Colombia: Decree 574 of 2025 and the Contributive Pillar Savings Fund regulation

06 Jun 2025    2 minute read
FSR

In brief

Decree 574 of 2025 ("Decree") adds Book 44 to Decree 2555 of 2010. The purpose of the Decree is to regulate the administration and governance of the Contributive Pillar Savings Fund ("Fund") and the investment regime of the resources that comprise it. It also seeks to adjust the determination of the value of exposure to operational risk of trust companies, pension and severance fund management companies, stockbrokers and life insurance companies.

Contents

In more detail

Legislative context

Context to the Pension System in Colombia:

  • Law 2381 of 2024 modified the structure of the Pension System in Colombia established in 1993; it established a regime founded in four pillars: i) Solidarity Pillar; ii) Semi-Contributory Pillar; iii) Contributory Pillar; and iv) Voluntary Saving Pillar.
  • The structure of the Contributory Pillar divides in two components: i) Average Premium Component and ii) Individual Savings Component.

Key takeaways to Decree 574 of 2025

What did Decree 574 of 2025 establish?

  • Decree 574 of 2025 regulates the administration and the governance of the Fund in which the contributor's money is saved — along with Government provided funds — and the way in which it will be invested.
  • The Fund will be administered by Colombia's National Bank (Banco de la República) through trusts and other financial figures, the funds and their revenue are unseizable. On the other hand, the Fund will operate through generational sub-accounts; said sub-accounts will hold for the necessary funds for paying pensions of different generational groups.
  • The main goal of the Fund is the investment of the resources of contributors for the future payment of their pensions to ensure a long-term financial sustainability of the pensions system; this goal shall be met following guidelines oriented by purpose-driven investing, diversification, prudence and performance.
  • The Fund's Steering Committee will be composed of the Ministers of Finance, Labor, and Planning, the Director of the National Planning Department and four independent experts appointed by the Central Bank's Board. Its responsibilities include approving investment and risk policies, overseeing fund performance, and Reporting to Congress and the public. All administrative functions of the Committee shall follow the principles of transparency, merit-based selection, gender equality, and legal compliance.

For more information, the Circular can be consulted at the following link.

Please do not hesitate to contact us in case you have any questions or require our advice.

Click here to read the Spanish version.

Contact Information
Ricardo Trejos Robledo
Partner
Bogota
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ricardo.trejos@bakermckenzie.com
Francisco Muñoz
Associate
Bogota
francisco.muñoz@bakermckenzie.com

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