By DIANA JEAN SCHEMO

           BOGOTA, Colombia -- The note was scrawled on a scrap of paper and thrust at a truck
           driver for a United States oil company stopped on a rebel-held highway to the eastern plains
          of Colombia recently. "Please do us the favor of coming to talk to us, so we can reach agreements
          allowing you to work without problems," the note said. "If you do not come, we will not be
          responsible for the consequences."

          The company passed the extortion demand, penned in oddly formal, misspelled Spanish, to
          Colombian military intelligence. Executives at the multinational concern, who asked that the company
          not be identified, did not give in to insurgents, but ordered their drivers to skirt the area by taking
          other roads.

          The company could alter its routes and still conduct business, said Enrique Urrea, head of a
          committee of security chiefs for U.S. multinationals operating in Colombia. "Not everybody can," he
          added.

          A Colombian soft drink manufacturer, defying similar demands from the insurgents, saw 54 of its
          trucks burned. In September, the rebels kidnapped three of the company's drivers and executed one
          to pressure the company. "If they give up a road, they lose a market," Urrea said. He asked that the
          company not be named, saying publicity could endanger the lives of the remaining hostages.

          Though the new government of Andres Pastrana seeks peace talks with the country's three rebel
          movements in an effort to end three decades of civil war, Colombia remains one of the riskiest
          places in the world to do business. Threats to foreigners come from random street crimes,
          kidnappers, extortion, vandalism and sudden roadblocks thrown up by rebel factions vying for
          power.

          Half of all the reported kidnappings in the world happen in Colombia; 806 occurred in the first six
          months of this year and 1,693 last year, according to the Presidential Anti-Kidnapping Office. More
          people are murdered in this nation of 36 million than in the entire United States, which has nearly
          eight times the population. In 1996, the last year for which figures are available, the Federal Bureau
          of Investigation reported 19,645 homicides; in Colombia, there were 26,627.

          While the central government holds Bogota and the larger cities, the countryside is fragmenting into a
          collection of fiefs controlled by rebels or by right-wing paramilitaries that terrorize peasants, often in
          collusion with army officers and the police. Foreign businesses are particularly vulnerable to
          kidnappings and extortion and kickback demands from the rebels. Security costs, which average 4
          percent of a company's operating costs in the rest of the developing world, can run up to 10 percent
          here, security experts and company executives say.

          Despite the limitations and risks, a variety of U.S. companies have opened offices and factories in
          Colombia, particularly since the country acted in the early 1990s to lower trade barriers and
          otherwise open the economy to foreign investment. They include Occidental Petroleum, Procter &
          Gamble, Colgate-Palmolive, Kellogg, DuPont and Citigroup.

          Some businesses have left, but those that stay in Colombia have learned to protect their interests. To
          discourage kidnappings, they employ Colombian executives and use local contractors. They hire
          such multinational security services as Control Risks Group and Defense Systems Ltd., both based
          in London; Ackerman Security, and the Kroll-O'Gara Co., in New York, to tailor security packages
          for their executives, installations and trade secrets.

          Insurance companies, sometimes working directly with protection services, often demand strict
          security precautions from U.S. executives in Colombia, said Joseph Finnin, head of the American
          Chamber of Commerce here. One insisted that not only an oil company president but also his wife
          use bodyguards and armored cars.

          The security services also analyze the risks of doing business with a given Colombian company,
          perusing court records for potential legal or tax problems. Earlier this fall, Kroll-O'Gara bought a
          factory for making armored cars in Colombia, said Bruce Goslin, a managing director of the
          company's office in Miami.

          Because of security worries, foreigners largely confine themselves to a small, safe piece of this grimy,
          bustling city. They take apartments on the upper floors instead of houses, and only in the priciest
          neighborhoods. They vary routes, switching vehicles and vetting maids, nannies and gardeners with a
          thoroughness J. Edgar Hoover might have envied. And they fly, rather than drive, if they must leave
          Bogota.

          Oil companies pay a special war tax to the government, and they contract with the Defense Ministry
          for special army platoons to protect oil exploration and production sites or dangerous highways. As
          threats to their business escalate, foreign companies are sharing security information and tightening
          their lines of communication with Colombia's military intelligence service.

