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FINANCING LAW HAS BEEN DECLARED UNCONSTITUTIONAL

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October 16th 2019

The Colombian Constitutional Court stated the unconstitutionality of Law 1943 of  2018 (Financing Law), due to irregularities on the law-making proceeding.

The effects of the decision are deferred and are applicable as of December 31st 2019. Therefore, the decision will be effective as from January 1st 2020.  In this sense, provisions introduced by Financing Law shall be applicable to corporations, individuals, private equity fund and foreign investors for taxable year 2019

The decision will have effects in the future in order to not affect consolidated legal situations, such as equity tax ( impuesto al patrimonio) and the voluntary disclosure program ( impuesto de normalización tributaria) duly filed and paid by taxpayers during year 2019.

In case that prior to December 31th 2019 the Colombian Congress does not enact a new tax reform, provisions in force before Financing Law will apply.