I. Introduction
This report presents a general overview of recent legal improvements made by the Colombian authorities aimed at tackling corporate and financial crimes. It mainly presents the improvements made by Law 599 of 2000 (the Penal Code), Law 1474 (the Anticorruption Statute), Law 1778 of 2016 (the Antibribery Law) and the various efforts made by different political administrations to prevent and sanction these kind of infractions.
The document also offers an assessment of the impact these improvements have had, and portrays some of the remaining key challanges faced by the Colombian authorities in order to secure the effective detterence and prosecution of corporate criminality.
The efforts made by Colombia within this arena may be of interest to those other countries that have also felt the profound impact of their economic activity being overrun by drug cartels, rebel groups, crime-driven ’shell’ companies, corrupt public officials and many other types of major criminals and criminality.
Defeating organized crime, money laundering operations, fraudulent business schemes, accounting fraud, insider trading, massive smuggling and human-trafficking activities, amongst other criminality requires a huge effort from the Colombian authorities. Some major steps have been made, but many projects are still unfinished, requiring greater commitment, political will and smart policies.
A. Development and impact of economic crime
The regulation of economic crime, along with wider institutional efforts, have evolved over time in Colombia. However their defining moment was during the 1980s and 1990s, owing to the strength of the illicit or ‘underground’ economy, fuelled by drug trafficking, smuggling and money laundering activities conducted by drug cartels, rebel groups, paramilitaries and other organized crime, as well as the regulatory requirements of a growing financial and stocks market. However, Colombian history records incidences of economic and financial crime, as well as regulatory and enforcement efforts, from as far back as the early 16thcentury.
In his book “Corruption”, Hermes Tovar reveals the history of corruption throughout colonial rule (16thto early 19thcentury) in what later become known as Colombia. He explores the sociological, economic and cultural consequences of smuggling, tax evasion and Ponzi-scheme like fraudulent operations.[1]
However, modern regulation to combat economic crime is a development from the Republican era, which began in the early 19thcentury. The Penal Code of 1936 already included some regulation aimed at tackling forms of illicit activity. But it wasn’t until the enactment of the 1980 and 2000 Penal Codes, that more modern regulation was created, specifically influenced by the need to address those factors that led to the economic crisis of the 1990s.
Further relevant regulation was issued by the Executive Branch and Congress in 2008 following the meltdown of DMG and other companies engaged in massive Ponzi-scheme operations, which had led to an unprecedented economic crisis in the South Western region of Colombia, with harsh consequences affecting thousands of individuals who had invested their life savings in said companies.
Apart from the regulation mentioned above, Title X of the Penal Code of 2000 contains the crimes against “economic social order”; among them, economic panic, ilicit commercial exploitation, speculation, agiotage, usury, ficticious export or import, fiscal evasion, unlawful use of funds collected from the public, infringement of prohibited transactions with shareholders or associates, unlawful collection of funds from the public, securities fraud, smuggling, customs fraud, money laundering, omission of money laundering control, ilicit enrichment and others.
B. Main problems controlling economic crime
Economic crime is difficult to defeat owing to several compounding, contributing factors. One of the most relevant examples is the low education levels of citizens that invest in Ponzi-schemes and similar ‘business’ vehicles. But, problems with institutional arrangement also help to facilitate this kind of criminality, especially in terms of regulatory loopholes and the overlapping functions of institutions responsible for enforcement, oversight and control.
Indeed, some of these institutions responsible for oversight and control do not have enough human, economic and technical resources to carry out their work in a timely and effective fashion. Particularly important is the lack of high technology labs, with some exceptions such as that of the Superintendence of Industry and Commerce and the Prosecutor General´s Office.
The poor training of public officials is also a problem. In some institutions, officials are not sufficiently or appropriately trained, and therefore lack the required skills to effectively carry out their duties.
Budget restraints are another issue. In a country facing so many challenges in terms of justice, violations of human rights, terrorism and other egregious crimes, funds need to be distributed across a number of different priority areas, all of which compete with the fight against economic crime.
Corruption within institutions responsible for enforcement, oversight and control is an additional factor that hinders effective prosecution and punishment of economic crime. This, added to the difficulty in the timely detection of economic crime, fuelled by a huge lack of public trust in the effectivess of institutions, and the fear of retaliation or retribution due to the lack of whistleblowing protection regulations, are major contributing factors to incidences of impunity.
Finally, regulatory loopholes and insufficient sanctions within certain key sectors, affect the capacity to engage in effective prosecution and punishment, and negatively impact the deterrent effect of applicable laws.
C. Measures of legal reform
Colombia has undergone significant legal reforms throughout the last few decades, which have focused on improving the effective prosecution of economic crime and corruption. To this end, Congress has enacted laws such as Law 190 of 1995 (First Anticorruption Statute), Law 599 of 2000 (Penal Code), Law 906 of 2004 (Penal Procedural Code, which introduced an adversarial prosecutorial system to Colombia), Law 1340 of 2009 (which amended the Antitrust Law)[2], Law 1474 of 2011 (Second Anticorruption Statute), and Law 1778 of 2016 (Anti-Bribery Statute).
One of the most important reforms adopted within these laws was the enactment and progressive improvement of tackling crimes such as illicit enrichment and money laundering, as well as the incorporation (under article 34 of the Constitution of 1991) of the non conviction-based asset forfeiture of property (extinción de dominio)[3], which is deemed in Colombia to be an action against property and not against a person. Law 333 of 1996 followed, further regulating procedural aspects. More recently, Law 793 of 2002 substituted Law 333. Later, Law 1330 of 2009 and Law 1453 of 2011 amended Law 793. And more recently, Law 1708 of 2014 substituted previous extinción de dominioregulations. Finally, Law 1849 issued procedural improvements to Law 1708.
