5. Protection of Property Rights

Property rights and enforcement are notoriously unreliable in Nicaragua. The government regularly fails to enforce court decisions on the seizure, restitution, or compensation of private property. Legal claims are subject to non-judicial considerations, and members of the judiciary, including those at senior levels, are widely believed to be corrupt or subject to political pressure. During ongoing crisis, Ortega-Murillo regime loyalists illegally took over privately owned lands, with implicit and explicit support from municipal and national government officials. Some land seizures were politically targeted and directed against the political opposition. Under the first Ortega-led government in the 1980s, the expropriation of 28,000 foreign-owned and Nicaraguan-owned properties created a significant number of real estate claims and counterclaims. Property registries suffer from years of poor recordkeeping, making it difficult to establish a title history. In 2019, the Supreme Court modified property registry rules to prohibit most access to these records. Mortgages and liens exist, but the recording system is not reliable.

Investors should conduct extensive due diligence and use extreme caution before investing in real property. Unscrupulous individuals have engaged in protracted confrontations with U.S. investors to wrest control of prime properties, particularly in tourist areas. Judges and municipal authorities are known to collude with such individuals, and a cottage industry supplies false titles and other documents. In the Autonomous Caribbean Regions, communal land cannot be legally purchased; however, a known scheme involves individuals selling communal land with apparently legal documentation before communal authorities strip buyers of their property.

Those interested in purchasing property in Nicaragua should seek experienced legal counsel early in the process. The Capital Markets Law (2006/587) provides a legal framework for securitization of movable and real property. There are no specific restrictions regarding foreign or non-resident investors aside from certain border and other properties considered important to national security.

Given the state of the public records registry, it is not possible to determine what percentage of land does not have clear title. There is no defined government effort to resolve this. Squatters can obtain ownership of unoccupied property, particularly if they have government backing.

Nicaragua established standards for the protection and enforcement of intellectual property rights (IPR) through CAFTA-DR implementing legislation, which is consistent with U.S. and international IPR standards. Enforcement of IPR law is limited. Infringement on rights and theft – particularly media piracy and trademark violations – are common. The United States has expressed concerns about the implementation of Nicaragua’s patent obligations under CAFTA-DR, including: the mechanism through which patent owners receive notice of submissions from third parties; how the public can access lists of protected patents; and the treatment of undisclosed test data.

Nicaragua does not publicly report on seizures of counterfeit goods. Nicaragua is not listed in the U.S. Trade Representative’s Special 301 Report or its Review of Notorious Markets for Piracy and Counterfeiting.

For additional information about national laws and points of contact at local IP offices, please see the World Intellectual Property Organization’s country profile for Nicaragua .

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The Lessons of 1989: Freedom and Our Future