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About Randall Zamora Hidalgo

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Randall Zamora Hidalgo, Member of the Costa Rican Chartered Accountants Board, former Head of Accounting Department and CFO of multinational companies such as Four Seasons Resort Costa Rica; Pro Bono Local Partner of The World Bank; active member of the Interamerican Accounting Association; recommended consultant by and

Doing Business in Costa Rica: A Quick Guide to not fail!

Costa Rica is a well know destination for investment purposes, no wonder why multinational companies such Intel, P&G, Western Union and many other had decided to establish operations in this 51,100 km2 and 4.9 million population Central America Country.

Although, one of the goals of the Costa Rican Government is to attract foreign investment, to start a business would be tricky if the home work is not done properly, not to mention the different Government Agencies to be visited in order to get fully licensed business wise.

That being said, the following list intends to give an overview of what needs to be done in order to do business in Costa Rica, while reading the list please keep in mind that if done properly, this is a onetime process.

Incorporation of a Company in Costa Rica

The most common form of incorporation is the Sociedad Anónima (Corporation). The articles of incorporation must be recorded in a notarized public instrument and registered in the Public Record Office. The Public Record Office will then provide an identification number. The Law requires a minimum of two (2) persons to register the corporation. After the incorporation, the number of shareholders may be reduced or increased, with NO limitations as to the nationality. Registration procedures usually last at least four weeks. Shell companies can be used in case of immediate application.

Basic Features of Corporations in Costa Rica

The Corporation is managed by a Board of Directors of no less than three members, President, Secretary and Treasurer, who do not need to be shareholders (there are no citizenship or residency requirements). No one can hold two office positions. The President of the Board legally represents the corporation, as well as any other member so specified in the articles of incorporation. They are able to delegate all or some of their power to other members of the Board if the articles of incorporation allows it. They may also appoint one or more managers.

One half of the members of the Board are required for meetings and a majority of those present to hold a resolution. The President has two votes in case of a tie.

The company must have a Resident Agent, an attorney with office in Costa Rica. The Resident Agent must be registered in the Mercantile Registry and will be in charge of receiving all legal notifications.

Registering a Branch in Costa Rica

Foreign corporations which have or intent to open branches in Costa Rica are required to appoint, maintain, and register a legal representative agent vested with full powers of attorney in the country for the business affairs of the branch.

Registering a representative with full powers of attorney

An unlimited power of attorney authorizes a person to act on behalf of a company. It must be given by a representative of the parent company with sufficient power, before a Costa Rican Public Notary or the local Costa Rican Consulate.

General Income Tax Office (Dirección General de Tributación Directa)

The General Income Tax Office is part of the Ministry of Treasury. Every person or entity that performs one or more economic activities in the country must register as a taxpayer. The procedure is executed at the Tax Administration offices.


Under the Costa Rica tax system, residents and corporations are taxed only on income earned in Costa Rica. The tax year begins on October 1 and ends September 30, for both individuals and corporations. Companies may request filing returns on a different tax year, subject to the approval of the Ministry of Finance. Unless proof to the contrary exists, the Ministry of Finance establishes a presumptive net income for professionals as well as corporations, and constitutes a minimum taxable base.

Social Security (Caja Costarricense de Seguro Social – CCSS)

According to the Costa Rican law, the employer must contribute to the social security regime of its employees with a fixed percentage of the employees’ salary. The employee must also contribute a fixed percentage of its salary. Therefore, the company must first be incorporated as an employer with the CCSS; this can be done at the central office or any of the regional offices of the CCSS. The company’s incorporation as an employer and the registration of its employees must be done within the first eight days after hiring its employees.

National Insurance Institute (Instituto Nacional de Seguros)

According to the Costa Rican Labor Code, the employer must secure an occupational risk insurance policy for its employees. For this, the employer has to underwrite a policy from the National Institute of Insurance (INS). The policy has to be underwritten at the beginning of the operation and has to be in force during the operation. To underwrite an occupational risk policy, the applicant has to go to the Central Office or a branch of the INS, a commercial Insurance Agency or an authorized Insurance Agent. At the moment the policy is underwritten, the company will be automatically registered as an employer at the INS. Once the policy is underwritten, the employer has to remit to the INS on a monthly basis a status of the forms indicated: names of the workers, days and hours worked and the salaries paid.

Ministry of Public Health – Operation Certificate

In accordance with the General Health Law, companies must request authorization, or an Operation Certificate, from the Ministry of Public Health prior to the initiation of operations. This is a requisite prior to obtaining the municipal business license.

The activities that are subject to said process, as well as the requirements for obtaining the permit and the duration of such a permit, are defined in Executive Decree N° 30465 and its amendments and in the Regulations on Sanitary Registry of Establishments Regulated by the Ministry of Public Health. In this decree, activities are classified in three categories in accordance their level of environmental and health risks: A (high risk), B (moderate risk) and C (low risk).

Municipal License

All individuals or entities with business activities require a municipal license (or permit) from the canton in which the activity is developed. The license involves the payment of a tax during the time of operations. In virtue of the municipal autonomy, the forms and requisites to obtain a license may vary among municipalities, pursuant to their legislation and administrative dispositions.

The above information is useful for a company that is more likely to lease an space and focused in the service industry, ever since, when it comes to build a facility, industrial process and Free Duty Regimen other steps must be added, but this list is a good start to understand what needs to be done in order to do business in Costa Rica.