Population
5,226,362

Location
Costa Rica is in Central America, bordered by Nicaragua to the north and Panama to the south. To the west, it is flanked by the Pacific Ocean, and to the east, it meets the Caribbean Sea.

Climate and Ecosystems
Although Costa Rica is a relatively small country, it enjoys a privileged global position that allows it to have a variety of climates and habitats. Generally, temperatures range from 14 to 28 degrees Celsius in the high Central Valley and from 22 to 36 degrees Celsius in the low and coastal lands. Temperatures in each region remain relatively stable throughout the year, although some slight changes occur from "Summer" (dry season) to "Winter" (rainy season). Summer usually goes from December through April and Winter from May through November. Costa Rica has no Fall or Spring seasons.

Tourism
Costa Rica is renowned for its natural beauty and biodiversity, making it a premier destination for eco-tourism and adventure travel. The country offers a wide array of attractions, including majestic volcanoes, lush rainforests, and pristine beaches. Visitors can experience Costa Rica's rich biodiversity, home to colorful birds, butterflies, monkeys, and sloths. Additionally, the country provides numerous opportunities for adventure activities such as surfing, ziplining, and hiking.

San José, the capital city, is surrounded by verdant mountains and valleys and is known for its historical significance, outstanding architectural buildings, museums, art galleries, and parks. La Fortuna, located in the northern highlands, is famous for its natural beauty and adventure opportunities, particularly in the Arenal Volcano region.

The tourism industry in Costa Rica has been one of the fastest-growing economic sectors in the country. Since the late 1980s, Costa Rica has become a popular destination for nature travel, with a well-established system of national parks and protected areas covering approximately 23.4% of the country's land area. This extensive network of protected areas supports a rich variety of flora and fauna, making Costa Rica one of the most biodiverse regions in the world.

Communication System
Costa Rica has one of the most advanced telephone systems in Latin America, and international calls can be dialed directly from any point in the country.

Mobile technology has grown rapidly in recent years after the country opened up to private participation in the telecommunications industry after the adoption of CAFTA-DR. Even if the telecom industry was monopolized for decades, Costa Rica is one of the countries in Latin America with the highest density in the popularization of mobile phones. Companies such as Liberty, Claro, and Tigo currently compete directly with the giant state-owned company ICE in the telecom industry. It is possible to buy a mobile phone for immediate use (for prepaid and other different plans) at many stores, most of them located in the main cities of the country.

Internet is also widely developed and connections through several Internet Service Providers may be obtained in one day. Wireless networks for public use have not been expanded fully, but it is quite common to find open networks all around the country.

There are two different types of entities that you can set up in Costa Rica: (i) A "Sociedad Anónima" (S.A.) which is equivalent to a stock corporation; or (ii) "Sociedad de Responsabilidad Limitada" ("S.R.L."), which is the equivalent to a limited liability corporation. The following is a brief overview of both entities:

Sociedad Anónima ("S.A.")
Corporations are mostly used for business purposes given their structural flexibility. Since local laws define a corporation as a bilateral agreement, they must be formed by at least two parties. However, immediately after formation, all the shares of stock may be legally owned by a single party. Founding parties (and any shareholders thereafter) may be physical individuals, registered business entities of any nature or a combination thereof, regardless of citizenship and domicile.

They must be incorporated by at least two incorporators by means of a notarial instrument, and recorded with the Mercantile Registry, provided a notice of incorporation is published in the Official Gazette. The registration of a corporation may take 1 week, although, with recent changes that allow for online filing, they can be recorded in 24-48 hours.

Every corporation must have a Board of Directors comprised of a minimum of three individuals to hold the positions of President, Secretary and Treasurer. Additional Board members may be appointed at will. It is not required that Board members be simultaneously shareholders.

Limited Liability Company ("Sociedad de Responsabilidad Limitada")
Limited Liability Companies ("LLCs") are permitted and are very common entities. They must be formed by at least two partners in a procedure similar to that of corporations. Basic rules and procedures for the creation and operation of S.A. also apply to LLC companies, except that no board of directors exists (a manager or management committee must be appointed instead), and shares are substituted by capital “quotas” with more strict and personalized assignment rules.

General Tax Obligations
Every company that has an economic activity in Costa Rica must register as a taxpayer before the Costa Rican Tax Administration. Although tailored tax advice is recommended for each company, below is a list of the main obligations an entity may be subject to.

