• Costa Rica Real Estate

Government aims to open vehicle inspections market

November 24, 2011

The Public Works and Transport Ministry (MOPT) is trying to dissolve one of the few remaining monopolies in the country, though the slow pace of lawmakers might prevent it from happening anytime soon. 

The future is uncertain for the monopoly held by Riteve, the Spanish-Costa Rican company that has been in charge of mandatory vehicle inspections since 2001. A 10-year contract the company signed with the Costa Rican government expires at the end of the year. In July, MOPT announced it would not renew the contract in hopes of generating competition in the inspections market. According to Transportation Vice Minister Rodrigo Rivera, MOPT has ambitions for “at least two companies” to challenge Riteve’s monopoly. 

Although MOPT’s decision not to renew the contract would appear to end Riteve’s monopoly on inspections, competitors have yet to step forward. If MOPT refuses to re-sign the contract by year’s end, the country would be left without a company in charge of vehicle inspections. Because of the guidelines established in the original contract the company signed in 2001, Riteve’s infrastructure and property could not be acquired by the Costa Rican government until 2021. 

Since 2006, legislators have debated the passing of a transit law that, among several pieces of new legislation, would open Riteve’s monopoly for competition. 

“When you think about things the Legislative Assembly has failed to deliver, the most obvious failure has been the transit law,” said Steffan Gómez, a chief researcher for the State of the Nation report. “It has been argued in the Legislative Assembly for five years. Had it been approved at any point during those five years, there might be a competitor for Riteve.” 

Riteve, which for years has battled over the constitutionality of its monopoly, recently announced plans to increase inspection costs by 19 percent. The current rate of ₡10,000 ($20) would be hiked to ₡11,900 ($24). The company says the adjustment stems from an increase in the operational cost of the services provided. 

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