Gaming License in Costa Rica

Costa Rica is a unique country for online gambling operators: the country does not officially grant a gaming license. Despite the fact that Costa Rica is one of the five most popular jurisdictions for gaming, however, it still does not have legislation that regulates the conduct of an online gambling business on the Internet. In other words, any Costa Rican company can carry out such activities without obtaining any additional permits (exception – citizens of Costa Rica and other countries where online casinos are prohibited or require a local license cannot participate in such gambling projects ).

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Advantages of the Costa Rica Gaming License

Costa Rica gaming license offers a number of advantages over other online gaming jurisdictions:

No clear legal regulation: you only need to set up a local legal entity and apply for a data processing license. There are also no legal requirements regarding fair play, player protection, etc.;
Tax incentives: Costa Rica’s tax system offers a favorable tax environment that helps reduce tax liabilities. Thus, income received from sources outside Costa Rica is exempt from taxation;
Relatively low license fees compared to other jurisdictions, both for company registration and for paying company renewal;
No mandatory presence in Costa Rica – there are no requirements for hosting game servers in Costa Rica;
Privacy: Costa Rica offers a higher level of privacy for operators as the country does not require disclosure of ownership structures or business details;
Flexibility for international markets: Costa Rica authorities do not impose restrictions on operators serving customers from other countries.

Thus, a Costa Rican gaming license is ideal for companies that want to minimize the costs of its incorporation and operation, and despite the lack of clear legal regulation, retain the ability to operate in the global gambling market.

Cost Efficiency and Tax Advantages

Costa Rica gaming license offers significant cost efficiencies and tax advantages for online gaming operators.

The economic advantages include the following:

Low initial licensing costs compared to other jurisdictions: the Costa Rica gaming commission for issuing a license is not as high as, for example, in Malta or the UK. There are also no rather expensive fees for license renewal.
Minimal costs for documentation during the preparatory process for obtaining a license;
No requirement for reserve capital;
No substance in Costa Rica: there is no requirement to host game servers in the country and hire local staff, which significantly saves the company money at the initial stage of starting a business.

The tax advantages include:

No direct taxes on gambling (through unregulated Costa Rica online gaming) operators do not pay specific taxes on gambling in Costa Rica. This results in significant savings for operators when setting up a business;
No VAT on international transactions: companies using a Costa Rican online gaming license typically serve the international market, while offshore transactions are not subject to value added tax (VAT).
No taxes on player income withholding: there are no taxes on player payouts, which makes the online gambling platform attractive to players from different countries;
Availability of corporate tax incentives: corporate tax rates are taxed only on income earned in Costa Rica. For companies serving primarily international markets, this means that most of their income is not subject to local tax.

Thus, despite the lack of strict legal regulation of gambling in Costa Rica, this license includes a number of “bonuses” that are so attractive to business owners who are interested in gambling.

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Costa Rica Gaming License Requirements

Costa Rica does not offer any special gambling licenses. Companies that want to operate in Costa Rica in the gambling industry must obtain a data processing license. To obtain such a license in Costa Rica, the following basic requirements must be met:

Register a company in Costa Rica and obtain a tax identification number (cédula jurídica);
Establish substance in Costa Rica in the form of a physical office where official documents can be sent;
Comply with tax regulations: regularly file corporate tax returns;
Adhere to restrictions for Costa Rican residents: gaming platforms operating under a data processing license cannot accept bets from individuals residing in Costa Rica.

Step-by-Step Licensing Process

To obtain a gaming costa rica license (data processing license) in Costa Rica, it is necessary to comply with certain requirements step by step, namely:

Step 1: Register a company in Costa Rica with at least two shareholders, having previously checked the availability of the chosen company name in the National Registry. Upon completion of the registration process, the company will be assigned a corporate identification number (cédula jurídica);
Step 2: Open a corporate bank account;
Step 3: Submit an application for a data processing license to the municipality in which the legal entity was incorporated;
Step 4: Create a substance in the form of a physical office in Costa Rica to which official company documents can be delivered;
Step 5: Register the company with the Ministry of Finance for the purpose of tax compliance – filing corporate tax returns;
Step 6: Develop rules in the company to comply with international anti-money laundering (AML) and (KYC) rules to prevent illegal activities;
Step 7: Create systems for customer identification and payment processing solutions;
Step 8: Develop data processing software.

