Business Legal Enviroment
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Financial Center
Foreign Retiree
Tax Benefits
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Doing Business
Business Legal Enviroment
Panama offers many opportunities for business entrepreneurs. International companies and organization to start new business or expand commercial activities can greatly benefit from Panama’s economy. According to a report published by the General Comptroller of the Republic, Foreign Direct Investment (FDI) entering Panama in 2011 reached $2,789.8 million dollars, which represented an increase of 18.7% when compared to $2,350.1 million dollars in the same period of 2010. In fact, hundreds of foreigners and international organizations actually have established all kinds of activities according to legal authorizations and inscriptions. Panama possess an strategic geographical position for successfully business operations, because the country offers major quality investments in communication, airport and port facilities, free tax trade zone, and dollarized banking system. There are no money transfer restrictions, among others living, legal and business competitive advantages for foreign investors and families.

Panama offers the opportunity to do local and/or foreign business while living in the country. One of the most attractive business incentives is that from an office in Panama you can make operations that take its effect outside the Panamanian territory and those incomes are tax exempted.  Also, you can operate from a tax free trade zone regime.

There are some legal structures to organize a business:

  • Sole proprietor:   Usually, for an individual who exercise directly and generally in his name business activities with a license granted by the commerce authorities.
  • Corporations:   It is a separated legal entity which is constituted by stock capital. Share can be issued to a nominal owner or to a bearer owner. Legal responsibility is limited to the entity and not transferred to the shareholder. A minimum capital of $10,000 is required for inscription in the public register.
  • Foreign Corporations   A foreign corporation can incept the home office constitution act in the Panamanian public register and obtain the business operation permits. A minimum capital of $10,000 is required for inscription in the public register. Some regulated business requires other documentations and capital to approve the start-up.
  • General or Civil Partnership:   All partners are liable for the partnership’s legal responsibility.
  • Limited Partnership:   There is no restriction about nationalities. There may be from 2 to 20 partners and the capital may vary from $2,000 to $500,000. The legal responsibility of each partner is limited up to his paid or unpaid share subscription.
  • Commentate Company:   At least one partner must have the legal responsibility and is limited to the amount of the capital subscribed.
  • Private Foundation:   A legal entity, subject to rights and obligations, in which a person named “The Founder” transfers or assigns their property to a foundation so that this will protect and manage on behalf of a beneficiary, which may be the founder himself or a third person.

There are other business activities which have particular legal regulations, such as: Banking and Finance activities, Insurance, Trust Funds, leasing, and ship registration. All corporations or civil organization are recorded in the tax authority registry. 

Once the corporations or the partnerships are organized they can process their permit and the operations license, hire personnel, rent or purchase   premises, open bank accounts and start operations.

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