Trade and business.
Costa Rica has implemented several laws that encourage nationals and
foreigners to invest in all fields available; such as laws that provide
certain taxes and fiscal incentives, depending of the kind of activity
a company is involved in, either in the field of tourist or the export
business.
The Costa Rica-Canada Free Trade Agreement was signed on Monday April
23, 2001 enhancing the commercial opportunities of our business sectors.
Our Embassy's priority is to promote the trade and business relations
between our two countries, not only providing information but facilitating
contacts, organization of missions, advices and more.
To provide a better service, we work closely with the
Costa Rican Foreign Trade Corporation (Procomer), the Costa Rican Foreign
Investment Corporation (CINDE) and The External Promotional Office of
the Costa Rican Ministry of Foreign Affairs.
Doing business in Costa
Rica | Trade Office |
Doing business in Costa Rica.
Important information:
Main Exports. Total goods: $5.5 billion: electronic
components, textiles, bananas, coffee, pineapples, telephone equipment,
medicines, fish and sea food,etc.
Major Revenue generator in 1998: Electric circuits and microstructures,
with US$957.0 millions.
Second Revenue generator: Tourism, with US$829.7 million.
Main Imports. $6.3 Billion: petroleum, machinery,
industrial capital goods, durable consumer goods, chemical, and foodstuffs.
Industries. Electronics, food processing, apparel,
construction materials, plastic products.
Commercial negotiations. Costa Rica has signed
Free Trade Agreements with Mexico, Chile, Dominican Republic, Trinidad
& Tobago and Caribbean States and Canada. Negotiations with the
United States of America recently finished.
Currently, Costa Rica is involved in the implementation
of the Free Trade Area of the Americas.
and is having negotiations with Panama.
- Constitution of your company in Costa Rica:
Three elements are essential for the constitution
of a Company in Costa Rica:
1) A Public Document containing
the constitution of the company before a Notary Public.
2) Publication of that document at the Official
Newspaper "LA GACETA".
3) Registration of that Public Document at the
Register Public, mercantile section.
The Notary Public in Costa Rican Law is invested with
public faith and all civil acts of importance should be executed before
him in order to create a valid public instrument.
Taxation. Income Tax. This tax applies only
to income generated in Costa Rica. It has to be paid by:
1) Persons with profits generating
activities.
2) Legal entities( corporations or "sociedades
anonimas).
3)Persons with profits generating activities. The following rates
are applied to taxable annual profits:
a) Profits up to Can. $3,700 per year are tax-exempt.
b) In excess of $3.700 and up to $6.500: 10%.
c) In excess of $6.500 and up to $10.725: 15%.
d) In excess of $10.725 and up to $22.400: 20%.
e) In excess of $22.400: 25%.
Legal Entities.
The following tax table is applicable:
a- For an annual gross income up to $67.000:
10% on net profits.
b- For an annual gross income up to $135.000:
20% on net profits.
c- Above $135.000: 30% on net profits.
Corporations without any commercial activities during
the fiscal year (October to September) must pay CAN $105 yearly.
Loses during one fiscal year are allowed to be deducted within the next
three fiscal years. In case of agricultural activities, loses can be
deducted during the following 5 years.
Note: you have the right to take your profits
from your company out of the country.
Tax on distributed profits:
a) Whenever the profits are distributed to partners,
15% tax must be paid to the Tax Office.
b) When dividends are distributed by a corporation
whose shares are registered in an officially recognized stock exchange,
a 5% tax must be with held only if the shares were acquired through
a stock exchange.
Salary Tax:
a- For an annual income salary of CAN $1000: TAX EXEMPT.
b- In excess of $1000 and up to $1400: 10%.
c- Above $1400: $15%.
Land or Territorial Tax. Law
No.27 of March 2,1939, as amended, establishes a tax on real estate
called a land or territorial tax ( impuesto territorial). This tax is
levied in favor of the Municipalities and is very reasonable. It taxes
land and all permanent buildings, installations and plantations contained
there in.