D-140 Registration
If a company engages in economic activity, then it must formally register as a taxpayer, where it will specify its economic activity, operation address, legal representative information and contact information.

Corporate Tax
All commercial companies that are registered at the Mercantile Registry (including branches and subsidiaries) must pay corporate taxes. This applies whether the company actively engages in a commercial activity or not.

For companies that are registered as active taxpayers, the amount of taxes will be determined based on the income reported during the prior fiscal year, based on the following brackets:

The base salary for 2024 is ¢462,200.00, approximately USD 897.47.

Duly registered micro-enterprises (or “pymes”) may be exempted from the payment of corporate taxes.

Income Tax
The Costa Rican tax system is based on the territoriality principle. Therefore, only Costa Rican source income derived from real estate, movable assets, goods, services and services rendered or located in Costa Rica is subject to taxation. This is regardless of citizenship, residence, or domicile.

For net income of up to CRC 122,145,000.00, taxes apply according to the following brackets:

Income tax filings are completed electronically through the digital platform ATV (Tax Administration web platform).

Real Estate Rental Income
Income from leasing, subleasing, as well as from the constitution or assignment of rights or faculties of use or enjoyment of real estate constitute income from real estate capital and is subject to a special, simplified tax regime. The tax base of this tax is determined by the difference between the gross income and a fixed-expense rate of fifteen percent (15%), without the need for any proof or the possibility of any other deduction. Therefore, the effective tax rate results in 12.75% of the gross income (15% of the net 85% income).

The tax under this regime must be filed and paid within 15 calendar days of the month following the taxable event. The Income Tax Law allows the taxpayer to “opt-out” of the simplified regime to pay taxes under the ordinary income tax regime if it hires at least one employee and pays his/ her social security contributions. This choice depends on the reality of each taxpayer, and fundamentally, it is necessary to review the total deductible expenses that could be taken advantage of in each tax. Once the taxpayer decides to pay taxes under the income tax regime, the taxpayer must remain in this regime for at least five years.

Tax on Dividends
All distributions made by a Costa Rican company from its net profit are subject to a fifteen (15%) withholding tax. However, dividends received by a Costa Rican entity registered as a taxpayer, from another Costa Rican entity are exempted. Dividend-related tax filings are completed electronically through the ATV digital platform.

Value Added Tax
With the recent approval of the Tax Reform in 2019, the former Sales Tax changed to Value Added Tax (“VAT”). The VAT taxes most sales of goods and services at a 13% rate, although there are some exemptions and reduced rates for certain goods and services.

Taxpayers that offer taxable services are obliged to charge the applicable VAT rate and report and pay the amounts collected on a monthly basis. VAT filings are completed electronically through the ATV digital platform.

Electronic Invoice
All Costa Rican taxpayers are currently obligated to issue electronic invoices. Electronic invoices replaced physical invoices to allow the Tax Administration a more efficient way to control tax evasion; while providing real information on the amount of sales to properly 6 calculate income taxes. Taxpayers must select an electronic invoice provider that is properly registered before the Tax Administration.

Ultimate Beneficiaries Registry
Recent regulations to create a registry of ultimate beneficiaries for transparency mandate that the Central Bank of Costa Rica must create and manage a national registry containing all the information about the ultimate beneficiaries of all companies, trusts, third-party fund managers and non-profit organizations in Costa Rica. This requirement was implemented as of September 1st, 2019.

Operation Permits or Municipal Licenses
All business activities within the jurisdiction of a specific local government or Municipality must apply for an operation permit or municipal license and a Health Permit. Historically, the Municipalities nor any other governmental institutions have requested vacation rental businesses to obtain an operation permit. However, Costa Rica has approved legislation to regulate and formally tax Airbnb, VRBO, and all short-term rentals.

Moreover, additional labor permits, and music exploitation (if applicable) must be considered for the proper operation of the company.

Ordinary General Meeting
Shareholders must hold an ordinary meeting at least once a year, within 3 months of the end of the fiscal year, in order to review and approve the Financial Statements, agree on the distribution of profits, and take the necessary agreements for the operation of the company.

Income Statement of Inactive Companies
Costa Rica just recently is requiring all inactive or dormant companies to file an “inactive company” tax return, for the tax authority to have information on the assets dormant companies have and the value of these assets.

