To date, Colombia has not exercised its right to terminate the investment treaties it has signed and ratified. This is consistent with Colombia’s broader approach of continued participation in the investment treaty system, combined with periodic treaty renewal and modernisation. Colombia is party to a significant network of investment-related agreements, including bilaterial investment treaties (BITs) with China, France, India, Japan, Peru, Spain, Switzerland and the UK, as well as a recently signed treaty with Venezuela. It has also concluded several free trade agreements (FTAs) and economic integration instruments containing investment protections (see 2.3 Free Trade Agreements).

Colombia’s treaty practice recognises investor–state arbitration as an important mechanism for the protection of foreign investment. Most Colombian investment treaties provide access to international arbitration and Colombia is a party to the ICSID Convention and the 1958 United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”). Colombia has also engaged constructively in broader reform discussions, including the UNCITRAL Working Group III.

Although the government in office until August 2026 referred to renegotiating treaties and potentially withdrawing from the investor–state disputes settlement system, no formal steps were adopted. The government in office since August 2026 has not communicated any such intentions.

Colombia ratified the Washington Convention on 18 May 1993 and it entered into force on 14 August 1997. Colombia also ratified the New York Convention on 25 September 1979 and this treaty entered into force for Colombia on 24 December 1979. Colombia has not made any declarations and/or reservations with regard to the New York Convention.

Investor–state arbitration is a prevalent and well-established method for resolving investment disputes involving Colombia, and Colombian investment treaties generally provide access to arbitration. However, arbitration is not always the immediate or exclusive route. Investors have resorted to pre-arbitral phases of investment disputes prior to initiating arbitration.

To date, there is only one publicly known case of settlement of an investment arbitration involving Colombia: the November 2025 settlement in Aris Mining v Colombia, which reportedly avoided exposure to claims of approximately USD380 million. The government in office since August 2026 has indicated its intention to continue pursuing negotiated solutions with foreign investors.

The most significant investor–state arbitration activity in the cases against Colombia has been focused on the mining sector. Based on the publicly available cases identified, 12 of the 32 cases concern the mining sector. Mining disputes have typically arisen from long-term concession rights and public-interest measures, including environmental restrictions affecting páramo (alpine) ecosystems, changes to royalty calculations, and measures addressing illegal mining or public security concerns.

Telecommunications, energy, and financial services are the next most prominent sectors. Telecommunications disputes mainly concerned heavily regulated concessions, particularly issues relating to the reversion of assets to the State and the renewal of operating rights. Energy and financial services disputes have generally involved government intervention, liquidation proceedings, tariff or regulatory measures, and the administration of strategic infrastructure.

One of the most legally significant investor–state cases involving Colombia is Ángel Samuel Seda and others v Republic of Colombia, brought by a group of US investors under the USA–Colombia Trade Promotion Agreement (TPA). The dispute arose from the claimants’ investment in the Meritage Project, a luxury real estate development in Medellín. Although Colombia’s AML and Asset Forfeiture Unit had previously indicated that the property was unencumbered, the Attorney General’s Office later attached it as a precautionary measure under Colombia’s Asset Forfeiture Law. The measure was based on evidence suggesting irregular transfers in the property’s chain of title and a reasonable inference of illicit origins, following allegations by Iván López Vanegas (a convicted drug trafficker and alleged former owner) that he had been forced by local cartels to transfer the property.

The claimants challenged the measure before Colombian courts, where proceedings remained pending, and later commenced ICSID arbitration. They alleged breaches of several TPA protections, including fair and equitable treatment, full protection and security, national treatment, and protection against expropriation. Colombia invoked Article 22.2(b) of the USA–Colombia TPA (the essential security interests exception), arguing that the measures were connected to the fight against organised crime, money laundering and drug trafficking. Because Colombia invoked the exception in its rejoinder and framed it as a jurisdictional objection, the tribunal first considered whether the invocation was procedurally belated.

The tribunal rejected the claimants’ timeliness objection. It held that Article 22.2(b) of the USA–Colombia TPA does not prescribe when it must be invoked, that Colombia was not required to identify the relevant essential security interest when adopting the measures, and that the parties had sufficient opportunity to be heard. On interpretation, the tribunal found that Article 22.2(b) of the USA–Colombia TPA is a self-judging essential security exception, but not an entirely non-reviewable one. Applying Articles 31 and 32 of the Vienna Convention on the Law of Treaties, the tribunal held that the provision operates as an exception to the treaty’s coverage, subject only to limited good-faith review.

