Panama Offshore Company Formation

#Go Panama. Be Global
  • Short description of the Panama jurisdiction

    Panama is an independent country located in Central America with access to the Caribbean Sea and the Pacific Ocean. Its greatest assets are the Panama Canal, the world’s largest shipping registry, and its developed financial sector.

    Panama is considered the world’s oldest offshore financial centre, with numerous first-class banks boasting strong ties with the Americas. Companies operating outside Panamanian borders enjoy all the benefits of the classic model of territorial taxation.

    Panama is a stable and democratic presidential republic with legislative functions vested in the National Assembly. The president is both the head of state and of government. The country is a famous offshore financial centre with a rich history of providing financial services. Panama is an offshore tax haven that has a lot to offer to someone who is seeking to operate internationally.

  • Taxation in Panama

    Panama has a territorial tax system, which means that only income derived in its territory is taxable. All other worldwide income of a company is not subject to taxation in Panama.

    Panama has long been one of the best places in Latin America to conduct international business. It is also one of the oldest international financial centres with territorial taxation.

    There is no obligation to file audited financial statements for a Panama offshore corporation that does not receive income from the territory of Panama.

    For such an offshore company, there is no withholding tax, capital gains tax or stamp duty in Panama.

    There is also no value-added tax for a Panama offshore company that does not operate in Panama.

    The official currency of Panama is the Balboa (PAB). The US dollar is also widely used.

    There are no currency exchange controls in Panama.

    Currency Balboa (PAB); US dollar (USD)
    Corporate tax 0%
    Withholding tax 0%
    Capital gains tax 0%
    VAT 0%
    Currency Controls No
  • Panama legislation

    Panama’s legal system is based on a civil law system, which was inherited from Spain. There is also some influence from the English legal system, particularly the Corporations Law of 1927, which is largely based on common law. Overall, the regulation of offshore services in Panama relies on a combination of civil and common law, including the recognition of trusts. As a result, Panama’s developed financial services industry is shaped by a fairly complex body of legislation oriented towards offshore services.

    Panama recognises trusts, and it is possible to establish a trust that would be regulated by the laws of Panama. However, one of the best known and most popular entities for wealth structuring in Panama are offshore foundations, which are regulated by civil law. With the adoption of the Foundations Law in 1995, Panama became a pioneering jurisdiction that allowed for the setting up of so-called “incorporated trusts”. Shortly thereafter, most other offshore financial centres adopted the same legislation.

    In Panama the offshore legal services are well recognised and developed. There are many local and international law firms, as well as accounting and auditing companies, which contribute to the financial services infrastructure in Panama.

    The court of final appeal in Panama is the Supreme Court of Justice.

    The laws regulating companies and the financial sector in Panama are as follows:

    • Corporation Law of Panama, Law 32 of 1927;
    • Law No. 1 on Trusts of 1984;
    • Law No. 4 on Limited Liability Companies of 2009; and
    • Law No. 25 on Private Foundations of 1995.
  • Why chose Panama?

    Panama offshore company incorporation is one of the best solutions for anyone considering going offshore. The country itself has a well-established reputation as a stable and progressive financial centre. In fact, Panama has successfully developed all the key segments of a leading offshore financial centre.

    Panama offshore company benefits include favourable taxation, among others. The territorial taxation system provides a zero-tax environment for companies operating globally and avoiding operations in Panama itself.

    The robust banking system and offshore legal services allow companies to operate efficiently and with low administrative costs.

    In addition, the world’s largest shipping registry makes Panama the number one choice for maritime businesses and vessel holding companies.

    During the last decade, Panama became the subject of several tax evasion scandals due to the Panama Papers leaks. However, it is important to remember that offshore company registration in Panama is entirely legal.

    Astra Trust has the expertise to incorporate a company in Panama cost-effectively, promptly and to the company owner’s advantage. Our company can also assist in obtaining legal services from local advisers if required.

    The following types of entities are available for Panama offshore company formation:

    • Corporation or Sociedad Anonima
    • Limited Partnership or Sociedad de Responsibilidad Limitada
    • Limited Liability Company or LLC

    A company registered offshore in Panama is the best choice for the following business activities:

    1. International trade
    2. Vessel ownership
    3. Asset protection
    4. Holding company
  • Incorporation process

    Stage 1 Contact us for more information and quotes. We answer within three hours!
    Stage 2 Fill in a form, provide us with the required documents and make a payment.
    Stage 3 Receive the scanned incorporation documents within two days, and hard copies by courier in up to seven days.

