Costa Rica - Using an Agent to Sell U.S. Products and ServicesCosta Rica - Using an Agent
Costa Rican law provides two main forms of representation: a representative or a distributor. The representative can also be considered an agent. It is possible for one person to be both a representative and agent or a distributor at the same time.
Representative or Distributor
A representative or agent and a distributor is any individual or company who "in continuous and autonomous form, with and without legal representation, acts by directly placing purchase of sales orders among the local import or export firms, on a commission or percentage basis; or who prepares, promotes, facilitates and completes the sale of merchandise or services which another foreign merchant or firm renders."
A representative:
The Costa Rican Commercial Code allows a U.S. company to participate in public tenders directly without a local Costa Rican representative. The only requirement is that the official representing the U.S. company must have a Power of Attorney that is certified by a Costa Rican Consulate in the United States. However, the process of bidding on public tenders is usually a tedious process and best accomplished through engaging the services of a qualified Costa Rican representative.
Finding a Partner
The U.S. Commercial Service (USCS), a division of the U.S. Department of Commerce, helps U.S. companies in identifying potential business opportunities in Costa Rica. Information can be provided via the FCS website, and/or counseling sessions over the telephone, via e-mail or videoconference, or by office appointment. For a complete list of USCS services, please see export.gov’s Costa Rica webpage. Please view export.gov’s U.S. offices webpage to find the U.S. Export Assistance Center (USEAC) office nearest to you.
To help U.S. companies identify appropriate local representatives, the Commercial Service offers its Gold Key Service for those who wish to meet prospective local partners in Costa Rica through appointments set up by Commercial Service personnel, or its International Partner Search (IPS) for those companies who cannot immediately visit Costa Rica or prefer to arrange their own appointments from a USCS-generated list of local companies. To request these services, U.S. firms should e-mail csoiocountry-costarica@trade.gov
Whichever method a U.S. company chooses for its partner search, the company should ask for as much information as possible from the potential partner prior to any contractual arrangements. In addition, the company should be prepared to provide complete information about its history, resources, personnel, product line, and previous export experience.
Once a partner has been selected, the U.S. firm should obtain business and/or credit reports on the Costa Rican company, as part of the due diligence process. The Commercial Service offers the International Company Profile -ICP, a credit check/background report that will provide the U.S. company with useful information for evaluating the foreign company as a potential partner. The U.S. company can also contact Dun & Bradstreet for Latin America.
Costa Rican firms wishing to represent U.S. companies may request exclusive representation in the local market. American firms should consider this issue carefully to decide if they want to retain the right to sell to other representatives/importers in the Costa Rican market.
U.S. companies should employ the services of a qualified Costa Rican attorney for various issues, ranging from contract advice to protection of trademarks and other intellectual property. Lists of Costa Rican law firms can be found on, the FCS website, export.gov’s Business Service Providers directory, and the Consular Section of the U.S. Embassy in Costa Rica. (See Web Resources Section at the end of this chapter for this and other links.) Both the Costa Rican Chamber of Commerce (Cámara de Comercio) and the Costa Rican-American Chamber of Commerce (AmCham) have established International Arbitration Centers to provide alternative methods for dispute resolution. Please see Chapter 9 for contact information for these chambers.
Agricultural Sector
The United States is the single most important agricultural partner for Costa Rica due to its geographical proximity, the high quality and wide selection of its competitively priced products. However, competition in the local market is increasing. Costa Rica has free trade agreements in effect with several countries and blocs, some of these include: Mexico (since 1995), Chile (2002), Canada (2002), CARICOM (2005), Panama (2008), the People’s Republic of China (2011), Peru (2013), Singapore (2013), the EU (2013), and Colombia (2014). Costa Rica is a member of the Central American Common Market, which sets low to zero duties for most agricultural products. After a long process that started in October 2007, Costa Rica approved the “Association Agreement” with the European Union in October 2013.
Most grains are imported into Costa Rica in bulk, limiting the import market to a few major players. There are two wheat mills (Molinos de Costa Rica and Fábrica de Harinas de Centroamerica), which account for the purchase of all wheat imports. Two groups of private sector importers buy almost all of the yellow corn and soybean imports. Rice is generally imported by a group of producers and millers grouped under the name CONARROZ (National Rice Corporation). Rice importers outside of this group must pay higher duties, unless they use the tariff rate quotas set up under the CAFTA-DR agreement. For 2018 the CAFTA-DR quotas are 63,000 metric tons for rough rice and 8,250 metric tons for milled rice.
Import permits (other than those for phytosanitary and sanitary requirements) are not required for imports of grains, poultry, meat, dairy products or any other agricultural product, per the terms of Costa Rica’s GATT accession agreement.
