Costa Rica remains one of the safest and most attractive countries for foreign investment in Latin America. The Costa Rican government and commercial sector maintain a decidedly pro-U.S. and continental stance in regard to financial security and tax laws. The economy is being transformed from its long-time dependence on coffee, bananas and cattle-raising to one centered on industries such as tourism, microprocessor production, and high-tech telecommunications services.
Costa Rica is one of the most vocal supporters of continental free trade and already has its own agreement with Mexico and other regional countries. Costa Rica's numerous free trade zones and tax holiday opportunities are designed to encourage direct foreign investment.
Costa Rican Government
Costa Rica enjoys one of the oldest and most stable democracies in Latin America. The Costa Rican political system is representative, consisting of three branches. The president is elected by popular vote every four years by universal adult suffrage (voting is obligatory). Legislation is the responsibility of the 57-member National Assembly, which is also elected for a 4-year term of office. The current president is Dr. Abel Pacheco (2002-2006).
Because the political environment and legal framework are conducive to foreign investment, Costa Rica is regarded as one of the lowest risk countries in all of Latin America. Costa Rica is a full member of the WTO and the Central American Common Market, has a free trade agreement with Mexico, and is actively involved with the implementation of the Free Trade Area of the Americas.
Ownership of Land in Costa Rica
Costa Rica has the oldest continuous democratic government in Latin America. Its laws and constitution are founded on well-developed traditions of guaranteeing the protection of private land and property ownership, extended by law equally to foreigners and residents alike. Neither citizenship, residency or even a presence in the country are required for land ownership. Accordingly, there are almost no restrictions to the ownership of land in Costa Rica, with the exception of direct beach front property, which is considered a national treasure.
To a prospective off-shore investor, the receptiveness of Costa Rica as a host country is an important consideration. Few countries in the developing world welcome foreigners through such transparent laws providing for and protecting the property rights of foreign investors on a basis equal to those of its citizens. Costa Rica's open door policy to foreign investment, combined with secure property rights, has earned credibility and acclaim by foreigners seeking a presence through real estate and direct foreign investment.
Foreigners are entitled to the same ownership rights as citizens of Costa Rica. Neither citizenship, nor residency, or even a presence in the country is required for land ownership. Generally for individuals there are no capital gains taxes on real estate in Costa Rica.
Ownership of Beach Front Property
Costa Rica maintains strict rules governing the development of ocean front property along its Pacific and Atlantic coastlines.
Beaches are considered to be an inalienable national treasure. Accordingly, the first 50 meters above the mean high-tide line of all beaches are considered public lands which everyone may enjoy. No one may restrict access to or claim a beach as privately owned, with the exceptions of certain landholdings in port areas, old land grants or by some agreements made prior to 1973.
In addition, all beachfront land within the next 150 meters of the mean high-tide line not titled prior to 1973 are subject to governance by individual local municipalities as a Maritime Zone designated to preserve the integrity of the natural coastal habitat. Contractual concessions for the proprietary use and development of Maritime Zone property are granted by the local municipalities as the means to ensure Costa Rica's beaches do not succumb to haphazard and irresponsible development as have many pristive regions throughout the world.
Costa Rica has a secure form of title registration to protect ownership records. In many ways, the Costa Rican system of maintaining property records is simpler and superior to systems in use by more developed countries. All documents are centered in the National Registry, where both titles and surveys are recorded. Records are kept in original form as well as in a central computer system and on microfilm. Duplicates of all records are updated daily, and sent to two fireproof vaults in separate locations from the registry. Any change in the status of a title, or any claim that might affect it, must also be noted on the title registry page, thus making it easy to verify true and correct ownership of land title.