On the facts, the tribunal accepted that Colombia’s interests in combating organised crime, money laundering and drug trafficking – and in protecting public safety, national security and socio-economic stability – qualified as essential security interests. It found no basis to conclude that Colombia had invoked the provision in bad faith and identified a sufficiently plausible nexus between the asset forfeiture measures and Colombia’s stated interests. The tribunal therefore held that Colombia had invoked Article 22.2(b) of the USA–Colombia TPA in accordance with the USA–Colombia TPA and that the exception applied. As a result, the tribunal had no mandate to review Colombia’s remaining jurisdictional objections, dismissed the claimants’ claims (a) through (d), and dismissed all other claims and requests raised by the parties.

The award is significant because of its detailed analysis concerning the effect of a self-judging essential security clause and its conclusion that tribunals should only conduct a limited good-faith review of such provisions, while giving substantial deference to the State’s assessment of its own security interests. Other relevant cases include South32 SA Investments Limited v Republic of Colombia (“South32”) and Telefónica, SA v Republic of Colombia (“Telefónica”) – both of which are subject to ongoing annulment proceedings.

Four known monetary awards have been issued against Colombia. In Glencore (I), the annulment proceedings concluded with a decision against Colombia, but there is no public record of any enforcement proceedings. Colombia had sought annulment on the grounds of manifest excess of powers, serious departure from a fundamental rule of procedure, and failure to state reasons – arguing that the tribunal had erred in excluding from the record documents that allegedly would have evidenced corruption and illegality orchestrated by the claimants.

In Glencore (II), on 20 January 2026, Glencore filed a request for discontinuance of the proceeding pursuant to ICSID Arbitration Rules 53 and 44. There is no public information regarding enforcement of the award.

South32 remains subject to annulment proceedings and no public information is available regarding the grounds invoked by Colombia. There is also no public indication that any stay of enforcement has been lifted.

In Telefónica, even though the annulment proceedings remain pending and there is no public information regarding the grounds invoked by Colombia in the annulment proceedings, the ad hoc committee lifted the stay of enforcement after Colombia failed to provide a bank guarantee. On 2 June 2026, Telefónica filed the first known petition to recognise and enforce an investment arbitral award against Colombia before the Courts of the District of Columbia. On 8 September 2026, Colombia submitted a motion to dismiss the enforcement proceedings for lack of jurisdiction or – alternatively – to stay the proceedings pursuant to the court’s inherent authority pending the outcome of the annulment procedure.

As mentioned in 1.1 National Position, Colombia has concluded nine BITs with China, France, India, Japan, Peru, Spain, Switzerland, the UK, and Venezuela. Colombia has also signed a number of investment agreements that have not entered into force yet, including BITs with Brazil, Belgium–Luxembourg, Chile, Cuba, South Korea, Singapore, Turkey, the UAE, and Spain.

The latest version of the Colombian Model BIT was published in 2017 by the Ministry of Trade, Industry, and Tourism (Ministerio de Comercio, Industria y Turismo, or MINCIT) through the Directorate of Foreign Investment and Services. In general, this model BIT affords protection to investors under the established standards, while allowing contracting states the right to regulate investments in order to achieve legitimate public policy objectives, with a particular emphasis on the social responsibility of investors.

This model BIT also highlights the State’s ability to apply general exceptions to investor protection to safeguard human rights or the environment. In addition, this model BIT includes specific provisions regarding dispute resolution – for example, by setting a standard of review in fork-in-the-road cases and the burden of proof for the tribunal, and spelling out the minimum contents of an award, among other things.

Colombia is a party to numerous FTAs and regional integration instruments containing investment protection and investor–state dispute settlement provisions. These include agreements with Canada, Chile, Costa Rica, Israel, South Korea, Mexico, the USA, the Northern Triangle countries (El Salvador, Guatemala and Honduras), the Pacific Alliance, and Singapore. Colombia also participates in the FTA with the European Free Trade Association (EFTA) – although that agreement does not contain substantive investment protections or investor–state arbitration provisions.