Capital Gains Tax
The capital gains regime corresponds to a variation in the value of the taxpayer's patrimony that comes into effect because of any alteration in the composition of its assets, for example, when selling stocks. Capital Gains tax applies only to “capital assets” like stocks, bonds, and real estate that are not in the service of an income-producing activity related to corporate income taxes.

Under Costa Rican Labor Law, each employer has obligations before its employee(s), the Costa Rican Social Security Administration (in Spanish, Caja Costarricense de Seguro Social, “CCSS”), the National Insurance Institute (in Spanish, Instituto Nacional de Seguros, “INS”), and the Tax Administration. General obligations include:

• Employer Registration
  Every employer must register before: (i) the Social Security Administration, which is in charge of collecting the monthly payroll payments made by the employer (26.67%) and the employee (10.67%); (ii) the National Insurance Institute in charge of issuing the workers compensation insurance policy that must cover every employee, subscribed by the employer; and (iii) the Tax Administration, institution in charge of collecting the salary tax withheld from each employee.
• Equal Treatment
  As a main obligation, our Labor Code sets forth the right to equal opportunities for every person who wishes to perform the same job and prohibits discrimination for any reason.
• Work Shifts
  There are three types of work shifts: Daytime (8 hours, which can be up to 10), Nighttime (6 hours, no extensions), and Mixed (7 hours, extendible to 8). Those considered to be exempt employees have 12-hour ordinary shifts with a paid break (meal and/or rest time) of 1.5 hours.
• Overtime
  Overtime must be paid at 50% of the ordinary hourly wage of the employee and must be computed daily.
• Minimum Salary
  Every employee has the right to receive a minimum salary, which is based on different categories depending on the type of work performed.
• Vacation
  Every employee has the right to (a) annual paid vacations of a minimum of two weeks for every fifty weeks of continuous work for the same employer, or (b) a proportion of those two weeks of paid vacation if the employee has worked for less than the fifty weeks.
• Holidays
  If an employee is required to work during a holiday, the employer must pay twice the amount of salary the employee is entitled to.
• Maternity/Paternity Leave
  Costa Rican labor law provides a special regulation for pregnant women, who are entitled to a paid leave of absence of one month prior to birth and three months after birth. Regarding paternity leave, the biological father is entitled to two days of paid leave per week for four weeks following the birth.
  During both maternity and paternity leave, the Social Security Administration will pay 50% of the salary, and the employer will pay the remaining 50%.
  
  Employees on maternity or paternity leave are subject to special legal protection commonly known as "fuero de protección". This measure ensures that during the leave period, employees are protected against dismissal, except when the employee has committed a serious offense as outlined in Article 81 of the Labor Code, which will hinder the possibility of defending the employment relationship. In such instances, prior authorization must be sought from the Ministry of Labor.
• Severance Payment for Termination by the Employer
  If an employer terminates an employee “without cause”, the employee is entitled to receive not only the corresponding proportional compensation for vacation and Christmas bonus “aguinaldo” (acquired rights for all employees regardless of termination with or without cause), but also compensation for both pre-notice (up to one month’s salary, depending on seniority) and severance (ranges between 19.5 and 22 days per year worked, depending on seniority, with a cap of eight years).
• Foreign Employees
  There is no legal provision that conditions employers to hire a certain number of foreigners. However, in equal conditions, Costa Rican employees should be preferred.
• Statute of Limitations
  Employee’s rights have a statute of limitations of one year; said term commences on the date of termination.
• Christmas Bonus (“Aguinaldo”)
  A full additional month of salary must be paid to every employee by December 20th, on a yearly basis. It is calculated based on the average ordinary and extraordinary salaries earned by the employee over the twelve months prior to December 1.

Business Transactions with Nationals, Residents or Non-Residents
Other than money laundering regulations, which require reporting cash transactions in amounts exceeding US$10,000, there are no restrictions or reporting requirements related to business transactions with nationals, residents or non-residents.

Investment Controls
Except for transactions related to the ownership of certain coastal properties and natural resources concessions, there are no restrictions on foreign direct or indirect investment in the country.

Money Transfers
The current foreign currency exchange allows free possession and conversion of foreign currency into local currency (the “Colon”) and vice versa. However, currency exchange transactions are only permitted through banks and other authorized entities. Also, an organized currency exchange operates in the country administered by the Central Bank ("MONEX").

U.S. dollars are widely available and are also an accepted currency in the country in almost every place. It is also possible to buy U.S. dollars at a broad variety of financial institutions, as there are no practical or legal restrictions for payments from Costa Rican entities destined to foreign counterparties.

