If you are a foreign investor looking to transfer money to Colombia to purchase real estate, establish a business, or make any type of investment, it is essential to follow the correct process to ensure compliance with local regulations.
One of the most important aspects of this process is properly managing the forms required by the Banco de la República (Colombia’s central bank) to ensure the legality and traceability of the funds. Below, we explain the step-by-step process to make your international transfer safely and without complications.
1. Choose the Transfer Method
Before sending money to Colombia, it is important to select the appropriate method. Some options include:
- International bank transfers (SWIFT): The most common and secure option.
- Authorized exchange houses: Companies that facilitate transfers with competitive rates.
- Fintech platforms: Services like Wise or Remitly may offer lower costs.
It is crucial to verify that the receiving institution in Colombia is authorized to accept foreign currency transfers.
2. Open a Bank Account in Colombia
To receive the funds, you will need a bank account in Colombia. Banks typically require:
- A valid passport.
- A document justifying the source of the funds (depending on the amount and the bank).
- A Foreign Investment Certificate (for certain investment transactions).
If the investment is made through a company, additional documents such as incorporation papers and a legal representative’s credentials will be required.
3. Classify the Transfer: Foreign Investment or Loan
Funds sent from abroad to Colombia can be classified under different categories, such as:
- Foreign direct investment: For purchasing real estate, creating companies, or acquiring shares.
- International loans: To finance projects or businesses in the country.
It is essential to correctly classify the transfer, as this will affect tax obligations and regulatory requirements.
4. Completing the Banco de la República Forms
Any capital transfer from abroad intended for investment must be registered with the Banco de la República de Colombia by submitting the following forms:
📌 Form No. 4 - Foreign Investment Exchange Declaration
Used to register foreign investments in Colombia and is mandatory for legalizing incoming funds.
📌 Form No. 5 - Foreign Investment Registration
This form certifies the investment and allows for future capital and profit repatriation.
📌 Form No. 6 - External Debt Exchange Declaration
If the funds originate from a foreign loan, this form must be used for registration.
These forms can be completed either directly or through the authorized bank intermediary receiving the transfer.
5. Receiving and Legalizing the Funds
Once the transfer has been made, the receiving bank in Colombia will process the transaction and notify the Banco de la República if it is classified as a foreign investment. It is essential to keep all transaction records and completed forms.
6. Using the Funds and Repatriation
After completing the legalization process, you will be able to use the money for your investment in Colombia. Additionally, in case you sell the property or withdraw your investment, you will be able to repatriate your funds and earnings by complying with the required reporting and registration processes.
Conclusion
Making international transfers for investment in Colombia is a regulated process that requires planning and compliance with local laws. Properly managing the Banco de la República’s forms is crucial to ensuring legality and facilitating future transactions, including capital repatriation.
If you need assistance with this process, seeking expert advice on investment and financial regulations in Colombia is highly recommended.
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