COSTA RICA Law and Practice Contributed by: Douglas Soto, Miguel Elizondo-Soto and Osvaldo Madrigal Méndez, Zurcher, Odio & Raven
local and international research into their per - sonal and financial backgrounds; • an affidavit about the source of the funds; and • a detailed business plan. The banking licence application must be filed at SUGEF for its review. If completed to its satisfac - tion, SUGEF will transfer the application together with an opinion to CONASSIF for its approval or disapproval. If approved, CONASSIF issues a conditional licence to start the constitution of the entity/branch and other remaining opera - tional requirements; once completed, SUGEF will release the final licence for the start of busi - ness operations in the Costa Rican market. As part of the process, to start the operation, the applicant must deposit approximately USD31.91 million in advance into the BCCR. This deposit can be partially drawn by the applicant to fund the lending operations, investments, installation and operational costs. The licensing process may take around 12 months.
and if the thresholds established by the law are triggered, the parties are obliged to notify before closing. The definition of economic concentration con - tained in the Competition Act is broad and covers a whole series of transactions, such as mergers, the transfer of shares, the purchase of assets, and the purchase and sale of a business establishment, among others, if the following elements are met: • it is carried out between two or more inde - pendent economic agents, whether or not they are competitors; • at least two of the participating economic agents have operations with an impact in Costa Rica; • it involves a transfer of control of one or more of them, either through the acquisition of control over one another, or in the formation of a new economic agent, wherein “control” is defined as the de facto or legal possibil - ity of executing a decisive influence over an economic agent or its assets, or the power to adopt or block decisions that determine its strategic commercial decisions; • it is carried out permanently or with the inten - tion of permanence; and • the following thresholds are met: (a) joint threshold: the combined assets of the parties in Costa Rica, or the combined revenue generated during the last fiscal period, has to be more than 30,000 base salaries (approximately USD25.856 mil - lion); and (b) individual threshold: the individual sales or assets in Costa Rica of each party have to be more than 1,500 base salaries (approximately USD1.29 million).
3. Changes in Control 3.1 Requirements for Acquiring or Increasing Control Over a Bank The Competition Act
The Promotion of Competition and Consumer Protection Act (the “Competition Act”) promotes and seeks to maintain market competition by regulating anti-competitive conduct by com - panies, including concentrations where two or more companies combine by means of a merger or acquisition. It means that a merger or acquisi - tion must be notified in advance to the Compe - tition Commission so that it can be examined before the closing of a binding agreement. If the transaction can be classified as a concen - tration under the definition provided by the law,
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