According to our income tax rules, payments remitted abroad to individuals or corporations from a Costa Rican source, constitute taxable income subject to applicable withholding taxes. The withholding rate varies from 5% to 30%, depending on the nature of the payment remitted.

Costa Rica has been a member of GATT (later succeeded by the "WTO") since 1990, and a party to the following free trade agreements: free trade agreements with the United States, the Central American countries and the Dominican Republic ("CAFTA-DR"), countries of the Caribbean Community, Canada, Peru, Chile, Mexico, China and the European Union.

As a member of CAFTA, Costa Rican products are entitled to enter El Salvador, Guatemala, Honduras, Nicaragua, the United States and the Dominican Republic either completely or partially on a duty-free basis. As a member of the European Union-Central America Association Agreement, products to Europe are also exempted from import and customs taxes.

The National Customs Service is in charge of valuing the goods. In order to clear customs, our General Customs Law requires importers to file an affidavit with full and detailed information regarding the merchandise brought into the country and, to the extent needed, allows for the inspection of such merchandise. Based on this filing and any inspection conducted, there are customs tariffs to be paid depending on the type of merchandise being imported in accordance with international and national product classifications.

Customs brokers are usually in charge of these customs clearing procedures, although individual importers may process this on their own vis-à-vis the local authorities.

In the past few years, Costa Rica has gradually reduced or even abolished its customs tariffs as a consequence of implementing international trade agreements. Nevertheless, there are important taxes that still apply to imports, such as:

• Value-added tax (previously sales tax), which is generally 13% of the net sale price.
• Selective consumption tax, ranging between 5% and 75%, which is charged on certain merchandise, either imported or produced locally (tariffs to be set vary according to each product.)
• 1% special tax imposed on all imports except for medicines.

In order to legally stay in Costa Rica for more than 90 days, which is what the tourist visa allows, the State must grant a residency. The main residency options that foreign nationals apply for are the following:

• Retirement Resident
  This residency is given to retired people who can prove that they receive a monthly income of more than USD 1,000.00 per month.
• Investor Resident
  This residency is given to foreign investors that invest (such as a purchase of property) an amount equal to or higher than USD 150,000.00. One spouse must be the owner of the investment and the other spouse and the children under 18 years, can apply as dependents.
• Rentista Resident
  This residency is granted to foreign people who prove that a bank guarantees an income of USD 2,500.00 per month, for a period of no less than 24 months, in a consecutive, stable and irrevocable manner.
• Other considerations - "Digital Nomads" Law
  A new law was created to promote and allow for longer stays and investment among remote-working foreigners in the country.
  
  To obtain this condition, the applicant must show a minimum income of USD 3,000.00 per month. If it is a family application, then the income must be USD 4,000.00 per month. This law allows adding the income of both spouses to reach the monthly required minimum.

The country’s general attitude towards environmental regulation is one of protection based on constitutional principles, such as the right that each citizen has to live in a healthy and balanced environment. The government guarantees the enforceability of this right and will act on it as required. Through the Ministry of Environment and Energy, the Ministry of Agriculture, and various NGOs, there is widespread enforcement of current environmental rules. In Costa Rica, there is a widespread culture of protecting the environment. At least 25% of the country’s territory consists of national parks and protected natural areas.

The National Technical Environmental Agency ("SETENA") must conduct an environmental impact evaluation process of any new business or project that may involve exploitation activities or developments. The objective of this procedure is to determine the environmental feasibility of the project and the impact it will have on the environment. This prior approval must be obtained before initiating any other administrative procedures and, of course, any construction works.

The Costa Rican Public Registry is the government institution in charge of keeping all documents, records and general information concerning real estate properties and legal entities. Any title that constitutes, modifies, or extinguishes an ownership right, easement, mortgage or other right regarding a property, must be recorded in the Public Registry for it to be public, and therefore opposable against third parties. Rights or titles that are not recorded before the Public Registry can generate rights, but its registration will ensure that third parties are informed and can oppose them if they consider they have a better right.

Fee simple properties or titled properties are the most comprehensive form of property ownership in Costa Rica. The concept of fee simple in Costa Rica is the same as in Common law: a form of freehold ownership that gives the owner the absolute right to materially own the property, use it, transfer it, lease it, and modify it, among other uses, subject only to conditions outlined by Costa Rican regulations, or restrictions directly created in the property title by previous owners or applicable regulations.

