By means of Resolution 2, dated May 11, 2001, the Board of Directors of the Colombian Central Bank introduced substantial modifications to the exchange regime applicable to companies pertaining to the hydrocarbon sector. This Resolution 2 amended articles 48, 49, 50 and 51 of Resolution 8 of 2000 of that same entity.
Branches of foreign corporations that carry out activities of (i) exploration or exploitation of oil, natural gas, coal, ferronickel or uranium, or (ii) that are engaged exclusively to the hydrocarbon sector's inherent services, do not have to reimburse to the exchange market the proceeds from sales abroad in foreign currency.
These branches may not under any concept acquire currencies in the exchange market and must reimburse to the exchange market the currencies required to attend expenses incurred in Colombian pesos.
However the branches of foreign companies that do not wish to comply with the above mentioned regulations may exclude themselves of their application for a minimum not amendable term of ten years beginning as from the date when the relevant request is submitted to the Colombian Central Bank. If such request is made the branch will be obliged to comply with the common current exchange regime.
The Resolution establishes that the companies that are currently complying with the special hydrocarbon and mining regime established by means of Resolution 8 of 2000, may adopt the ordinary regime as established in article 50 of Resolution 8.
The Resolution additionally establishes that without prejudice to its article 79, local companies or those with foreign capital engaged in the above-mentioned activities may, within the country and among themselves, pay and enter into contracts in foreign currency with the condition that the relevant foreign currencies are derived from resources generated by their operation.
The following may also be paid in foreign currency:
(i) Sales and purchases between Colombian residents of fuel for vessels and aircraft used for international transportation;
(ii) Sales and purchases of crude oil and natural gas of national production carried out by ECOPETROL and other entities engaged in petroleum refinement; and/or
(iii) Sales by residents of the country of crude oil and natural gas of national production carried out by companies with foreign...