Since its enactment, extinción de dominiohas been one of the most effective tools in the fight against drug cartels and organized crime. However, it was only recently that the General Prosecutor of Colombia made a public statement announcing that the new policy of the Prosecutor is to utilize non conviction-based asset forfeiture of property as an anticorruption tool.
D. Overview of normative control regimes
Economic crime and economic infractions are punished in Colombia under two different control regimes: criminal and administrative. Under the criminal regime, an individual participating in what is deemed to be criminal behavior under the Colombian Penal Code may be investigated, prosecuted and sanctioned with fines, imprisonment and other penalties.
Legal persons are not subject to criminal prosecution under Colombian law, despite the fact that the Constitutional Court has ruled that if Congress decides to issue regulations on that kind of liability, such regulation would be compatible with the Colombian Constitution.
Under the administrative regime, different kinds of infractions may be investigated and sanctioned. Colombian law grants powers to entitites such as the Superintendence of Finance, the Superintendence of Companies and the Superintendence of Industry and Commerce to investigate potential violations of financial, antitrust and antibribery regulations, which will be outlined in further detail below.
For now, it is worth noting that over the last year, Colombian law has significantly increased the sanctions that may be imposed by the superintendencies; which in practice means that their sanctions can be as harsh or even harsher than those applicable under corporate criminal liability regimes of other countries.
II. Criminal Law
A. Aims and general characteristics of the legal regime
Colombian criminal law is considered the ultima ratiofor the protection of public interest and specially protected rights (bienes jurídicos protegidos). Its key drivers and principles are inspired by the traditions of civil law. For many years, Colombian criminal law was influenced by Spanish Law (more specifically the Spanish Penal Code[4]of 1822) and the Napoleonic Code[5]. In particular, the Penal Codes of 1837 and 1890 were drafted following the Spanish Penal Code and general rules of the Napoleonic Code.[6]
The Penal Code of 1890 was heavily modified in 1936 as a result of the impact that the theoretical developments of the Italian positive school of Garofalo, Lombroso and Ferri had had in the legal arena. Jorge Eliécer Gaitán, one of Colombia´s most renowned criminal lawyers of the 1930s and 1940s – and a disciple of Enrico Ferri – played a significant role in the introduction of the Positive School concept to Colombian legal thinking.[7]
More recently, with the enactment of the Penal Codes of 1980 and 2000, the influence of German scholars have been felt in the Colombian criminal legal system. This was due to the influence that German scholars had had over Spanish scholars, which in turn had a great impact on the works of Colombian professors.
In particular, legal concepts and ideas purported by scholars such as Claus Roxin and Gunther Jakobs, began to permeate the Colombian legal landscape, as well as the rulings of the Supreme Court of Justice.
It is worth noting that throughout history, demo liberal criminal law principles have remained constant, under the powerful influence of thinkers such as Beccaria. Therefore, notwithstanding the variations in different legal aspects and technicalities of each penal code, the legal regime has been defined by respect for the principles of presumption of innocence, proof beyond doubt[8], due process and right to contradict evidence presented by the government.
B. Sanctions and their substantive requirements
1. Types of sanctions
Article 34 of the Colombian Penal Code clasifies criminal penalties in three ways: the main punishments, the substitutive and the accessory. The main punishments, according to Article 35, are imprisonment, fines and other penalties privative of other rights, as established by specific articles of the Code (e.g. prohibition to hold public office). Substitutive penalties are domiciliary imprisonment (that is, imprisonment in the place of residence) and weekend arrest as a substitute for fines.
With regard to imprisonment, it is subject to the following rules, under Article 37: (i) Imprisonment shall have a maximum duration of forty years; (ii) rules and applicable benefits for the fulfillment of the imprisonment are subject to the regulation of the Penal Code and Penal Procedural Code; (iii) preventative arrest is not deemed a penalty, but if a final conviction sentence is issued, the time of the arrest will contribute to the final completion date of the punishment.
Rules applicable to domiciliary arrest are contained in Article 38 of the Penal Code. According to this, domiciliary arrest will be carried out in the place of residency of the person convicted, except for cases where the offender pertains to the family circle of the victim.
Other applicable rules for domiciliary arrest are: (1) the minimum penalty established by Law for which the individual has been convicted cannot exceed five years of imprisonment; (2) the personal, labor, family and social activities of the offender must allow the court to decide that the sentence will not endanger members of the community nor will it evade the fulfillment of the penalty, (3) the offender must pay bail, and is obliged to comply to (3.1) request authorization to change residency, (3.2) behave properly, (3.3) repair the damage caused by the crime, (3.4) attend any meeting requested by the judicial authority charged with the supervision of the penalty, if necessary, and (3.5) allow public officials charged with the oversight of the sanction to enter the residency.
The regulations for fines are included in Article 39 of the Penal Code. According to the Code, fines can be imposed alongside the main punishment, but in which case they cannot exceed 50,000 minimun monthly wages. Fines can also be imposed as the main punishment if the Penal Code establishes such type of sanction for the felony perpetrated by the offender. In case of it proving impossible for the offender to pay the fine upfront, the court may allow for the payment to be made in a maximum of twenty-four installments during a term that cannot exceed two years. According to Article 40, if the offender does not pay the fine, they can be subject to arrest.
Finally, Article 43 regulates penalties that restrict other rights. These include: (1) Prohibition to hold public office, (2) Loss of employment or public office, (3) Prohibition to undertake activities within a certain profession, craft, office, industry or commerce,[9](4) Prohibition to exercise parental rights, (5) Prohibition to drive automotive vehicles and motorcycles, (6) Prohibition to carry guns, (7) Prohibition to reside in or visit certain places, (8) Prohibition to consume alcoholic beverages or drugs, and (9) Expatriation (only applicable to foreigners).