Foreigners do not require any special conditions or authorizations to purchase titled property in Costa Rica. Furthermore, foreigners can also freely purchase interest in companies and corporations that already own properties.

The National Registry related to real estate properties is comprised of two areas:

• Real Estate Department
  All titled properties in Costa Rica are recorded in the Real Estate Section of the National Registry. Titled properties have an identification number referred to as “folio real”. The recorded property title contains detailed information concerning the property, including the name and identification number of the owner; the exact location of the property by province, country and district, survey map, area, liens and encumbrances, among others.
• Cadastral Department
  In addition to the Real Estate Department, the National Registry has a Cadastral Office that records all surveys. To acquire or transfer property, the cadastral plot must be duly registered at the Cadastral Office and assigned to the property.

To purchase titled property in Costa Rica, the following steps should be followed (among others, depending on the specific transaction):

• Due Diligence on the Property
  Prior to purchasing the property, it is highly recommended to perform title research in order to acquire all information regarding the current legal status of the property.
• Incorporation of a New Company
  A common practice in Costa Rica is to acquire properties through a new company. This vehicle is especially practical if the buyer wishes to sell the property in the future, register the company as a tax person, and other considerations. This is also highly recommended for asset protection and liability purposes.
• Transfer Deed
  Once the buyer has a clear view and understanding of the property status, the parties must execute a property transfer deed. The transfer deed must be executed before a Costa Rica notary public (which, by law, must be an attorney as well) and recorded before the Real Estate Department of the Property Registry.
• Recording Process
  Once counsel executes and prepares the public deed, it must be filed immediately before the National Registry. Property transfer registration takes from five to ten business days.

Intellectual Property is currently governed by the Law of Trademarks and Other Distinctive Signs No. 7978, Law No. 7979 for the Amendment of the Law for Patents, Industrial Models, Drawings and Utility Models No. 6867, the Amendment of the Copyright Law and Related Rights No. 6683, the Law of Undisclosed Information No. 7975, the Law for the Protection of Microchips Traceability Systems No. 7961), and the Law for the Compliance of the Procedures of Intellectual Property Rights No. 8039. It is important to point out that most of these laws were amended when the CAFTA-DR was approved by the Costa Rican Congress.

Costa Rica is a party to the Berne Convention (Paris text), the Convention Establishing the World Intellectual Property Organization, the Geneva Convention, the Inter-American Copyright Convention, the Inter-American Patent Convention, the Paris Convention for the Protection of Industrial Property, the Rome Convention, the Universal Copyright Convention Paris Text, and the Patent Cooperation Treaty.

Trademarks and Patents
To register a trademark, the applicant must submit a power of attorney. If no objections are filed, the registration process takes approximately six months. Service marks, collective marks, and commercial marks are subject to registration in Costa Rica. The same applies to slogans and trade names. Unregistered trademarks are also protected if they qualify as famous, well-known, or notorious trademarks. Use is not a prerequisite to registration; however, the current Trademark Law establishes that if a registered trademark is not used within a five-year period from the registration date, it will be subject to cancellation at the request of a third party. The initial trademark registration is granted for ten years from the date of issuance. A trademark may be renewed for additional ten-year periods, indefinitely.

In order to seek a patent in Costa Rica an applicant must apply for registration with the Industrial Property Registry Office. The Registry Office then conducts a professional technical study of the patent, notices are published to allow third-party oppositions and should no oppositions be filed, the patent is approved and issued. The process usually takes five to six years.

Patents in Costa Rica are granted for a 20-year term from the filing date, or the term remaining according to the registration date of the invention in the country of origin, provided such term does not exceed 20 years. The same applies for patent rights to medicines, goods and substances of therapeutic application, beverages, food products, fertilizers, general agrochemicals, and substances or products for the control, treatment, or prevention of weeds or animal or vegetable pests. Patents may not be renewed. There is a use requirement in the sense that the issuance of a patent requires its exploitation (i.e., commercial use.)

Trade Secrets
Trade and industrial secrets are protected by the Undisclosed Information Law. This law protects the information that: (a) is secret, meaning that it is not generally known or easily accessible for persons in groups where said information is normally used; (b) is legally under the control of a person who has adopted reasonable and proportional measures to keep it secret; and (c) has certain commercial value due to its secret condition.

