White collar stealing does not require a gun

By: Garland M. Baker B.

Exclusive to A.M. Costa Rica

Editor's Note: While this article was accurate at the time of publication, some information may now be outdated. We are currently preparing a comprehensive update. Sign up for our Alerts to be notified as soon as the revised content is live!

“Stick 'Em Up”, says the robber to the tourist. “Give me all your cash.”

“José, move the property marker 10 feet. The neighbor will never notice. They're always in the States,” says the new landowner to his surveyor.  

Both are examples of stealing and punishable by imprisonment in Costa Rica.

According to the security ministry, every four days, a property in Costa Rica is invaded by squatters. In the past, the practice was more of a problem in remote parts of the country.  Nowadays, professional squatters make a living encroaching on lands because of their increasing value, especially in Guanacaste.  There have been seven major invasions in this area alone from Jan. 1st to June 12th.

Moving fences and property markers called mojones, in Spanish and boundary stones, markers or monuments in English, happens much more often.  Squatters are generally poor people trying to make quick cash, preying on property owners like locusts.  Moving mojones is a practice of the “well-to-do” motivated by greed.

Both scenarios are examples of trespassing and the illegal seizure of property referred to as usurpación or usurpation, defined as the “wrongful seizure or encroachment of a privilege belonging to another.” 

Purchase of a business has its own challenges

By: Garland M. Baker B.

Exclusive to A.M. Costa Rica

Editor's Note: While this article was accurate at the time of publication, some information may now be outdated. We are currently preparing a comprehensive update. Sign up for our Alerts to be notified as soon as the revised content is live!

Most people believe selling a business in Costa Rica is like selling a piece of real estate.  This is not true.  There are other factors to consider and special rules that apply to the sale of a business.

Two different situations may arise:  The business may or may not be part of a real estate transaction.  However, the business sale part of the deal does not differ much between the two cases.

Normally, a business operates from a company structure like a sociedad anónima (S.A.). It is similar to what is called a corporation in the United States or as a sociedad de responsabilidad limitada (S.R.L.), comparable to a limited liability corporation.

When the business is in one of these company types, transferring the entity is as simple as transferring its stock shares to a purchasing party.  The new owners change the board of directors in the case of an S.A. and the managers in the case of an S.R.L. Then they restructure any clauses of the original constitution to suit their special needs.

This custom of transferring shares to change ownership is very commonplace but dangerous.  It is great for the seller, but not safe for the buyers.  Credit instruments like prendas, referred to in English as chattel mortgages, letras, known as letters of exchanges, and pagarés or promissory notes live on for four years even after a closing.  These documents are usually undeclared or forgotten skeletons for which the purchaser is responsible.

Why so many expats get the short end here

By: Garland M. Baker B.

Exclusive to A.M. Costa Rica

Editor's Note: While this article was accurate at the time of publication, some information may now be outdated. We are currently preparing a comprehensive update. Sign up for our Alerts to be notified as soon as the revised content is live!

Why do so many who come to Costa Rica get hoodwinked, bamboozled, hornswoggled or just downright screwed?

It is because they come to buy a dream and do not think or do the proper homework before jumping into a project or investment.

Yes, there are many good deals in Costa Rica.  There are also many good real estate agents, attorneys, and advisers who can guide a newcomer in the right direction.  However, there are bad ones.  Some people moving to Costa Rica to live do not even have legal residency, hang out a shingle, and start selling property and investment schemes.

There is no required real estate broker’s license necessary to sell property in Costa Rica.  A professional organization does exist and has worked hard trying to legitimatize an association, but to date, it has not been successful in requiring brokers to have some type of license.