Panamanian Corporations have been one of
Panama’s fundamental offshore services since 1927. Recent amendments to the law allow
for corporate directors, where previously natural persons were required, bringing Panama
into line with practice in other jurisdictions. The incorporation process was simplified
in 1999, and it is anticipated that the modernisation of the Public Registry will result
in a more efficient service to clients, providing for same-day incorporation and speedy
delivery of documents. All the previous benefits of a Panamanian Corporation remain
unchanged, making the entity a useful tool for international trade and business.
An integral part of international and
domestic business, Panamanian Corporations offer the following features and advantages:
Asset
Protection: Panamanian Corporations can hold assets internationally on a
favourable tax basis. They are not required to keep assets or have bank accounts in
Panama.
Bearer
Shares: One of the prime benefits of a Panamanian Corporation is shareholder
anonymity. The law does not state a minimum number of shareholders, although it does
require 2 subscribers to the Articles of Incorporation, which Shirley & Associates can
provide. One person can therefore be the sole owner of all stock, holding this in bearer
form.
Board
and Shareholders’ Meetings: There are no specific provisions as to the
frequency of such meetings, which may be held in any part of the world. Any minutes, acts
or contracts of the directors, shareholders, managers or liquidators performed by
telephone, facsimile or other electronic means of communication will be considered as
having been made in person if they were directly in contact. These will be valid even when
signed on different days and in different places (such as a round-robin resolution).
Business
Activities: Corporations may undertake any type of lawful business activity,
such as investments, project contracts, or sale and purchase of goods or services.
Contracts, invoices and corporate documents may be maintained in any language, and the
records of transactions that take place outside of Panama may be kept in any country.
Confidentiality
of Business Documents: The laws of the Republic of Panama only permit the
submissions of accounting records, files, correspondence or other documents to foreign
authorities with the express permission of the Courts of Panama. Information sharing
treaties are limited to drug-related offences. All other revelations are expressly
prohibited and may result in criminal prosecution.
Corporate
and/or Nominee Officers and Directors: It is common practice for Panamanian
Corporations to have corporate officers and directors or nominees provided by a service
provider such as Shirley & Associates. It is not necessary for the officers and
directors to be Panamanian citizens, nor is it necessary for the officers to be directors
of the company. A minimum of 3 directors is required.
Currency
and Exchange Controls: There are no restrictions or controls on currency
exchange in Panama. The US dollar is freely interchangeable with the local currency, the
Balboa. With more than 100 banks within a radius of 5 miles and international business
constantly taking place locally, there are few limitations as to the availability of
foreign currency transactions in Panama City.
Filing
Requirements: There are no requirements to file reports with the
Panamanian government regarding any off-shore activities.
Limited
Liability: Shareholder liability is limited to any unpaid capital on issued
shares.
Name
Reservation: For a nominal fee, a corporation’s name may be reserved for
up to 30 days.
Payment
of Salaries: Only residents of Panama need declare their salary, wages or other
compensation received from the Corporation in Panama.
Share
Classes: The Board of Directors can establish and issue shares of different
classes, with such preferences, privileges, voting rights or restrictions as they deem
expedient.
Tax
Advantages: Any and all income resulting from activities outside of the
territory of Panama are not taxable under Panamanian law. Foreign-source income is also
exempt from dividend and capital gains tax, as is interest earned on deposits in local or
foreign banks. Even where a corporation has an office in Panama, employees in Panama and a
Panamanian business license, Panamanian income tax does not apply to income from
transactions consummated outside of Panama.
Transferability
of Shares: Share of a Panamanian Corporation, whether bearer or registered, are
freely transferable. This facilitates the transfer of assets on a confidential basis,
through the simple exchange of bearer (or registered) shares, rather than an exchange of
the underlying assets.
Shirley & Associates offers both
incorporation of tailor-made corporations as well as the provision of shelf
corporations. A shelf corporation is one which has been put into inventory after
formation and is available for immediate transfer. Please do not hesitate to request a
list of available corporations. The incorporation of a tailor-made corporation can
be completed in a matter of days.
Details required for Tailor-Made
Corporations
The following information is considered
vital for incorporation of a tailor-made Corporation:
Name:
It is requested that the name, and alternative versions thereof in order of preference, be
provided. Where a given name is not available, other options are necessary to expedite the
matter. The name can be written in any language, with the terminations S.A., Corp., A.G.,
or Inc. added thereto. For more information see: Choosing
the Company Name.
Share
Capital: Unless otherwise instructed, all companies are incorporated with a
share capital of US$10,000, divided into 100 shares of US$100.00 each. Nonetheless, shares
may be issued with or without par value and in one or more classes, according to a
client’s needs. Costs may vary if certain capital limits are exceeded.
Officers
and Directors: Please provide the details of the officers and directors as
requested in the application form. Nominee officers and directors are also available upon
request.
Objects:
Generally the objects of the corporation are broadly stated as "any lawful
activity".
The laws of the Republic of Panama require
that every corporation have a law office or lawyer as its Registered Agent in Panama. This
is a service which Shirley & Associates provides to its clients for a nominal annual
fee.
Corporate Secretarial Services
Shirley & Associates is dedicated to
the organisation, creation, modification, merger, liquidation, and dissolution of
corporations, and the Firm’s staff are experienced in all facets of corporate
secretarial services. The Firm routinely provides certificates of good standing for
companies, payment of annual franchise taxes, drafting of minutes of meetings for
shareholders, directors, and managers, general and special powers of attorney, and
searches at the Public Registry Office, in addition to specific legal counsel where
required.
Registration of Documents
In addition to registering the Articles of
Incorporation with the Public Registry Office, the following documents must be registered
for public scrutiny:
Amendments to the authorised capital;
Name changes of the corporation;
Changes of officers of the company or to the Board of
Directors;
Merger agreements or the dissolution of the company;
Any other amendments to the Articles of Incorporation