2. Substantive requirements and safeguards for imposing sanctions
The general rule applicable under Colombian law is that in order to be considered a crime, there needs to be intent (dolo). However, some conduct may be punished despite a lack of intent. For example, a person that accidentally kills somebody while driving a car may be punished for culpable homicide, but not for murder.
This rule is contained within Article 21 of the Penal Code, which states: “Criminal conduct may be intentional, culpable or preterintentional. Culpable and preterintentional conduct is only punishable in cases explicitly stated under the law." According to Article 22, the conduct is committed with intent when the individual is aware of those elements that make it a criminal infraction and continues to carry the activity. It shall also be deemed that a conduct is committed with intent when the realization of the crime has been foreseen as probable, yet its non occurance is left to chance.
Furthermore, Article 23 establishes that a conduct is culpable whenever the substantive infraction is the result of a violation of the objective duty of care (deber objetivo de cuidado) and that the agent should have foreseen it, or having foreseen it believed they could avoid it. Lastly, Article 24 states that a conduct is preter-intentional whenever its result, being foreseable, exceeds the intent of the agent.
Importantly, Article 25 of the Penal Code considers that criminal conduct may be commited by action or omission. Particularly, it states that whoever avoids impeding the perpetration of a conduct punishable under substantive criminal law, being able to do so, shall be subject to the penalty established under the corresponding regulation. For such purpose, the agent must have under its responsibility the protection of the legally protected good (bien jurídico protegido) or must be obliged to expressly protect it under the Constitution or the law.
According to the same article, the following situations are deemed to be constitutive of a fiduciary duty: (1) the voluntary assumption of the duty to protect a person or to prevent a risk, (2) the existence of a close life relationship (estrecha comunidad de vida entre personas), (3) the undertaking of a risky activity by several individuals, (4) the previous creation of a situation of unlawful risk to the detriment of the corresponding legally protected good.
Such situations will only be considered constitutive of a fiduciary duty with regard to the following crimes: homicide and other crimes against life, crimes against liberty, personal injuries and sexual injuries.
3. Sanctions against companies and other organizations
Criminal liability applies only to individuals and not to legal entities. Therefore, companies and other legal persons cannot be subject to criminal prosecution. However, civil penalties (including suspending or cancelling the company’s legal personality, or ordering civil compensation) may be imposed.
The temporary suspension could be either withdrawn or upheld when the relevant company´s official is sentenced. The legal personality of the company could even be cancelled if the court finds that it has been “used partially or totally to commit the crimes”. In this instance, it could not operate in Colombia.After a court rules on the criminal liability of an individual, it may also require the offender or a third party to pay reparations to the victim.[10]
C. Procedures and their safeguards
1. Institutions and actors
a) Investigating authorities
The Technical Investigation Body (Cuerpo Técnico de Investigation), regulated by Law 1765 of 2015, is Colombia´s investigation bureau for criminal enforcement. It is a Directorate of the General Prosecutor´s Office and undertakes investigative activities under the instruction of the Attorney General and its delegate prosecutors. With regards to the military and police penal system, Articles 32 through 41 of Law 1765 of 2015 regulate a Special Technical Investigation Body for the Military and Police Justice System.[11]
b) Prosecutorial authorities
Since the enactment of the Constitution of 1991, criminal prosecution in Colombia is led by the Prosecutor General´s Office (Fiscalía General de la Nación). The functions and jurisdiction of the Prosecutor General´s Office are regulated under Articles 249 through 251 of the Constitution. Before 1991, prosecution was made by investigative judges or justices, as regulated under Articles 87 and 311 of Decree 50 of 1987.
c) Deciding (esp. adjudicating) authorities
Criminal cases are adjudicated by municipal or circuit judges or, in specific cases, in appellate tribunals or the Supreme Court of Justice. Following the Peace Agreement between the Government and FARC rebels, a Special Tribunal for Transitional Justice (Tribunal de Justicia Especial para la Paz[12]) will have jurisdiction over all cases where crimes were committed in the context of the armed conflict. The Tribunal was created by means of Legislative Act 1 of 2017, by which the Constitution was amended.
d) Control authorities and range of control
Article 267 of the Constitution grants the General Comptroller’s Office the role of performing activities related to fiscal control. Also, Article 271 states that findings made under preliminary investigations shall have evidentiary value in criminal cases. Further, numerals 21, 22, 24 and 26 of Article 289 of the Constitution invests the President of the Republic with the authority to exercise control and supervision over public administration. Thus, the Colombian executive branch has the following institutions for control and oversight: (1) Superintendence of Health, (2) Superintendence of Companies, (3) Superintendence of Private Security, (4) Superintendence of Industry and Commerce (charged with anti-trust), (5) Superintendence of Not-For-Profits, (6) Superintendence of Finance, (7) Superintendence of Notaries, (8) Superintendence of Public Services, (9) Superintendence of Ports and Transport, and (10) Superintendence of Social Welfare. It also has a Financial Information and Analysis Unit, which collects financial information and shares it with the Prosecutor General´s Office.
2. Investigative powers and duties to cooperate
a) Investigative powers
The General Prosecutor´s Office can issue search and seizure orders, as well as wiretapping, providing they have prior approval from a judge (juez de control de garantías).[13]Also, it can arrest suspects, but is obliged to present them before a court within 36 hours of arrest.[14]
b) Duties to cooperate and right against self-incrimination
The Colombian Penal Code and Penal Procedural Code state that any person has the duty to report any crime of which it is aware, except those that require private action (for example, libel or breach of fiduciary duty). This report should be made to the Prosecutor General’s Office.The obligation to report applies to both individuals and legal entities, living/registered in Colombia or abroad.
