COSTA RICA Law and Practice Contributed by: Claudio Donato and Carolina Retana Herrera, Zurcher, Odio & Raven
pany with the acquiror. In such circumstances, dissenting shareholders shall have the right to withdraw and demand compensation. In addition, shareholder agreements including drag-along clauses may be implemented. While not regulated by the law, they can still be con - tractually agreed and enforced between share - holders. If properly structured, these agreements can force minority shareholders to sell their shares once the majority approves a transaction. 6.11 Irrevocable Commitments It is possible to negotiate such types of commit - ment in Costa Rica, but they are not common. These commitments are typically negotiated at an early stage in the process, and the nature of these undertakings can vary. In some cases, they are strictly binding and irrevocable, regardless of the emergence of a competing offer. However, these commitments may be drafted so that they allow the principal shareholder to withdraw their commitment if a superior offer is received. In private company acquisitions, while irrevo - cable undertakings may also be sought, they tend to be more straightforward and less likely to include fiduciary outs.
circulation after SUGEVAL has received and processed the application of the bid. 7.2 Type of Disclosure Required In the context of business combinations such as mergers, Costa Rican law requires cer - tain disclosures prior to the registration of the merger with the National Registry. Specifically, the notary public who formalises the sharehold - ers’ meeting resolutions approving the merger must publish an edict in the official newspaper, La Gaceta . This publication must allow inter - ested third parties to raise objections and must include, at a minimum, the names and corpo - rate identification numbers of the merging Costa Rican companies, along with a summary of the merger agreements. In addition, if the transaction is subject to merg - er control, COPROCOM is required to publish a notice in a public medium of its choosing. This notice must identify the parties involved, describe the nature of the transaction, and indi - cate the relevant markets in which the parties operate. 7.3 Producing Financial Statements Bidders involved in a Public Purchase Offering of Securities in Costa Rica are required to sub - mit audited financial statements. These must cover both the bidder (ie, the direct offeror) and its broader economic interest group, and must include, at a minimum, the financial information for the most recent fiscal year. While the specific regulations governing this process do not mandate a particular account - ing standard, in practice financial statements are generally prepared in accordance with Inter - national Financial Reporting Standards (IFRS), which are widely accepted in Costa Rica.
7. Disclosure 7.1 Making a Bid Public
The purchase and sale of shares of private com - panies does not require publication. In some asset purchase agreements, a publication in the official newspaper must be made so that third parties can make a well-founded objection. In acquisitions of public companies, the offer must be published in newspapers of national
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