Young Entrepreneurs Law

Law 1780 of 2016 seeks to promote the creation of new young companies, with the understanding that a young company is one that is comprised by individuals or legal persons falling under the classification of small companies, understanding also that small companies are those with no more than 50 workers, and whose total assets are less than 5.000 Minimum Monthly Wages.

BENEFITS:

  • Exemption from the payment of the merchant's registrar for the first year, as well as its renewal.
  • Benefits will be received in the contributions and payments made to family compensation funds for companies who hire young employees between 18 and 28 years of age, under conditions that will be defined by the National Government

REQUIREMENTS:

  1. Having less than 50 employees.
  2. Having total assets not exceeding 5.000 Minimum Monthly Wages.
  3. The Merchant's Certificate must be renewed on March 31, of each year, at the latest.
  4. Not be covered by any of the conditions described in article 48 of Law 1429 of 2010, nor in those listed in article 2.2.2.41.5.9 of Decree 639 of 2017. Any small company which is created after the entry into effect of this law, in which the corporate purpose, payroll, commercial establishment(s), address, intangibles or assets which comprise their exploitation unit are the same as a company which was dissolved, liquidated, spun-off or made inactive after the entry into effect of this Law, shall not eligible to receive these benefits represented in registrations and renewals, or in fiscal and labor contribution benefits.
  5. If an individual, must be between 18 and 35 years old.
  6. If a legal person, the capital must be owned by one or several people whose age range is between 18 and 35 years, who represent no less than one half plus one of the stock, shares or participation percentages the capital has been divided into.
  7. In accordance with Decree 639 of 2017, if the above requirements are met, the following documents must be added to the request for the merchant's registrar:
  • Copy of the personal identification document(s) of the individual or of the partners or shareholders, if a company.
  • Signed statement certifying the ownership of one half plus one of the stock, shares or participation percentages the partnership's or company's capital has been divided into, as applicable.
  • List of workers directly employed by the company, if any, stating their names and personal identification numbers.
  • When filing the request for the merchant's registration, the individual or legal person, either directly or through its legal representative, will state that it is compliant with the requirements set forth under article 2.2.2.41.5.2 of Decree 639 of 2017. The CCB form will state that said statement shall be understood to have been given under oath.

Furthermore, in order to maintain these benefits, when filing the request to renew the merchant's registrar, the individual or legal person, either directly or through its legal representative, shall provide:

  • A list of workers directly employed by the company, if any, stating their names and personal identification numbers.
  • A statement indicating that the company has made the required contributions to the Comprehensive Social Security System and all other payroll-related contributions, should it be mandated to do so, and that it has fulfilled all of its tax obligations.
  • A copy of the financial statements duly signed by the accountant or statutory auditor, as applicable, with cutoff as of December 31st of the immediately previous year.
  • When renewing the merchant's registrar for legal persons, a certificate shall be provided, as issued by the small young company's legal representative and/or the statutory auditor, certifying that he, or the partners whose age ranges between 18 and 35 years account for one half plus one of the stock, shares or participation percentages the company's capital has been divided into.
  • Copy of the personal identification document for the partners or shareholders, if they are different from those provided at the time the company was created.

IMPORTANT: If the aforementioned documentation required to maintain the benefits is not provided at the time of the renewal, then the amount corresponding to the renewal of the merchant's registrar will be charged, upon evidencing that the conditions to maintain such benefit were not met or certified.

For the cases of beneficiaries of Law 1780 of 2016 and Decree 639 of April 19th, 2017, issued by the Ministry, and if a return of the monies paid for merchant's registration or renewal is applicable, then it will be necessary to send an e-mail with the following documents beneficiosley1780@ccb.org.co, for legal persons:

  • Copy of the personal identification documents of the partners or shareholders at the time the company was created in 2016, and at the time of the 2017 renewal.
  • A statement signed by the legal representative certifying that at the time the company was created, the partners or shareholders younger than 35 years of age held no less than one half plus one of the stock, shares or participation percentage into which the company's capital has been divided.
  • A statement signed by the legal representative certifying that at the time of the renewal of the company , the partners or shareholders younger than 35 years of age held no less than one half plus one of the stock, shares or participation percentage into which the company's capital has been divided.
  • Financial statements with cut-off as of December 31st of 2016 (If you have already filed your financial statements with the CCB, please ignore this requirement).
  • Statement signed by the legal representative certifying the company's compliance with the fiscal and fringe benefits at the time of the company was established in 2016 and at the time of the renewal of its merchant's registrar in 2017.

The above only if said documents have not yet been provided.  If registered as an individual, make sure you include your personal identification document.

THE FOLLOWING SHALL NOT BE ELIGIBLE FOR THESE BENEFITS:

No legal person or individual acting as a small young company shall be eligible to receive the benefits set forth under Article 3 of Law 1780 of 2016, when they are covered by any of the following situations: 

  • Individuals who, prior to the entry into effect of the aforementioned law, have canceled their registration and are requesting a new one as an individual, for the same economic activity.
  • Any legal person created as the result of a spin-off of one or more existing legal persons.
  • The legal persons created after the entry into effect of the Law 1780 of 2016, resulting from a merger.
  • The legal persons re-established after the entry of the Law 1780 of 2016.
  • Legal persons created after the entry into effect of the Law 1780 of 2016 whose capital comes from trade establishments, branches or agencies, transferred by an existing legal person or an individual, which had been destined to develop an existing company.

Do you have questions?

You may be interested