There is no clarity under Colombian law on when this obligation arises. However, practice shows that the authorities believe that the obligation to report arises when there are objective and reasonable elements that would allow an individual or corporate to reach a reasonable belief that an offence was (being) committed. That is to say, a conclusion that any normal person under normal conditions would reach.
However, there is a right to avoid self-incrimination in Colombia if the disclosure could result in a possible sanction or exercise of the punitive power of the state against the person that discloses the information.[15]Furthermore, client-attorney privilege also protects any communication between the subject of an investigation and their counsel, whether internal or external. However, if the counsel is involved in wrongdoing or becomes a part of a transaction or activities of any sort that could be deemed criminal, the privilege may not apply.
3. General procedural safeguards
Any and all actions exercised by the Prosecutor General that may affect the fundamental rights of the individual under investigation must have prior approval from a judge. Also, individuals have the right to presumption of innocence, contradiction and appeal. Finally, Article 124 of the Penal Procedural Code of 2004 states that the defense of the accused will be entitled to exercise all rights recognized under international human rights treaties, the Constitution and the law.
a) Privileges against coercive powers
Coercive powers must be exercised in a manner that is compatible with the Constitution and fundamental rights. Also, they must be utilized in a way that comply with any international obligations and conventions entered into by Colombia, such as the Inter-American Convention of Human Rights of 1969.
Of particular importance is the fulfillment of the obligations portrayed by Articles 7, 8, 9, 24 and 25 of the Convention, which regulate the rights to personal liberty, due process, principle of legality and no-retroactivity of penal law, equal rights before the law and judicial protection.[16]
b) Proof of claim
Under Colombian law, filing a criminal complaint does not require proof of claim. In fact, there only needs to be evidence based on a reasonable belief that a criminal infraction has occurred.
c) Access to the file
Article 124 of the Penal Procedural Code states that the defense can exercise all rights and capacities admitted under Colombian law and the Constitution. Furthermore, under number 3, of Article 125, the defense may, “In the event of an indictment, have access to all proof, physical evidence and information of concern of the Prosecutor General´s Office, including those that may be favorable to the accused.” During the last 20 years, the Constitutional Court has issued several decisions that analyze these concerns.
d) Right to be heard and oral hearing
The right to be heard is enshrined under Article 8, letter e) of Law 906 of 2004, which states that the defendant has the right to: “e) be heard, assisted and represented by an attorney of their trust or by one appointed by the State.”
Other noteworthy rights of the defendant protected by Article 8 are: a) Right not to be obliged to issue self-incriminatory statements or that may incriminate their spouse, permanent partner or relatives within the fourth civil or consanguine degree, or the second of affinity; b) Right not to self-incriminate or incriminate their spouse, permanent partner or relatives within the fourth civil or consanguine degree, or the second of affinity; c) Right to not have silence being used against them; d) Right to not have used against them the content of conversations designed to reach a plea agreement or such with the Prosecutor; as well as to reach an amicable solution; f) access to the assistance of a certified translater, if necessary; g) access to private communication with their defense attorney before appearing with public authorities; h) acknowledge the charges for which they are being indicted, with a clear explanation of the mode, time and place in which they supposedly occurred; i) reasonable time and the necessary means to prepare their defense; j) produce, require and controvert evidence; and k) face a public and impartial trial, without undue delay, in which they shall have the possibility of cross examining witnesses, as well as presenting witnesses and experts that may shed light over the facts of the case.
With regard to oral hearings, the Penal Procedural Code adopted in 2004 introduced oral criminal trials in Colombia. The Code establishes in Article 9 the principle of “orality”, as follows: “The proceedings will be oral, and for their performance the technical means that allow for their agility and fidelity shall be used, notwithstanding the preservation of the record of what occurred. (…)”.
Article 145 states: “All proceedings, whether before or during the formal proceedings, shall be oral”. Moreover, according to Article 147,“In public hearings held for criminal proceedings, matters discussed shall be solved within the same hearing. Persons present shall be deemed notified with the issuance of the oral decision or ruling.”
Interestingly, Article 163 prohibits the literal transcription of the judicial decision, except when necessary to explain the grounds of the decision, as a means to protect the principles of orality and celerity of criminal proceedings. Such rule is a clear response to what previously happened in practice with the Penal Procedural Code of 2000 (Law 600), which was replaced by Law 906 of 2004.
Despite the fact that Law 600 had already established a principle of orality, in practice the courts and attorneys did not comply with it. In many cases, attorneys would simply give the court a digital file with what they meant to say in the public “hearing”. The court´s officials would then cut and paste the content of this file and include it in the written record and transcripts of the proceedings.
e) Secret evidence
All evidence shall be presented in public hearings. Therefore, no secret evidence is allowed. The only cases where the orality and publicity principles can be restricted are those related to child molesting and other similar cases, where the right to privacy of specially protected victims or witnesses needs to be safeguarded.
f) Transparency
Criminal cases, as well as the activity of criminal courts, are subject to the principle of publicity. Thus, the hearings shall be public, except for cases where evidence must be protected or where the fundamental rights of the victims or witnesses need special care.
g) Companies and other organizations
Companies and other legal entities cannot be subject to criminal prosecution under current Colombian regulations. That reflects the idea, still predominant in our legal context, that societas non delinquere(companies do not commit crimes), based on the idea that intent(dolo) is a subjective element that can only be applied to natural persons.