Colombia has published guides, verbal notes, and diplomatic communications regarding the interpretation of certain IIAs. In fact, Colombia has signed interpretative notes on the investment chapter of the TPA with the USA and has also issued interpretative declarations for the IIAs with UK, India, France, Canada, and Israel. These notes and interpretative declarations have been published in the IIAs section of the MINCIT’s website, as well as in the Virtual Treaty Library of Colombia’s Ministry of Foreign Affairs.

Colombia does not have a national investment law.

Direct arbitration clauses specifically providing for investor–state arbitration in contracts between foreign investors and Colombia, or Colombian state-owned entities, are not common. There is also no specific Colombian regulation governing this type of contractual investor–state arbitration clause.

Colombian law does allow public entities to enter into arbitration agreements in commercial matters, including international commercial arbitration agreements. However, Presidential Directive No 5 establishes a number of requirements for national public entities before agreeing to national or international arbitration clauses. Notably, entities must obtain a prior legal opinion from the head of their legal office – supported by a documented legal and economic assessment of the appropriateness of arbitration – and must secure prior approval from the National Agency for the Legal Defence of the State (Agencia Nacional de Defensa Jurídica del Estado, or ANDJE).

This Presidential Directive further provides that public entities must refrain from agreeing – in international arbitration clauses or arbitration agreements – that commercial disputes be submitted to ICSID.

Oil, Gas and Mining

Most recent disputes involve investors’ claims that the legislative, judicial and administrative decisions adopted by Colombia regarding the prohibition of mining activities in páramo ecosystems – and the delimitation of such ecosystems – amount to unlawful expropriation and breached fair and equitable treatment provisions.

Construction and Engineering

Recent claims involve measures and fiscal liability proceedings started by the Comptroller General of the Republic. Although those disputes have been terminated without awards on liability, investors’ claims involved expropriation and violations of the national treatment and most favoured nation (MFN) standards.

Other disputes involved asset forfeiture proceedings by the Colombian Attorney General’s Office over real estate development projects. Investors alleged that such conduct amounted to expropriation, as well as violations of due process rights, legitimate expectations, and the national treatment and full protection and security standards.

Other disputes relate to the inaction from the Colombian Ministry of Transport regarding competitive imbalances resulting from the free-of-charge use by foreign-owned companies of a public coal port. The investor claimed unfair treatment by the State, violation of MFN status, and unreasonable, discriminatory measures.

Telecommunications

Most disputes involved the Estate’s application of Laws 422 and 1341 and Colombian Constitutional Court decisions concerning the reversion of assets relating to telecommunications concessions. Investors argued that the decision to extend the reversion to all equipment and infrastructure used for the provision of mobile telephone services amounted to unlawful expropriation and breached fair and equitable treatment provisions.

Public Services

Disputes in this sector mainly involve the intervention and liquidation of investor-owned companies, as well as measures taken by the Special Assets Society in early disposal procedures of investors’ ownership of local companies. Investors alleged that Colombia breached fair and equitable treatment, full protection and security, MFN and expropriation standards.

In investor–state arbitration involving Colombia, party autonomy in the selection of arbitrators is principally governed by the applicable investment treaty and arbitral rules, rather than by Colombian arbitration law. Such instruments may prescribe requirements regarding arbitrator qualifications, nationality, and appointment procedures. For instance, The Colombian Model BIT requires arbitrators to have expertise or experience in public international law, international investment or trade rules, or the resolution of investment or trade disputes, and to be independent from the parties and the disputing investor.

Comparable requirements appear in certain treaties, including the Colombia–Canada FTA – although they are not uniform across Colombia’s treaty docket. In all cases, appointments remain subject to the applicable standards of independence and impartiality.

In investor–state arbitration involving Colombia, Colombia’s investment treaties typically refer disputes to international rules, such as the ICSID Convention or the UNCITRAL Arbitration Rules, which contain their own default appointment procedures. In addition, certain treaties – including Colombia’s BITs with Canada, Singapore, Chile, Costa Rica, South Korea, India, Costa Rica, Japan and Peru, the Colombia–Chile FTA, the Alianza del Pacifico–Singapore FTA, the Additional Protocol to the Pacific Alliance, the Colombia–Northern Triangle FTA, and the USA IIAs – feature specific provisions for default procedures applicable to the appointment of arbitrators. The treatment of multiparty arbitrations will likewise depend on the applicable treaty and arbitral rules.

