The Movable Secured Collateral Law which came into force on May 20, 2015, is designed to promote access to credit for individuals and small and medium businesses that do not own traditional forms of collateral – such as cars, aircrafts, and ships. The Law also creates a new Registration System to register a wider range of assets that can be offered as collateral for potential borrowers. Assets which may now be used to grant collateral include: tangible and intangible assets, invoices, intellectual property rights, receivables, and essentially any object with economic value.
The immediate effect of the Law is that secured interests over some assets currently enrolled under the traditional system of guarantees (including agricultural equipment, civil works, and trailers) must migrate to the new regime. This will ensure that creditors do not lose their existing priority rights on registered guarantees, in the event a debtor breaches their agreement.
A two-month extension was granted, and therefore all assets should now have migrated to the new Registration System prior to October 20, 2015. However, many stakeholders have not been sufficiently warned about some prerequisites to registration, including requesting a Costa Rican corporate identity card number for foreign companies, and registering their legal entities as creditors at the Secured Transactions Office. Consequently, many may have failed to complete the move on time.