Business | Prism Law

CORPORATE

Purchasing a business

In addition, in a commercial transaction, several contracts are necessary to define the rights and obligations of the seller and buyer of the said transaction. For example, the following contracts can be concluded when buying a company:

Purchase Agreement: Under this Agreement, the price, evaluation period, payment method and any other specific purchase terms are agreed between the seller and the buyer.
Business Purchase Agreement: This is a contract used to transfer ownership of a business from the seller to the buyer.
Power of attorney: This contract is usually signed by the buyer, who is sometimes not present to sign the purchase and sale contract, and thus authorizes a third party (usually his agent) to sign the contract on his behalf.
Escrow agreement: An agreement also entered into by the buyer and seller to designate an escrow agent withholding payment or part of the payment from the sales contract until all conditions of sale are met, then the escrow agent transfers the payment to the seller.
The financial aspect of the due diligence performed on this type of purchase is critical in determining the profitability of a company.

We will draft, review and advise on all contracts necessary to complete the required transaction with minimal risk, as well as to assist you in starting your business.

Trademarks and copyrights
Advocating for your idea is an important part of your success. You have spent countless hours and energy creating your business concept and product. Don't let anyone take that from you. Registering your trademarks and copyrights will help protect the future of your business.

Small Business Registration & Benefits
If you have a small business, you will qualify for a tax deduction. But you need to register your business with the Small Business Administration. Additionally, if you need to grow your current business, there are financing options available to help you keep going.

Licenses & Permits

Depending on the business owned a number of permits must be obtained to be compliant under the local regulations.

Some usually required permits are the following:

Patente de Municipal: which is a business license from your local municipality.
Permiso de Salud: which is a license from the department of health. You will be required to obtain additional licenses from the DoH depending on your business.
SETENA permits: In some instances, it will be required to obtain a permit from the Environmental Agency. It will depend on the type of activity. It is generally applicable for manufacturing, production, farming, and hotel industries, among others.
ICT permits. This will be applicable to some tourist services.
Registration with the Revenue Service. Although it is not a license, your business is required to be registered with the Revenue Service. Of course, you will need to pay taxes.

We will advise on the permit or permits your business needs to function without any problems, and we will help you obtain the required permits as efficiently and fast as possible.

Establish and build companies in Costa Rica

When first establishing a business, it is important to define the limits of your company's liability and separate your personal assets from your company's assets. Furthermore, a business structure allows to bring in partners and to set the share of each partner participation in the business. Last but not least, various business structures allows for more beneficial tax treatments. Current regulations provide various business structures depending on your needs. Some of them are:

Corporations (Sociedad Anónima or SA)
Limited Liability Company (Sociedad de Responsabilidad Limitada or SRL)
Limited Liability Partnership (Sociedad de Servicios Profesionales or SSP)
Individual Liability Company (Empresa Individual de Responsabilidad Limitada or EIRL)
Coops (Cooperativas)

Small Business Registration & Benefits
If you have a small business, you will qualify for a tax credit. But it is required for you to register your business with the Small Business Administration. Furthermore, if you need to expand your existing business, there are financing options available to help you move forward.

Labor Law, Employer Obligations & Compliance

According to Costa Rican regulations, you as an employer must uphold certain obligations with your employees to remain fully compliant and to avoid any possible suits or claims.

For instance, you as an employer may be obligated to the following:

To sign with your employees an agreement which will fully establish the obligations and rights for both of you, according to the local regulations.
To obtain workers compensation insurance in case a member of your team has an accident.
To pay into the Social Security System (CCSS) and to deduct from your employee’s salary their contributions to the system.
To pay your employees according to the minimum salary established by law for their specific work activity.
To deduct their taxes and pay it to Hacienda.
To ensure that your employees are able to legally work in the country.

There are certainly a number of obligations as an employer. You cannot run the risk of not being compliant and expose your business to fines and closure.

CORPORATE

Purchasing a business

In addition, in a commercial transaction, several contracts are necessary to define the rights and obligations of the seller and buyer of the said transaction. For example, the following contracts can be concluded when buying a company:

Purchase Agreement: Under this Agreement, the price, evaluation period, payment method and any other specific purchase terms are agreed between the seller and the buyer.

Business Purchase Agreement: This is a contract used to transfer ownership of a business from the seller to the buyer.

Power of attorney: This contract is usually signed by the buyer, who is sometimes not present to sign the purchase and sale contract, and thus authorizes a third party (usually his agent) to sign the contract on his behalf.

Escrow agreement: An agreement also entered into by the buyer and seller to designate an escrow agent withholding payment or part of the payment from the sales contract until all conditions of sale are met, then the escrow agent transfers the payment to the seller.

The financial aspect of the due diligence performed on this type of purchase is critical in determining the profitability of a company.

We will draft, review and advise on all contracts necessary to complete the required transaction with minimal risk, as well as to assist you in starting your business.

Licenses & Permits

Depending on the business owned a number of permits must be obtained to be compliant under the local regulations.

​

Some usually required permits are the following:

Patente de Municipal: which is a business license from your local municipality.

Permiso de Salud: which is a license from the department of health. You will be required to obtain additional licenses from the DoH depending on your business.

SETENA permits: In some instances, it will be required to obtain a permit from the Environmental Agency. It will depend on the type of activity. It is generally applicable for manufacturing, production, farming, and hotel industries, among others.

ICT permits. This will be applicable to some tourist services.

Registration with the Revenue Service. Although it is not a license, your business is required to be registered with the Revenue Service. Of course, you will need to pay taxes.

We will advise on the permit or permits your business needs to function without any problems, and we will help you obtain the required permits as efficiently and fast as possible.

Establish and build companies in Costa Rica

Corporations (Sociedad Anónima or SA)

Limited Liability Company (Sociedad de Responsabilidad Limitada or SRL)

Limited Liability Partnership (Sociedad de Servicios Profesionales or SSP)

Individual Liability Company (Empresa Individual de Responsabilidad Limitada or EIRL)

Coops (Cooperativas)

Labor Law, Employer Obligations & Compliance

According to Costa Rican regulations, you as an employer must uphold certain obligations with your employees to remain fully compliant and to avoid any possible suits or claims.

For instance, you as an employer may be obligated to the following:

To sign with your employees an agreement which will fully establish the obligations and rights for both of you, according to the local regulations.

To obtain workers compensation insurance in case a member of your team has an accident.

To pay into the Social Security System (CCSS) and to deduct from your employee’s salary their contributions to the system.

To pay your employees according to the minimum salary established by law for their specific work activity.

To deduct their taxes and pay it to Hacienda.

To ensure that your employees are able to legally work in the country.

There are certainly a number of obligations as an employer. You cannot run the risk of not being compliant and expose your business to fines and closure.