Zone Profile: Zona Franca Transitoria Plaza Mayor
Located in the city of Medellín, Plaza Mayor is an international convention and exhibition center. It is located in the administrative sector of the city, known as La Alpujarra. It is a joint venture between the Municipality of Medellín, the Medellín Chamber of Commerce, the National Federation of Coffee Growers of Colombia, and the Government of Antioquia.
Located in the city of Medellín, Plaza Mayor is an international convention and exhibition center. It is located in the administrative sector of the city, known as La Alpujarra. It is a joint venture1 between the Municipality of Medellín, the Medellín Chamber of Commerce, the National Federation of Coffee Growers of Colombia, and the Government of Antioquia.
Over the years, Medellin has established itself as a financial and business center, not only for Colombia, but also for Latin America as a whole. The department of Antioquia, where Medellin is located, stands out for its attractive investment climate. A thriving regional economy2 was one of the reasons why Plaza Mayor was created.
In 2001, the Municipality of Medellin, the National Federation of Coffee Growers, the Medellin Chamber of Commerce and the Institute for the Development of Antioquia, introduced the idea of a convention center on land ceded by the National Federation of Coffee Growers. The project was designed by the Consortium of Colombian Architects, Bonilla-Esguerra-Mazzanti3.
In 2003 construction of the Convention Center began, and the creation of the "Plaza Mayor" brand was agreed upon as a way of identifying the project with the community of Medellín. In 2006, the Palacio de Convenciones de Medellín S.A. and the Centro Internacional de Convenciones LTDA. were integrated, giving birth to Plaza Mayor Medellín S.A.
Plaza Mayor facilities have hosted events of national and international importance, such as the General Assembly of the Organization of American States (OAS) in 2008 and 2019, the World Urban Forum in 2014, the visit of Pope Francis in 2017, the Assembly of the Inter-American Development Bank in 2009. In addition to this, although it was not held in Plaza Mayor's facilities, but in Bogotá's Plaza Bolívar, the Plaza Mayor team led the presidential inauguration of President Iván Duque in 2018.
Due to its particular location in the urban heart of the city of Medellín, it is possible to access Plaza Mayor through different routes. Both the Alpujarra and Exposiciones stations of the Medellín metro system are located near Plaza Mayor, with signage to direct visitors to the site. Similarly, the Metroplus system has the Plaza Mayor station, with direct access to the convention center facilities.
Although most commercial flights to Medellín arrive at José María Córdova airport on the outskirts of the city, specifically in Rionegro, it is possible to get connections to Olaya Herrera airport in the heart of the city. From there, Plaza Mayor is only a 5-minute drive away.
The Plaza Mayor complex is divided into two large areas, one for conventions and the other for exhibitions, which are connected by the Plazoleta Interamericana.
On one hand, the convention area is located on an esplanade crowned by the "Caja de Madera", the most well-known building of Plaza Mayor, and an icon of the city of Medellín, occupying the third floor of the convention center. It has a total space of 1,179 square meters. This structure was built with 470 slats in fine oak.
On the other hand, the pavilion area is composed of 5 large pavilions, named after the colors green, yellow, white, blue and red. The yellow pavilion is the largest and the first to be built, with 4,850 square meters of total space.
But this is not all. The administrative offices of Plaza Mayor are part of the complex. Just in front of the "Caja de Madera" building, with a similar architectural style, you can find a long corridor where the parking lot is located, as well as the administrative offices and some Colombian restaurants.
The surroundings of Plaza Mayor are always open to the public, visitors and passers-by. They are characterized by being large open spaces with a large amount of urban furniture, such as chairs and tables, which makes them outdoor meeting points. Similarly, green areas are characteristic of the surroundings, where wild birds of the region can be observed.
At the end of the corridor linking the administrative office building and the "Wooden Box" is the bamboo park. This is made up of a series of walkways covered by large bamboo trees.
Plaza Mayor also has 730 parking spaces distributed throughout the venue. Finally, the city has bicycle lanes that facilitate access to Plaza Mayor through Avenida San Juan, as well as 100 free bicycle racks.
Plaza Mayor offers the following services:
- Space rentals for meetings, fairs, exhibitions, parties, corporate and social events.
- Food and beverages
- Furniture and audiovisual equipment
- Planning and organization of events inside and outside the country.
