Circular Economy Business Model Agreement Colombia (Acuerdo de Modelo de Negocio de Economía Circular)

A Circular Economy Business Model Agreement Colombia (Acuerdo de Modelo de Negocio de Economía Circular) is a commercial contract that formalises the rights, obligations, and operational framework between two or more parties who agree to implement a circular economy model within their commercial relationship. The circular economy — defined by the Ellen MacArthur Foundation and adopted in Colombian policy through CONPES 3874 de 2016 (Política Nacional para la Gestión Integral de Residuos Sólidos) — is an industrial and commercial system designed to eliminate waste by keeping materials, products, and components in use for as long as possible through reuse, repair, remanufacturing, and recycling, in contrast to the traditional linear 'take-make-dispose' model.

In Colombia, the legal framework for circular economy operations is built on several pillars. Ley 99 de 1993 (Ley del Medioambiente) established the foundational environmental obligations of commercial entities and the authority of the Ministerio de Ambiente y Desarrollo Sostenible (MADS) to regulate environmental impacts. Decreto 1076 de 2015 (Decreto Único Reglamentario del Sector Ambiente) consolidated the regulatory framework for waste management and environmental permits. CONPES 3874 de 2016 established Colombia's national policy for solid waste, including targets for waste diversion from landfills and the promotion of valorisation as a preferred end-of-life option. More recently, Resolución 1407 de 2018 of the MADS established the Extended Producer Responsibility (Responsabilidad Extendida del Productor — REP) framework for packaging and packaging waste, requiring producers and importers of packaged goods to implement take-back and recovery programmes.

The Acuerdo de Modelo de Negocio de Economía Circular serves a different purpose from a simple waste management contract (contrato de gestión de residuos). While the latter merely outsources waste disposal, the circular economy agreement restructures the commercial relationship itself around circular principles. This may mean: (1) converting a product sale into a product-as-a-service (PaaS) arrangement, where the supplier retains ownership of the product and the customer pays for performance or use — a model increasingly common in lighting (luminarias como servicio), textiles (ropa como servicio), and industrial equipment; (2) establishing a material return and recovery loop (ciclo de retorno de materiales) where the buyer agrees to return used products, packaging, or components to the seller for remanufacturing or recycling; or (3) creating a symbiotic exchange where the waste or by-products of one party become the input materials of another — known as industrial symbiosis (simbiosis industrial).

The legal basis for circular economy agreements in Colombia is the Código de Comercio, specifically the principle of contractual freedom under Artículo 864 CCo, which allows parties to structure novel commercial relationships not explicitly contemplated by the existing typified contracts (contratos nominados). The agreement may combine elements of a supply contract (contrato de suministro — Artículos 968 to 980 CCo), a service contract (contrato de prestación de servicios), and a waste management contract (regulated by Decreto 1713 de 2002 and subsequent norms).

Forms-legal.com's Circular Economy Business Model Agreement template is designed to capture all these dimensions in a single, legally sound instrument that reflects Colombian regulatory requirements and international circular economy standard practices.

A Circular Economy Business Model Agreement Colombia is needed in the following circumstances:

**Implementing Extended Producer Responsibility (REP) programmes under Resolución 1407 de 2018.** Producers and importers of packaged goods covered by the REP regulation must establish take-back and recovery systems. When these systems involve third-party collectors (gestores de residuos), recyclers, or remanufacturers, the REP obligation must be formalised through contracts that specify material recovery targets, reporting obligations, and the allocation of REP programme costs. The circular economy agreement provides the legal framework for these multi-party REP arrangements.

**Converting a product business model to product-as-a-service (PaaS).** Companies in lighting, textiles, industrial equipment, or electronics transitioning from product sales to service contracts — where the company retains ownership and responsibility for the product's end-of-life — need a formal agreement that redefines the commercial relationship, performance metrics, maintenance obligations, and return and recovery procedures. Without a properly structured PaaS agreement, the company may inadvertently transfer legal ownership of the product and the associated waste management liability under Decreto 1076 de 2015.

