conditions and situations that could
influence the decision-making process;
(ii) adjust it to the new business judgment
rule standard regulated in Article 9 to
enable a coherent application of the new
standard by the courts; and, (iii) eliminate
the current liability regime for directors,
namely, the use of Article 63 of the
Colombian Civil Code.
duty of care, the creation of the business
judgment rule with deferential scrutiny,
as the new standard of review to be used
by the judges, is meant to shield the
decisions of the corporate directors as risk
takers and narrow the situations where
they could be found liable.
rule, just as in the U.S. system, creates a
rebuttable legal presumption, protecting
the directors' decisions as long as they
are made with reasonable judgment
sufficiently informed. According to the
new standard, in order to challenge the
presumption and make the directors
liable, the plaintiff will have the burden to
prove that the directors acted in bad faith,
violated the law, or the duty of loyalty.
the strengthening and reinforcement of
the current duty of loyalty, stating that the
actions of the directors shall always be
performed pursuing the best interests of
the company.
this duty, the bill enlisted five duties that
need to be obeyed by the directors to be in
"compliance" with it; these are:
a conflict of interest, unless due
authorization is provided according
to the procedure established in
Article 13 of this law; and,
the corporation and taking for oneself
business opportunities that belong to
the company, unless due authorization
is provided according to the procedure
established in Article 17 of this law.
and ex post) is implemented to allow the
directors to foresee some circumstances
and events where conflicts of interests are
completely and undoubtedly clear, and
some others that, if considered uncertain,
can later be reviewed by the courts in
order to protect the best interests of the
corporations and its shareholders.
2 Id.
3 ACT 222 OF 1995. ARTICLE 24. RESPONSIBILITY
severally liable and without limitation for the damages
caused by negligence or willful misconduct caused to
the company, to the partners or to third parties.
5 BILL PROJECT NO. 231 OF 2017. ARTICLE 8.
managers' liability, the rules on the levels of negligence
provided in article 63 of the Civil Code shall not be
taken into account.
BUSINESS JUDGMENT OF THE CORPORATE
DIRECTORS. The judges shall respect the business
judgment adopted by the directors in the decision
making process related to the exercise of their functions,
provided that such determinations correspond to a
reasonable judgment sufficiently informed. Therefore,
unless bad faith, violations of the law or the duty of
loyalty, the directors shall not be liable for damages
originated as consequence of their business decisions."
fulfilled at all times in function of the best interests
of the company.