Copyrights
Copyright registration is not mandatory in Costa Rica. Its registration only serves the purpose of third-party publication and in infringement proceedings. Copyright protection lasts for the author’s lifetime and extends for seventy years after death, for the benefit of the author and his/her heirs. All literary and artistic works, as well as other works including computer software, are eligible for copyright protection in Costa Rica.

Enforcement of IP Rights
Costa Rica has a robust legal framework for the protection and enforcement of intellectual property ("IP") rights. The country is a member of several international treaties and agreements, including the World Intellectual Property Organization ("WIPO") and the Agreement on Trade-Related Aspects of Intellectual Property Rights ("TRIPS").

The enforcement of IP rights in Costa Rica is primarily governed by the Intellectual Property Law, which covers patents, trademarks, copyrights, and industrial designs. The National Registry, under the Ministry of Justice and Peace, is responsible for the registration and administration of IP rights.

The Competition Promotion and Consumer Protection Law and its Regulations were enacted to protect the legitimate rights and interests of the consumer and are also aimed at promoting free competition.

In 2019, the Competition Promotion and Consumer Protection Law came into force. This law prohibits public or private monopolies and monopolistic practices that prevent or restrain competition, access of competitors to the market or that tend to exclude competitors from the market.

Overall, Costa Rica's compliance regulations are designed to promote ethical business practices and reflect the country's commitment to maintaining a transparent and sustainable business environment.

Specifically, regarding anti-corruption, the country has robust laws in place to prevent and combat corruption in both the public and private sectors. Companies are encouraged to implement anti-corruption programs and policies, conduct regular audits, and ensure compliance with international anti-corruption standards. Specifically in public procurement, the country has established criteria for public procurement processes to enhance transparency, competitiveness and sustainability criteria. Companies participating in public tenders must meet specific compliance requirements, including anti-corruption criteria and adherence to fair bidding practices.

Costa Rica has established a comprehensive legal framework for the protection of personal data. The primary legislation governing data protection is Law No. 8968, known as the Protection of Persons Regarding the Processing of their Personal Data. This law was enacted to regulate the activities of companies that administer databases containing personal information.

Law No. 8968 applies to personal data held in both automated and manual databases of public or private organizations. It also covers any form of subsequent use of such data within the territory of Costa Rica or where Costa Rican legislation applies by virtue of the conclusion of a contract or international law. The law defines personal data as any information that relates to an identified or identifiable living individual, and sensitive data as information concerning sensitive aspects of a person, such as racial or ethnic origin, political opinions, religious beliefs, and health.

The law outlines several key principles and requirements for data controllers and processors, including:

• Consent
  Data controllers must obtain explicit consent from individuals before processing their personal data.
• Data Minimization
  Only the data necessary for the specific purpose should be collected and processed.
• Transparency
  Individuals must be informed about the purposes for which their data is being processed.
• Security
  Appropriate technical and organizational measures must be implemented to protect personal data from unauthorized access, loss, or destruction.

The enforcement of data protection regulations is overseen by the Costa Rican Data Protection Agency ("PRODHAB"). This agency is responsible for ensuring compliance with the law and handling complaints related to data protection violations.

The Commission for Promotion of Competition (“COPROCOM”) is in charge of reviewing and approving mergers and similar transactions. The General Superintendency of Telecommunications (“SUTEL”) is the regulatory and competition authority for the telecommunications markets.

Regarding concentrations that involve one or more entities supervised by the financial system superintendencies, the National Council for Supervision of the Financial System ("CONASSIF") will have powers, in exceptional cases where the rights of financial consumers may be violated, to resolve the authorization request.

Costa Rica enjoys a highly developed infrastructure. Located in the Central American Isthmus, between Nicaragua and Panama, Costa Rica can be accessed from anywhere in the world through both the Atlantic and the Pacific Oceans. Driving time between the Caribbean and the Pacific ports is approximately 4.5 hours and between the Nicaraguan to the Panamanian border it is approximately 13 hours.

The growing demands for foreign trade have made it necessary to build the necessary infrastructure that allows the transportation of these goods. The seaports of Limon and Moin, located on the Caribbean coast are within a few kilometers of each other. They are connected to the Pacific by internal highways as well as by sea, through the Panama Canal. Both port facilities are primarily dedicated to container shipments offering roll-on/roll-off services.

On the Pacific coast, the main port is Caldera, located a few kilometers South of the city of Puntarenas, which is a major tourism center. Caldera is very well accessed by the Southern coastal highway and Route 27, with the Central Valley. Also, secondary ports on the Pacific may be found in Puntarenas and Golfito. In addition, various marinas are located throughout the coastline, particularly in Flamingo, Papagayo, Puntarenas, Herradura and Golfito.

