Panama

General Information

Area – 78,200 sq. km

Population – 3,864 million people

Capital – Panama

Official language – Spanish

Official currency – US dollar (USD), Balboa (PAB)

Key Aspects

No treaties for the avoidance of double taxation were signed. A special licence is required to provide banking and insurance services.

Company Type

The most popular company type in Panama is an International Business Company (IBC)

Corporate Legislation

Corporation Act 1927 with amendments made in 1997.

Main Requirements for Company Directors and Shareholders

There should be at least three directors.

Nominee directors are allowed to be used.

Directors may be residents of any country.

Directors may be both natural persons and legal entities.

There should be at least one shareholder.

Nominee shareholders are allowed to be used.

Shareholders may be residents of any country.

Shareholders may be both natural persons and legal entities

Authorised Capital

The authorised capital of a company is specified according to a resolution. There is no minimum or maximum authorised capital stipulation. The standard joint-stock capital is USD 10,000 divided into 100 shares with par value of USD 100 each.

Taxation and Reporting

Offshore companies are exempted from paying taxes and pay only the yearly duty.

Companies are freed from the preparation and filing of any financial accounts and conducting audits.

A company is exempted from the payment of all taxes if a company carries out its economic activity outside Panama. There is no need for maintaining accounting records if a company carries out its economic activity outside Panama. There is no need for the preparation and filing of annual accounts if a company carries out its economic activity outside Panama.

Questions that need to be answered to prepare incorporation documents

• Passport details of the beneficiary (passport scan; in case a national passport is scanned – its translation into English).
• Utility Bill (confirmation of the registration address translated into English).
• Passport and Utility Bill in the agent’s name if it is not the beneficiary.