In investor–state arbitration involving Colombia, the selection of arbitrators is generally governed by the applicable treaty and arbitral rules, such as the ICSID Convention or the UNCITRAL Arbitration Rules. Colombian courts therefore do not ordinarily intervene in the appointment process. Court intervention may arise only where the arbitration is seated in Colombia and the parties have not agreed on an appointment method (or where the agreed method fails or is obstructed). In such cases, Colombian courts act as appointing authority under Article 73 of the Law 1563 of 2012 (the “Arbitration Statute”).

To the best of the authors’ knowledge, to date, there are no publicly recorded cases in which Colombian courts have been asked to appoint arbitrators under this framework in investment arbitrations.

In investor–state arbitration involving Colombia, challenges to and removal of arbitrators are generally governed by the applicable investment treaty and arbitral rules, such as the ICSID Convention or the UNCITRAL Arbitration Rules.

Where the arbitration is seated in Colombia under the Arbitration Statute), Article 75 allows a party to challenge an arbitrator on two grounds:

• where circumstances give rise to reasonable doubts as to the arbitrator’s impartiality or independence; or
• where the arbitrator does not meet the qualifications agreed by the parties.

A party may challenge an arbitrator whom it appointed, or in whose appointment it participated, only on grounds that arise after the appointment.

In investor–state arbitration involving Colombia, requirements concerning arbitrator independence, impartiality, and disclosure of potential conflicts are generally governed by the applicable investment treaty and arbitral rules, such as the ICSID Convention or the UNCITRAL Arbitration Rules. Some Colombian investment treaties also contain express requirements regarding arbitrator qualifications and independence. By way of example, the Colombia–Canada FTA and the Additional Protocol to the Pacific Alliance require arbitrators to have expertise or experience in public international law, international investment or trade rules, or the resolution of investment or trade disputes, and to be independent from the parties and the disputing investor. In all cases, appointments remain subject to the applicable standards of independence and impartiality under the relevant treaty and arbitral rules.

Where the arbitration is seated in Colombia, Article 73 of the Arbitration Statute provides that – when appointing arbitrators – the competent judicial authority must take into account the qualifications required by the parties and considerations aimed at securing the appointment of an independent and impartial arbitrator. Article 75 of the Arbitration Statute further reflects the importance of independence, impartiality, and any qualifications agreed by the parties, as it permits a challenge where circumstances give rise to reasonable doubts as to the arbitrator’s impartiality or independence, or where the arbitrator does not meet the qualifications agreed by the parties.

The availability of interim and preliminary relief in investor–state arbitration involving Colombia is generally governed by the applicable investment treaty and arbitral rules, such as the ICSID Convention or the UNCITRAL Arbitration Rules. Certain Colombian treaties, including the FTAs with Canada and the USA, contain specific provisions on interim measures of protection. These measures may be ordered so as to:

• preserve the rights of a disputing party;
• ensure that the tribunal’s jurisdiction is made fully effective;
• preserve evidence in the possession or control of a disputing party; or
• protect the tribunal’s jurisdiction.

Where the arbitration is seated in Colombia, Arbitration Statute applies. Article 80 of the Arbitration Statute empowers arbitral tribunals to order interim measures, unless the parties have agreed otherwise.

Article 80 of the Arbitration Statute defines interim measures as temporary measures ordered at any time before the final award. They may require a party to

• maintain or restore the status quo pending resolution of the dispute;
• prevent present or imminent harm or interference with the arbitral proceedings;
• preserve assets that may be used to satisfy an eventual award; or
• preserve relevant evidence.

Under Article 88, interim measures ordered by an arbitral tribunal are binding and may be enforced by the competent judicial authority.

The Arbitration Statute also regulates preliminary orders. Under Articles 82 and 83 of the Arbitration Statute, a party may request a preliminary order without prior notice to the opposing party where advance notice would risk frustrating the purpose of the requested interim measure. Preliminary orders are temporary, expire after 30 days unless replaced by an interim measure, and do not constitute awards or judicially enforceable measures.

Articles 84 and 85 of the Arbitration Statute further provide that tribunals may modify, suspend or revoke interim measures and preliminary orders, and may require the requesting party to provide appropriate security.