Air Transportation
The Juan Santamaría International Airport is located a few kilometers West of the capital city of San Jose and is served by the main international airlines visiting the country. There are direct flights from Europe, the USA, Mexico, Central and South America. The Liberia International Airport in the Northern touristic Province of Guanacaste also has daily direct flights from the USA and Canada, including chartered flights during the peak of the touristic season. Other international airports are under evaluation, being the ones that will service the Southern part of the country are the most advanced in planning. Additionally, local airports for smaller planes can be found all around the country.

Public Transportation
With respect to public transportation, it is easy and quite inexpensive to get around in Costa Rica. The main public transportation is the bus, followed by taxis, also known as the “red force” due to their characteristic red color. Most recently the train has been re-launched and it now serves as an alternative way of public transportation within the great metropolitan area.

All main rental car agencies operate in the country since one of the most important economic activities in Costa Rica is tourism. It is easy to rent a car, and the prices are relatively similar to those of other neighboring countries.

Water and Sanitation
Water is mainly distributed by the state waterworks agency “Acueductos y Alcantarillados” (“AyA”), with coverage of water access in the territory of approximately 97%. Tap water is 99% potable and safe for human consumption in the Central Valley and all major towns in the country. In rural areas, potable water is often higher than 86%. In some areas, local communal organizations known as ASADAS manage the local water sources and are under the supervision of AyA. Normally water is an inexpensive service, but the rates will vary from region to region. The consumption rate is set by the regulatory agency known as “ARESEP”.

Electricity
Electricity is mainly distributed by two public companies, Instituto Costarricense de Electricidad ("ICE") and Compañía Nacional de Fuerza y Luz ("CNFL"). Other state-owned, private and several mixed-ownership entities (granted with public concessions) provide electricity in the provinces of Cartago, Heredia and Alajuela. Electricity coverage in the country is approximately 97%. The cost of the service will vary depending on its use. Typically, the cost for industry use is less expensive than that for commercial and residential use, but other cost factors include area and development level. Just like in the case of water, the consumption rate is set by ARESEP. ICE also controls several hydroelectric power plants and other power generators that produce sufficient energy to fulfill the country’s needs. Carbon and oil fields, and any other hydrocarbon substances, as well as existing radioactive mineral deposits in the national territory and gas deposits, are exclusively controlled by the State, which may grant public concessions for their exploitation. In some cases, concessions may only be granted by the Legislative Assembly (Congress).

A business may be terminated at any time by the parties involved with minimum interference from the local authorities, provided liabilities are first settled with existing creditors. In this regard, any company, joint venture, trust or business association may be dissolved and wound up if the parties choose to do so. Generally speaking, liabilities must be established and paid as part of the process, and any remaining assets may be thereafter distributed among its partners, shareholders, investors, etc. according to their respective percentages of ownership or in a manner agreed upon between them.

Under local civil, commercial and administrative rules, corporations and limited liability companies (the two most widely used business vehicles in Costa Rica) are separate legal entities from their owners. As previously explained, the corporate veil is enforced and the liabilities of an entity, even in the case of insolvency, do not affect its owners, whether individuals, a parent company or any other related entity.

An exception to the above is related to criminal offenses, mainly fraud, whereby a criminal court may disregard the entity in order to establish legal relationships for purposes of prosecution (including criminal and civil liabilities). Recent case law has also opened avenues for piercing the corporate veil in situations of so-called abuse of legal personhood but they remain rather exceptional.

For the most part, under Costa Rican laws a company's liability for insolvency or breach of contract will not reach its shareholders or parent company in the absence of (i) a formal guarantee, or (ii) a criminal offense.

Even though bankruptcy is always a legal possibility Costa Rican law also offers the alternative of financial restructuring, by means of (i) a creditors’ agreement; and (ii) the management of the business through judicial intervention (similar to a Chapter 11 intervention).

A court may vary the procedure from insolvency or bankruptcy to reorganization if the company presents a plan to its creditors for these purposes and this plan is accepted.

When a bankruptcy procedure is initiated, the court ex-officio submits a notice to the Criminal Court to investigate the possibility of fraud behind the bankruptcy. Further procedures will depend on the findings of the Criminal Court about any eventual criminal behavior involved.