3 Steps to Setup a Business in Costa Rica

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    Costa Rica offers business opportunities only available in a developing country yet with certain guarantees proper of a developed nation.

    In our optic, Costa Rica is a unique scenario for international investors and entrepreneurs who slowly discover the benefits of doing business in the only Latin American democracy included in the list of the 22 oldest democracies in the world.

    That political and economic stability offers an ideal business environment to use Costa Rica as a global business hub for many different industries, having said that we have to warn potential investors that an organized effort will be necessary to be successful.

    Below you will find a very simple description of the steps necessary to launch any business enterprise in Costa Rica:

    Step 1: Incorporate your company

    The entrepreneur has to hire the services of a local attorney acting authorized as a public notary prepares a public deed adjusted to article 18 of the Costa Rican Commerce Code and requests the National Registry to issue a corporate identification number.

    The newly formed company will enable a local business operation protecting the personal assets of the beneficiaries via its limited liability.

    Estimated Duration: 24 hours (Perhaps one of the most significant tangible efforts made by the government to reduce the time of launching a business in Costa Rica as it was reduced from normally two weeks to just hours, available only via attorneys with digital signature capability)

    Step 2: Apply for Licenses & Permits

    Depending on the type of business activity, the entrepreneur will have to apply for different permits that will lead to a final business license. In general every company will have to be registered as an Employer before the Social Security (CCSS), obtain Work Risk Insurance from the Insurance Agency (INS) and be registered as a Tax Payer before the local Tax Authority.

    Parallel to such applications it is necessary to request a Zoning Permit regulated by the local government of where the business will be located. After the Zoning Permit is approved the company has to meet all the criteria to obtain a Health Permit from the Ministry of Health.

    After all the previously described permits are approved the company is finally ready to request the specific business license for the desired activity.

    Estimated Duration: 30-45 business days

    Step 3: Employ People

    After the company has been properly registered as an Employer before the Social Security it will be necessary to elaborate individual Work Contracts for the employees. Each employee has to be reported to the Social Security and both Employer and Employee must contribute to the national pension regime and to the public health system. The Employer will pay a combined sum of approximately 26% of the salary of each Employee to the Social Security and each Employee’s salary will be deducted by 9% as a contribution to the regime.

    Additional steps are required for companies that conduct the following business activities:


    Companies in this industry could be eligible for Tourism Incentives which are granted by the Costa Rican Tourism Board (ICT). If construction is required a pre design survey will be necessary to comply with all existing planning regulations and in order to obtain approval of plans and construction permit.

    Depending on certain variables the project might also be subject to environmental evaluation before the SETENA.


    As Costa Rica’s economy is outward oriented it offers several options for exporting companies. The company could be eligible to become part of a Special Export System or gain access to a Free Trade Zone in all cases it is necessary to be a part of the Exporter’s Registry at PROCOMER.

    It is also important to register trademarks of the company at the Industrial Property Registry which can be done under the guidance of a specialized Intellectual Property attorney.

    The initial efforts to set up a business in Costa Rica will be rewarded later once you understand the local cultural and business practices and all the related issues of doing business in Costa Rica.

    [quote_box_center]Augusto Arce has a JD from the Universidad de Costa Rica and a Global Masters in Business Administration from Thunderbird School of Global Management and the Tec de Monterrey. Mr. Arce has more than 15 years of experience in foreign advisory and currently is the Managing Partner of GLC Abogados.[/quote_box_center]

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