Colombia’s arbitration statute was enacted by the Arbitration Statute. The Arbitration Statute contains a dualistic regime, with specific provisions applicable to domestic arbitrations and international arbitrations.

Concerning international arbitrations seated in Colombia and abroad, the Arbitration Statute provides that interim measures can be ordered by arbitral tribunals and by judicial authorities. Under this law, interim measures are all temporary measures issued at any moment prior to the award that finally decides the dispute – whether in the form of an award or not – by which parties are ordered to:

• maintain or restore the status quo while the dispute is resolved;
• take actions to prevent imminent harm or the obstruction of the arbitration;
• preserve assets necessary for the enforcement of the award; or
• safeguard evidence that could be relevant to the dispute.

The Arbitration Statute contains provisions on the enforcement of interim measures in international arbitrations.

Additionally, Articles 71 and 90 of the Arbitration Statute state that parties may request interim measures to the judicial authorities – before the commencement of or during the arbitration proceedings – without it being understood as a waiver to the arbitration agreement.

Arbitral tribunals seated in Colombia may also order preliminary orders directing a party not to frustrate the purpose of the interim measure requested, prior to enacting an interim measure.

The Arbitration Statute does not expressly regulate security for costs as a standalone measure. However, a potential basis for seeking such relief may be found in the tribunal’s general power to order interim measures under Article 80 of the Arbitration Statute, particularly where the requested measure can be framed as necessary to preserve assets or to ensure the effectiveness of an eventual award. On this basis, a party could argue that security for costs falls within the broader category of interim relief available to arbitral tribunals – although this would depend on the circumstances of the case and the tribunal’s assessment of the applicable treaty, arbitral rules and Colombian arbitration law. The Arbitration Statute also allows tribunals to require the applicant for an interim measure or preliminary order to provide appropriate security, which may be relevant by analogy when considering requests involving financial safeguards.

Third-party funding of investor–state claims is not prohibited under Colombian law. The majority of Colombia’s investment treaties do not expressly regulate third-party funding and there is limited public information regarding its prevalence in investor–state arbitrations involving Colombia.

However, recent treaty practice reflects increased attention to the issue. The Pacific Alliance–Singapore FTA contains detailed provisions on third-party funding, including disclosure obligations and rules relating to security for costs. Similarly, the BIT signed between Colombia and Spain in 2021 – which has not entered into force – requires disclosure of third-party funding arrangements and addresses security for costs.

There is no Colombian case law specifically addressing the regulation of third-party funding.

In investor–state arbitrations involving Colombia, publicly available decisions have addressed the issue only in limited terms, such as the Declaration on Costs issued by Philippe Sands in Eco Oro Minerals Corp v Colombia. In that declaration, Professor Sands noted that the claimant sought to recover approximately USD4.5 million in costs allegedly incurred to secure financing for the arbitration.

Although the funding arrangement did not affect the outcome of the costs allocation, Professor Sands expressed serious concerns about third-party funding in investor–state arbitration. Notably, he cautioned against arrangements in which a funder with no prior relationship to the investment or the host state may receive a substantial share – or even a majority – of any recovery while bearing no exposure to adverse costs. He also observed that such arrangements may increase the cost, complexity and sensitivity of proceedings, especially where the funding enables claims that could not otherwise have been brought.

Professor Sands welcomed initiatives aimed at increasing transparency around third-party funding, including reform discussions within the UNCITRAL Working Group III. However, he considered the current inability of tribunals to issue costs orders against funders to be a significant concern. In his view, tribunals should – as a matter of principle – have the power to order costs against third-party funders in appropriate cases, as the use of investor–state arbitration for financial speculation may undermine confidence in the system and its perceived legitimacy.

Neither Colombian law nor the majority of Colombia’s investment treaties establish a general obligation to disclose third-party funding arrangements. The Pacific Alliance–Singapore FTA adopts a more recent approach. It expressly defines third-party funding, requires the funded party to disclose the identity and address of the funder and (where applicable) its beneficial owner and corporate structure, and imposes an ongoing disclosure obligation throughout the proceedings. The Pacific Alliance–Singapore FTA also permits tribunals to consider evidence of third-party funding when deciding requests for security for costs – although the existence of funding does not automatically justify such an order.