          Through the committee that Urrea heads, the chiefs of security for 65 of the largest companies in
          Colombia, most of them from the United States, are in constant contact through beepers that flash
          bulletins. Urrea heads security operations for Esso, the Colombian subsidiary of Exxon. On one
          recent day, his beeper warned of a strike by 700,000 civil servants that was paralyzing roads,
          telecommunications, hospitals and airports.

          The Colombian military sends the committee daily intelligence reports and other information, while
          the police provide financial profiles of potential or actual employees. "If there's no information,
          there's no power," Urrea said.

          For Armando Lara, a former FBI officer who heads Latin American operations for Control Risks,
          that maxim was vividly illustrated a few years ago. Running late to a meeting with a military
          commander in charge of eastern Colombia, Lara flipped on the radio to hear that the commander
          had been killed when his car exploded a few minutes earlier. If Lara had known security was so
          volatile in the area, he would have avoided going there, he said.

          But more information means maintaining close ties to military and police forces that have a record of
          chronic human rights abuses. According to government investigators and human rights groups, army
          and police officers have colluded with the right-wing paramilitaries, which roam the countryside,
          terrorizing and massacring peasants.

          Last summer, the 20th Intelligence Brigade, which supplied information to every branch of the
          military, was disbanded, with numerous officers facing criminal charges of running death squads and
          carrying out political assassinations. For more than a year, the State Department has been combing
          through the human rights records of the Colombian army, seeking units with clean records to receive
          aid to combat narcotics. But the human rights problems are so pervasive that only one unit has been
          cleared, and another had to be created fresh, culling officers and soldiers with unblemished records
          from scattered units.

          Urrea said that most security chiefs working in the private sector are retired military officers like him
          who have access to the most senior officers in the Colombian military command.

          "As far as I know, they are honest, but there are exceptional cases where a person, in his impotence
          before the situation we're living through, commits excesses and violates human rights," he said. " But
          that's the exception, not the rule."

          Security chiefs and security firms have also been involved in negotiating ransoms, which are
          technically illegal in Colombia. In a famous case, Control Risks negotiated for the wife of a BASF
          chemical company executive. The hostage, Brigitte Schone, was eventually released when a German
          spy couple, Werner and Isabel Mauss, elbowed Control Risks aside and paid rebels a ransom of
          $1.5 million -- 10 times the amount the company had bargained the ransom down to. The case set
          off an international incident when the Mausses were briefly arrested trying to leave the country with
          the freed hostage, using false passports provided by the German government.

          (In the latest illustration of how shadowy are the ties that run Colombia, the Mausses emerged last
          summer as behind-the-scenes figures arranging peace talks in Mainz, Germany, between rebels of
          the National Liberation Army, or ELN, and Colombian business and church representatives.)

          It is also illegal to pay extortion in Colombia. Most large U.S. companies do not surrender to
          extortion, Lara of Control Risks said, but added, "So many have a policy of subcontracting to
          Colombian firms, and Colombians feel, especially operating in rural areas, that they've got to pay to
          keep themselves safe."

          The most costly threat to foreign businesses has been attacks on oil pipelines. The attacks have not
          ceased even as the government prepares to open talks with the largest insurgent group, the
          Revolutionary Armed Forces of Colombia, or FARC, in an effort to end the civil war, which last
          year claimed 2,183 lives, according to human rights groups.

          Nestor Martinez, Interior Minister in the new government, acknowledged that lack of security is a
          serious hindrance to doing business in Colombia. "Of course, we have problems, like all other
          developing countries," he said, "but we're dealing with them, and we're beginning peace talks with
          the guerrillas."

          Of the four major American oil companies working here -- Exxon, Amoco, Chevron and Occidental
          Petroleum -- perhaps no company has been more battered by the instability than Occidental. Oxy
          Colombia, as the company's local office is known, pumps 160,000 barrels a day of crude from its
          complex at Cano Limon, near the Venezuelan border.

          So far this year, ELN rebels have blown up the pipeline 61 times. Last year, rebels bombed the
          pipeline 64 times and started striking closer to home, at the wellheads.

          The rebels collect a 10 percent commission from contractors hired to repair the pipeline and
          wellheads, said Robert Stewart, a spokesman for Occidental.

          "We're getting clobbered," he acknowledged. "It used to be the guerrillas would do their attacks and
          run. They're not even scrambling anymore. Now, they sit around after, have a cup of coffee and wait
          for the army to show up."