**Establishing industrial symbiosis partnerships.** When one company's production waste or by-products become another company's raw materials — e.g., heat recovery between industrial neighbours, slag from steel production used as aggregate in construction, or food processing waste converted to biogas — the material exchange must be formalised to clarify: (i) whether the material is classified as waste (residuo) under Colombian environmental law and therefore subject to Decreto 1076 de 2015, or as a by-product (subproducto) that can be traded without a waste management licence; (ii) the transfer of environmental liability; and (iii) quality specifications and acceptance testing.

**Accessing green financing from Bancóldex or the Fondo para el Financiamiento del Sector Agropecuario (FINAGRO).** Bancóldex's green credit lines and FINAGRO's credit lines for sustainable agriculture require borrowers to demonstrate that the financed activity qualifies as a circular economy investment. A formal circular economy agreement that specifies the material flows, environmental KPIs, and compliance with CONPES 3874 de 2016 provides the documentary evidence required by these lenders.

**Complying with supply chain sustainability requirements of multinational clients.** Companies in Colombia that supply to European or North American multinationals are increasingly required to demonstrate circular economy practices as part of supplier due diligence under the EU Corporate Sustainability Due Diligence Directive (CSDDD) and the US Securities and Exchange Commission's climate disclosure rules. A formal circular economy agreement — particularly one that quantifies material recovery rates and GHG emission reductions — satisfies these international supply chain requirements.

**Participating in Colombia's Zonas de Economía Circular.** The Ministerio de Ambiente y Desarrollo Sostenible has promoted the creation of Zonas de Economía Circular — designated areas where companies collaborate on material exchanges, shared infrastructure, and waste valorisation. Participation in these zones typically requires formal agreements specifying each participant's circular economy commitments and the governance of shared resources.

A thorough Circular Economy Business Model Agreement Colombia must include the following elements to be legally sound and operationally effective:

**1. Identification of parties and their roles in the circular model.** The agreement must identify all parties with their full razón social, NIT (DIAN), registered address, and Cámara de Comercio registration. Crucially, it must define each party's role in the circular model: operator (operador del ciclo), material supplier (proveedor de materiales), collector (gestor de residuos licenced under Decreto 1076 de 2015), recycler (reciclador or aprovechador), remanufacturer (remanufacturador), or final client under a product-as-a-service arrangement. Where parties act as gestores de residuos — handling materials classified as waste under Colombian environmental law — the agreement must reference their Licencia Ambiental or Plan de Gestión de Residuos issued by the Corporación Autónoma Regional (CAR) or the Autoridad Nacional de Licencias Ambientales (ANLA).

**2. Definition and classification of materials.** The agreement must precisely define the materials covered — raw materials, products, components, packaging, and waste streams — and their classification under the Lista de Residuos Peligrosos (RESPEL under Decreto 4741 de 2005) or as non-hazardous solid waste. Materials that qualify as by-products (subproductos) rather than waste under CONPES 3874 criteria must be identified, as they may be traded without a waste management licence. For each material stream, the agreement must specify: composition standards, quality specifications, contamination limits, and acceptance/rejection criteria at each transfer point.

**3. Circular model description and material flow diagram.** The agreement must include a detailed description of the circular business model being implemented — linear-to-circular transition, product-as-a-service, industrial symbiosis, or closed-loop recycling — with a material flow diagram (diagrama de flujo de materiales) that maps inputs, outputs, recycling loops, and waste streams. This diagram is critical for regulatory compliance and for demonstrating the circular economy character of the arrangement to financing institutions such as Bancóldex and to REP programme administrators.

**4. REP obligations and compliance framework.** Where the agreement involves products covered by Resolución 1407 de 2018 (packaging and packaging waste), the parties must specify: (a) the REP targets applicable to each party under their role in the supply chain; (b) the data collection and reporting obligations to the Sistema de Información Ambiental (SIAC) of the MADS; (c) the allocation of REP compliance costs between manufacturer, importer, and distributor; and (d) the consequences of non-compliance with REP targets, including the administrative sanctions under Artículo 40 de la Ley 1333 de 2009.

