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Sala IV Likely to Ashcan Discriminatory Beach Rule

by Garland M Baker on September 3, 2007

Legal circles are buzzing with the expectation that the Sala IV will soon open up the Zona Maritima Terrestre — the maritime zone — to foreigners. They may soon be able to hold and develop public land next to the beach without making under-the-table deals.

The first 200 meters, 656 feet, of coastal land inland from high tide is Costa Rica’s maritime zone. The first 50 meters of the 200 meters, 164 feet, is un-exploitable beach land. The rest, 150 meters, 492 feet, is public land. This area can be developed by private parties through a concession with the state.

Much of the nation’s tourism infrastructure at the beaches can be found at least partly on concession land.

Now only Costa Ricans or a corporation owned by mostly Costa Ricans can develop a concession in the public area of the maritime zone. Law 6043 Articles 47, 31, and its bylaws Article 25 mandates this fact.

Stefano Santini, a 32-year-old Italian businessman, is the crusader trying to change the law that would allow foreigners to hold concessions and develop them. The constitutional court rejected his initial filing because it was not prepared correctly. He tried again and refiled in 2006, and it was accepted.

He based his arguments on a similar case presented to the Sala IV by Beeper S.A., C.V. in 1998. Beeper S.A. is a pager company which opposed the fact communication companies were restricted to Costa Rican ownership. Beeper, S.A. won. The case took three years to resolve.

Taca filed a similar complaint against the civil aviation laws that also prohibited foreign ownership on March 29. The Sala IV resolved the case in record time. The constitutional court with vote 11156-2007 of Aug. 1 — just last month — found such a restriction unconstitutional.

The legal beagles of Costa Rica believe this reflects a trend for the high court and that Stefano will win his case.

In 2005, a Spanish news service estimated that 81 percent of the concessions in Costa Rica were in the hands of foreigners and only 19 percent in the hands of Costa Ricans. Many of these concessions were granted in direct violation of the law. In others, the foreigners just skirted the rules by putting a puppet Tico as owner on paper to comply with the law.

These facts show that impractical rules make people break the law. When using a puppet to circumvent the rules, the puppet may just come alive and fire the puppeteers. There is a case where this happened and many others that go unreported. Foreigners applied for a concession and gave the majority ownership and power of attorney to a Tico lawyer to comply with the law. The lawyer just took over one day and left the investors hanging with their mouths open. After years in court, the lawyer won. The court stated it does not tolerate or protect abuses of the law.

Many xenophobic legislators are outraged. They know the writing is on the wall. Former legislator Nidia González Morera of the Partido Acción Ciudadana wanted to put through a legislative decree to require the foreigners to have 10 years of permanent residency and personal presence in Costa Rica before they would qualify. Permanent residency is a legal status of residency. Personal presence is time on Costa Rican soil. The Dirección General de Migración y Extranjería manages this information with entrance and exit data.

The attorney general’s office and the environmental ministry have had their disputes over this valuable area of Costa Rica for the last few years. Concessions were at a standstill until just a few months ago.

Santini wants the opportunity to file for a concession as a foreigner so he does not have to break or skirt the law. This makes sense. Even though decisions from the Sala IV do not always make sense, they will probably make changes to the maritime law, which will have a significant impact on the country and its future.

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