Five things you should know before incorporating a company
- Types of companies
- Administration and representation
- Responsibility
- Powers
- Legal books
Types of companies
The main two types of companies commonly used in Costa Rica are the limited liability company (sociedad de responsabilidad limitada) and the corporation (sociedad anónima. The limited liability company adjusts to simple management needs while the corporation is the figure that responds to a more robust corporate structure.
In both types of society there must be at least two partners at the time of incorporation.
Administration and representation
The limited liability company will be managed by one or more managers.
The corporation will be managed by a board of directors, which must be formed, at least, by president, secretary and treasurer, who may or may not be partners. The judicial and extrajudicial representation of the company will always correspond to the President of the board of directors. A comptroller should be appointed and will not be part of the board.
In both type of companies, the shareholders must meet compulsorily at least once a year to resolve on the issues that the company will address in the future or to review past actions and decisions.
Responsibility
The partners of both types of companies will respond to third parties, solely, with the capital they invested in the company.
Power of attorney
The company can designate proxies according to their needs. The Commercial Code establishes three types of powers:
- General Power of Attorney, empowers to sell, mortgage and otherwise dispose of or encumber all kinds of property, entering into all types of contracts and executing all other legal acts.
- General power, basic faculties for the normal management of a business.
Special power, s - ecific powers for a given act.
Legal books
The limited liability company must have two legal books: Shareholders meetings and Registry of Shareholders.
The corporation must have three legal books: Shareholders meetings, Registry of Shareholders and Board of Directors minutes.