However, in Sentence C-674 of 1998, the Colombian Constitutional Court ruled that if Congress wants to create legal liability for corporations or any legal entities, it could do so perfectly, and such regulation would not be deemed unconstitutional. Furthermore, it stated that creating this kind of criminal liability would require Congress to expressly regulate the crimes for which it would apply, as well as the applicable punishments.[17]
4. Discretion to commence and to stay proceedings
The Colombian Constitution and Article 66 of Law 906 of 2004 grant the Prosecutor General´s Office the power to initiate criminal enforcement. Also, the law gives the body the capacity to withdraw from starting criminal action against individuals in light of a negotiation and agreement of an opportunity principle (principio de oportunidad); namely, an agreement whereby the defendant agrees to become a witness or fully cooperate with the Prosecutor in the investigation of a larger case.
Since the enactment of the Penal Procedural Code, the opportunity principle has been utilized by the Prosecutor General in some high profile cases, provoking distrust and anger of the general public. As a result, legislators and politicians have been advocating for legal reform, targeted at preventing the abuse of power by the body and impunity in relevant cases. Currently, several bills focused on the reform of the Penal Procedural Law are under Congressional review and discussion.
5. Relationship with other national and international legal regimes
a) Transfer of evidence within the national legal order
As Colombia is a country with a central government, the Prosecutor General´s Office works as a single and unitary entity, via a network of delegate prosecutors. Therefore, if the Prosecutor in charge of a case needs evidence to be collected in a territory or region different to their specific domicile, they can issue instructions to local judicial police officials to travel to those areas in order to collect the evidence, or seek help from other prosecutors or members of the judicial police in those territories.
Also, according to Article 202 of the Penal Procedural Code, it is worth noting that (1) the Ministry Public (Procuraduría General de la Nación), (2) the Comptroller General, (3) transit authorities, (4) public entities with control and oversight functions, (5) the national and regional directors of the Penitentiary Institute (INPEC), as well as the directors of prisons and personnel charged with custody and oversight duties, (6) mayors of municipalities, and (7) police inspectors, are permanently invested with judicial police powers. Furthermore, Article 203 states that such powers may also be exercised by other entities that have been authorized to do so by the Prosecutor General, for the specific matters set forth in the corresponding resolution. Thus, evidence collected by all the above mentioned officials and institutions may be introduced in the criminal trial.
b) Ne bis in idem within the national legal order
Articles 29 of the Constitution, 21 of the Penal Procedural Code of 2004, and 8 of the Penal Code, establish the ne bis in idemprinciple. Further, Article 17 of the Penal Code states that all sentences issued by foreign courts, whether with acquittals or convictions, will also be deemed cosa juzgada, and therefore cannot be submitted again for a new trial.
Exceptions to that rule are found in paragraph 2 of Article 17 of the Penal Code. It states that, sentences issued by foreign courts related to matters covered under Articles 15 and 16, numerals 1 and 2, shall not have the value of cosa juzgada, and therefore ne bis in idemis not applicable in those cases.
Article 15 relates to crimes commited (i) by any person on board a ship or aircraft of the state or commercially exploited by the State, where such crimes are committed abroad, or (ii) by any person committing the crime on board any national ship or aircraft found in high seas where no other criminal action has been initiated by a foreign authority.
Article 16 relates to crimes commited by (1) any person against the security and existence of the State, against the Constitutional system, against the economic social order (except for the crime described under Article 323), against the public administration, or by any person participating in national currency counterfeit, terrorism financing or administration, and (2) by any person that being under the service of the Colombian government, enjoys immunity under international law, and commits a crime abroad.
The only other exception to the mandatory application of the ne bis in idemprinciple related to decisions issued by domestic courts occurs in cases where an international court or commission of human rights has issued a sentence that mandates a review of the decision adopted locally.
c) International cooperation
In 1979, Colombia and the United States signed an extradition treaty specifically targeting the extradition of Colombian drug traffickers. However, in 1987 the Constitutional Chamber of the Colombian Supreme Court of Justice ruled that such a treaty was unconstitutional. Later, Article 35 of the Colombian Constitution of 1991 prohibited the extradition of Colombian nationals. But, the war against drug cartels throughout the 1990s changed that.
Political pressure from the United States, coupled with the need to transport and imprison cartel leaders in maximum security jails, where they would not be a threat to Colombian authorities and public safety, led Congress to approve a reform to the Constitution in 1997, whereby extradition was authorized. Since then, Colombia has extradited hundreds of nationals, mainly to the United States.
Currently, the Penal Procedural Code regulates extradition proceedings under Articles 490 through 514. It also regulates cooperation proceedings in investigations of interest for authorities abroad or for Colombian authorities needing the cooperation of foreign authorities. It does so under Articles 243, 427, and 484 through 514.
Of particular importance is Article 484, which regulates the general principle of cooperation, as follows:
“Article 484. General Principle. Investigation and judicial authorities shall do whatever is necessary to fulfill the requirements of international cooperation that may be required from them, in accordance with the Constitution, international conventions and the law, especially in connection with the jurisdiction of the International Penal Court.
Paragraph. The arrest warrant of a person by means of diffusion or a red arrest order through the channels of the International Organization of Criminal Police (INTERPOL), will have efficacy in Colombia. In said cases, the arrested person shall be put immediatly at the disposal of the Prosecutor General.
The Prosecutor General will notify immediately the Ministry of Foreign Affairs for what may be necessary and shall issue, in a term that may not exceed two (2) days, an arrest warrant with extradition purpose, under the terms established under Article 508 of this Code.”
