International Society of Primerus Law Firms

Costa Rican Corporations

Written By: Luis A. Montes

Guardia Montes & Asociados

San Jose, Costa Rica

It is absolutely feasible to organize companies in Costa Rica, whether they are Stock Companies or Limited Liability Companies, for foreigners who are not residents in the country, or for legal entities domiciled abroad, who would like to organize an affiliate or subsidiary in the Costa Rican territories.

Our Political Constitution and the commercial and civil laws grant them the same rights and obligations granted to nationals and residents, reason for which any international company or foreign client, an investor or not, can be an owner of a Costa Rican company with the same rights that a national shareholder would have.

Whether it is to open an account or else because they may wish to create local or international businesses, Costa Rican companies will provide great support, helping your daily operation of the business and making any physical arrangements and movements at world level easier.

Some features of our companies are:

i- The companies may have any amount of capital, which can be divided into as many shares or membership interests (“cuotas”) as the investor may want to have (usually structured in a way that makes it easier to divide the total by as many shareholders or members (“cuotistas”) as may be expected, in view of the fact that such shares or membership interests are indivisible by law). It is important to add that shares cannot be transferred to other shareholders without the prior express consent of the other shareholders, who have a first option right to acquire them.

ii- Depending on the type of company, that is, a Limited Liability Company, with 1 or more Managers, or Stock Companies, with a Board of Directors, these legal entities require only just one person for management thereof (Manager or Chairman of the Board), thus providing a particularly attractive structure with regard to efficiency, agility and operational capacity in business.

iii- Its Bylaws can be amended from time to time, as well as the powers of attorney granted by a Shareholders’ or a Members’ Meeting, which can be held with the attendance of all shareholders or members, respectively, or with individuals designated by them under proxies or special powers of attorney. These Shareholders’ or Members’ Meetings can be held anywhere in the world.

iv- It is possible to establish special mechanisms for protection of minority shareholders or members and their voting rights.

v- Their legal representatives –Manager or Chairman of the Board– (who have power of attorney to act on behalf of the company) are responsible for any action taken by them against the interests of the company and/or its shareholders or members.

vi- The companies shall keep two or three corporate or company books depending on the type of company (Shareholders’ Meetings Minute Book or Members’ Meetings Minute Book, Board Meetings Minute Book, Shareholders’ Register or Members’ Register), as well as three accounting books (Journal, Ledger and Inventory and Balance Sheets). Such books shall be approved by the local tax authorities and are a requirement for implementation of any change in the bylaws of the company or its structure of authority, because no Shareholders’ Meeting or Members’ Meeting can be held without having the proceedings thereof written down in the specific book authorized for such purpose.

vii- Companies in Costa Rica shall register with the Tax Authorities. Companies not involved in business activities in the country for the current fiscal year are not required to be formally registered (just the authorization concerning their books). However, they are required to file a return as of the end of each fiscal year, stating that there was no business activity during this period, thus avoiding the imposition of penalties.

The normal fiscal year for taxpayer companies in Costa Rica runs from the 1st of October to the 30th of September of every year, and tax returns can be filed until the end of December. A different fiscal year can be authorized to companies which are owned by or related to foreign entities that use a different fiscal year in their countries of origin.

viii- It is important to state that taxation in Costa Rica is territorial, reason for which the revenues generated abroad through Costa Rican companies, whatever their kind, shall not be declared to the Costa Rican authorities and no taxes are paid on them.

If a company in Costa Rica is a subsidiary or affiliate of a Company domiciled in another country, our office recommends the creation and organization of a “Limited Liability Company”. This type of legal modality is a very simple structure, because it is not required to have a Board of Directors, being managed by one or more Managers with Full Power of Attorney, who shall control the operations of the company, upon prior authorization of the respective parent company.

At this time, thanks to an initiative of Digital Government, there is a new mechanism, which permits to organize companies and legalize their books online. This computer took has allowed our Law Firm to provide times of response that are faster and much more attractive to our clients. Once a Notary Public has executed the articles of organization of the company, the information is entered, payment of the publication of the appropriate notice in the Official Journal is made and registration of the company with the National Registered is performed, all of these actions online. The whole procedure may take between 24 and 48 hours.

The law firm, Guardia, Montes & Associates, based in San José, Costa Rica, has extensive experience providing high end and specialized services to its clients.

For more information about Guardia Montes & Asociados, please visit the International Society of Primerus Law Firms.


The general information contained herein is intended for informational purposes only. It is not intended to be, and should not be construed as, legal advice or legal opinion on any specific facts or circumstances.

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