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Everything is in place the previous owner got tired and now it is for sale for a reasonable price with everything included like licensing, bank accounts, vendor agreements and the price includes the real estate. I would think with the new road from San Jose to Jaco now might be a good time to give it a try. What are your thoughts?
There are numerous legal hurdles to jump. If you have not consulted a knowledgeable Costa Rican attorney about the labor laws, that should be a first step. Failure to do so could put you in jeopardy of a huge legal and bureaucratic nightmare. You’ll also have to deal with tax matters, maybe the matter of your alcoholic beverage license, etc.
What’s more, if you’re not aware, until you become a permanent resident (which will take five years or maybe longer), you cannot legally perform ANY work in your business. You must first apply for, wait for, and be granted the temporary residency for which you qualify (pensionado or rentista, most commonly). That can take a year or longer to be approved. Then you must actually be in that status for three years before applying for permanent residency. That can take yet another year — or longer. Only when your permanent residency has been granted can you perform work in your restaurant.
You can direct the work of others, but you cannot open, close, bus tables, cook, mix drinks, do the books, or perform any of the tasks that will be required.
Non-residents can own businesses in Costa Rica, but absent legal residency you will only add to your headaches which will be aplenty.
Restaurant owners frequently get “tired.” It’s an exhausting business and my first question would be, have you managed a successful restaurant before mpgycht?
DavidCMurray offers up great advice as usual and if that restaurant is not up to date with the CAJA payments for example, you could inherit a nightmare …
Buying an existing corporation can save you a fortune when it’s a simple company that only owns a home for example but, buying an existing corporation which has bank accounts, contracts and is operating business with employees etc., means you are buying into the entire history of that company and all the potential problems that it may have had in the past and any problems that may come up in the future…
Please seek the help of a good attorney to do comprehensive due diligence on the existing company which owns the business as a well as the person/owner before you even think about making an offer…
Good luck to you!
Scott
I will say that in our experience, the profit was simply not worth the headache. In addition to asking if you have ever managed a restaurant, I would also ask if you speak great Spanish & have the patience to deal with bureaucratic nightmares. We spent more time trying to resolve issues with the CAJA, the Ministerio de Salud, the Hacienda, the Muni, etc. than just trying to focus on the customer in the restaurant. Buying an established business does not mean you are buying into anything easy. You don’t have the benefit of having set up licenses or permits, nor have you filed paperwork on your own, so you’re literally flying by the seat of your pants. An existing corporation doesn’t equal a clean corporation & even having an accountant & a lawyer review it doesn’t mean something cannot pop up later. Paperwork doesn’t always catch up to the corporation in a timely manner in CR. Anyways, good luck with whatever you decide. We sold our restaurant & I will never own another in CR. Period!
Jessica
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