Originally from:
Doing Business in Colombia - 2nd Edition - Hardcover
Doing Business in Colombia - 2nd Edition - Electronic
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Chapter 9
Hydrocarbons and Mining
I. HYDROCARBONS
The Political Constitution of Colombia has set the following guidelines
in this matter through the following dispositions:
Article 332: The State is the owner of the subsoil and of nonrenewable
natural resources, without prejudice to the rights
acquired and perfected according to previously existing laws.
Article 360: The law shall specify the conditions for the
exploitation of non-renewable natural resources and also define the
rights, which territorial entities have over those resources.
Exploitation of a non-renewable natural resource shall entitle the
State to receive compensation in the form of a royalty, without
prejudice to any other rights or compensations agreed on.
The departments and municipalities in whose territories nonrenewable
natural resources are exploited, as well as the ocean and
river ports through which said resources or their by-products are
transported, shall be entitled to share in the royalties and
compensations.
According to these dispositions, the Colombian State is the owner of the
subsoil and, consequently, no person may engage in exploitation of
hydrocarbons and related resources without a definite authorization issued
by the State, which is represented by the National Agency for Hydrocarbons
(ANH).
Royalties are the economic compensation caused in favor of the State as
a result of the exploitation of a non-renewable natural resource.
A. General Considerations
Hydrocarbons (including oil and gas) are one of the most rapidly changing
political and legislative sectors of the economy during recent years.
Just a few decades ago, the government owned Colombian Oil
Company, Ecopetrol, was directly in charge of its exploitation and took care
of this matter, either directly or through association contracts. The
About the Firm:
Cavelier Abogados, a Colombian law firm established in 1953 that combines experience and innovation and stands out as a leading advisor in Latin America in several fields of the law. Using the most modern legal infrastructure and technology, the firm offers clients a strategic partnership for business development with legal services in Colombia and overseas countries. The strength of Cavelier Abogados lies in its Intellectual Property Law and Business Law areas, but the firm is also strong in Corporate Law, Financial Law, Foreign Investment Law, Tax Law and Mining and Hydrocarbons Law. Besides occupying prominent places in the top rankings of law publishers, the firm employs several university professors and authors of books on the practice areas of the firm. Cavelier Abogados also has a network of 469 correspondents in 143 countries. It was also one of the first Colombian law firms to have its own Code of Ethics, which contains higher standards of conduct compared to local legislation. The firm uses a multidisciplinary approach to find creative, prudent and value generating business solutions that optimize clients' return on investment while minimizing risks.
About the Contributors:
Natalia Tobón-Franco is a Lawyer from Universidad de los Andes
(Bogota, Colombia) with an L.L.M. in Intellectual Property Law from
Franklin Pierce Law Center (New Hampshire, U.S.A.); a Professor and
Author of several books and articles on Copyright Law, Freedom of Speech
and Entertainment Law; and an Associate Attorney at Cavelier Abogados.
Eduardo Varela-Pezzano is a Lawyer and Specialist in Intellectual
Property Law from Universidad del Rosario (Bogota, Colombia); an
Intellectual Property Law Professor at Universidad del Rosario; an Author
of several books and articles on Freedom of Speech, Patent, Trademark,
Copyright and Entertainment Law; and an Associate Attorney at Cavelier
Abogados.
