Legal Advice for Start ups in Costa Rica

Starting a business in Costa Rica involves several legal aspects that entrepreneurs must consider in order to operate within the legal framework and avoid possible sanctions. Below, we present a guide with the key aspects that you should take into account when establishing your business in the country.

1. Choosing the Legal Structure

One of the first steps when starting a business is to choose the appropriate legal structure. The most common options are:

•  Individual with Profit-making Activity: This is the simplest option for small entrepreneurs who wish to operate as independent workers.

• Sociedad Anónima (S.A.): Requires at least two partners and offers limited liability to shareholders.

The choice of structure will depend on the type of business, level of investment and growth projection.

2. Tax and Social Security Registration

 Every company or self-employed person must register before the Ministry of Treasury in order to comply with its tax obligations. In addition, it is mandatory to register before the Costa Rican Social Security Fund (CCSS) if they hire employees or as self-employed workers.

3. Obtaining Permits and Licenses

Depending on the line of business, additional permits may be required:

• License: Operating permit granted by the corresponding municipality.

• Sanitary Operating Permit: Required for businesses that handle food, chemicals or provide health services.

• Trademark Registration: Although not mandatory, registering the trademark before the National Registry protects the name and logo of the business.

4. Contracts and Legal Protection

It is advisable to have well-structured contracts for employees, suppliers and customers, ensuring clarity in the responsibilities and rights of each party. Some important contracts include:

• Labor contracts: To define workers' rights and obligations.

• Commercial lease contracts: In case of renting premises to operate.

• Terms and conditions: In case of operating an online business or providing digital services.

5. Compliance with Labor Laws

If the business requires hiring employees, it is essential to comply with the labor laws established in the Labor Code, such as:

• Payment of the minimum wage as stipulated by the Ministry of Labor.

• Affiliation to the CCSS and insurance of employees.

• Compliance with rights such as vacations, Christmas bonus, and adequate working hours.

6. Electronic Invoicing and Accounting Obligations

The use of electronic invoicing is mandatory in Costa Rica. You must use a provider authorized by the Ministry of Treasury and issue electronic receipts for all transactions.

Conclusion

Complying with the legal aspects when starting a business in Costa Rica is fundamental to avoid problems and guarantee the sustainable growth of the company. Proper legal advice can make this process easier and safer.

If you need help with the incorporation of your company or legal advice for your business, contact us for professional guidance!