Costa Rica established tariff rate quotas (TRQs) for high-tariff products in conformance with its Uruguay Round commitments in July 1997. Outside of the TRQs, tariffs on “sensitive” products range as high as 150 percent for some chicken products, and 65 percent for dairy products. Also, there are TRQs under CAFTA-DR that allow imports of potatoes, onions, dairy products, pork, poultry and rice (both rough and milled) with zero duties.
Under CAFTA, Costa Rica recognized the U.S. meat and poultry inspection service, thus eliminating the previous plant inspection requirement. All federally inspected meat and poultry plants are now eligible to export to Costa Rica. Exporters of animal origin products other than those mentioned in the previous sentence are required to register with the Animal Health Service (SENASA) prior to exporting their products. Exports of U.S. consumer-oriented products such as snacks, meats, processed fruits and vegetables, and dairy products, have grown steadily since the approval of CAFTA-DR in 2009.
A list of the major Costa Rican importers of consumer-oriented foods can be obtained by contacting the Foreign Agricultural Service (FAS) office at the U.S. Embassy, San Jose. For more information, please contact Laura Calzada at Laura.Calzada@fas.usda.gov
Negotiating an Agreement with a Costa Rican Company
Once a U.S. company has selected a potential representative, the next step is to negotiate an agreement. The content of this agreement is extremely important, as it will determine the legal basis for any relationship between the exporter and the representative. Engaging a qualified lawyer is strongly advised.
U.S. companies should pay close attention to the conditions of the contract with representatives and distributors and be prepared to work within the agreed upon guidelines. The approved CAFTA-DR agreement makes provisions for a new damage compensation method in the Law of Representatives of Foreign Firms. When compensation for damages is claimed based on one of the provisions of the law, the financial damages suffered or that could be incurred must be compensated, as a direct and immediate consequence of the infringement of the provision or a violation of the agreement. The regulations from the Costa Rican Civil Code apply to this subject matter.
In the court proceeding to obtain damages under this law, the judge may, upon the request of one of the parties, establish an appearance guarantee, in proportion to the amount being claimed. This request can be made when it has been determined that the party of which an appearance guarantee is requested does not have enough assets in the country to respond to an award. The appearance guarantee shall consist of a deposit in cash or in securities payable to the order of the court.
Therefore, it is very important for U.S. companies to have a written agreement in place and to have that agreement reviewed prior to signing by a competent qualified attorney familiar with Costa Rican law.
Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.
Representative or Distributor
A representative or agent and a distributor is any individual or company who "in continuous and autonomous form, with and without legal representation, acts by directly placing purchase of sales orders among the local import or export firms, on a commission or percentage basis; or who prepares, promotes, facilitates and completes the sale of merchandise or services which another foreign merchant or firm renders."
A representative:
- Can be a Costa Rican or a foreign national, permanently and legally established within the country for at least ten years;
- Must have at least three years’ experience engaged in any form of commerce within Costa Rica;
- Must be sufficiently knowledgeable in commercial matters and recognized as being solvent and of honorable character; and
- Must be duly registered in the Mercantile Registry of Costa Rica.
The Costa Rican Commercial Code allows a U.S. company to participate in public tenders directly without a local Costa Rican representative. The only requirement is that the official representing the U.S. company must have a Power of Attorney that is certified by a Costa Rican Consulate in the United States. However, the process of bidding on public tenders is usually a tedious process and best accomplished through engaging the services of a qualified Costa Rican representative.
Finding a Partner
The U.S. Commercial Service (USCS), a division of the U.S. Department of Commerce, helps U.S. companies in identifying potential business opportunities in Costa Rica. Information can be provided via the FCS website, and/or counseling sessions over the telephone, via e-mail or videoconference, or by office appointment. For a complete list of USCS services, please see export.gov’s Costa Rica webpage. Please view export.gov’s U.S. offices webpage to find the U.S. Export Assistance Center (USEAC) office nearest to you.
To help U.S. companies identify appropriate local representatives, the Commercial Service offers its Gold Key Service for those who wish to meet prospective local partners in Costa Rica through appointments set up by Commercial Service personnel, or its International Partner Search (IPS) for those companies who cannot immediately visit Costa Rica or prefer to arrange their own appointments from a USCS-generated list of local companies. To request these services, U.S. firms should e-mail csoiocountry-costarica@trade.gov
Whichever method a U.S. company chooses for its partner search, the company should ask for as much information as possible from the potential partner prior to any contractual arrangements. In addition, the company should be prepared to provide complete information about its history, resources, personnel, product line, and previous export experience.
Once a partner has been selected, the U.S. firm should obtain business and/or credit reports on the Costa Rican company, as part of the due diligence process. The Commercial Service offers the International Company Profile -ICP, a credit check/background report that will provide the U.S. company with useful information for evaluating the foreign company as a potential partner. The U.S. company can also contact Dun & Bradstreet for Latin America.
