Real Estate Solutions

A blog of all sections with no images
Can a foreigner incorporate in Costa Rica? Print

Yes, a citizen of any country may incorporate a company in Costa Rica. A corporation may be formed in one of two ways. Simultaneous subscription, the most common way, requires at least two incorporators to appear before a Costa Rican Notary Public to execute the articles of incorporation. The second way, known as subsequent subscription, is rarely used, as it involves the formation by a promoter as opposed to incorporators. The articles of incorporation must include:

  1. the date and place of formation,
  2. complete identification of each of the incorporators including nationality and identity or passport number,
  3. the corporate name,
  4. the corporate purpose,
  5. the duration of the corporate term,
  6. the capital stock of the company,
  7. the capital contribution by the shareholders,
  8. the legal domicile of the company,
  9. the board of directors (at least a president, secretary and treasurer),
  10. an enumeration of powers of the directors,
  11. a statement as to the allocation of profit and loss,
  12. a statement as to how the company would be dissolved, and
  13. the name of a resident agent, who must be a Costa Rican Attorney.
 
How do I establish a business in Costa Rica? Print

First, you must determine whether you wish to operate the business as a sole proprietorship or through a corporation. A business license must be obtained from the municipality, where you intend to conduct business. Some municipalities, such as the Municipality of San José, require that you obtain a "Zoning Certificate" ("Certificado de Uso de Suelo"), to insure that the property intended for the business is properly zoned for that use, prior to applying for a business license. You must also register your business with the Ministry of Finance, with respect to the collection of any sales tax. If an existing business is to be purchased, extreme caution must be taken in ascertaining all of its liabilities, some of which may not be readily apparent. This is not a matter which should be undertaken without appropriate legal advice.

 
Can a foreigner purchase a motor vehicle in Costa Rica? Print

Buying a motor vehicle in Costa Rica by a foreigner is permitted, but as with the purchase of real estate, does present some unusual title search and transfer of title problems, not common to other jurisdictions such as the United States and Canada, including in part, the execution of a formal Bill of Sale before a Notary Public.

Again, because of the intricacies of the title search and transferring process, it is imperative that a purchaser retain the services of a lawyer specializing in motor vehicle transfers, to advise on and carry-out the transfer process. A transfer tax of 2.5% and a registration fee of .05% of the purchase price must be paid, along with a number of documentary fees, at the time of the registration, in the National Public Registry.

 
Are prenuptial agreements legal in Costa Rica? Print

The Family Code in Costa Rica, recognizes the validity of Premarital Agreements which allocate the distribution of present and future assets. The Premarital Agreement must be signed in the Notary Public protocol book and registered in the Public Registry, in order to be valid.

 
How much are property taxes in Costa Rica? Print

The municipal government in the area where the property is located is in charge of levying and collecting property taxes. The tax rate is set annually by the municipality and is based on 0.25% of the recorded property value in the National Public Registry. The property value may be adjusted automatically by the municipality, when the property is sold or mortgaged

 
How do I obtain a construction permit for a house? Print

The law requires that the application for a construction permit be presented by a licensed architect or engineer, to the municipality where the property to be built on is located. Prior to submitting a application, municipal zoning for the property should be checked, a determination that basic services such as water, electricity and telephone are available, and insure that there are no restrictions placed on the property, which would deny the issuance of a construction permit. To determine if such restrictions exist, the registered title, in the National Registry, would need to be reviewed, along with checking with a number of other Government agencies, who may have statutory authority to restrict development. For a serviced residential lot, you will need:

  1. architectural blueprints,
  2. an electrical plan,
  3. each of the above should be appropriately endorsed and filed with the "Costa Rican Association of Engineers and Architects", along with their standard consulting agreement,
  4. approval of the plans from the Ministry of Health;
  5. filing at the appropriate municipality, along with the completed construction permit application,
  6. a worker's compensation policy from the National Insurance Institute,
  7. a certified copy of the property survey map,
  8. three copies of the construction plans,
  9. a municipal certification that all property taxes and assessments are current, and
  10. an approval from the water company (AyA), regarding the availability of water, where the home is to be built.