The Costa Rican Immigration Law which was passed in March of 2010 created the immigration category of Investor. However the law lacked any guidance or direction regarding the type of investment required to qualify for this residency category.
As such the most asked question we would receive was related to the purchase of real estate in Costa Rica and if that purchase would qualify the Buyer for investor status. Our answer was always “maybe”. The reason for that was that there were no clear guidelines issued by Immigration. This is about to change.
On 28th January 2011 the Department of Immigration published 366 pages of the proposed Regulations to the Immigration Law. Once the Public Comment period is over these regulations should become official and then implemented internally within the Department of Immigration.
These new regulations provide guidelines and requirements that must be met for those purchasing property or investing in Costa Rica that want to apply for investor status. The exact wording of the regulation which is Article 63 states that:
“The applicant for the temporary residency category of investor must present an investment project of at least two hundred thousand dollars [US$200,000]. The investment can be in real estate, stock shares, negotiable instruments, productive projects or projects that are in the national interest. ”
The Regulations specify the documentation that will be required to prove the investment. The applicant must provide a detailed description of the investment that is being made. If the investment is made in real estate then the applicant must present a certificate of title issued by the National Registry of the property that will be the basis for the application.
The regulations also require the applicant, once approved, to register the investment with the Costa Rican Department of Revenue before they will be allowed to renew the status. The residency status must be renewed every two years. However, the law allows an applicant to change status from Temporary to Permanent Residency after three years. As such you should be able to renew once and then before the next renewal apply for a change of status to permanent residency.
Now here is the catch. The property taxes for the home will be based on the registered value of $200,000 or more if the recorded value is higher which may in turn also subject the property to imposition of the Luxury Home Tax which has a threshold of $175,000.
If the application is based upon a project then the applicant must file a feasibility study of the project along with the following documentation:
(1) Certification issued by the Costa Rican Social Security Administration (CCSS) indicating that the applicant or their local company is registered with the Social Security Administration. This has been a common theme since the introduction of the new immigration law in March of 2010.
The government has mandated that all foreigners that have residency in Costa Rica register and contribute to the Social Security system and failure to do so could result in the rejection of the renewal of the immigration status.
(2) For certain types of projects the regulations will require proof that the project has complied with all permits and requirements such as local municipal permits as well as environmental impact statements as may be required by applicable law. Likewise, for certain projects the applicant may have to demonstrate that they have a workers’ compensation policy in place.
(3) If the project is being carried out by a local corporation then the applicant will have to include a certificate of standing and a certified copy of the articles of incorporation.
In addition to documentation supporting or documenting the investment that will be made the applicant will also need to provide the following documents.
a. Application addressed to the Department of Immigration.
b. Birth certificate of the applicant. Certified and authenticated.
c. Police clearance certificate from your country of origin. Certified and authenticated.
d. Copy of your entire passport.
e. Two photographs
f. Fingerprinting in Costa Rica for background check
g. Proof of registration with your local Embassy or Consulate in Costa Rica.
h. Payment of Fees. $50 application fee and $200 change of status fee if you apply in Costa Rica.
It is important to repeat that these regulations are currently under the Public Comment period and once completed should become official. For those that are interested in this option you now have a set of guidelines which you can follow to make the application process clearer to follow.
Keep in mind that this category is a discretionary category which means that the Department of Immigration has discretion whether to approve or reject the application. As such, those interested in this category should ensure that they prepare a well documented application to have the highest probability of approval.
Written and copyright by Attorney at Law – Roger A. Petersen. Roger has been an attorney since 1992 and is a member of both the Costa Rican and Florida Bar. He practices law in San José, Costa Rica and is the author of the best-selling book The Legal Guide To Costa Rica which is available on Amazon.com and Barnes & Noble… Attorney Petersen’s website can be found at Petersen & Philps Law Offices.
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