Zone Profile

Zone Profile: EXENNTA

,  
November 21, 2022
November 21, 2022

Photo taken by Adrianople Group

Overview

Prebuild arrived to Colombia in 2012 and began the consolidation of the GACHANCIPÁ Industrial Park, a project that sparked an investment of $250 million USD [1]

Prebuild [2] is a group created in 2001 with Portuguese private capital and operated in the construction, industry, and services sectors, with a portfolio of 43 companies that complement each other. 

Colombia was the first Latin American country that Prebuild entered. Once the national considerations were reviewed, comparative advantages of the municipalities in each region were evaluated, finding that Gachancipá had special conditions. For example, it had available land with topographic and structural conditions suitable for the project's development; the proposed location on the Briceño-Tunja-Sogamoso dual carriageway corridor facilitated the mobility of cargo vehicles. 

Photo taken by Adrianople Group

Prebuild has counted on Terranum Corporativo as a strategic partner. Terranum Corporativo [3] structures, develops and promotes corporate real estate projects for office, logistics, and industrial use. They have developed more than 1,000,000 m2 of land in Colombia. 

Both companies structured The Permanent Free Trade Zone (PFTZ) ZOFRANDINA [4] in 2012 under “the premise of providing tools in terms of synergy, opportunity, and competitiveness,” mainly for companies in the industry sector of the Prebuild Group. 

Prebuild chose the land and the design of the industrial park, while Terranum would manage the entire project. By 2014, the project was expected to be 70% complete [5]. However, through a public statement, Terranum announced in May 2015 that Prebuild had failed to comply with various contract obligations. Therefore, Terranum urged its legal advisors to take appropriate legal action against Prebuild. [6]

Zone Layout

In September 2015, Terranum resumed the project, changing its name to EXENNTA [7], which seeks to express solidity and confidence to its users. The variety in shades of gray and the intense red contrast convey a dynamic, productive, modern, and innovative image. 

Photo taken by Adrianople Group

The building that houses the access portico is the singular example of this corporate intention. To achieve this type of contrast in its architecture, the company decided to use the Tile system by Hunter Douglas. [8] 

Source: EXENNTA Master Plan

It has 79,000 m² [9] of warehouses and 9 offices, designed to adapt to industrial operations (high, medium, and low impact), logistics, and commercial users. All facilities are designed to guarantee protection against the entry of animals and pests and are also equipped with resting and feeding areas separated from the production and storage areas.

Economics

EXENNTA is a small PFTZ, best considered a “boutique.” Even when their focus is on goods and services companies with production, assembly, and distribution operations, two data centers are planning to start operations here. 

In 2019, Express Luck Technology [10], one of the leading manufacturers and exporters of digital products in China, began operations in EXENNTA, developing its top product: TVs from the Exclusivity brand. 

Photo taken by Adrianople Group

Legal

In general, the Free Trade Zone regime in Colombia offered for years the same benefits for different users. However, the Law Decree 278 of March 15, 2021 [11] improves incentives for SEZ in the country. Changes include: Promoting the 4.0 economy and the export of services, electronic commerce availability, reduction of 15.2% of the minimum amount of investment, and the number of requirements has been reduced from 57 to 24. [12]

Among the tax benefits [9] are:

  • Income tax rate of 20%.
  • No customs duties (VAT and tariffs) are caused or paid.
  • VAT exemption for raw materials, inputs, and finished goods acquired in the National Customs Territory.

On the other hand, customs benefits [9] include: 

  • Nationalize as needed.
  • Nationalize raw material or finished product.
  • Partial processing outside the Free Trade Zone.
  • Sales between free zone users are exempt from VAT on inbound and outbound exports.

Besides the tax and regulatory incentives, there are other motivations for foreign investment in EXENNTA [13]. The zone lists the following as its primary advantages:

  • It is located near Bogota, Medellin, and Bucaramanga, which contain 73% of the population among the 5 main cities of Colombia.
  • Warehouses from 2,500 to 22,000 m² can be adapted to the capacity required for storage, production, weighing, and control, with the necessary segregations.
  • Gachancipá and its area of influence have a wide residential offer for the working population of companies settling in the area, with current agreements to access subsidies. 