- Transitory free trade zone
The benefits of the Transitory Free Trade Zone regime are as follows:
The exhibitor may bring advertising material (samples with no commercial value, advertising material, stand elements, articles intended exclusively for demonstration purposes within the premises, which will be consumed at the fair, food and beverages) from abroad without payment of taxes up to:
Days of duration of the fair
1 to 3 days
4 to 5 days
6 days or more
If equipment and/or products are sold, taxes are paid by the importer from Colombia, not by the exhibitor from abroad. If they have merchandise in another Free Trade Zone of the country, it is not necessary to nationalize them, since it is possible to make transfers between Free Trade Zones without payment of taxes. To bring merchandise from another country, it is not necessary to have a company registered in Colombia to consign the documentation, it can be brought in its own name with a proforma invoice.
No VAT or tariffs will be charged while exhibitors have their goods in Plaza Mayor. Permanence of merchandise of foreign origin until the end of the Transitory Free Trade Zone. Entry of exhibition merchandise for sales purposes, taking orders and to be nationalized or returned to the country of origin.
Plaza Mayor has a significant economic impact in Colombia. In 2011, nearly 520 national events were held4, a figure that was surpassed in 2013 with 2,167 events, among which 44 were international fairs. At that time, Plaza Mayor generated more than 33,000 jobs throughout Colombia, with net profits of US$2 billion..
Legal & Regulatory
Usually, when we think of Special Economic Zones, the image of an industrial park is the first thing that comes to mind. However, Plaza Mayor is part of what Colombia has designated as a "Transitory Free Trade Zone" in its Special Economic Zones program.
The Transitory Free Trade Zones, in contrast to the Permanent Free Trade Zones, have the benefits of the free trade regime for a determined period of time. In the case of Plaza Mayor, space is provided for fairs, exhibitions, congresses and seminars of international character that are important for the economy and international trade of Colombia. In such projects, Plaza Mayor offers the benefits of a Transitory Free Trade Zone, which allows the entry of goods directly related to the event to be brought from abroad free of tariffs and VAT.
Tax Reform Update
On October 6, 2022, the Colombian government approved a new tax reform that would have a significant impact on the country's Free Trade Zones5. One of the key points of this reform is the requirement of an Internalization Plan that imposes a minimum requirement of exports from the Free Trade Zone to maintain the tax benefits of this regime.
Colombia is the only country in Latin America with a transitory free trade zone regime. This type of free trade zones, due to its particular characteristics in time and the type of activities it pursues, could be affected by this measure. Being a type of Free Trade Zone with marked differences from traditional Free Trade Zones, which are composed of an industrial park with multiple users, Plaza Mayor could have an impact on its business model, at least as far as the free trade regime is concerned.
Despite this, so far there have been no statements from official government spokespersons regarding Transitory Free Zones in Colombia. It will be enough to observe if they receive a differentiated treatment or could be subject to suppression in the future as it is proposed with the Special Permanent Free Trade Zones6.
One option that Plaza Mayor could take as a future strategy, in accordance with this new tax reform, would be to return to the permanent free trade zone regime oriented to services. Due to the temporary nature of the transitional free trade zone regime, exploring the option of offering the benefits of a permanent service-oriented free trade zone is an alternative to simply abolishing the free trade regime.
Although it is not a conventional Free Trade Zone, Plaza Mayor offers the possibility of accessing the tax and customs incentives that the free trade regime has in Colombia. It is currently seeking a transition to become a Permanent Free Trade Zone for Services, in order to further extend its benefits to the potential customers it has.
Plaza Mayor is not only an important convention center, but an icon of the city of Medellín. Its facilities have been perfect for hosting events of national and international relevance. The free trade regime, applied to this case, allows it to be a competitive space to encourage events that have an impact on the economy of the country and the region.
You can find more about Plaza Mayor on the Open Zone Map.
- Historia; Plaza Mayor Medellín https://plazamayor.com.co/historia/
- Antioquia, the corner of America that is being valued for foreign investment; ACI Medellín https://www.acimedellin.org/antioquia-the-corner-of-america-that-is-being-valued-for-foreign-investment/?lang=en
- International Convention Center; El Equipo Mazzanti https://www.elequipomazzanti.com/en/proyecto/centro-de-convenciones-2/
- Plaza Mayor ahora es zona franca permanente; El Espectador https://www.elespectador.com/economia/plaza-mayor-ahora-es-zona-franca-permanente-article-473112/
- How Colombia's New Tax Reform Will Affect FTZs; Adrianople Group https://www.adrianoplegroup.com/post/how-colombias-new-tax-reform-will-affect-ftzs
- ¿Cuáles son los efectos de la reforma tributaria sobre el modelo de las zonas francas?; La República https://www.larepublica.co/economia/cuales-son-los-efectos-de-la-reforma-tributaria-sobre-el-modelo-de-las-zonas-francas-3426036