Family Businesses in Costa Rica
How to Legally Structure a Family Business
90% of businesses are family-owned.
They represent 65% of national production.
Despite this, only 15% transition successfully to the second generation.
And of that 15%, only 4.5% survive into the third generation.
BG&A conducts a legal analysis of your family business structure and recommends the implementation of administrative, organizational, and control adjustments that ensure business continuity.
We assist in the creation of short- and long-term protocols that allow for:
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The incorporation of new members (family or non-family)
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Preparation for generational transition
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Professional development of future heirs
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Resolution of family conflicts that may affect ownership and business management (marital property regime)
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Retirement or death of founding members and owners
Likewise, it is of great importance to:
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Recognize that the personal trust-based interaction typical of family businesses requires strong tax and financial protocols that, in addition to protecting financial performance indicators, help prevent tax violations.
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Establish a structured family compensation system.
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Avoid paying higher board compensation to family members than to non-family members.
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Prevent the company from being used as a personal “petty cash” source.
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Avoid using company funds to cover non-deductible or non-business-related family expenses (children’s education, medical expenses, leisure travel, etc.).
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Regulate personal investments unrelated to the core business (purchase of goods and services, etc.).