The Colombia–Spain BIT signed in 2021, which has not entered into force, similarly requires disclosure of the funder’s identity and address and the value of the funding. The Colombia–Spain BIT also permits tribunals to order security for costs and provides consequences for failure to disclose funding. This instrument reflects Colombia’s recent treaty practice but does not create obligations under a treaty currently in force.

There is no settled publicly available practice of courts or tribunals in cases involving Colombia treating the existence of third-party funding as sufficient, by itself, to order security for costs.

Pre-arbitration procedural requirements vary across Colombia’s investment treaties and must be assessed under the specific treaty invoked.

As a threshold matter, Colombian treaties require – or at least encourage – the investor to pursue available local or administrative remedies before commencing arbitration. By way of example, the Colombia–Canada FTA encourages parties to make every effort to exhaust administrative recourse under Colombian law.

Other treaties – such as Colombia’s BITs with Spain, the UK, Japan, and Peru, as well as its FTAs with Israel and the Northern Triangle – require exhaustion of remedies in relation to administrative acts, generally for a period not exceeding six months. Some other treaties also refer to the exhaustion of local remedies, including Colombia’s treaties with China and Costa Rica.

After any applicable local-remedies requirement has been addressed, Colombian investment treaties generally require the investor to submit a written notice of intent before initiating arbitration. That notice should identify the measures at issue, the factual and legal basis of the claim, the treaty provisions allegedly breached, and the relief sought. In treaties such as the USA–Colombia TPA, the investor must also show that both the alleged treaty breach and the resulting loss or damage have already occurred; speculative claims based solely on a future breach may not be submitted.

Colombia’s treaties also generally require a prior period of consultations or negotiations before arbitration may be commenced. Cooling-off periods vary, ranging from 30 days to nine months, with six months as the most common period. Certain treaties combine notice and consultation requirements with additional waiting periods – for example, the Colombia–Canada FTA may require nine months’ notice if administrative recourse has not been exhausted, while the Pacific Alliance instruments and several FTAs include both six-month consultation periods and additional notice requirements.

Finally, several treaties impose further procedural conditions to consent, including limitation periods and waivers of parallel domestic or international proceedings concerning the same measure. Waiver requirements appear in Colombia’s treaties with Canada, Japan, Chile, and Peru, the Pacific Alliance–Singapore FTA and the Colombia–Northern Triangle FTA, and may apply both to the investor and to the locally incorporated enterprise.

Several Colombian investment treaties reflect the growing demand for transparency in investor–state disputes. Some treaties provide for varying degrees of public access to pleadings, decisions, awards, and hearings, while preserving protections for confidential, privileged, and commercially sensitive information. This approach is reflected, for example, in Colombia’s FTAs with Chile, Panama, and the Northern Triangle countries.

Colombia’s treaty practice also includes broader transparency obligations directed at the State. The IIAs with Japan, France, Singapore, Canada, the USA, and Costa Rica, as well as the Pacific Alliance–Singapore FTA, the Colombia–Chile FTA, the Additional Protocol to the Pacific Alliance, the Colombia–Northern Triangle FTA, and the Colombia–Peru FTA require the contracting states to publish state procedures.

The remedies available in investor–state arbitration involving Colombia are primarily determined by the applicable treaty. Colombian investment treaties commonly empower tribunals to award monetary compensation and interest. Some treaties also expressly refer to restitution of property. This approach appears, for example, in the investment chapters of the Colombia–Chile FTA and the Colombia–Northern Triangle FTA. Some Colombian treaties also place express limits on the remedies that may be awarded. Notably, certain treaties prohibit tribunals from awarding punitive damages, including Colombia’s FTAs with Chile and the Northern Triangle states.

This treaty practice is consistent with Colombian law, which is guided by the principle of full compensation. Articles 1613 and 1614 of the Civil Code limit compensatory damages to actual loss and loss of profit, while Article 16 of Law 446 of 1998 provides that damages must be assessed in accordance with the principles of full compensation and equity. Colombian law therefore seeks to restore the injured party through restitution or compensation equivalent to the loss suffered and is traditionally compensatory rather than punitive.

Colombia’s investment treaties do not generally prescribe a specific valuation methodology. Tribunals and national courts determine the appropriate approach by reference to the nature and development stage of the investment, the loss established, and the reliability of the available evidence.

