Limited Liability Company - LLC Corporation by Shares
(Sociedad de Responsabilidad Limitada) (Sociedad Anónima)
Name The name of the company must include
the word “Limitada” or the “Ltda.”
abbreviation.
Establishment The company must be established by
public deed granted before a Notary
Public.
Liability The partners are responsible up to the
amount of their contributions to the
corporate capital, with exception of
labor and tax liabilities.
Management The administration of the company
relies in its partners who can validly
appoint a manager fixing his powers and
faculties attributions.
Required Requires of at least 2 partners.
Constituents
Corporate The capital shall be sufficient to cover its
Capital preoperative expenses. Capital is
divided into quotas. The capital must be
paid in full at the moment of its
establishment.
Statutory The limited liability company only
Auditor requires for a statutory auditor when
certain amount of income and/or assets
is reached.
Corporate Image LLC’s were legal entities intended for
family owned businesses. However, this
type of legal entity has been generally
used for non-family businesses. Partners
are registered in the Mercantile Registry
of the Chamber of Commerce.
Branch of a Foreign Legal Entity
(Sucursal de Sociedad Extranjera)
The name of the corporation shall
include the “S.A.” abbreviation.
The corporation must be established by
public deed granted before a Notary
Public.
Shareholders are responsible up to the
amount of their contributions in the
corporate capital, without exception.
The administration relies in the
Shareholders Meeting, a Board of
Directors and the Legal
Representatives.
Requires of at least five (5)
shareholders.
The capital must be formed by shares.
At the moment it is established, the
corporation must have a subscribed
capital of at least 50% of the authorized
capital and the paid in capital must be
30% of the subscribed capital. The
subscribed capital must be paid in a
maximum term of one year.
Are always obliged to have a statutory
auditor.
Corporations by shares usually
represent bigger businesses than that
of LLC’s and its shareholders are always
anonymous.
Simplified Corporation by Shares
(Sociedad por Acciones Simplificada)
The name shall be the same of the parent
company accompanied by the reference to
“Colombia”.
The branch of a foreign corporation must be
established by public deed granted before a
Notary Public including the articles of the
parent company.
The parent company is 100% responsible for
its branch’s obligations.
The administration relies in the parent
company, however, it can delegate such
representation in a general manager and an
alternate.
Parent company.
The assigned capital should at least
correspond to that necessary to cover the
initial preoperative expenses. Money
transfers can be done either as a capital
increase of the assigned capital or by means
of a supplementary investment to the
assigned capital which is an account of
exclusive use for branches of foreign
companies.
Mandatory.
Third parties will know who is the parent
company.
The name of the corporation shall include
the S.A.S. abbreviation.
The corporation can be established by
means of a private document, thus
representing the savings of the
corresponding notaries’ fees.
The shareholders are only liable up to the
amount of their contribution to the
corporate capital.
The administration relies in the
shareholders meeting and legal
representatives (manager and alternate).
A Board of Directors is optional.
The corporation can validly exist with just
one (1) shareholder.
There is no minimum corporate capital.
The subscribed capital can be paid during
a two (2) years term.
Not required unless the corporation
exceeds certain amount of assets and/or
income in a given tax year.
It is the newest and most modern type of
admitted legal entity, and constitutes an
efficient vehicle for doing business or
investing in Colombia.