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Public private partnerships in Colombia: the APP regime, private initiatives, public funding caps, terms and contract changes

Last verified: 2026-10-27 · Status: Changing

Colombia's public private partnership (APP) law, Ley 1508 de 2012, lets a State entity hand a private investor the design, construction, operation and maintenance of infrastructure in exchange for the right to exploit it, with payments tied to availability and service levels. Projects must exceed 6,000 monthly minimum wages of investment (about COP 10,505,430,000 in 2026), contracts run up to 30 years including extensions, and private originators may propose projects on their own account and risk, with a 3 to 10 percent scoring bonus if the project goes to a tender. Public money in private initiatives is capped at 30 percent of the investment budget (20 percent for road projects), additions and extensions are capped at 20 percent, and a September 2026 earthquake emergency decree lifted the addition cap for emergency related work.

USD figures use the TRM (tasa representativa del mercado) of COP 3,157.94 per US dollar, valid 27 October 2026, from the official TRM series certified by the Superintendencia Financiera and published on the national open data portal. Conversions are for orientation only.

Key facts

Minimum investment for a public private partnership project	6000 monthly minimum wagesLey 1508 de 2012 art. 3 par. 1, as of 2026-10-27 · in force
Minimum investment for a public private partnership project, 2026 (6,000 x COP 1,750,905)	10505430000 COPLey 1508 de 2012 art. 3 par. 1; Decreto 1469 de 2025 art. 1, as of 2026-10-27 · in force
Maximum term of an APP contract, including extensions, without CONPES approval	30 yearsLey 1508 de 2012 art. 6, as of 2026-10-27 · in force
Cap on public funds in a private initiative APP, share of estimated investment budget	30 %Ley 1508 de 2012 art. 17 (Ley 1753 de 2015 art. 38), as of 2026-10-27 · in force
Cap on public funds in a private initiative road APP, share of estimated investment budget	20 %Ley 1508 de 2012 art. 17 (Ley 1753 de 2015 art. 38), as of 2026-10-27 · in force
Scoring bonus for the originator of a private initiative in the public tender	3 to 10 % of initial scoreLey 1508 de 2012 art. 17, as of 2026-10-27 · in force
Cap on additions plus extensions in public initiative APPs, share of original contract value	20 %Ley 1508 de 2012 art. 13, as of 2026-10-27 · in force
Fee for requesting an addition to an APP contract	10 % of amount requestedLey 1508 de 2012 art. 29, as of 2026-10-27 · in force
Fee for requesting an extension of an APP contract	1 % of initial contract valueLey 1508 de 2012 art. 29, as of 2026-10-27 · in force
Maximum time for the entity to review a private initiative at prefeasibility	3 monthsLey 1508 de 2012 art. 15, as of 2026-10-27 · in force
Maximum time for the entity to evaluate a private initiative at feasibility (extendable by half)	6 monthsLey 1508 de 2012 art. 16, as of 2026-10-27 · in force
TRM used for USD conversions (valid 27 October 2026)	3157.94 COP per USDResolución Externa 1 de 2018 of the Board of Banco de la República, art. 40 (TRM), as of 2026-10-27 · in force

The rule

1. A public private partnership is a contract between a State entity and a private individual or company to provide public goods and related services, involving the retention and transfer of risks between the parties and payment mechanisms linked to the availability and service level of the infrastructure or service. Concessions under Ley 80 de 1993 art. 32 num. 4 are a form of APP. The law applies to contracts in which the State entrusts a private investor with design and construction of infrastructure and its associated services, or its construction, repair, improvement or equipment, always including operation and maintenance, and may cover infrastructure for public utility services. The investor is paid with the right to exploit the infrastructure or service, with State contributions where the project needs them. Only projects with an investment above 6,000 monthly minimum wages may be structured as APP.
Cost to do it: Investment floor: 6,000 monthly minimum wages, COP 10,505,430,000 at the 2026 minimum wage of COP 1,750,905 (Decreto 1469 de 2025).
Example: A municipal hospital wing with an investment budget of COP 8,000,000,000 cannot be done as an APP in 2026, because it is below COP 10,505,430,000; it would be ordinary public works procurement. / The 2026 floor is about US$3,326,672; a project of about US$2,533,297 falls below it.Ley 1508 de 2012 (Diario Oficial 48.308 of 10 January 2012), Art. 1, art. 2, art. 3 and par. 1, 2012-01-10 official text · verified 2026-10-27