Photo taken by Adrianople Group

Conclusion

It was challenging to start marketing the Zone after the controversy that arose during the project's construction. However, they have been able to manage their public relations and renew themselves with a very modern and dynamic image that inspires confidence in their visitors and users. Today, they are a successful Free Trade Zone, with more than 170,000 m2 of land used by their 14 current clients.

However, the zone may face some new challenges.

On August 8, 2022, a bill was filed before the Congress of the Republic to adopt a new tax reform in Colombia, which aims to raise 25.9 billion annually (9). This has led to a review of taxes, as is the case of the free trade zones. 

Under Colombia's new tax reform, Permanent Free Trade Zones (multi-user) such as EXENTTA could maintain tax benefits at 20% if they comply with an approved Internationalization Plan. They would also need to have an area of more than 80 hectares and more than 40 users (both domestic and foreign companies are counted). 

It is still being determined whether the increase of the tariffs and the inclusion of new requirements for their application to existing users would be constitutional since they have complied with investment and employment generation commitments under the current rules, waiting for the application of the special tariffs. 

The reform was approved on November 3rd, 2022. But the congress still discusses some points before publishing the final version. In any case, changes will be a reality in 2024.  EXENNTA still has time to develop new ideas to meet the deadlines and objectives proposed by the reform. Also, reviewing their current economic balance with tenants and deciding whether or not contracts with data centers will still be the same. 

EXENNTA needs to review if they would meet the export requirements with the tenants they have now or if they would have to look for new prospects, ending compromises with companies that do not export. 

See more about the EXENNTA in our Open Zone Map here.

Sources

  1. Prebuild from Portugal announces investments for USD 250 million and one thousand new jobs in Colombia; Invest in Colombia 
    https://investincolombia.com.co/en/articles-and-assets/articles/prebuild-from-portugal-announces-investments-for-usd-250-million-and-one-thousand-new-jobs-in-colombia
     
  1. Prebuild company profile; Development Aid https://www.developmentaid.org/#!/organizations/view/71656/prebuild
  2. Terranum company profile; Terranum https://terranum.com/Internas/Paginas/exennta.aspx  
  3. ZOFRANDINA company profile; Las Empresas https://www.lasempresas.com.co/bogota/terranum-zofrandina-sas/ 
  1. Parque Industrial Prebuild, Zona Franca de Gachancipá: Un polo de desarrollo para América; http://proyectos.andi.com.co/czf/Documents/Parque%20Industrial%20Prebuild,%20Zona%20Franca%20de%20Gachancip%C3%A1,%20Un%20Polo%20de%20Desarrollo%20para%20Am%C3%A9rica%20-%20Dra.%20Vivian%20Herrera.pptx 
  2. Terranum denounces non-compliance by the Portuguese company Prebuild; Portafolio https://www.portafolio.co/negocios/empresas/terranum-denuncia-incumplimientos-portuguesa-prebuild-37572 
  3. Terranum construction company goes for three corporate projects in the country; La Republica https://www.larepublica.co/empresas/la-constructora-terranum-va-por-tres-proyectos-corporativos-en-el-pais-2302696 
  4. Hunter Douglas Portfolio. Tile Revestimentos; Hunter Douglas https://architectural.hunterdouglas.com.co/uploads/co/productos/productos_archivo_descarga_3136.pdf 
  5. Benefits in EXENNTA; EXENNTA https://exennta.com/beneficios/ 
  6. Express Luck Technology company profile; Express Luck
  7. https://www.expressluck.com/ 
  8. Law Decree 278 of March 15, 2021; Presidencia https://dapre.presidencia.gov.co/normativa/normativa/DECRETO%20278%20DEL%2015%20DE%20MARZO%20DE%202021.pdf 
  9. Modification of the Free Trade Zones regime in Colombia; Mincomercio https://www.mincit.gov.co/prensa/noticias/industria/se-modifica-el-regimen-de-zonas-francas 
  10. EXENNTA company profile; EXENNTA https://exennta.com 
Tags
Zone Profile

Zone Profile: EXENNTA

,  
November 21, 2022
November 21, 2022

Photo taken by Adrianople Group

Overview

Prebuild arrived to Colombia in 2012 and began the consolidation of the GACHANCIPÁ Industrial Park, a project that sparked an investment of $250 million USD [1]

Prebuild [2] is a group created in 2001 with Portuguese private capital and operated in the construction, industry, and services sectors, with a portfolio of 43 companies that complement each other. 