Conveyance Tax. Law 6153 of
November,1977 as amended establishes a conveyance tax based on the value
of the property transferred at the following rates. 1.5%, 2.5%, 3.5%,
or 4.5%, according to a char. There are other taxes existing at the
present time. You may ask your lawyer or business advisor in Costa Rica
in case you require more information.
Investments Laws.
Certain activities such as fishing, poultry, forestry, pig breeding
etc. Enjoy special tax benefits. Investments in reforestation are tax
deducible. Tourist Investment ( Hotels, car rentals, etc.) enjoys a
very good exemption of taxes specially for custom procedures taxes and
importation of products or machinery necessary to operate their business.
Specific information on tax and fiscal incentives is available from
The Costa Rican Foreign Trade Corporation ( Procomer). We recommend
its web site: www.procomer.com
or the Costa Rican Investment and Trade Development Board:
www.cinde.or.cr.
Banking system. The National
Banking System in Costa Rica consists of the following entities:
1- Central Bank of Costa Rica. (Federal Reserve bank in some
countries).
2- State owned or Public Banks. ( Banco Nacional,
Banco de Costa Rica are the principals)
3- Commercial Private Banks. There are several
Private Banks in Costa Rica within them, We have the Canadian Bank of
Nova Scotia. A very interested characteristic and certainly a safeguard
for depositors, is that the public banks of Costa Rica cannot become
insolvent. The State guarantees the operations of all public Banks and
thus bankruptcy is ruled out.
Employment requirement.
The article 13 of our Labor Code establishes: All companies in
Costa Rica must have a 90% of Costa Rican employees; only 10% of foreign
employees are allowed. That regulation is not applicable to the President,
Directors, and managers of the company.
Also, to contract a employee: You have to do a private contract of labor,
ask your lawyer about it.
Other related
information:
• To get the Costa Rican
Permanent Residence by becoming a " Foreign Investor". Ask
us for the document: "Investment and Retiring in Costa Rica".
• To see Commercial Opportunities Costa
Rica-Canada: see www.procomer.com.
• Investing Opportunities in CR: www.cinde.or.cr.
• For Custom Procedures, ask us for a list
of Custom Agencies.
• For Real Estate information, please contact:
Costa Rican Real Estate Broker's Association: (011-506) 283-01-91 or
Fax: (011506) 283-03-47.
• For more information regarding the Free
Trade Agreement Canada-Costa Rica, contact us or visit:
www.comex.go.cr
• If you would like more information on investing in Costa Rica,
We invite you to fill out the form below and forward it to us by fax
(613) 562-2582, we will be pleased to assist you.
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Trade office in Canada
Interested in Costa Rican products? Contact the Costa Rican Commercial
Office in Canada.
Costa Rica and Canada have strengthened the commercial ties by signing
a Free Trade Agreement that allows Costa Rican products to enter Canada,
taking advantage of certain benefits under this agreement, and vice-versa.
Our Commercial Office is located in Toronto, supported by the Foreign
Trade Corporation of Costa Rica (PROCOMER) offering a wide range of
services to help exporters strengthen and expand the presence of Costa
Rican products in commercial markets world wide. Our main objective
is the promotion of Costa Rican products in Canada, through commercial
missions, independent business visits, fairs and other events of interest.
With the support of Procomer´s experts and other public and private
organizations, our programs are designed by committees of businesspeople
that represent our various national productive sectors. These work teams
assist our institution in identifying the needs of different sectors
and customizing our services.
Currently, Procomer has established Commercial Offices in Canada, USA
(New York and Los Angeles), Mexico, Puerto Rico, Dominican Republic,
Trinidad & Tobago and Chile.
Please contact our Commercial Office in Toronto, We will be glad to
assist you.
PROCOMER – Canada Office
Director: Itzamn Huelat
Assistant: James DesLauriers
Tel (416) 865-3382
Fax (416) 865-3383
Cell. (416) 721-3382
e-mail: canada@procomer.com
Address: 130 King Street West, Suite 1800. Toronto, ON. M5X 1E3
Other related links:
Canada Costa Rica Chamber of Commerce www.costaricacanada.org
The Canadian Trade Commissioner Service http://www.dfait-maeci.gc.ca/trade/intl_bus_dev-en.asp.
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