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Research by Country/Region January 19, 2018  
COLOMBIA: CUSTOMS, TAXES, and DOCUMENTATION REQUIREMENTS: IT PRODUCTS and SERVICES IMPORTS

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A. Is this country a member of the Information Technology Agreement?

B. Customs documentation requirements for IT products

C. Software: duties and taxes, updates, licenses, electronically delivered

D. IT services: tax treatment and other regulations

E. Refurbished, used, or repaired computer equipment imports


A. IS THIS COUNTRY A MEMBER OF THE INFORMATION TECHNOLOGY AGREEMENT?
NO
Signatories to the Information Technology Agreement (ITA) have eliminated their import duties on a wide range of information technology products, including software and computer hardware. For more information on the ITA, and exact tariff elimination schedules of signatories, click here.
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B. CUSTOMS DOCUMENTATION REQUIREMENTS FOR IT PRODUCTS

What are the documentation requirements for the physical import of software? For other information technology products?
The following documents and procedures are required for ordinary or common imports:
(1) import registration or license form approved by Mincomex, when required;
(2) import declaration accompanied by the bill of lading or air waybill and the commercial or proforma invoice;
(3) proof of payment of import duties, value-added tax, surcharges and other fees collected through commercial banks;
(4) packing list;
(5) customs valuation and inspection, if necessary;
(6) an Andean declaration for all imports with an FOB value of US$5,000 and over
(7) certificate of origin, when required.

Customs procedures have been simplified significantly. Fewer forms are required, as import/export procedures and customs clearance have become practically virtual. Import, export and custom transit declarations are to be presented to customs through electronic or magnetic media and passwords are assigned to users.
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C. SOFTWARE: DUTIES and TAXES, UPDATES, LICENSES, ELECTRONICALLY DELIVERED

DUTIES AND TAXES ON SOFTWARE IMPORTS

Are duties assessed on the intellectual property of the software or on the medium on which is it presented?
Duties applied on software imported into Colombia are assessed on the medium used (diskette, CD-ROM). Duties and the Value Added Tax (VAT) are levied on the invoice amount or declared value.
--If the original invoice reflects the cost of the software including manuals and the medium used, then duties and VAT are applied on the transaction value as determined by agreements.
--This can be either the cost of the media or the cost of the media plus the intellectual property.

Are taxes assessed on the intellectual property of the software or on the medium on which is it presented?
Taxes applied on software imported into Colombia are assessed on the medium used (diskette, CD-ROM). Duties and the Value Added Tax (VAT) are levied on the invoice amount or declared value
--If the original invoice reflects the cost of the software including manuals and the medium used, then duties and VAT are applied on the transaction value as determined by agreements.
--This can be either the cost of the media or the cost of the media plus the intellectual property.

Is customized software treated differently than packaged software?
Customized software is not treated differently than packaged software.
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IMPORTS OF SOFTWARE UPDATES

What are the customs duties and tax implications for software sold with updates when the full sales price, including cost of updates, is shown on the original commercial invoice? Are duties and taxes paid on that amount? What happens when the updates are sent at a later date? Are duties/taxes applied again? If so, based on what value? How should information presented on the commercial invoice for the original and subsequent shipments to avoid paying duties/taxes more than once on a single sale?
When updates are included in the original invoice, no import duties/taxes are applied to future updates.
-Duties and taxes will be paid on the full sales price. Only duties on the value of the medium will be paid on the later date when the update is provided.

The original invoice should declare the full amount, if not the update should be sent declaring the value of the medium and software. This will allow the media to be imported via a courier service (DHL, Fedex or UPS) under a special import process:
- Courier or express shipments: Courier or express shipments not exceeding US$1,000 in value and 20 kilograms in weight are freely imported into Colombia. These shipments are classified under HS 98.08.00.00.00, and are subject to a 10 percent CIF tariff and 16 percent Value-Added Tax assessed on the CIF-duty-paid value of most merchandise shipments. Rules apply to either air or surface courier shipments contemplated under the new customs code that entered into effect on July 1, 2000.

Software is considered a service by Colombian customs and no duties or VAT are applicable.
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SOFTWARE LICENSES: CUSTOMS CLASSIFICATION, IMPORT DUTIES, TAXES, OTHER

Are software licenses classified in Harmonized System 4907?
Software licenses in Colombia are classified under HS 49.11.99.00.00. This tariff classification is used for the physical paper on which the license contract is printed.

Are import duties/taxes applied? If so, on what cost/price base are they levied?
The import duty is 20% CIF plus 16% VAT assessed on the CIF-duty-paid value. In other words, the only declared value should be the cost of the actual paper itself.

Are withholding or other additional taxes applied on software licenses? If yes, how?
A withholding tax of 35% is imposed on 80 percent of the value of the licensing fee.

If a U.S. license agreement is included in the packaging or is part of the installation/registration of shrink-wrapped software imported from the United States, would that agreement be binding on consumers in your market? If so, would U.S. or local laws pertain?
Colombian law is applicable.
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SOFTWARE DELIVERED OVER THE INTERNET/ELECTRONICALLY DELIVERED SOFTWARE

Are taxes applied to software delivered to the end-user over the Internet? If so, on what value?
A withholding tax of 35% is imposed on 80 percent of the value of the licensing fee.

