Published on September 4, 2026
The Council of State, in a judgment dated June 4, 2026, declared the nullity of Articles 2, 3, 4, 5, 12, and 13 of Decree 2669 of 2012, which regulated factoring activities carried out by commercial companies and Article 8 of Law 1231 of 2008. The decision was based on an excess in the exercise of the Executive Branch's regulatory authority.
The Court held that Article 8 of Law 1231 of 2008 did not grant the National Government a general authority to regulate the content and scope of portfolio purchase services at a discount. Consequently, it concluded that the challenged provisions exceeded the limits established for the exercise of the regulatory authority provided for in Article 189, paragraph 11, of the Political Constitution. Nevertheless, the decision did not declare the Decree 2669 of 2012 null and void in its entirety.
The Chamber clarified that regulatory authority allows for the issuance of provisions necessary for the proper enforcement of the law, but does not authorize the Executive Branch to regulate matters that were not subject to regulation by the legislature. In this case, it determined that the challenged articles exceeded the scope of the authorization contained in Article 8 of Law 1231 of 2008.
Among the matters regulated by the annulled provisions were the definitions of factoring activity, factoring transaction, and factoring agreement, as well as related transactions; the obligations of the factor and the client; rules concerning liability; and matters related to the supervision and control of the activity.
Although Law 1231 of 2008 was subsequently amended by Law 1676 of 2013 and Decree 2669 of 2012 was subject to amendments, the judgment analyzed the legality of the provisions in light of the higher-ranking rules in force at the time of its issuance.
Those engaged in factoring activities are advised to review the provisions currently supporting their transactions and agreements in light of the nullity declared by the Council of State.
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