Colombia is also a signatory of the OECD Convention
on Combatting Bribery of Foreign Public Officials in International Business Transactions (the Antibribery Convention). As part of its obligations under the Convention, in February 2016 Congress issued Law 1778, best known as the Antibribery Law. According to Article 29 of this law, the Prosecutor General´s Office must inform judicial and administrative foreign authorities on any criminal notice provisionally assessed as bribery, when the conduct under investigation has been committed by employees or managerial level officials of a corporation domiciled within their territory.
D. Evaluation
The criminal justice system in Colombia requires full respect for due process. That implies that the defendant shall be clearly informed on the facts for which they are being tried. Also, that they must be informed of the charges, which shall made in accordance with the facts of the case. Further, in virtue of the congruency principle(Article 448 of the Penal Procedural Code), no conviction may be issued in breach or excess of the charges filed by the prosecutor of the case.
Other important safeguards of due process have to do with the motivation principle.All final decisions made by a Colombian judge or any of its courts must be motivated. This is in stark contrast to the legal tradition of other countries where the finding of guilt or innocence is made by a jury, which does not have the obligation to explain the reasoning behind its decision. On the other hand, poor motivation of a decision can be the basis for a success appeal or legal recourse or even of criminal prosecution against the judge or justices who issued the decision.
Finally, it is worth noting that, due to the in dubio pro reoprinciple, incorporated in our legal system under Article 29 of the Constitution and Article 7 of the Penal Procedural Code, every person shall be deemed innocent and treated as such, until a definitive decision is made determining their criminal culpability.
Also, in virtue of in dubio pro reo, it is the Prosecutor who bears the burden of proving the criminal liability of the accused. Any doubt will be found in favor of the accused. A judge may only issue a conviction when they are assured beyond any doubt of the criminal liability. In conclusion, the Colombian standard for finding criminal liability is higher than that of many countries using the reasonable doubt standard, which, in our view, is lower.
III. Administrative criminal law
A. Aims and general characteristics of the legal regime
According to the OECD Antibribery Convention, countries can adopt criminal or administrative liability regimes in order to sanction foreign bribery. With the enactment of the Antibribery Law of 2016, Colombia adopted an administrative liability regime. However, its impact has similar consequences to those of a criminal liability regime. It is worth mentioning that the Antibribery Group of the OECD reviewed Colombian antibribery legislation and found that it was compliant with the Antibribery Convention standards.
As to the aims of the administrative legal regime, its purpose is to deter and enforce effectively egregious unlawful behavior of Colombian legal persons participating in international business transactions. It also looks to promote compliance initiatives targeted at increasing the commitment of the private sector to prevent, detect and combat corruption, alongside the government.
B. Sanctions and their substantive requirements
1. Types of sanctions
The Antibribery Law offers different types of sanctions. Firstly, a fine of up to 200,000 Minimum Monthly Wages (around $52 million dollars (USD)). Secondly, prohibition to enter into contracts with any public body. Thirdly, publication via mass media communication channels and on the website of the legal person sanctioned of the transcript of the administrative decision whereby the punishment was imposed. Fourthly and finally, prohibition to receive any grant or subsidy from the government for a term of up to five years. The administrative act must be registered in the mercantile registry of the city where the company is incorporated, and must be inscribed in the certificate of incumbency and incorporation of the company.
2. Substantive requirements and safeguards for imposing sanctions
According to the Antibribery Law, all elements described under Article 2 shall be met in order to find liability. Consequently, the legal persons acting through one or more employees, contractors, managers, or associates, whether of the parent company or any of its subsidiaries, give, offer or promise to a foreign public official – directly or indirectly – any sums of money, object with economic value, or any other benefit expecting the foreign official to perform, omit or delay, any act related to its function and in connection with an international deal or transaction, shall be subject to administrative sanctions within the terms of the law. Furthermore, parent companies shall be held liable in those cases whereby any of their subsidiaries participate in any of the activities described under Article 2, with the consent or tacit approval of the parent company.
Paragraph 1 of Article 2 defines a foreign public official, in order to avoid any legal lacuna. According to the definition, a foreign public officialis any person with a legislative, administrative or judicial position in the State, its political subdivisions or local authorities, or in a foreign jurisdiction, regardless as to whether the official has been appointed or elected. Any person that exercises a public function for a State, its political subdivisions or local authorities, or in a foreign jurisdiction, whether in a public entity, or in a public owned company or in any legal person controlled by the State, its subdivisions or local authorities, or a foreign jurisdiction shall also be considered a foreign public official, as shall any official or agent of an international organization.
3. Sanctions against companies and other organizations
As mentioned above, four type of sanctions may be imposed on legal persons under the administrative regime for foreign bribery cases. Such sanctions may also be imposed on other companies not directly implicated with the bribery case, but which, according to the law, may be held liable in virtue of their failure to report a wrongdoing, for aiding and abbeting, or simply for not having undertaken due diligence activities to detect and prevent the wrongdoing.
Therefore, according to Article 6 of the Antibribery Law, in those cases where the legal person that undertook the unlawful conduct described under Article 2, reforms or changes their nature before the expedition of the administrative act determining liability, the following rules shall apply:
“1. Whenever a company, that has participated in any of the conducts under Article 2 of this law, ceases to exist due to a merger, the absorbing company or that of new creation will bear the burden of the punishment established under this law.
2. Whenever a company participates in any of the unlawful conducts under Article 2 of this law, and later divides, all the companies that participated in the division process, whether as the company that splits or the beneficiary, will be jointly responsible for the sanctions established under this law.
3. Whenever there is a control transfer of the company that participated in any of the conducts under Article 2 of this law, the new controlling company will be liable to the sanctions under this law.
The preceeding rules shall be applicable to all associative forms different from companies. (…)”
Finally, under the Antibribery Law, the parent company shall be liable for the acts of its subsidiaries or officials abroad.