What are the documentation requirements for the electronically delivered import of digitized products (i.e. software, movie downloads) over the Internet or other networks?
Digitized products delivered over the Internet do not require any documentation.

Must an electronically delivered software import be accompanied by a physical shipment of the same product?
Per Customs Resolution 4240 of 2000 (Article 214), electronically delivered software must be accompanied by a physical shipment.
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D. IT SERVICES: TAX TREATMENT AND OTHER REGULATIONS

Are services (i.e. training, set-up, etc) relating to the sale of software taxed? If so, at what rate and based on what value?
A withholding tax of 10% is levied on consulting services.

Are U.S. IT solution providers permitted to send personnel into the country to set up hardware/software-related systems?
Foreign staff are allowed into Colombia to set up hardware and software. In such cases, the following procedures should be followed: most business persons who visit Colombia travel primarily to the major cities and commercial centers of Bogota, Cali, Medellin, Barranquilla and Cartagena, where caution should be taken against common large-city crimes such as pickpocketing, jewelry and purse-snatching, and currency scams. Selecting a good hotel, keeping valuables in a hotel safe, using authorized taxis and hired car services, and using common sense in avoiding certain areas of town will help to reduce the risk of falling victim to these crimes. At airports, care should be taken with hand luggage and travel documents. Travel between cities should be by air in order to avoid rural areas controlled by guerillas, narcotraffickers and paramilitary groups. Travel outside of the major cities is not recommended. Those who absolutely must travel to facilities in outlying areas (most commonly oil and mining professionals and technicians) are advised to adhere strictly to the security regulations and guidelines established by their companies.

Are special visa, work permits, and/or professional certification by an accredited body required?
US. citizens traveling to Colombia are required to carry a valid U.S. passport and a return/onward ticket. U.S. citizens do not need a visa for a stay of sixty days or less. Stiff fines are imposed if passports are not stamped on arrival and if stays exceeding sixty days are not authorized by the Colombian immigration agency (Das Extranjeria). Although business travelers may enter Colombia on a tourist visa, they may not establish a domicile in Colombia and the activities they engage in may not produce honoraria or salaries in Colombia. Businessmen traveling under a tourist visa also should be aware that contracts they sign or business they carry out may be considered invalid and non-binding. Business visas are valid for up to three years, can be renewed, and can be used for multiple entries into Colombia for stays of up to six months per visit.

Persons wishing general information concerning Colombia should communicate with the Colombian Embassy in Washington, DC at 2118 Leroy Place, NW, Washington DC, 20009; tel: (202) 332-7476 or (202) 332-7573.
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E. REFURBISHED, USED, OR REPAIRED COMPUTER EQUIPMENT IMPORTS
1. REFURBISHED COMPUTER EQUIPMENT
Is the import of refurbished computer hardware, parts, and accessories (including toner cartridges) permitted?
Imports of refurbished and used machinery and equipment are permitted into Colombia depending on their condition and year of manufacture (not to exceed five years since manufacture).

If so, what are the documentation requirements?
Refurbished and used machinery require a prior import license approval by the Colombian Foreign Trade Ministry, Mincomex (formerly Foreign Trade Institute or Incomex).

Is special labeling required?
Labeling is required. It should show the name of manufacturer, year of manufacture, and year of refurbishing.

What value should be shown on the invoice?
The original FOB price when new (or the resulting price when rebuilt/refurbished by 70 percent or more) in the country of origin and/or purchase, less depreciation percentages (about 10% per year) applied for the years of use, constitute the customs base value for assessing CIF import duties and surcharges.

How are duties and taxes assessed?
Refurbished/used or new machinery is subject to the payment of a 5, 10 or 15 percent CIF import duty (duty may be CIF 5 percent depending on the non-availability of local production of the type of machinery), plus a 16 percent Value-Added Tax (VAT) assessed on the CIF-duty-paid value of imports.
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2. USED COMPUTER EQUIPMENT
Is the import of used computer hardware, parts, and accessories (including toner cartridges) permitted?
Same as for refurbished computer equipment. See answers above.
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3. REPAIRED COMPUTER EQUIPMENT
Are duties and taxes assessed on the re-import of repaired computer equipment?
Duties and taxes are assessed on the re-import of repaired computer equipment, and are applicable on the aggregate value abroad, plus other expenses (transportation, insurance).
The following documents must be provided:
- copy of the temporary statement from Colombian customs of export for repairs
- commercial invoice that accredits the aggregate value abroad
-transport documents

How should the commercial invoice appear?
It should accredit the aggregate value abroad
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RESPONSE INFORMATION

This response was prepared by the U.S. Department of Commerce/Commercial Service in Bogota in February and July 2003. For further clarification please contact:\
Americo Rios
Senior Commercial Specialist
U.S. Commercial Service/U.S. Embassy Bogota
Cra. 45 No.22-D-45
Bogota, Colombia
Phones: (571) 383-2712 & 315-2126 & 315-2298
Faxes: (571) 315-2171 & 315-2190
americo.rios@mail.doc.gov

Special Notes: The above information is intended to serve only as unofficial guidance. In seeking to obtain government rulings in specific cases, it will often be necessary to refer to special laws, separate regulations and announcements, and case-by-case decisions by the government. Beyond the general guidelines shown above, legal counsel should be retained at an early stage of consummation of a major procurement contract, and before entering into any legal commitments.

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