by LandCo LawUnderstanding the “Derecho” in Costa Rican Real Estate Law: Your Legal Share in a Property
In the Costa Rican real estate system, foreign investors are frequently introduced to the concept of a “derecho”—a legal term referring to a co-ownership interest or undivided share in real property. Unlike sole ownership, this structure implies shared rights and responsibilities over a single property among multiple titleholders. Understanding this concept is critical to ensuring proper due diligence, securing your rights, and avoiding future legal disputes.
To provide you with a clearer understanding of your ownership structure, this article explains the legal framework governing co-ownership rights, outlines the rights and obligations associated with a “derecho”, and provides practical advice for foreign purchasers acquiring undivided interests.
I. What Is a “Derecho” in Costa Rican Property Law?
The term derecho—literally translated as “right”—in Costa Rican real estate refers to a legally registered ownership interest in a property that is held jointly with other individuals, typically in the form of a pro indiviso share. This share represents a percentage interest in the entire estate, not a physically demarcated portion of the land.
For example, if a property is registered with five co-owners each holding a 20% interest, each of them has a “derecho” equivalent to one-fifth of the entire property.
These undivided shares are recorded in the National Property Registry (Registro Nacional) and are legally enforceable rights, subject to all protections, rights, and obligations established under Costa Rican law.
II. The Legal Framework: Pro Indiviso Ownership
In Costa Rica, the structure governing co-ownership interests is called “copropiedad en pro indiviso” (co-ownership in undivided shares), regulated primarily under the Civil Code of Costa Rica.
Key Features of Pro Indiviso Co-Ownership:
No Physical Division
Each co-owner holds an abstract portion of the entire property, not a specific segment. The land remains undivided unless a judicial or consensual partition takes place.
Transferability of Shares
A co-owner may sell, gift, or bequeath their share without needing the consent of the other co-owners. However, the buyer steps into the same co-ownership structure and does not gain exclusive rights over any portion of the land.
Use and Enjoyment
All co-owners are entitled to use and enjoy the entire property, provided it does not interfere with the rights of the others.
Partition Rights
Any co-owner may request judicial partition if they no longer wish to remain in co-ownership, unless such right has been legally waived or restricted by agreement.
III. Legal Rights of Co-Owners (“Derecho Holders”)
As a holder of a derecho in Costa Rica, your rights mirror those of a sole property owner, although subject to co-ownership limitations.
Primary Rights (Civil Code):
Ius Fruendi – The right to derive income or benefits from the property, such as rental income.
Ius Utendi – The right to use and occupy the property personally.
Ius Abutendi – The right to transfer, sell, or otherwise dispose of your ownership share.
Secondary Rights:
Right of Possession – You may legally possess and enjoy the land as a co-owner.
Right of Defense and Exclusion – You may act to protect the property against third-party encroachments or unlawful use.
Right to Compensation – If the property is damaged or taken, co-owners are entitled to proportionate restitution or indemnification.
IV. Governing Principles of Co-Ownership
Costa Rican law applies several governing doctrines to regulate the interaction between co-owners:
1. Private Autonomy
Co-owners may freely enter into private agreements that regulate use, maintenance, cost-sharing, scheduling, or even limitations on transfers. These agreements are highly recommended and may be enforced among parties.
2. Proportionality
All rights and obligations (including profits, costs, and responsibilities) are distributed in proportion to each owner’s registered percentage.
3. Democratic Decision-Making
Decisions affecting the property—such as repairs, leases, or improvements—require the approval of owners representing the majority of shares, not merely a majority of individuals.
4. Individual Liberty
Co-owners retain the right to transfer or sell their share without requiring prior consent, unless a valid co-ownership agreement limits this right (and it is properly registered).
5. Solidarity and Shared Responsibility
All co-owners are jointly responsible for municipal taxes, maintenance expenses, and legal compliance related to the property.
V. Practical Considerations for Foreign Buyers
Due Diligence is Crucial
When purchasing a “derecho,” especially in properties with multiple owners, it is critical to verify:
The legitimacy and registration of the share.
That the co-owner has not encumbered their share with mortgages or liens.
That there is no ongoing legal conflict or request for judicial partition.
At LandCo, we thoroughly examine each file to ensure your share is uncontested, registered, and transferrable.
Co-Ownership Agreements Add Protection
Although not legally required, it is strongly advised to have a formal agreement among co-owners, particularly when properties are used jointly or rented out. Such agreements may address:
Allocation of usage times;
Shared maintenance costs;
Sale rights and preemptive rights among co-owners;
Dispute resolution mechanisms.
Access and Usage Rights
Unless otherwise agreed, no co-owner has exclusive rights to a specific area of the property. If the use of the land is to be divided (e.g., one party uses the northern lot, the other the southern), this must be by mutual agreement.
Partition Options
If co-owners cannot agree on how to use or manage the property, judicial partition may be requested. This involves either:
Physical division of the land, if possible; or
Judicial sale and distribution of proceeds.
VI. When Does a “Derecho” Make Sense?
This structure is common in:
- Family inheritance scenarios;
- Shared vacation homes among multiple buyers;
- Investment properties purchased by several individuals or corporations;
- Agricultural or large tracts of land intended for future subdivision.
However, if your intent is exclusive use or development, we advise exploring a formal subdivision or condominium regime, which offers exclusive ownership over a defined area.
Understanding Derecho in Costa Rican Law – Conclusion: Know Your Rights and Responsibilities
Holding a “derecho” in Costa Rica is a legally valid and enforceable form of property ownership. However, it comes with shared rights and responsibilities that must be understood and respected.
Whether you’re entering a new co-ownership arrangement or already own an undivided interest, understanding the scope, limitations, and implications of your “derecho” is essential for making informed decisions and protecting your investment.
At LandCo, we specialize in advising foreign investors and buyers throughout the country—particularly in Guanacaste, Puntarenas, and coastal investment zones—on all aspects of property structuring, including co-ownership, condominiums, and subdivisions.
Let our legal team review your ownership structure to ensure clarity, security, and full compliance.