The Business Year

Mauricio Zagarra

COLOMBIA - Economy

A Bright Future

Managing Partner, Norton Rose Fulbright Colombia


Prior to joining the Norton Rose Fulbright Bogotá office, Mauricio Zagarra worked both in Colombia and the Andean Region as legal vice-president, general secretary, and associate general counsel for Latin America for several multinational corporations such as IBM, Bellsouth International, and Telefonica Moviles-Movistar. He also worked as an international associate with a prominent law firm in the US and as a partner of and counsel for some of the largest law firms in Colombia. His practice focuses on regulatory, corporate, commercial, transactional, and telecommunications/IT. Zagarra is well acquainted with the legal systems of several countries in Latin America and has an extended network of business and legal contacts throughout the region.

TBY talks to Mauricio Zagarra, Managing Partner of Norton Rose Fulbright Colombia, on local regulations, rule of law, and FDI in 2016.

How would you describe the regulatory framework for investment in Colombia?

Colombia has a regulatory framework that favors foreign investment. As you know, Colombia has been an investment destination for some time now. The past and current governments have been very interested in fostering foreign investment and have tried to cut the red tape and help foreign investors in their incorporation process and operations in the country. That has been achieved to a certain extent, but it is a work in progress. However, there have been recent modifications to the tax regime that, in the view of many foreign investors, may affect their future investments in Colombia. This message has been conveyed to the government by several key players and stakeholders, and there is something to be done in that respect. Due to this scenario and international prices of certain commodities, our clients and foreign investors are now cautious about their investments in Colombia, waiting to see how the situation evolves, both tax-wise compared to other Latin American countries and also in terms of the ongoing peace talks with the guerrilla FARC in Cuba. Under the current global and local circumstances, being cautious makes sense.

How do you evaluate the legal security and the rule of law in Colombia?

Legal certainty and rule of law are alive and well in Colombia. We have some of the highest standards in Latin America in this respect. For example, there is legal certainty about several things. Justice, although slow in countries like ours, is still reliable, especially at the higher court levels. Laws are enforced, and, if they are changed, they change toward the future, not retroactively, which provides legal certainty. In the past, foreign companies have entered into legal stability agreements with the government, which shows the clear intention to promote stability and the rule of law. Furthermore, an arbitration procedure can be handled independently and without the interference or influence of the government, other sectors or third parties. Colombia has adopted a flexible and internationally derived regulation on international arbitration, which we believe meets international criteria. In 2012, though not entirely derived from UNCITRAL’s Model Law on International Commercial Arbitration (“Model Law”), Colombia’s Arbitration Law bears several similarities with the Model Law when dealing with international arbitration.

What are the priorities for Norton Rose Fulbright in Colombia right now?

We continuously hold conversations with other members of the legal community and key players in the Colombian market about achieving sustainable growth while maintaining our current ratios of profitability and success. At Norton Rose Fulbright, we always want to hire and retain the best legal talent there is in Colombia and the region. We want to have the same quality and compare ourselves to other law firms not just in Colombia or Latin America, but anywhere in the world. We are a London-based global law firm, and that is our standard. We have to continue to provide legal services of worldwide quality.

What is your outlook on FDI in Colombia in 2016?

I am somewhat optimistic because of the many projects and huge investments in the infrastructure sector. This will greatly help the Colombian economy, and FDI in this sector will continue to grow. However, it is justified to be somewhat concerned with many macroeconomic forecasts for 2016. Next year will hopefully bring a concrete result in the peace talks in Cuba due to the agreed deadline for the peace process, which has taken more time than originally expected and generated uncertainty among foreign investors and our clients for the past three years. At the same time, the government has also discussed and analyzed tax impacts on foreign investment and it seems to be willing to explore possibilities to modify the current tax structure. This will not happen in the short term due to the great pressure of international oil prices on our economy, but the finance officers of the administration know this has to be addressed at some point.



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