2. The right to collect revenue from the project, to receive public disbursements or any other payment is conditional on the availability of the infrastructure, compliance with service levels and quality standards in each functional unit or stage of the project. APP contracts have a maximum term of 30 years including extensions; a longer term is allowed only if the financial structuring shows it before the selection process and CONPES (the national economic and social policy council) gives a prior favourable opinion.Ley 1508 de 2012; art. 5 as amended by Ley 1753 de 2015 art. 37, Art. 5 and art. 6 (num. 6.1), 2015-06-09 official text · verified 2026-10-27

3. Private parties may structure public infrastructure projects on their own account and risk, bearing all structuring costs, and submit them confidentially to the competent entity in two stages. At prefeasibility the entity has up to 3 months to decide whether the proposal is of interest; at feasibility it has up to 6 months from filing to evaluate it (extendable by half that period), and if it finds the project viable the originator has up to 2 months to agree the conditions, failing which the project is deemed rejected. Initiatives may not modify existing contracts or concessions, cover projects already being structured by a public entity, or demand State guarantees or public disbursements above the legal caps. Where several originators propose the same project, the first to file a proposal later declared viable has priority.
Cost to do it: The originator bears the whole structuring cost; if another bidder wins, the originator is reimbursed by the winner the study costs the entity accepted (art. 17 and art. 20).Ley 1508 de 2012, Art. 14, art. 15 and art. 16, 2012-01-10 official text · verified 2026-10-27

4. If a private initiative needs public disbursements, a public tender is opened and the originator gets a bonus of 3 to 10 percent on its score, depending on project size and complexity. Public resources from the national budget, territorial entities or other public funds may not exceed 30 percent of the project's estimated investment budget, or 20 percent for road infrastructure projects. If the originator is not selected, the winner must pay it the value the entity set before the tender as the cost of the studies.
Example: For a private initiative with an estimated investment budget of COP 500,000,000,000, public funds may reach at most COP 150,000,000,000, or COP 100,000,000,000 if it is a road project. / About US$47,499,319 (or US$31,666,213 for roads) on a budget of about US$158,331,064.Ley 1508 de 2012, art. 17 as amended by Ley 1753 de 2015 art. 38, Art. 17, 2015-06-09 official text · verified 2026-10-27

5. If a private initiative needs no public money, the entity publishes the agreement, studies and draft contract on SECOP for 1 to 6 months. If no one else shows interest the contract may be awarded directly to the originator. A third party that wants to compete must back its interest with an insurance policy, bank guarantee or other legal security and prove legal, financial and experience capacity; the entity then runs an abbreviated selection with prequalification, and if the originator does not have the best offer it may improve on the best one within 10 business days of the evaluation report. These contracts may not later be changed to receive public money and may be extended by at most 20 percent of the initial term.Ley 1508 de 2012, Art. 19, art. 20 and art. 21, 2012-01-10 official text · verified 2026-10-27

6. In public initiative APPs and private initiatives with public money, additions of public resources may not exceed 20 percent of the originally agreed contract value (or of the public disbursements originally agreed), counting additions and the value of time extensions together; extensions may only be agreed after the first 3 years and before three quarters of the original term (art. 7). Bidders' legal, financial and experience capacity is a pass or fail requirement and no Registro Único de Proponentes is required (art. 12.1). All project funds must be run through a trust (patrimonio autónomo) set up by the contractor (art. 24). Lenders may take over the contract on the contractor's default (art. 30).Ley 1508 de 2012, Art. 7, art. 12 num. 12.1, art. 13, art. 18, art. 24 and art. 30, 2012-01-10 official text · verified 2026-10-27

7. When asking for an addition or extension, the contractor must pay a fee of 10 percent of the requested amount for an addition, or 1 percent of the initially agreed value for an extension, as consideration for the Ministry of Finance's review; if the project was previously submitted to CONPES, the fee for an addition falls to 2 percent of the requested amount.
Cost to do it: 10 percent of a requested addition (2 percent if the project went through CONPES), or 1 percent of the initial contract value for an extension.
Example: An addition request of COP 20,000,000,000 costs a fee of COP 2,000,000,000, or COP 400,000,000 if the project went through CONPES. / About US$633,324, or US$126,665, on a request of about US$6,333,243.Ley 1508 de 2012, Art. 29, 2012-01-10 official text · verified 2026-10-27

