree 055 of 2007. Nueva EPS was established as a healthcare promotion entity under the contributive regime by means of Resolution 371 of April 3, 2008 of the National Health Superintendence.
2 days No cost
* 14 Affiliate employees to a severance fund

Each employee is free to select the severance fund of his or her choice. The company submits the documents for affiliation and must deposit every year –on February 14th– payment of each employee’s severance entitlement.
1 day No cost
* Takes place simultaneously with another procedure.
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