We use cookies for statistical purposes.

Our Articles

Set Up a Subsidiary in Costa Rica

Set Up a Subsidiary in Costa Rica

Foreign companies setting up operations in Costa Rica can choose between the branch office and the subsidiary. While the first type comes with various restrictions, it is not the case for subsidiary entities that can complete their activities just like a domestic business.

Below, you can find explained the main steps for setting up a subsidiary in Costa Rica. You can rely on our Costa Rican company formation agents for support in registering it.

Steps to open a Costa Rican subsidiary

The procedure to register a subsidiary company is the same as for all other domestic businesses that operate in Costa Rica, namely:

  1. establishing a company name, securing a legal address, and drafting the incorporation papers;
  2. opening a bank account;
  3. filing the documents with the Companies House;
  4. obtaining tax identification and VAT numbers;
  5. registering for social security purposes as an employer;
  6. securing any business licenses (if necessary).

If you need assistance in creating a subsidiary in Costa Rica, you can rely on our agents. We can also help immigrate to Costa Rica should you want to run your business onsite.

Documents for setting up a subsidiary in Costa Rica

In terms of paperwork related to opening a subsidiary company apart from the Articles of Association and information about the parent company, the following should also be considered:

  • an application through which the parent company requests a corporate number;
  • submitting proof of payment of all company registration fees;
  • an impact study, if the capital of the company consists in real estate assets.

Also, the subsidiary must draft an announcement about the launch of the company that will be published in the National Gazette.

All the documents can be drafted and filed by our lawyers in Costa Rica through a power of attorney. They can also assist if you want to move and apply for residency in Costa Rica as a shareholder of the foreign entity setting up the subsidiary.

Why incorporate a Costa Rican subsidiary?

The subsidiary can be registered as a private limited liability company or as a stock corporation in Costa Rica. This means that it must abide by the laws of this country from an operational point of view while reporting to the foreign company.

Depending on the type of entity chosen, Costa Rica’s subsidiary laws may apply. A minimum of 2 shareholders and one director are required for the formation of a private limited liability company, which is also the fastest to register. Also,  a minimum of 1 USD share capital is also required to complete the incorporation process.

One of the main advantages of choosing to create a subsidiary is having the opportunity to take up employment in Costa Rica, a procedure that is quite difficult through other channels. Moreover, both the subsidiary and the parent firm will be safeguarded in terms of liability to third parties. This means that the parent company’s liability for the subsidiary‘s activities is limited, while the subsidiary is free to operate in Costa Rica.

If you need assistance with the company formation process in Costa Rica, you can rely on our specialists.

Doing business in Costa Rica

Over time, there were many studies that attested to Costa Rica’s good reputation as a business destination. One of the most recent was completed by the World Bank in its last Doing Business Report for 2020. In it, the bank provides for the following:

  • the country scored 79.9 points on the starting a business evaluation, out of the total 100;
  • it also scored 77.6 points from a trading across-the-border point of view;
  • Costa Rica was the 4th best-scoring country among the South American states.

If you need advice or assistance in setting up a subsidiary in Costa Rica, please contact us.