In addition to its beautiful weather and rich cultural history, Costa Rica offers flexible business practices and numerous commercial opportunities. It is an ideal destination for starting a business due to its tax advantages, high level of privacy, English fluency among locals, and fast incorporation process.
Incorporation: Map of Costa Rica and its principal cities. Company formation in Costa Rica. Business formation Costa Rica
Costa Rica is known for being one of the most developed countries in Latin America. In 2019, it had a gross domestic product (GDP) of $61.77 billion and a Gross National Income (GNI) of $11,700 per capita. This makes Costa Rica an upper-middle-income nation according to World Bank standards.
Despite its small size, Costa Rica attracts significant foreign direct investment (FDI). It has multiple free trade agreements (FTAs) that provide preferential access to major markets including Chile, China, the Dominican Republic, Mexico, and the United States. The country’s main exports include electrical machinery, bananas, pharmaceuticals and medical equipment, and plastic products. If you are considering starting a business in Costa Rica and want to incorporate a company, continue reading to learn about the benefits offered by this Central American country.
Here are 7 benefits of incorporating a company in Costa Rica:
1. Bilingualism: While Spanish is the main language, English is widely understood in Costa Rica. This means you can register your company name in either Spanish or English.
2. World Trade Organization (WTO) Membership: Costa Rica has diversified its economy and joined the WTO, which has accelerated growth in various sectors. Companies incorporating in Costa Rica can take advantage of these expanding opportunities.
3. Minimal Requirements: Only four individuals are needed to incorporate an S.A. in Costa Rica: President, Secretary, Treasurer, and Controller. These directors will be publicly listed.
4. Privacy and Anonymity: Shareholders do not appear on public records, and there are no government-imposed accounting or reporting requirements for local companies.
5. Quick Incorporation: It typically takes 20 to 40 business days to incorporate a company in Costa Rica, enabling companies to commence commercial activities sooner compared to other jurisdictions.
6. Favorable Taxation: Companies registered in Costa Rica are only taxed on the income generated within the country, thanks to the territorial taxation principle.
7. Free Trade: Costa Rica has numerous free trade agreements with countries such as the U.S., Mexico, Chile, and Canada, offering significant advantages for importers and exporters. Additional agreements with other countries are also in progress.
By incorporating a company in Costa Rica, individuals can experience financial freedom. The most common legal entity type is a Sociedad Anonima, which provides liability protection for shareholders. Apart from the benefits of a Sociedad Anonima, the business-friendly ecosystem in Costa Rica offers numerous opportunities for financial flexibility.
If you need assistance with incorporating a company in Costa Rica or personalized advice, Biz Latin Hub has a team of experts who can provide legal guidance, accounting, and financial services tailored to your needs. Contact us now for personalized assistance or a free quote.