In general, the requirements for obtaining a gambling license in Costa Rica are similar to the requirements for such licenses in other jurisdictions. It is important to observe both legal and legal bases for doing business.

Initial Consultation and Eligibility Check

Any process related to document flow requires prior consultation and verification of compliance with the requirements that must be met. The data processing license (equivalent to a gambling license in Costa Rica) is no exception.

Among the mandatory elements in the analysis of documents and verification of compliance with the requirements, the following can be distinguished:

Element 1: consultation with an experienced lawyer: the lawyers of FINTECH HARBOR CONSULTING, who have many years of experience in obtaining a gambling license in Costa Rica, will be such a reliable legal advisor. During the consultation, legal experts will evaluate your business model and future prospects. Make sure your plans meet local requirements and the legal framework of Costa Rica.
Element 2: assessment of existing documents for company registration. Verification of the compliance of shareholders and board members with the requirements of Costa Rican law.
Element 3: verification of the requirement regarding the substance of the company: the possibility of maintaining a presence both in the office in Costa Rica, and the modality of organizing the office itself as an official premises for a company with a gambling license.
Element 4: Data Processing License Compliance Assessment: Due to the fact that Costa Rica does not issue a gambling license, the company must operate as a data processing company under Costa Rican laws. That is, the main business activity of the legal entity must be data processing, software development or a similar technological operation.
Element 5: International Gambling Compliance Check: It is worth checking that the future jurisdictions you choose to operate a gambling license company with a jurisdiction will not conflict with Costa Rican laws.
Element 6: Assessing banking and payment options, including considering the possibility of using payment solutions from international banks or EMI.
Element 7: Analyzing the possibility of complying with tax legislation in terms of the company’s compliance with corporate tax laws, filing annual reports, etc.
Element 8: Studying the main risks during the initial consultation with a specialist who will help to obtain a gaming license in Costa Rica should include a detailed risk analysis of all the elements presented earlier (elements 1-7).
Element 9: Assessing the time frame and costs associated with the process of setting up a company and obtaining a gambling license: Having analyzed the documents, as well as the information received from the client, an experienced legal specialist will help to roughly calculate the costs and time associated with obtaining a gambling license in Costa Rica.

The initial consultation and compliance check gives an understanding of how the future business is prepared for the licensing process in Costa Rica, what weaknesses and strengths have already been taken into account, and what should be paid attention to.

Document Preparation and Submission

Obtaining a license for data processing in Costa Rica involves the preparation of a certain set of documents and taking certain actions that will result in obtaining a gaming license:

Preparation of registration documents for the creation of a company:
the draft charter – the founding document of the company, which defines the company’s purpose, structure and management. This document must state that the main activity of the company is data processing, software development or related (tangential) technical services to the above services.
Registration of the company in the State Register after preparation of the charter: submission of the charter to the national registry of Costa Rica followed by obtaining the company’s corporate identification number (cédula jurídica).
Obtaining a zoning permit (Uso de Suelo) in order to confirm that the company’s office will be located in a zone that allows commercial activities that include data processing or software development.
Directly submitting the application for obtaining a license for data processing. For submission, it is necessary to prepare certain documents, namely:
- a company registration certificate with a copy of the company’s registration data obtained from the National Register.
- tax identification number, which will confirm the company’s registration with the Ministry of Finance for tax purposes.

Confirmation of the substance
- the real office of the company. The company’s use of the office can be confirmed by:
- a lease agreement, or documents certifying ownership of office premises in Costa Rica.

Obtaining a tax identification and setting the company on the tax register for the purpose of submitting an annual corporate tax return.

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Follow-Up and License Approval

To make sure that the application for a data processing license (used by online gambling operators) in Costa Rica has been launched, it is necessary to:

Get a receipt or confirmation from the local municipality when submitting an application. If the application was submitted in electronic form, it is important to receive electronic confirmation that the application has been submitted and is being processed;
Periodically monitor the progress of the application – check the status of the submitted document;
Provide additional information/documentation in case of questions and clarified by the municipality;
After the process of checking submitted documents for obtaining a gaming license in Costa Rica, provided that all requirements are met, obtain a data processing license from the municipality (official letter of approval or license certificate);
After obtaining a license for data processing, in order to comply with the legislation of Costa Rica, it is necessary to register with the tax authority in order to pay local municipal taxes and submit a declaration;
Open a corporate bank account and comply with the requirements that must be followed by the owner of the gambling license.

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Fintech Harbor Consulting | Gaming License in Costa Rica