Costa Rica has a government watchdog agency to regulate and supervise the country’s financial system. This agency is called the National Council of Financial System Supervision CONASSIF and its administration works hand in hand with the Superintendent of Financial Institutions SUGEF as well as the Superintendent of Securities, SUGEVAL, the Superintendent of Insurance, SUGESE and the Superintendent of Pension Funds, SUPEN.
Costa Rica’s Chamber of Investment Funds, CAFI made an announcement on July 13, 2016 that SUGEF had initiated new changes to their Regulations of Management Companies and Investment Funds in order to permit new offerings for public and private infrastructure projects. In June, CONASSIF also approved the new regulations, opening the door for the sale of new investment funds for new infrastructure projects in the Costa Rican National Stock Exchange, BNV. The changes will take place as soon as the new regulations have been announced in the official publication of the Costa Rican Government, La Gaceta. Furthermore, according to the new regulations, any new public projects will need the approval of the Comptroller General of the Republic.
The Costa Rican National Stock Exchange is regulated by the General Superintendant of Securities SUGEVAL and the financial products that are offered to the public are only available through authorized Brokerage Companies. All financial offerings in Costa Rica are listed on the National Stock Exchange and the public can get all details of the issuers in the National Registry of Securities and Intermediaries RNVI, which is a public registry managed by SUGEVAL and regulated by SUGEF.
The concept of the new financial regulations seems noble, with the intention to finance the development of private and public infrastructure projects, such as the construction of buildings, hospitals and roads as well as sustainable projects that utilize renewable energy, such as solar systems, treatment plants and forestry projects.
However, anyone who understands the local culture and has been involved with stocks and investment funds that are monitored by a chain of government institutions like those detailed above, knows that the web of scrutiny over stock and investment fund issuers can easily be clouded by the watchdog agencies that are administered by public employees that are low paid bureaucrats accustomed to accepting bribes.
Many seasoned investors understand that the most secure investments in Costa Rica are real estate mortgages with low loan to value ratios as well as the rental of housing and commercial buildings which generate healthy monthly income.
The writer, Tom Rosenberger has lived and worked in Costa Rica since 1993 and from his travels throughout the country inspecting property and construction he has acquired a wealth of knowledge about living and doing business in Costa Rica.
If you have questions and would like to contact Tom click here.