Colombia was the first Latin American country that Prebuild entered. Once the national considerations were reviewed, comparative advantages of the municipalities in each region were evaluated, finding that Gachancipá had special conditions. For example, it had available land with topographic and structural conditions suitable for the project's development; the proposed location on the Briceño-Tunja-Sogamoso dual carriageway corridor facilitated the mobility of cargo vehicles. 

Photo taken by Adrianople Group

Prebuild has counted on Terranum Corporativo as a strategic partner. Terranum Corporativo [3] structures, develops and promotes corporate real estate projects for office, logistics, and industrial use. They have developed more than 1,000,000 m2 of land in Colombia. 

Both companies structured The Permanent Free Trade Zone (PFTZ) ZOFRANDINA [4] in 2012 under “the premise of providing tools in terms of synergy, opportunity, and competitiveness,” mainly for companies in the industry sector of the Prebuild Group. 

Prebuild chose the land and the design of the industrial park, while Terranum would manage the entire project. By 2014, the project was expected to be 70% complete [5]. However, through a public statement, Terranum announced in May 2015 that Prebuild had failed to comply with various contract obligations. Therefore, Terranum urged its legal advisors to take appropriate legal action against Prebuild. [6]

Zone Layout

In September 2015, Terranum resumed the project, changing its name to EXENNTA [7], which seeks to express solidity and confidence to its users. The variety in shades of gray and the intense red contrast convey a dynamic, productive, modern, and innovative image. 

Photo taken by Adrianople Group

The building that houses the access portico is the singular example of this corporate intention. To achieve this type of contrast in its architecture, the company decided to use the Tile system by Hunter Douglas. [8] 

Source: EXENNTA Master Plan

It has 79,000 m² [9] of warehouses and 9 offices, designed to adapt to industrial operations (high, medium, and low impact), logistics, and commercial users. All facilities are designed to guarantee protection against the entry of animals and pests and are also equipped with resting and feeding areas separated from the production and storage areas.

Economics

EXENNTA is a small PFTZ, best considered a “boutique.” Even when their focus is on goods and services companies with production, assembly, and distribution operations, two data centers are planning to start operations here. 

In 2019, Express Luck Technology [10], one of the leading manufacturers and exporters of digital products in China, began operations in EXENNTA, developing its top product: TVs from the Exclusivity brand. 

Photo taken by Adrianople Group

Legal

In general, the Free Trade Zone regime in Colombia offered for years the same benefits for different users. However, the Law Decree 278 of March 15, 2021 [11] improves incentives for SEZ in the country. Changes include: Promoting the 4.0 economy and the export of services, electronic commerce availability, reduction of 15.2% of the minimum amount of investment, and the number of requirements has been reduced from 57 to 24. [12]

Among the tax benefits [9] are:

  • Income tax rate of 20%.
  • No customs duties (VAT and tariffs) are caused or paid.
  • VAT exemption for raw materials, inputs, and finished goods acquired in the National Customs Territory.

On the other hand, customs benefits [9] include: 

  • Nationalize as needed.
  • Nationalize raw material or finished product.
  • Partial processing outside the Free Trade Zone.
  • Sales between free zone users are exempt from VAT on inbound and outbound exports.

Besides the tax and regulatory incentives, there are other motivations for foreign investment in EXENNTA [13]. The zone lists the following as its primary advantages:

  • It is located near Bogota, Medellin, and Bucaramanga, which contain 73% of the population among the 5 main cities of Colombia.
  • Warehouses from 2,500 to 22,000 m² can be adapted to the capacity required for storage, production, weighing, and control, with the necessary segregations.
  • Gachancipá and its area of influence have a wide residential offer for the working population of companies settling in the area, with current agreements to access subsidies. 

Photo taken by Adrianople Group

Conclusion

It was challenging to start marketing the Zone after the controversy that arose during the project's construction. However, they have been able to manage their public relations and renew themselves with a very modern and dynamic image that inspires confidence in their visitors and users. Today, they are a successful Free Trade Zone, with more than 170,000 m2 of land used by their 14 current clients.

