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Payment of dividends using means different than money

Article 455 of the Colombian Code of Commerce regulates the payment of dividends using means different than money. The purpose of this article is to present a brief analysis of the different means, besides money, by which the payment of dividends may be done and the specific requirements of each of them. All of the above, under the applicable laws and the different resolutions issued by the Colombian Superintendence of Companies.

The first option is the payment of dividends in shares of the company. The abovementioned article of the Code of Commerce sets forth the possibility to pay dividends in shares of the company, as long as this decision is approved by at least 80% of the shareholders assembly. It is important to highlight that this option is also included in the “Circular Básica Jurídica” of the Colombian Superintendence of Companies.

The second option is the payment of dividends in kind. The “Circular Básica Jurídica” also acknowledges this option, specifically in point 4, subpoint C of Chapter I, which sets forth the following two requirements: 1) that the shareholders assembly presents this option; and 2) that the shareholders approve it. On this point, resolution 220-059331 of the Superintendence of Companies dated August 1st, 2012, established as possible this mean of payment of dividends and pointed out that this decision should not compromise productive assets of the company. This decision should be taken in the company’s best interest and must not compromise profit producing assets. This, considering that the main role of the directors of the company is to increase its value.

It is worth mentioning that this possibility was also studied and approved by the Superintendence of Companies, in resolution 220-028457 dated April 9, 2019. This resolution clarified that the Superintendence did not intended to change this payment possibility through its previous resolution (resolution 220-0637775 dated April 13, 2016). For this purpose, it clarified that the previous resolution only analyzed the foreign exchange regulation, and therefore, it should not be understood as a change in their position regarding payments of dividends in kind. In sum, the Superintendence clarified this issue, and reaffirmed its position regarding the viability of paying dividends in kind.

In conclusion, the Colombian mercantile regulation and the Superintendence of Companies have set forth as possible two additional options for the payment of dividends. These options are: 1) The payment of dividends in shares of the same company; and 2) The payment of dividends in kind. Each option contains several requirements, analyzed on this article, that must be considered in order to comply with the Colombian legal framework. This, under the scope of the specific needs and the current situation of each company.


Portrait of Juan Camilo Rodríguez, LL.M.
Juan Camilo Rodríguez, LL.M.
Managing Partner
Camilo Caicedo, LL.M.
Ricardo José Díaz