However, in expropriation cases, Colombian treaties commonly prescribe the standard for compensation. Many treaties identify fair market value as the benchmark for lawful expropriation compensation. Several treaties also fix the valuation date as immediately before the expropriation or before the expropriation became public knowledge, whichever occurred first. These provisions appear in a broad range of Colombian treaties, including agreements with China, the UK, Canada, the USA, Costa Rica, Venezuela, Japan, Peru, South Korea, Chile, and Israel, as well as the Pacific Alliance–Singapore FTA, the Additional Protocol to the Pacific Alliance, and the Colombia–Northern Triangle FTA.

Several of Colombia’s investment treaties and investment chapters expressly allow tribunals to award interest, legal fees, and arbitration costs. Interest is treated more expressly in expropriation provisions. Many Colombian treaties provide that compensation for expropriation must include interest – generally at a commercial or market-based rate – accruing from the date of expropriation until the date of payment. These provisions appear in several Colombian treaties, including agreements with China, the UK, Canada, the USA, Costa Rica, Venezuela, Japan, Peru, South Korea, Chile, and Israel, as well as the Pacific Alliance–Singapore FTA, the Additional Protocol to the Pacific Alliance, and the Colombia–Northern Triangle FTA.

As to costs, several treaties expressly empower tribunals to allocate legal fees, expert fees and arbitration costs between the parties. Some treaties also require tribunals to consider costs when deciding preliminary objections and allow costs to be awarded against a party that advances frivolous claims or objections. Examples include Colombia’s FTAs with Chile, Canada, the USA, South Korea, Panama, and the Northern Triangle countries.

Colombian law does not establish a specific costs regime for international arbitration. Colombian procedural law recognises recoverable costs (including judicial expenses) under a cost-follow-the-event rule, as well as agencias en derecho (legal fees awarded to the winning party to cover its legal representation costs). The latter do not necessarily correspond to the legal fees actually incurred by the prevailing party, as they are awarded at the court’s discretion considering the characteristics of the dispute and in certain cases may be subject to tariffs established by the Superior Judicial Council (Consejo Superior de la Judicatura). Recoverable expert fees must also be evidenced and found reasonable.

Although Colombia’s investment treaties do not generally contain express provisions on mitigation, Colombian courts and arbitral tribunals have recognised that an injured party should take reasonable steps to avoid or mitigate its losses. The principle has been linked to the duty of good faith and to Article 2357 of the Civil Code – under which, compensation may be reduced where the injured party contributed to the loss through its own conduct.

The Supreme Court of Justice has recognised that a party suffering damage should, where reasonable, seek to prevent the aggravation of its losses or mitigate their effects. Colombian arbitral tribunals have adopted a similar approach. Accordingly, losses that could reasonably have been avoided may be excluded from compensation.

The recognition and enforcement of arbitral awards in Colombia is governed by the Arbitration Statute. Article 111 of the Arbitration Statute establishes the basic distinction between foreign awards and awards rendered in international arbitrations seated in Colombia. Foreign arbitral awards – that is, awards rendered in arbitrations seated outside Colombia – must first be recognised by the competent Colombian court before they may be enforced. By contrast, awards rendered in international arbitrations seated in Colombia are treated as national awards and may be enforced directly, without prior recognition. Recognition proceedings are conducted in a single instance and that the decision is not subject to appeal.

Article 112 of the Arbitration Statute sets out the exhaustive grounds on which recognition of a foreign arbitral award may be refused. These include:

• incapacity of a party;
• invalidity of the arbitration agreement;
• lack of proper notice or opportunity to present the case;
• excess of jurisdiction;
• irregular constitution of the tribunal or procedure;
• non-arbitrability under Colombian law; and
• incompatibility with Colombian international public policy.

Where annulment or suspension proceedings are pending before the courts of the seat, Article 112 of the Arbitration Statute allows the Colombian court to adjourn its decision on recognition if it considers it appropriate. At the request of the party seeking recognition, the court may also order the opposing party to provide suitable security. Colombian law further provides that recognition may be denied where an award has been annulled or suspended by a judicial authority at the seat of arbitration. The Supreme Court of Justice has explained that Articles V(1)(e) and VI of the New York Convention leave that determination to the discretion of the court hearing the recognition request, which may consider principles such as independence, autonomy, procedural economy, due process, and legitimate expectations.

