COSTA RICA Law and Practice Contributed by: Claudio Donato and Carolina Retana Herrera, Zurcher, Odio & Raven
Acquisitions in the finance sector must be filed before COPROCOM. However, for such types of transactions, the National Council of Super - vision of the Financial System (CONASSIF) may decide from a reasonable point of view whether COPROCOM or CONASSIF makes the final decision. Acquisitions involving publicly traded companies require the involvement of the General Superin - tendency of Securities (SUGEVAL). Depending on the shareholding threshold to be acquired, a public tender offer may need to be launched. Finally, transactions involving entities author - ised to manage pension funds must obtain prior authorisation from the Superintendency of Pen - sions, even if they do not trigger the standard merger control obligation. 2.3 Restrictions on Foreign Investments In Costa Rica there are no special limitations regarding foreign investment. However, com - panies that want to acquire companies in the following sectors must carry out a strategic exer - cise to consolidate their investments and ensure that they comply with the law. • Energy sector – the Costa Rican energy sector is a complex and regulated market in which the State, acting through various public entities, is the sole agent authorised to sell energy to end users. Private companies may sell energy to the State only if they hold a specific concession. In addition, such com - panies must have at least 35% of their capital stock ultimately owned by Costa Rican indi - viduals or entities. • Hospitality – in acquisitions involving entities that have a concession for the use of land located in the maritime-terrestrial zone, the capital stock be at least 50% Costa Rican.
As such, acquisitions in either sector must ensure that, following completion, the compa - ny’s capital structure complies with the applica -
ble local ownership thresholds. 2.4 Antitrust Regulations
Costa Rica has a pre-merger control system in place. The Law for the Strengthening of the Competition Authorities of Costa Rica (Law No 9736) broadly refers to transactions that are sub - ject to merger control as “concentrations” , defin - ing them as any transaction that results in an acquisition of control of one entity over another, or the formation of a new economic agent under joint control. As such, almost all mergers and acquisitions may be caught under the definition of “concentration” . A transaction must meet the following two crite - ria in order to trigger the notification obligation: • at least two of the economic agents involved must have generated revenues in Costa Rica or owned assets in the jurisdiction during the two years prior to the transaction; and • the following thresholds must be met: (a) combined threshold: the sum of the parties’ revenue or productive assets exceeds the sum of 30,000 base salaries during the previous fiscal year (approxi - mately USDD27.45 million); and (b) individual threshold: at least two of the parties involved have productive assets in Costa Rica or have generated revenues in Costa Rica of more than 1,500 base salaries during the previous fiscal year (approximately USD1.37 million). The merger control process is divided into two phases. The first phase involves the initial assessment of the transaction to determine whether or not it poses risks of anti-competitive
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