Colombia - Country Commercial Guide
Market Challenges
Last published date:

While the Colombian market is generally open and business-friendly, challenges remain. Overly burdensome and unpredictable bureaucratic processes pose a challenge for many firms. Extractive industries such as mining and oil and gas exploration face long and complex environmental licensing procedures and often are subject to Consulta Previa, in which indigenous and other ethnic minority groups must be consulted before projects can be carried out in their communities. The pervasiveness of informal and illegal mining and logging in Colombia, and the environmental damage that accompany them, tarnish the image of the mining industry in general and generate resistance to legitimate mining concerns that adhere to environmental standards and labor regulations.

Regulations and standards are another area of concern for U.S. businesses in Colombia. Regulations sometimes change without adequate notification given to the World Trade Organization, industry, and other relevant stakeholders. Moreover, the comment period normally required for stakeholders to voice their opinions on the proposed regulatory change can be insufficient, and comments might not be given adequate review by relevant Colombian authorities. In the area of standards, there have been proposals to adopt European standards and the exclusion of U.S. standards as well as proposals to require standards tests to be conducted by Colombian testing laboratories when no such laboratories exist in Colombia or when such tests have already been conducted at a certified lab in the United States 
The government procurement process in Colombia remains a barrier for many U.S. companies. A lack of transparency and competitive bidding conditions in the public tender process have resulted in U.S. bidders being excluded from key projects such as infrastructure development and project management. The Colombian Government is making efforts to address this issue through the establishment of public procurement agencies such as Colombia Compra Eficiente (Colombia Efficient Procurement). This agency has implemented a transactional, online procurement platform called SECOP II that is intended to promote more transparency in the request for proposal (RFP) process in public works projects. The U.S. Government is also collaborating with Colombian counterparts on initiatives such as the Global Procurement Initiative (GPI), a U.S. Trade and Development Agency (USTDA) partnership that encourages Colombian contracting authorities to focus on long-term value and best practices in public procurement. 

Colombia has also been on the United States Trade Representative (USTR) Special 301 “Watch List” every year since 1991, reflecting ongoing challenges in the enforcement of intellectual property rights (IPR). After being downgraded to the Priority Watch List in 2018, Colombia was upgraded by USTR to “Watch List” status in April 2019 due primarily to the passage by Colombia’s Congress in 2018 of several key IPR safeguard provisions, including copyright law amendments. Colombia remained at “Watch List” status in USTR’s 2023 report, with ongoing IP concerns related to pirated goods and counterfeits. USTR has recognized the country’s active cooperation with the United States on implementing notice-and-takedown and safe-harbor rules for internet service providers.

Logistics costs are another challenge to doing business in Colombia. Due mainly to poor road infrastructure that must wind its way through some of the world’s tallest mountain ranges, logistics costs are some of the highest in the region. Movement of products from the two main ports of Cartagena and Buenaventura to central locations like Bogota and Medellin adds considerable costs. These additional costs can be prohibitively expensive for sectors such as restaurant franchises, which must import most ingredients from abroad through the country’s two major ports. Colombia’s recently announced infrastructure investment initiatives are expected to help alleviate these costs, but the benefits will not be seen immediately as many of these projects will take years to complete.