C. Procedures and their safeguards
1. Institutions and actors
a) Investigating authorities
Under Article 11, the Antibribery Law grants the Superintendence of Companies investigative powers for cases of foreign bribery. For the purpose of investigating foreign bribery cases, the Superintendence created a Special Antibribery Group under the supervision of the Deputy Director of Economic and Accounting Affairs.[18]
b) Prosecutorial authorities
Under Articles 1, 5 and 11 of the Antibribery Law, the Superintendence of Companies investigates and adjudicates final decisions for foreign bribery cases.
c) Deciding (esp. adjudicating) authorities
Under Articles 1, 5 and 11 of the Antibribery Law, the Superintendence of Companies investigates and adjudicates final decisions for foreign bribery cases.
d) Control authorities and range of control
Control authorities different from the Superintendence of Companies do not have the power to directly investigate foreign bribery cases. However, they are obliged to report any case in which they acknowledge that foreign bribery has occurred to the Superintendence of Companies.
2. Investigative powers and duties to cooperate
a) Investigative powers
Article 20 of the Antibribery Law asserts that the Superintendence of Companies can perform any and all relevant actions authorized by the law aimed at fulfilling its inspection, vigilance and control functions. In particular, the Superintendence is entitled to:
1. Make inspection visits, order, collect and produce evidence and relevant information
2. Require natural and legal persons to deliver data, reports, books and business documents that may be necessary for the investigation
3. Perform interviews under oath with any person whose testimony may prove useful for the investigation, ensuring strict compliance with all regulated formalities for similar cases under the General Procedural Code
Furthermore, Article 21 of the same law grants the Superintendence the power to impose fines of up to $52 million dollars (USD) against those legal persons that in any way refuse to deliver to the Superintendence the reports or documents required in the course of foreign bribery investigations; that hide them, or impede or withdraw from authorizing access to its files or officials; or that send the information with significant errors or incomplete; or that do not go to the hearings of the Superintendence of Companies, without an adequate excuse. The Superintendence may also impose successive fines to the legal person that fails to provide the required information, as regulated under Article 90 of Law 1437 of 2011.
b) Duties to cooperate and right against self-incrimination
Unlike laws mentioned previously, the Antibribery Law does not impose a duty to cooperate when the Superintendence is exercising its investigative powers. However, the criteria which the Superintendence may take into account when determining the sanction include the following:
(i) The amount of the benefit or damage;
(ii) The degree and willingness to collaborate;
(iii) The adoption of measures requested by the Superintendence;
(iv) Admission of wrongdoing;
(v) The economic capacity of the company;
(vi) The use of intermediaries to conceal the bribe or its proceeds;
(vii) The existence of codes of ethics or compliance in the company;
(viii) Notifying the authorities of the wrongdoing; and
(ix) Providing all relevant facts and supporting evidence to the authorities.
After reading (ii), (iii), (iv), (viii) and (ix) above, it is clear that the company can benefit from more lenient treatment if it fully cooperates with the Superintendence.
With regard to self-incrimination,there is a privilege against it in Colombia if disclosure could result in a possible sanction or exercise of the punitive power of the State against the person that discloses the information.[19]This privilege against self-incrimination may be available to any legal entitity – not just in criminal cases, but also in administrative cases. Thus has ruled the Constitutional Court in may cases.
3. Discretion to commence and to stay proceedings
The Superintendence of Companies does not have discretion to commence proceedings nor to stay them. However, under provisions of Article 19 of the Antibribery Law it can grant leniency or even a full waiver of punishment provided that the company has self-reported the crime and it has not yet received any kind of benefit derived from the unlawful conduct.
4. Relationship with other national and international legal regimes
a) Transfer of evidence within the national legal order
Evidence and proof validly collected as the result of a judicial or administrative proceeding, in Colombia or abroad, and the material support of such evidence, may be transferred to the administrative proceedings of the Superintendence of Companies by means of copies authorized by the corresponding official.
Evidence collected by the Prosecutor General´s Office, the victims or the defense, may also be included in the administrative proceeding, without regard of such evidence having been formally introduced and controverted in trial. However, such evidence must be subject to contradiction rights by the defense in the administrative proceedings.
Whenever the Superintendence requires information related to an ongoing criminal investigation or requires to introduce to the administrative proceedings evidence collected that has not been yet uncovered by the Prosecutor, it will ask the Prosecutor General to authorize such petition. On a case-by-case basis, the Prosecutor shall assess the petition and determine what information or evidence it may disclose and deliver, without having an impact on the penal investigation and without jeopardizing its successful outcome.
b) Ne bis in idem within the national legal order
Ne bis in idemis applicable to all criminal and administrative investigations. Therefore, ne bis in idemis applicable for foreign bribery cases.
c) International cooperation
Articles 24 through 26 regulate international cooperation mechanisms that may be used by the Superintendence of Companies. Article 25 of the Antibribery Law regulates the collection or production of evidence in foreign territory. It states that the Superintendence of Companies may send its officials abroad for collecting or producing evidence, with the prior approval of foreign authorities who have the ability to authorize such proceedings. The Superintendence must first notify the Colombian Ministry of Foreign Affairs and the Colombian diplomatic body of the country where the proceedings should take place.
Article 24 also regulates reciprocal legal cooperation. This grants the Superintendence the power to utilize and benefit from the mechanisms of legal assistance foreseen under Article 9 of the OECD Antibribery Convention, which has been formally incorporated into the Colombian legal system via Article 1573 of 2012.
