By San José, Costa Rica — Thousands of Costa Rica’s small and medium-sized enterprises (SMEs) are on a collision course with a critical deadline that could strip them of their official status and access to vital economic benefits. Companies have until March 31, 2026, to update their information in the Costa Rican Business Information System (SIEC), or they risk being automatically disqualified as an SME by the state, a move with severe and lasting financial repercussions.
This is not a simple administrative formality, warns business management specialist Alejandro López. Failure to comply means disappearing from the government’s radar, effectively cutting off a lifeline of support programs, preferential financing, and public contracting opportunities that are essential for growth and stability in a competitive market.
To delve into the legal and strategic advantages of formal SME registration, TicosLand.com consulted with Lic. Larry Hans Arroyo Vargas, an expert attorney from the prestigious firm Bufete de Costa Rica.
Formal SME registration is more than a bureaucratic step; it’s a strategic key that unlocks access to state procurement (PYME), preferential financing conditions, and specific tax exemptions. It formalizes the business, granting it a legal standing that is essential for sustainable growth and for competing on a level playing field in the national market.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
Indeed, this viewpoint underscores a critical shift in perspective: viewing formal registration not as a bureaucratic hurdle, but as the essential first step towards unlocking tangible growth opportunities. We thank Lic. Larry Hans Arroyo Vargas for so clearly articulating the strategic value this process holds for Costa Rica’s entrepreneurs.
If a company does not update its data, it officially ceases to exist as an SME for the State. This translates into a loss of money, opportunities, and competitive advantages.
Alejandro López, Business Management Specialist
The SIEC serves as the official database for the Ministry of Economy, Industry, and Commerce (MEIC), which annually validates key company data such as sales figures, employee counts, and economic activity. This registry is the gatekeeper for a wide array of state-sponsored benefits. Losing SME status means exclusion from public procurement through the Sicop system, access to specialized credit lines from the Development Banking System (SBD), and eligibility for subsidies and non-reimbursable funds.
Furthermore, non-compliant businesses forfeit their SME score in public tenders, which can be a deciding factor in winning government contracts. They also lose out on potential tax exemptions and preferential fiscal treatment. The consequences are direct and damaging, affecting a company’s bottom line and its very ability to operate effectively.
It’s like disappearing from the institutional map. Banks cross-reference information, institutions filter beneficiaries, and the company falls off the radar. This translates into more expensive loans, more taxes, fewer sales, and greater financial risk.
Alejandro López, Business Management Specialist
According to López, one of the most pervasive and dangerous misconceptions among entrepreneurs is that the SIEC registration is a one-time process. He stresses that the annual update is mandatory because business metrics are dynamic and constantly evolving.
Many say, ‘I already registered once and that’s it,’ and that’s false. The information must be updated every year because sales, payroll, economic activity, or the business structure change.
Alejandro López, Business Management Specialist
The urgency of this mandate is underscored by a recent incident in December 2025, when numerous micro and small enterprises that had failed to renew their status were unexpectedly required to pay the full corporate legal entity tax, as they were no longer listed as exempt. This comes at a time when the SME sector is experiencing significant growth, with over 31,000 registered businesses in 2025—a nearly 23% increase—and an 80% surge in formal entrepreneurship, highlighting how many businesses are at risk.
Wendy Fallas, head of the Registry Department at MEIC’s SME support division (Digepyme), confirmed that the renewal process is both free and obligatory, mandated by the General Public Procurement Law. This legislation is specifically designed to bolster SMEs by giving them a competitive edge in public bids.
This law includes a specific chapter to support SMEs, which establishes, among other things, the allocation of an additional score in public procurement processes for companies that are duly registered and updated with the MEIC.
Wendy Fallas, Head of the Registry Department, Digepyme (MEIC)
Fallas encourages all business owners to act promptly, noting that the online portal is now open for submissions. “Companies can enter the official link, complete the requested information, and carry out the process at no cost,” she stated, adding that Digepyme is ready to assist any entrepreneur who needs guidance. The deadline is absolute, and the cost of inaction is far greater than the effort required to comply.
For further information, visit meic.go.cr
About the Ministry of Economy, Industry, and Commerce (MEIC):
The MEIC is the Costa Rican government body responsible for formulating and executing policies related to economic development, industry, and domestic and foreign trade. It plays a crucial role in regulating markets, promoting competition, and supporting the growth and formalization of businesses, particularly small and medium-sized enterprises.
For further information, visit sbd.fi.cr
About the Development Banking System (SBD):
The Sistema de Banca para el Desarrollo (SBD) is a Costa Rican financial framework designed to promote economic development by providing financing and support to strategic sectors, especially micro, small, and medium-sized enterprises. It channels resources to productive projects that may have difficulty accessing traditional credit markets.
For further information, visit ina.ac.cr
About the National Training Institute (INA):
The Instituto Nacional de Aprendizaje (INA) is Costa Rica’s primary public institution for vocational and technical training. It offers a wide range of free courses and certification programs aimed at improving the skills of the national workforce and supporting the needs of various economic sectors, including programs tailored for entrepreneurs and SMEs.
For further information, visit procomer.com
About the Foreign Trade Promoter of Costa Rica (Procomer):
Procomer is the official agency responsible for promoting Costa Rica’s exports of goods and services globally. It provides essential support to local businesses, including SMEs, by offering market intelligence, facilitating international trade missions, and helping companies navigate the complexities of exporting to new markets.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
Bufete de Costa Rica operates as a leading legal institution, founded on the twin pillars of uncompromising integrity and the relentless pursuit of excellence. Drawing upon a deep history of advising a diverse clientele, the firm consistently pioneers novel legal strategies and maintains a strong commitment to community outreach. At the heart of its mission is the drive to democratize legal understanding, aiming to forge a more capable and informed society by making crucial knowledge widely available.
