MIXED ECONOMY COMPANY: CHARACTERISTICS, HOW THEY ARE CREATED, EXAMPLES - ECONOMY - 2025

A mixed economy company (Colombia) is a corporate entity constituted with the contributions of private and state capital entities. It will be governed by private law and ordinary jurisdiction, except in the cases indicated by law.

A company of this type is created for the purpose of investing in commercial or industrial activities. It is defined as a form of collaboration between individuals and the State.

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The issue of State intervention in the world of commercial companies is not new, generating all kinds of opinions against and in favor, but the constitution of a mixed economy company has had enough defense to be developed and accepted.

The first normative publications related to this type of society are found in Colombia in Decree 1050 of 1955, and Law 151 of 1959.

However, it was from Decree 1050 of 1968 that an express and clear normative structure was established, which made it possible to decree its requirements and characteristics, as well as its true legal nature as a decentralized entity.

characteristics

The definition of a mixed economy company corresponds to that of a decentralized entity, whose characteristics are, among others, its own autonomy and management, having legal personality, and the development of a concrete and specific corporate purpose.

With the development of its corporate purpose, it becomes the support of the government apparatus to be able to carry out certain activities and tasks, which need to be carried out under special guidelines.

It is a legal business whose main characteristic is profit. Therefore, it implies the entry of the State into the performance of companies of a commercial nature, which in principle is considered outside the normal functions of a public entity.

However, it is justified for various reasons, always inspired by preserving or achieving a legal asset of great importance to the community, and not in the simple expectation of obtaining a dividend or profit in its favor.

It should not be assumed that these companies are exclusive to the executive section of the public power, since there is no legal or constitutional restriction so that they can also exist while being linked to other public branches.

State participation

Compared to any other type of company, the mixed economy company would only have as a differentiating component the circumstance of receiving a contribution whose origin is the public treasury. In its other aspects, it must obey the general rules established in the Commercial Code.

However, that the State participates in this type of society has a scope of great legal importance, since when making an investment of public money a set of legal and fiscal consequences arises that must necessarily be studied and taken into account.

For example, highly relevant aspects are manifested, such as the legal regime regarding its employees, the eventual public functions that they could perform, the contracting regime to apply in their legal acts, and the jurisdiction to apply in the face of lawsuits or contingencies.

How they are created

Its creation is required to be carried out in an orderly manner and in accordance with the guidelines established by law, based on the administrative acts of the territorial entity and administrative decentralization.

It can be constituted under any of the types of company provided in the Commercial Code, in simple limited partnership or by shares, collective, anonymous, or limited liability, because Colombian legislation does not indicate any especially for this type of companies.

The constitution of a mixed economy company is a complicated process, since the regulations that regulate this matter establish the realization of two essential legal acts to give rise to the new entity, which are the law that authorizes or creates it, and the contract of the society.

As a consequence, regulatory provisions of private law are intertwined and converge with those of public law. However, the authorization or legal creation that is carried out is not enough for the company to be constituted.

On the contrary, the subsequent agreement with the individuals and the solemnity of the contract are also required, according to the clauses of the Commercial Code, to start the new legal person other than the partners considered individually.

State approval

State approval to create mixed economy companies does not concern the concept of law in the tangible sense, among other reasons because the subject of said act must be concrete and singular, and in no way could it be an indefinite and general power.

When it refers to mixed-economy companies other than those of a national order, in most cases the state act of creation is issued by the municipal councils and departmental assemblies.

In these cases it becomes much more evident that these are not acts promoted by law, but administrative acts dispatched by these public bodies.

Partnership contract

On the other hand, the execution of a commercial company contract is required, following the clauses of article 110 of the Commercial Code.

In accordance with Law 489 of 1998, in article 50, the content of the authorization must be as follows: the law that provides for the creation of an administrative entity or body must establish its organic structure and its objectives. It will also stipulate the budget support.

All this must go according to the fiscal lines determined by the Ministry of Finance and Public Credit.

After having received the legal authorization to create the mixed economy company in favor of a specific public entity, its legal representative must proceed to carry out a strictly commercial legal business, such as the partnership contract. trade.

Finally, the act of taking it to public writing must be complied with. Finally, it must be registered in the chamber of commerce of the site where the company will have its main domicile.

Examples

Among the most important mixed economy companies in Colombia, together with the public body to which they are linked, are:

- National Institute for Water Use and Electricity Development (ICEL). Public entity: Ministry of Mines and Energy.

- Institute of Industrial Development (IFI). Public entity: Ministry of Economic Development.

- Empresa Siderúrgica Nacional de Paz del Río. Public entity: Instituto Financiero Boyacá.

- Livestock Funds. Public entity: Ministry of Agriculture.

- Banco de Comercio Exterior de Colombia SA (BANCOLDEX). Public entity: Ministry of Foreign Trade.

- La Previsora ​​SA Public entity: Ministry of Finance and Public Credit.

- Fund for the Financing of the Agricultural Sector (FINANGRO). Public entity: Ministry of Agriculture.

- Central Mortgage Bank. Public entity: Ministry of Finance and Public Credit.

- Hotel San Diego SA Public entity: Ministry of National Defense.

- Artesanías de Colombia SA Public entity: Ministry of Economic Development.

References

1. Get Updated (2017). Characteristics of mixed economy companies. Taken from: actualicese.com.
2. Carlos Frasser (2019). The constitution of a mixed economy company by a public university. University extership of Colombia. Taken from: magazines.uexternado.edu.co.
3. Structure of Public Power (2019). The Mixed Economy Societies. Taken from: www.structuredelpoderpublico.weebly.com.
4. Gerencie (2017). What characterizes a mixed economy society? Taken from: gerencie.com.
5. Legal Library (2019). Of Mixed Economy Societies. Taken from: co.biblioteca.legal.