- Le­gal Ease: Cor­po­ra­tions in Costa Rica

Howler Magazine - - Featured Contents - Ivan Grana­dos

Un­der­stand­ing the ad­van­tages of set­ting up a cor­po­ra­tion in Costa Rica is im­por­tant when con­tem­plat­ing the rel­a­tively un­re­stricted op­por­tu­ni­ties for for­eign busi­ness or prop­erty own­ers. Pur­chas­ing prop­erty through a Costa Ri­can cor­po­ra­tion, for ex­am­ple, may not be a re­quire­ment in some cir­cum­stances, but it's still ad­vis­able in the in­ter­est of flex­i­bil­ity and li­a­bil­ity pro­tec­tion. Fur­ther­more, cor­po­rate own­er­ship of a prop­erty al­lows for proper es­tate and tax plan­ning, and en­ables prop­erty own­ers to grant a spe­cial power of at­tor­ney to act in their ab­sence.

The two pri­mary types of cor­po­rate en­ti­ties in Costa Rica are So­ciedad Anón­ima (SA) and So­ciedad de Re­spon­s­abil­i­dad Lim­i­tada (SRL). In both cases, li­a­bil­ity is lim­ited to the cor­po­ra­tion's as­sets and to­tal­ity of share­holder or quota holder con­tri­bu­tions. There­fore, per­sonal as­sets are pro­tected against any of the com­pany's po­ten­tial cred­i­tors.

No­table dif­fer­ences be­tween the two types of cor­po­ra­tions in­clude the fol­low­ing.

The SA is gov­erned by a board of di­rec­tors com­pris­ing at least four in­di­vid­u­als. In ad­di­tion to a pres­i­dent, sec­re­tary and trea­surer, the comptroller po­si­tion is manda­tory. Each ap­point­ment must be oc­cu­pied by a dif­fer­ent per­son of le­gal age. The cap­i­tal stocks of an SA cor­po­ra­tion are called shares. They can be trans­ferred through en­dorse­ment of the share cer­tifi­cates and proper en­try in the share­holder reg­istry. Share­hold­ers may trans­fer their in­ter­est to a third party freely un­less oth­er­wise stated in the SA ar­ti­cles of in­cor­po­ra­tion or by­laws.

The SRL does not have a board of di­rec­tors. There­fore, it could be gov­erned by only one in­di­vid­ual (man­ager), mak­ing it rel­a­tively easy and sim­ple.

The cap­i­tal stocks of an SRL cor­po­ra­tion are called quo­tas. They are trans­ferred through an as­sign­ment agree­ment and proper en­try in the quota holder reg­istry book. How­ever, quota hold­ers have a right of first re­fusal pro­vi­sion for the sale of quo­tas. There­fore, quo­tas can­not be trans­ferred to a third party with­out of­fer­ing their in­ter­est to the other quota hold­ers first.

Any­one plan­ning to set up a cor­po­ra­tion here is urged to seek ad­vice from a Costa Ri­can at­tor­ney be­fore­hand. This le­gal ex­per­tise will help de­ter­mine the most ap­pro­pri­ate cor­po­rate struc­ture re­quired for the busi­ness or in­vest­ment you want to make. It must be suc­cess­fully im­ple­mented to avoid prob­lems with the au­thor­i­ties in Costa

Rica and for your cor­po­ra­tion to op­er­ate smoothly.

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