8. For APP contracts governed by Ley 1508 de 2012, additions and modifications aimed at addressing the emergency caused by the 10 August 2026 earthquake are not subject to the art. 13 cap on additions and extensions, provided their direct and specific link to the emergency in the municipalities covered is proven with a technical, legal and financial justification; they may never alter the contract's economic balance or payment scheme.Decreto Legislativo 1420 de 2026 (Diario Oficial 53.630 of 17 September 2026), Art. 1 and art. 3, paragraph, 2026-09-17 official text · verified 2026-10-27 · changed: Since 17 September 2026, emergency related additions to APP contracts in the earthquake area are exempt from the 20 percent cap of Ley 1508 de 2012 art. 13, under the economic emergency declared after the 10 August 2026 earthquake. As an emergency decree it is subject to Constitutional Court review.

Route	How the contractor is chosen	Public money	Additions and extensions
Public initiative	Public tender, with optional prequalification (art. 9 and 10)	Allowed, with fiscal approvals (art. 11 and 26)	Up to 20% of original contract value, additions and extensions combined (art. 13)
Private initiative with public money	Public tender; originator gets a 3 to 10% scoring bonus (art. 17)	Up to 30% of investment budget, 20% for roads (art. 17)	Up to 20% of the public disbursements originally agreed (art. 18)
Private initiative without public money	Direct award to originator after 1 to 6 months on SECOP, unless a third party competes (art. 19 and 20)	Not allowed, now or later (art. 21)	Time extensions up to 20% of the initial term (art. 21)

APP routes under Ley 1508 de 2012 and their main limits. USD at the TRM of COP 3,157.94, for orientation only.

Worked example

A foreign infrastructure fund originates a toll road extension with an estimated investment budget of COP 500,000,000,000 (about US$158,331,064). Prefeasibility review takes up to 3 months and feasibility evaluation up to 6 months plus a possible 3 month extension (art. 15 and 16). If the road needs public money, it can be at most COP 100,000,000,000 (20 percent for roads) and the project goes to a public tender in which the fund gets a 3 to 10 percent scoring bonus (art. 17). If another bidder wins, the winner reimburses the fund's accepted study costs.
Later, a request for a COP 20,000,000,000 addition carries a Ministry of Finance fee of COP 2,000,000,000 (about US$633,324) under art. 29, and all additions and extensions together may not exceed 20 percent of the original public disbursements (art. 18).

Step by step

1. Check the project size: investment above 6,000 monthly minimum wages (COP 10,505,430,000 in 2026) or it cannot be an APP (Ley 1508 art. 3 par. 1).
2. Decide the route: answer a public initiative tender, or originate a private initiative with or without public money (art. 9, 14, 17 and 19).
3. For a private initiative, file at prefeasibility (entity answers within 3 months), then at feasibility with the financial model, risk allocation, studies, proof of capacity and a sworn statement (entity answers within 6 months, extendable by 3) (art. 14 to 16).
4. Agree conditions within 2 months of the viability notice, or the initiative is deemed rejected (art. 16).
5. Bid: capacity is pass or fail and no RUP is needed; file the sworn beneficial owner and source of funds statement (art. 12 and 23).
6. After award, set up the project trust (patrimonio autónomo) and plan any addition or extension requests around the 20 percent caps and the art. 29 fees (art. 13, 18, 21, 24 and 29).

Common traps

Assuming the originator wins. Except in unchallenged no public money initiatives, a tender follows and the originator only gets a 3 to 10 percent bonus or a right to improve the best offer (Ley 1508 art. 17 and 20).
Planning to add public money later. A private initiative approved without public money may never be changed to receive it (art. 21).
Underpricing change requests. Additions cost a fee of 10 percent of the amount requested (art. 29), and additions plus extensions are capped at 20 percent (art. 13 and 18).
Ignoring timing limits on extensions. Additions and extensions may only be agreed after year 3 and before three quarters of the term have elapsed (art. 7).
Expecting payment before the asset works. Payments depend on availability and service levels for each functional unit (art. 5).
Reading the 2026 emergency relief too broadly. The cap waiver covers only additions with a direct and specific link to the earthquake emergency in the covered municipalities (Decreto Legislativo 1420 de 2026 art. 1 and 3).

Sources

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