As a result, the Superintendence may require foreign authorities or international organizations, directly or by other established means, to help provide any material evidence or the production of evidence deemed necessary, under the scope of their mandate. Within their petition for assistance, the Superintendence must provide the foreign authority with all necessary data for its effective collection; it must also explain the motivating facts for the petition, as well as its purpose, the regulations that have been infringed by the offender, the identity and whereabouts of the persons or assets compromised, and any additional specific instructions that the foreign authority should take into account.
V. Compliance regimes
Enactment of Law 1778 (Antibribery Law) of 2016 completely changed the landscape of compliance in Colombia. In practice, Article 23 has been the most important game-changer. According to this:
“Article 23. Corporate ethics programs. The Superintendence of Companies shall promote within the legal persons subject to its oversight the adoption of corporate transparency and ethics programs, of internal anticorruption mechanisms, of internal mechanisms and audit norms, promotion of transparency and mechanisms for the prevention of conducts described under Article 2 of this law (namely, foreign bribery).
The Superintendence shall determine the legal persons obliged by this regulation, taking into account criteria such as the size of assets, income, number of employees, and social purpose.”
After the enactment of the Antibribery Law, the Superintendence of Companies has issued a number of Resolutions defining the companies obliged to adopt corporate ethics programs, and the scope of such obligation. The most important are External Resolution 100-000003 of 2016and External Resolution 100-002657 of 2016.
The former is intended as a Guide for legal persons and contains useful tools for the preparation and implementation of anticorruption programs and mechanisms. The former contains the description of the types of companies and characteristics that should be met in order to be obliged to comply with antibribery compliance programs.
According to Resolution 100-002657, the companies obliged to adopt compliance programs are those that have entered into any international business or transaction in the previous year with foreign private or public entities, in those cases where one or both of these things occur:
(i) the domestic company pertains to any of the following sectors: pharmaceutical; oil, mining and gas; infrastructure and construction; manufacture; information and telecommunications; and exports and imports; or
(ii) the domestic company has held international deals or transactions by means of an intermediary or contractor, or by means of a subsidiary incorporated in another state by the Colombian company.
The impact of these compliance provisions is changing the corporate ethics landscape in Colombia. Thus, everyday more associations are adopting self-regulation pacts, pursuing Antibribery´s ISO37001 standard certificates, and preparing and adopting internal ethics codes, strategies and action plans. Also, some leading multinationals and local corporations have created the National Network of Compliance Officers, under the leadership of the International Institute for Anticorruption Studies, a not for profit incorporated in Colombia, which aims to promote best practices in corporate compliance and anticorruption public policy.
VII. Analysis and summary
During the last decade Colombia has made significant regulatory and institutional progress aimed at the detection, prosecution and effective punishment of economic crime and corruption, especially foreign bribery. Such progress has been made possible by strengthening investigative, prosecutorial and control institutions, investing them with the necessary powers and tools to perform their duties effectively.
However, there is still much more to be done. The detection of economic crime and corruption continues to elude the Colombian authorities in large part. Therefore, it is important to champion regulation for whistleblower protection, strengthen the Financial Information and Analysis Unit and provide more training for those public officials responsible for finding and punishing these infractions. It is also important to impose effective sanctions and promote public awareness, thereby increasing the ‘deterrent effect’ of the law. Finally, it is imperative to call on a greater commitment from the private sector, reiterating its shared responsibility (with the public sectot) preventing, detecting and blowing the whistle in cases of corruption.
[1]After the wars of independence the Virreinato de la Nueva Granada, which was formally created as a territorial entity in 1717, would become Colombia, Panama, Venezuela, Ecuador, and parts of Peru and Brazil.
[3]Since at least 1936 it has been widely discussed in the Colombia legal context whether property should be considered as having a social function or as being itself a social function. According to article 58 of the Constitution of 1991 property is deemed to be a “social function”. Said interpretation has been confirmed by the rulings of the Constitutional Court and the Supreme Court of Justice. For that reason, it has been understood that the state has the power to freeze and recover assets that have been used as or are the produce of certain unlawful activities, established by law.
[7]By way of anecdote, in the second half of the 1940´s, Jorge Eliécer Gaitán became the sole director of the Liberal Party, one of the two predominant political parties of the time. He pushed for the moral renovation of society and public administration, and claimed to be the leader of the liberal-conservative people, struggling against the liberal-conservative olicarchy. Due to his socialist orientation, formidable eloquence and commitment to the defence of liberals that were being killed thoughout the entire country by the extreme right wing political police, he was elected the party’s presidential candidate in 1948. While rallying for the presidency, he was shot dead on the 9th of April of that year. That same day, people rose in mutiny throughout the entire country. In Bogota nearly 3000 people were killed, according to conservative estimates, in a chaotic event that has been called El Bogotazo. Violence spread rapidly throughout the entire nation, and fuelled what later become the Colombian armed conflict, which only only came to an end in 2016, with the approval of the Peace Accords signed by President Juan Manuel Santos and the leaders of the Armed Revolutionary Forces of Colombia (FARC).
[8]Article 7 of Law 906 of 2004 (the Penal Procedural Code) protects the right of presumption of innocence. It also establishes that an individual can only be convicted if there is no doubt of their responsibility in the crime. Therefore, in our view, the Colombian standard for conviction is higher than the reasonable belief standard used in many other countries, particularly those under the Common Law tradition.
[9]Modificado por el art. 2, Ley 1762 de 2015. La inhabilitación para el ejercicio de profesión, arte, oficio, industria o comercio. Penal Code. Law 599 of 2000.
[10]Article 107 of Law 906 of 2004 (“incidente de reparación integral” - incident of integral reparation).
[14]Numeral 7 of Article 114 of Law 906 of 2004.
[15]Articles 29 and 33 of the Colombian Constitution.
[19]Articles 29 and 33 of the Colombian Constitution.
