The Colombian Government has issued Decree 1529 of October 14, 2026, amending the regulatory framework governing port concessions and establishing a mechanism for recognizing new investments which cannot be recovered within the remaining terms of existing concession agreements.
The objective is appropriate: to prevent the approaching expiration of port concessions from discouraging investments needed to modernize ports and enhance their competitiveness.
Under the Decree, once at least 70% of the concession term has elapsed, the concessionaire may propose new investments whose residual value may be recognized, subject to prior review and approval by the granting authority.
How will this residual value be recognized?
The Decree provides for two mechanisms:
- Continuation by the existing concessionaire. The residual value may be recognized as part of the same concessionaire’s new investment plan if it continues as the concession holder through an amendment to the existing agreement or the granting of a new concession.
- Replacement of the concessionaire. When a third party becomes the concession holder through a competing proposal submitted in connection with a concession amendment, a new concession application, or a government-initiated concession offering, the new concessionaire must recognize and pay the previously approved residual value to the outgoing concessionaire, even if the investments are not useful to, or are not actually used in, the new port project.
Where the new concession covers only part of the areas included in the previous concession, payment will be limited to the corresponding investments and the applicable proportion of shared investments. The payment obligation and its amount or calculation methodology must be disclosed in advance as part of the relevant proceedings.
Nevertheless, in my respectful view, significant legal and financial questions remain.
Firstly, the Decree leaves the methodologies for calculating and recognizing residual value, as well as investment caps and eligible investment categories, to a subsequent resolution. Certainty regarding the valuation and compensation of these investments therefore remains an open issue.
Secondly, requiring a prospective successor concessionaire to pay for investments made by its predecessor, even where the successor may consider them inconsistent with its own project, raises concerns regarding the future operational and financial structuring of port terminals and the competitive conditions governing new concessions.
Although the mechanism’s compatibility with statutory limits on contractual amendments and the principles of planning, transparency, and objective selection still warrants examination, the regulatory changes represent a positive first step.
The Decree introduces important safeguards, particularly regarding the approval and disclosure of investments and the associated financial obligations. Nevertheless, establishing a regulatory mechanism for recognizing residual value does not necessarily ensure that the underlying investments can be financed, their costs recovered, reasonable compensation obtained, or the resulting payment obligations legally enforced.
Accordingly, one of the challenges will be to resolve the legal questions surrounding the implementation of timely investments under existing concessions and, where those questions cannot be satisfactorily resolved, to avoid carrying the economic and legal uncertainties of one concession into the next.
Finally, Decree 1529 also introduces significant changes to the procedures for granting port concessions, their implementation, the transfer of concession assets (reversión), and material amendments to concession agreements. We will address these developments in forthcoming publications.