LEGAL FOREIGN OWNERSHIP

Costa Rica’s laws and constitution provides for secure property rights and private ownership of land equally to foreigners as well as residents. Land ownership requires no presence, citizenship or residency and with the exception of beach front property, there are almost no restrictions on land ownership in Costa Rica.

Costa Rica's laws reflect this country's efforts to welcome and be receptive to foreign investors. Extending equal status to foreigner's in the realm of property ownership is rare and creates unrivaled opportunities for investment, retirement and vacation home ownership. As in North American and Eurpope, property may be acquired differently but in Costa Rica there are two major forms of ownership. Fee Simple and Concession or Beach front property ownership.

Fee Simple ownership mirrors that which we find in the United States and Canada and is the ownership format which will apply to all Vista de Sirena projects. A fee simple owner has the absolute right to materially own the property, use it, enjoy it, sell it, lease it, improve it, among other, subject only to conditions which apply to everyone, national or foreign under Costa Rican Law.

Concessions in the Shoreline Zone. Beachfront property is more commonly know as “concession property.” In Costa Rica, 95% of beachfront property is concession property and is governed by the Shoreline Zone Law (Law No. 6043) and other specific regulations including but not limited to special dispositions ensuing from local governments (i.e. municipalities) and Costa Rican Board of Tourism (ICT). A concession is defined as the right to use and enjoy a specific portion of land located on the shoreline zone for a pre-determined period of time and based on a predetermined use of soil (zoning or master plan, known as “Plan Regulador”). This is very similar to federal leases granted to ranchers in the US who pay annual fees for grazing or watering rights. No long term ownership is ever acquired and the leases or "concession" may not be renewed (at the election of any one of the government agencies indicated above) at the expiration of the concession term.

By definition, the Concession property or shoreline zone commences 200 meters from the mean hightide mark heading inland. This 200 meter zone is government property and cannot be owned by any individuals or private business entities. From there, the shoreline zone is divided further into two segments. The first 50 meters is a “public zone” open to everyone and no private ownership and development of any kind is permitted. Further, no private person can restrict access to anyone else (by fence or other means) for any reason. The second segment of 150 meters can be leased by private persons or business entities through either a concession with a municipality or a management Plan with the Ministry of Environment and Energy (MINAE). Though Concession property is available for lease, Vista de Sirena suggests that all attempts to lease or obtain possession of Concession Property be done with the assistance of a local Costa Rican Real Estate Attorney.

Lease or concession agreements and management plans range in term from 5 - 20 years and extend at the Government’s discretion. Renewals can be negotiated between the government and private parties and typically depend on the success of the prior lessee in meeting the contractual, construction, development and other obligations of the first concession term. With Concession property, the ownership rights of foreigners and citizens diverge. Foreigners may not be majority owners of concession land but can be minority partners with a Costa Rican citizen who will act as the majority owner. Once a foreigner has lived in Costa Rica for at least five years, this distinction disappears and majority or exclusive ownership is now possible.

In the context of condominiums, the “Condominium Property Law” defines a structure for the development of various property types including condominium projects of several kinds, single family residence developments, PUD's and others. More importantly, this law allows Vista de Sirena and other developers to restrict certain uses or aspects of development projects to protect their value, integrity and continuity. Vista de Sirena does impose architectural guidelines, land use restrictions, and other limitations that are defined in our CC&R's, By-Laws or Home Owner Association Rules as may be applicable to each project. Beyond these government and private restrictions which typically mirror those in North American and Europe, ownership of condominiums is in fee simple form.