POLS offers Panama corporation formation services.
Incorporating in Panama offers many benefits. A Panama corporation can be used by individuals who are interested in doing any kind of legal business in Panama. The use of a Panama corporation also provides affordability and convenience for accomplishing your business objectives. Forming a Panama corporation is easy, quick, and cost effective. It generally takes 5 business days to set up a Panama corporation.
IMPORTANT NOTICE TO US PERSONS: U.S. persons (citizens or residents of the United States) are taxed on their world-wide income and are required to report any ownership of or control over foreign corporations, including Panama corporations.
What is a Panama corporation?
A Panama corporation is a juridical entity or juridical person, formed by law, generally by 2 or more people, which has similar rights and obligations as a person would have. A Panama corporation has Articles of Incorporation, which establishes the rules and regulations of who and how the company will operate. A Panama corporation must have 2 individuals called subscribers who appear before the Public Notary in Panama to sign the deed of formation of the Articles of Incorporation, which then gets inscribed in the Public Registry of Panama to form the juridical entity. Panama corporations require 3 individual directors to appear on the corporation, and 3 officers (President, Secretary and Treasurer), which can be 1 person occupying all 3 officer positions. The officers are the legal representatives who are authorized to sign for corporations. The shareholders of the company are appointed after the company is inscribed in the Public Registry.
Panama offers various types of Panama corporations, but the most common type is what is called a “Sociedad Anonima” (Anonymous Society), which is the standard corporation formed in Panama for both local and international business use. Unlike other jurisdictions, Panama does not offer a separate type of corporation specifically for use outside of Panama (offshore). Panama corporations are either for local business use, (in which case a local business operations permit is required), or for international business use, (in which case there is no local Panama business operations permit required), or both. A Panama corporation is also sometimes referred to as an “international business corporation”, or “ibc”, or “offshore ibc”, or “bearer share corporation”.
Why Form a Panama Corporation?
Panama corporations are generally used for local business operations in Panama, or for international trade, to settle trusts or foundations, to establish bank accounts or investment accounts, to hold ownership of real estate (usually in Panama), for holding intellectual property rights, or to hold any other type of assets. In some cases, people establish Panama corporations for very specific business needs. Individuals can also create several Panama corporations working together as a group for holding various assets, which can provide better organization of business or family patrimony, or for asset protection if structured in the correct way.
Panama Corporations for Asset Protection
A Panama corporation provides legal protection of your assets and your identity through the confidentiality of business and banking transactions being conducted through a Panama corporation. Panama is a totally sovereign nation, not governed or controlled by any other country in the world, keeping your business and banking transactions private and confidential. Panama has strict bank secrecy laws, although in recent years, the government of Panama has subscribed to various information exchange agreements, whereby banking information is exchanged with other countries, in some cases automatically, as it is with the United States.
Law 47 & Bearer Shares
Panama is one of the few countries in the world that still offers “bearer shares”, which are share certificates of a corporation that are issued to the name of “The Bearer”, meaning that the owner is the “bearer” or holder of the shares. However, in August, 2013, Law 47 was passed which requires that Panama corporations issuing bearer shares and everyone in possession of those bearer shares must designate an authorized custodian to take possession of the bearer shares. An authorized custodian could be a licensed bank, a Panama attorney (or law firm), Panama fiduciaries, or brokerage houses regulated by the Superintendence of the Panama Securities Market. Additionally, those custodians in possession of bearer shares must submit a sworn declaration providing basic identity information about the true owner and the corporation which issued the shares, as well as its resident agent.
Please note that this law does not obligate Panama corporations to register the names of the shareholders at the Public Registry. Only the corporation’s officers, directors, and registered agent’s names are registered at the Public Registry.
Due to the risk associated with bearer shares, POLS currently does NOT offer formation of Panama Corporations using bearer share certificates, we only offer formation of Panama Corporations with nominative share certificates, meaning that the shares are issued to specific persons’ name(s), or to the name of a corporation, foundation or trust.
If you wish to form a corporation in Panama, please don’t hesitate to contact our law offices for further details.