However, the zone may face some new challenges.

On August 8, 2022, a bill was filed before the Congress of the Republic to adopt a new tax reform in Colombia, which aims to raise 25.9 billion annually (9). This has led to a review of taxes, as is the case of the free trade zones. 

Under Colombia's new tax reform, Permanent Free Trade Zones (multi-user) such as EXENTTA could maintain tax benefits at 20% if they comply with an approved Internationalization Plan. They would also need to have an area of more than 80 hectares and more than 40 users (both domestic and foreign companies are counted). 

It is still being determined whether the increase of the tariffs and the inclusion of new requirements for their application to existing users would be constitutional since they have complied with investment and employment generation commitments under the current rules, waiting for the application of the special tariffs. 

The reform was approved on November 3rd, 2022. But the congress still discusses some points before publishing the final version. In any case, changes will be a reality in 2024.  EXENNTA still has time to develop new ideas to meet the deadlines and objectives proposed by the reform. Also, reviewing their current economic balance with tenants and deciding whether or not contracts with data centers will still be the same. 

EXENNTA needs to review if they would meet the export requirements with the tenants they have now or if they would have to look for new prospects, ending compromises with companies that do not export. 

See more about the EXENNTA in our Open Zone Map here.

Sources

  1. Prebuild from Portugal announces investments for USD 250 million and one thousand new jobs in Colombia; Invest in Colombia 
    https://investincolombia.com.co/en/articles-and-assets/articles/prebuild-from-portugal-announces-investments-for-usd-250-million-and-one-thousand-new-jobs-in-colombia
     
  1. Prebuild company profile; Development Aid https://www.developmentaid.org/#!/organizations/view/71656/prebuild
  2. Terranum company profile; Terranum https://terranum.com/Internas/Paginas/exennta.aspx  
  3. ZOFRANDINA company profile; Las Empresas https://www.lasempresas.com.co/bogota/terranum-zofrandina-sas/ 
  1. Parque Industrial Prebuild, Zona Franca de Gachancipá: Un polo de desarrollo para América; http://proyectos.andi.com.co/czf/Documents/Parque%20Industrial%20Prebuild,%20Zona%20Franca%20de%20Gachancip%C3%A1,%20Un%20Polo%20de%20Desarrollo%20para%20Am%C3%A9rica%20-%20Dra.%20Vivian%20Herrera.pptx 
  2. Terranum denounces non-compliance by the Portuguese company Prebuild; Portafolio https://www.portafolio.co/negocios/empresas/terranum-denuncia-incumplimientos-portuguesa-prebuild-37572 
  3. Terranum construction company goes for three corporate projects in the country; La Republica https://www.larepublica.co/empresas/la-constructora-terranum-va-por-tres-proyectos-corporativos-en-el-pais-2302696 
  4. Hunter Douglas Portfolio. Tile Revestimentos; Hunter Douglas https://architectural.hunterdouglas.com.co/uploads/co/productos/productos_archivo_descarga_3136.pdf 
  5. Benefits in EXENNTA; EXENNTA https://exennta.com/beneficios/ 
  6. Express Luck Technology company profile; Express Luck
  7. https://www.expressluck.com/ 
  8. Law Decree 278 of March 15, 2021; Presidencia https://dapre.presidencia.gov.co/normativa/normativa/DECRETO%20278%20DEL%2015%20DE%20MARZO%20DE%202021.pdf 
  9. Modification of the Free Trade Zones regime in Colombia; Mincomercio https://www.mincit.gov.co/prensa/noticias/industria/se-modifica-el-regimen-de-zonas-francas 
  10. EXENNTA company profile; EXENNTA https://exennta.com 
Tags
Latest Posts
Post Thumbnail Image

Due to its strategic location on the outskirts of Bogota, Intexzona has been relatively successful.

Arrow pointing to the right
Post Thumbnail Image

For decades, Colombian Free Trade Zones (FTZs) helped attract investment and grow the economy - but all of that is about to change. On August 8 2022, the Colombian government passed legislation which will strip FTZs of most of their tax incentives.

Arrow pointing to the right