No menu items!

COSTA RICA'S LEADING ENGLISH LANGUAGE NEWSPAPER

HomeArchiveIndustrial Free Zones Create Framework for Export

Industrial Free Zones Create Framework for Export

Industrial Free Zones for Export are defined as areas of national territory, with no residential population, that are under control of the General Customs Administration and subject to the special control of Customs.

The main objective of these zones is to promote investment and exports through the establishment of companies that are dedicated to those ends.

Industrial free zones can be either publicly or privately held companies. Zones falling under private domain fall under the administration of a company constituted as a mercantile corporation (known as sociedad anónima), with the specific purpose of administering the industrial free zone.

Nicaragua’s laws establish three types of private “Free Zone Companies”: 1) Operating Company of Free Zones. 2) Company User of Free Zone. 3) Administered Free Zone Company.

The corporations that administer these privately owned zones are known as the “Operating Company of the Free Zone,” which must be qualified and approved by the National Commission of Free Zones.

The companies known as “Free Zone User Companies” are authorized to operate inside an industrial free-zone park by the National Commission of Free Zones. There are two different types of free-zone user companies: 1) Producers of goods. 2) Service Provider.

Another type of free-zone company is the “Administered Free Zone Company” which is basically a free-zone user company, which, by the nature of its production process, the origin of its raw material, or the characteristics of the company itself, is authorized to act outside the industrial free zone park.

Once a company has been authorized by the National Commission of Free Zones to act under the Free Zone Law, it will be eligible for tax benefits such as exemption from income tax, exemption from inscription taxes, and exemption of municipal taxes, among others. The type and number of exemptions will depend on the type of Free Zone Company established.

In addition to the Private Free Zone Companies, there are also “Governmental Zones” that are administrated by the Corporation of Free Zones (CFZ), a body that was created entirely for the administration of such zones.

The CFZ will have its own assets and legal entity. The CFZ will be entitled to the same fiscal benefits as those granted to the “Operating Company of the privately owned Free Zone.”

The Industrial Free Zones for Export are a very important sector of the Nicaraguan economy as they contribute to the country’s total export volume.With a responsible and serious administration of the Free Zones Regime, the benefits will be felt by the population.

Fernando Sánchez is a junior attorney with the law firm García & Bodán in Managua.

 

Trending Now

Climate Change in Costa Rica Devastates Coffee Farms in Los Santos

In Costa Rica’s Los Santos region, famous for producing nearly half the country’s coffee, farmers are reeling from heavy losses driven by wild weather....

An Expat’s Take: 5 Burning Questions About Life in Costa Rica Right Now

Have you been keeping up with the various events taking place in Costa Rica? There is always something interesting going down, and here are...

Costa Rica’s Pride March 2025 Defies Restrictions and Celebrates Diversity

A large crowd gathered in Paseo Colón, San José, to participate in the LGBTIQ+ Pride March 2025. It began at noon, as people marched...

Celso Gamboa Allegedly Ran Drug Ring with Costa Rican Government Ties

Celso Gamboa, once Costa Rica’s Security Minister and a Supreme Court judge, now faces extradition to the U.S. for leading a major cocaine trafficking...

Costa Rica’s Eyelash Viper Snake Is One of the Most Beautiful

There are at least 141 different species of snakes in Costa Rica. With that large number of species packed into such a tiny nation,...

Costa Rica Joins U.S. Global Entry, Easing Travel for Tourists

Costa Rica took a big step forward, by officially joining the U.S. Global Entry program, a move set to make travel smoother for Costa...
Avatar
spot_img
Costa Rica Tours
Costa Rica Coffee Maker Chorreador
Costa Rica Coffee Maker Chorreador
Costa Rica Travel Insurance
Costa Rica Rocking Chait
Costa Rica Travel

Latest News from Costa Rica