Costa Rica: Country and Foreign Investment
Foreign Investment Incentives
The Costa Rican government has introduced a wide variety of incentives to encourage foreign investment. Among the most important are:
- The 'Drawback' law no 5162 of 1972 encouraged the siting in Costa Rica of "screw driver" assembly plants. Enterprises which wish to assemble products in Costa Rica and re-export the finished products to other markets can import all their capital machinery and raw materials including the parts to be re-assembled free of all import duties. The final product which is re-exported is not assessed to any business income tax on profits.
- Free Zones, known as Export Processing Zones - see below.
- (Now withdrawn) Export Contracts, under laws 7092 and 6955, are signed by the Government with individual enterprises, usually for a period of 10 years. See Law of Offshore for further details of the underlying legislation and application procedures. Export Contracts bring together incentives available under various laws, and typically include
- exemption from import duties;
- simplified procedures;
- special port tariffs;
- accelerated depreciation;
- tax credit certificates.
- (Now withdrawn) The Temporary Admission Regime, also under laws 7092 and 6955, allows goods or equipment to be imported for use in or during processing for subsequent export or re-export.
These brief details are given for purposes of general information only; deciding which regime best suits the particular circumstances of an investor is a complex matter requiring professional advice.