**5. Product-as-a-service provisions (if applicable).** For PaaS arrangements, the agreement must clearly specify: (a) that ownership of the product (dominio del bien) is retained by the operator throughout the contract term, consistent with Artículos 669 to 685 del Código Civil on property rights; (b) the service level commitments (SLAs) — performance, availability, maintenance — that the operator provides to the client; (c) the procedure for product return at contract end or upon client request; (d) the client's obligations regarding product care, prohibited modifications, and reporting of defects; and (e) the environmental liability for waste generated from the product during the service period.

**6. Environmental KPIs and measurement methodology.** The agreement must establish quantified environmental performance indicators (indicadores de desempeño ambiental) for each party, including: (a) material recovery rate (tasa de recuperación de materiales) expressed as percentage of mass recovered vs. total mass placed on market; (b) waste diversion rate from landfill (tasa de desviación de relleno sanitario); (c) GHG emission reductions (reducción de emisiones de GEI) calculated using the GHG Protocol or the IPCC methodology recognised by the IDEAM; (d) water consumption reduction; and (e) circular economy revenue ratio — the percentage of total revenues derived from circular activities. These KPIs must be measured using a defined methodology and reported in the Informe de Gestión Circular submitted annually.

**7. Data sharing and information management.** Circular economy models generate large volumes of material flow data, product performance data, and environmental impact data. The agreement must specify: (a) the data that each party is obligated to collect and share; (b) the data management system or platform used; (c) intellectual property rights over aggregated data and analytical insights; and (d) data protection obligations under Ley 1581 de 2012 (Ley de Habeas Data) for any personal data collected from end consumers in product-as-a-service or take-back programmes.

**8. Financial model and circular economy revenue sharing.** The agreement must specify the financial flows between parties: material purchase prices, service fees, revenue sharing from recycled material sales, royalties for the use of circular economy technology or methodology, and cost allocation for collection and processing. For industrial symbiosis arrangements, the pricing of material exchanges must comply with Artículo 90 del Estatuto Tributario (transfer pricing for related parties) if the parties are related companies, and must use arm's-length prices consistent with DIAN guidelines.

**9. Duration, renewal, and exit provisions.** Circular economy models require long-term investment in infrastructure, relationships, and process integration. The agreement should have a minimum term of 3–5 years, with renewal options. Exit provisions must address: (a) the orderly wind-down of material flows upon termination; (b) the disposal of inventory of circular materials held by each party; (c) the transfer or destruction of shared data; and (d) the continuation of REP obligations for products already placed on the market before termination.

**10. Compliance with environmental permits and reporting to ANLA and CAR.** Parties that handle waste streams, operate valorisation facilities, or conduct remanufacturing activities in Colombia typically require a Licencia Ambiental or a Plan de Manejo Ambiental (PMA) from the ANLA or the competent CAR. The agreement must specify which party bears responsibility for obtaining and maintaining these permits, and must include a compliance warranty (garantía de cumplimiento ambiental) and a reporting obligation to disclose to the other parties any non-compliance notice (auto de inicio de proceso sancionatorio) received from the environmental authority.

**11. Dispute resolution and governing law.** Disputes arising from the circular economy agreement must be resolved under Colombian law. The agreement should include a tiered dispute resolution mechanism: (1) good-faith negotiation between senior representatives for 30 days; (2) mediation before the Centro de Conciliación de la Cámara de Comercio of the operator's domicile under Ley 640 de 2001; and (3) arbitration before the Centro de Arbitraje y Conciliación de la Cámara de Comercio de Bogotá, with proceedings in Spanish and Colombian law as the lex causae.

Forms-legal.com's Circular Economy Business Model Agreement template covers all eleven elements and is designed to satisfy the requirements of Colombia's environmental authorities, green financing institutions, and international supply chain due diligence frameworks.

Under the Codigo de Comercio (Decreto 410 de 1971), the Camara de Comercio maintains the Registro Mercantil of Colombian companies. The Ley 1258 de 2008 governs Sociedades por Acciones Simplificadas (SAS). The Superintendencia de Sociedades supervises corporate governance. The DIAN (Direccion de Impuestos y Aduanas Nacionales) administers the Impuesto de Renta and IVA under the Estatuto Tributario (Decreto 624 de 1989).