Colombia does not have specific legislation or settled case law identifying separate grounds on which the recognition or enforcement of an ICSID award may be resisted. In principle, ICSID awards are subject to the enforcement regime established in the ICSID Convention. However, recent Supreme Court of Justice decisions concerning non-ICSID and ICSID Additional Facility awards indicate that Colombian courts may still consider issues of sovereign immunity at the enforcement stage.

Colombia does not have a specific statute governing sovereign immunity. The Constitutional Court has held that sovereign immunities are governed by customary international law. Recent Supreme Court of Justice decisions have applied sovereign immunity from execution restrictively but have nevertheless refused recognition and enforcement of non-ICSID investment awards on immunity grounds (see 9.2 Approach of the Courts). Accordingly, although immunity is not absolute, a state or state entity may successfully resist enforcement where the assets targeted are protected by sovereign immunity or where no applicable exception to immunity is established.

As mentioned in 9.1 Enforcement Procedure, two recent decisions by the Supreme Court of Justice rejected the recognition and enforcement of non-ICSID investment awards on the basis of sovereign immunities.

On 30 August 30 2022, the Supreme Court of Justice rejected Swiss Renewable Power Partners’ request to recognise an award issued on 28 February 2020 in the PCA Case No 2012-14, which concerned an investment dispute under the Energy Charter Treaty, filed by Swiss Renewable Power Partners against Spain. The Supreme Court of Justice considered that it had no jurisdiction to summon Spain based on the principle of immunity from jurisdiction. On 13 September 2023, the Supreme Court of Justice confirmed its decision on the decision AC2305-2023 addressing the motion for reconsideration (recurso de suplica) filed by Swiss Renewable Power Partners. The Supreme Court of Justice found that there was no applicable exception to the principle of sovereign immunity from execution enshrined in customary international law, nor was there evidence that Colombia or Spain were persistent objectors to this custom. Consequently, the Supreme Court of Justice denied recognition of the award, stating that Colombian judges lacked jurisdiction to enforce a foreign award against another state.

On 20 June 2024, the Supreme Court of Justice issued decision SC1453-2024, denying a request for the recognition of the award issued in ICSID Case No ARB(AF)/12/5, filed by Rusoro Mining Limited against Venezuela. This award was rendered under the ICSID Additional Facility Rules. The Supreme Court of Justice first concluded that, under customary international law, immunity from execution was restrictive. The Supreme Court of Justice acknowledged that Colombia is a party to the ICSID Convention, but the ICSID Convention does not override customary international law on immunity from execution. The Supreme Court of Justice then considered the provisions on enforcement of the ICSID Convention, particularly Article 54, in its analysis and found that they could not trump international custom on sovereign immunities.

Following recognition of a foreign arbitral award, enforcement is conducted before the competent judicial authority. International awards issued in arbitrations seated in Colombia can be enforced as domestic awards, without the need to resort to prior recognition proceedings. Whenever public entities are involved, recognition and enforcement proceedings of awards are conducted before the Council of State and administrative judges (as applicable).

Colombian law provides for a specific procedure to obtain payment of judgments or awards from public entities. Articles 192 to 195 of the Code of Administrative Procedure and Administrative Litigation establish a specific mechanism for the payment of monetary judgments and settlements by public entities, including the use of budgetary appropriations and contingency funds. The same provisions declare the appropriations allocated to the payment of judgments and settlements – as well as the resources of the Contingency Fund – exempt from attachment.

In addition, attachment of assets is subject to substantial statutory restrictions. Article 594 of the General Code of Procedure establishes a broad list of unattachable assets, including:

• assets, revenues and resources incorporated into the national or territorial budgets;
• social security resources;
• royalties;
• public-use assets; and
• assets directly allocated to public services.

Colombian law does not contain specific provisions addressing the piercing of the corporate veil of foreign investors. With regard to companies incorporated in Colombia, the Superintendence of Companies has jurisdiction to disregard separate legal personality when a company is used in fraud of the law or to the detriment of third parties. In such circumstances, shareholders and directors who carried out, participated in or facilitated the fraudulent acts may be held jointly and severally liable. Colombian authorities have explained that veil piercing constitutes an exceptional remedy designed to prevent the misuse of legal personality and to overcome the limitation of liability ordinarily afforded to shareholders.