Costa Rican firms wishing to represent U.S. companies may request exclusive representation in the local market. American firms should consider this issue carefully to decide if they want to retain the right to sell to other representatives/importers in the Costa Rican market.
U.S. companies should employ the services of a qualified Costa Rican attorney for various issues, ranging from contract advice to protection of trademarks and other intellectual property. Lists of Costa Rican law firms can be found on, the FCS website, export.gov’s Business Service Providers directory, and the Consular Section of the U.S. Embassy in Costa Rica. (See Web Resources Section at the end of this chapter for this and other links.) Both the Costa Rican Chamber of Commerce (Cámara de Comercio) and the Costa Rican-American Chamber of Commerce (AmCham) have established International Arbitration Centers to provide alternative methods for dispute resolution. Please see Chapter 9 for contact information for these chambers.
Agricultural Sector
The United States is the single most important agricultural partner for Costa Rica due to its geographical proximity, the high quality and wide selection of its competitively priced products. However, competition in the local market is increasing. Costa Rica has free trade agreements in effect with several countries and blocs, some of these include: Mexico (since 1995), Chile (2002), Canada (2002), CARICOM (2005), Panama (2008), the People’s Republic of China (2011), Peru (2013), Singapore (2013), the EU (2013), and Colombia (2014). Costa Rica is a member of the Central American Common Market, which sets low to zero duties for most agricultural products. After a long process that started in October 2007, Costa Rica approved the “Association Agreement” with the European Union in October 2013.
Most grains are imported into Costa Rica in bulk, limiting the import market to a few major players. There are two wheat mills (Molinos de Costa Rica and Fábrica de Harinas de Centroamerica), which account for the purchase of all wheat imports. Two groups of private sector importers buy almost all of the yellow corn and soybean imports. Rice is generally imported by a group of producers and millers grouped under the name CONARROZ (National Rice Corporation). Rice importers outside of this group must pay higher duties, unless they use the tariff rate quotas set up under the CAFTA-DR agreement. For 2018 the CAFTA-DR quotas are 63,000 metric tons for rough rice and 8,250 metric tons for milled rice.
Import permits (other than those for phytosanitary and sanitary requirements) are not required for imports of grains, poultry, meat, dairy products or any other agricultural product, per the terms of Costa Rica’s GATT accession agreement.
Costa Rica established tariff rate quotas (TRQs) for high-tariff products in conformance with its Uruguay Round commitments in July 1997. Outside of the TRQs, tariffs on “sensitive” products range as high as 150 percent for some chicken products, and 65 percent for dairy products. Also, there are TRQs under CAFTA-DR that allow imports of potatoes, onions, dairy products, pork, poultry and rice (both rough and milled) with zero duties.
Under CAFTA, Costa Rica recognized the U.S. meat and poultry inspection service, thus eliminating the previous plant inspection requirement. All federally inspected meat and poultry plants are now eligible to export to Costa Rica. Exporters of animal origin products other than those mentioned in the previous sentence are required to register with the Animal Health Service (SENASA) prior to exporting their products. Exports of U.S. consumer-oriented products such as snacks, meats, processed fruits and vegetables, and dairy products, have grown steadily since the approval of CAFTA-DR in 2009.
A list of the major Costa Rican importers of consumer-oriented foods can be obtained by contacting the Foreign Agricultural Service (FAS) office at the U.S. Embassy, San Jose. For more information, please contact Laura Calzada at Laura.Calzada@fas.usda.gov
Negotiating an Agreement with a Costa Rican Company
Once a U.S. company has selected a potential representative, the next step is to negotiate an agreement. The content of this agreement is extremely important, as it will determine the legal basis for any relationship between the exporter and the representative. Engaging a qualified lawyer is strongly advised.
U.S. companies should pay close attention to the conditions of the contract with representatives and distributors and be prepared to work within the agreed upon guidelines. The approved CAFTA-DR agreement makes provisions for a new damage compensation method in the Law of Representatives of Foreign Firms. When compensation for damages is claimed based on one of the provisions of the law, the financial damages suffered or that could be incurred must be compensated, as a direct and immediate consequence of the infringement of the provision or a violation of the agreement. The regulations from the Costa Rican Civil Code apply to this subject matter.
In the court proceeding to obtain damages under this law, the judge may, upon the request of one of the parties, establish an appearance guarantee, in proportion to the amount being claimed. This request can be made when it has been determined that the party of which an appearance guarantee is requested does not have enough assets in the country to respond to an award. The appearance guarantee shall consist of a deposit in cash or in securities payable to the order of the court.
Therefore, it is very important for U.S. companies to have a written agreement in place and to have that agreement reviewed prior to signing by a competent qualified attorney familiar with Costa Rican law.
Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.