     

  • Required documents to incorporate in Panama

    To open an offshore company in Panama the following CDD documents are required:

    1. Certified copy of passport for all directors, shareholders and beneficial owners
    2. Certified proof of address for all directors, shareholders and beneficial owners
    3. KYC form provided by your personal manager in Astra Trust
  • Documents and services you receive upon incorporation in Panama

    The costs of offshore Panama company formation include services for the following:

    1. Company name search in the Register of Companies for availability
    2. Revision of KYC and CDD documents
    3. Drafting of activation corporate documents on incorporation of the company
    4. Registered office services for 1 year
    5. Registered agent services for 1 year
    6. Full administrative support 24/7 from your personal manager in Astra Trust

    After the offshore company formation you will receive the following documents:

    1. Certificate of Incorporation issued by the registrar of companies
    2. Memorandum of Association stamped by the registrar of companies
    3. Articles of Incorporation stamped by registrar of companies
    4. Resolution of appointment of first directors
    5. Register of directors
    6. Register of shareholders
    7. Register of beneficial owners
    8. Minutes of first meeting of directors
    9. Share Certificate for each shareholder
  • Company name in Panama

    The company name in Panama can be in any language, and shall contain a word, phrase or abbreviation that distinguishes the company from the natural person. In practice, such words or abbreviations are usually:

    • “Corporation” or “Corp”;
    • “Incorporated” or “Inc.”;
    • “Sociedad Anonima” or “S.A.”.

    The proposed company name shall not be similar to the name of an already existing company. According to the Panamanian Corporation Law, there are no other restrictions on the company name.

  • Board of directors and shareholders of a Panamanian company

    To register a business in Panama, the corporation must have at least three directors who are appointed to the board of directors. Directors can be individuals or legal persons. There are no restrictions regarding the nationality or residency of such directors.

    A company in Panama must also have three appointed officers, namely a president, secretary and treasurer. Usually, three directors act as the officers. This helps to minimise paperwork. However, it is not necessary for a person to be a member of the board to be appointed as an officer, unless the company’s Articles of Incorporation require it.

    There are no restrictions regarding the nationality or residency of the shareholders of a Panamanian corporation.

    Nominee services are allowed in Panama. How to incorporate in Panama with nominees? Astra Trust can provide nominee services and assist with all corporate matters to ensure your company complies with all legal requirements. It should be noted that in Panama, three directors are usually provided for the fee of one director, so this should not be an obstacle to using Panama offshore services.

  • Share capital of a Panamanian company and types of companies

    A Panama offshore corporation is a company limited by shares. There are no specific requirements for the minimum amount of authorised share capital to open a company in Panama. Shares authorised to be issued can be both par value and no par value.

    The standard authorised share capital is usually USD 10,000 divided into 100 shares with a denomination of USD 100 per share. The authorised share capital amount may be adjusted to any particular requirements. The share capital can also be denominated in any other currency.

    The issued share capital can be of any amount, from one share to all the shares authorised to be issued by the company.

    Bearer shares are allowed to be issued in Panama.

  • Privacy of a Panamanian company

    The register of companies in Panama is a public register. This means that information about the company’s directors, officers, and shareholders is publicly available.

    In Panama, offshore company registration is carried out by the so-called resident agent. According to the legislation, all resident agents are required to identify their clients and persons with a substantial beneficial ownership interest in a Panamanian legal entity, as well as persons with more than a 25 percent interest in such entity.

    However, privacy can be easily achieved through nominee services, which are allowed and widely used in Panama. In case the beneficial owners need to retain control, it is possible to use foreign corporations with closed registers as the shareholder and director of the Panamanian company.

    The information on beneficial owners must be filed in the closed beneficial owner database kept by the special Superintendence. The resident agent is obliged to file information on the beneficial owners upon company registration and update it accordingly.

    Only the state authorities authorised by the law may request information about beneficial owners from the database. The list of these authorities is given below:

    • Financial Analysis Unit;
    • Public Ministry;
    • Ministry of Economy and Finance;
    • Superintendence of Banks; and
    • Superintendence of the Securities Market.

    All other authorities and third parties do not have access to the beneficial owners database.

    Astra Trust can advise you on how to open a company in Panama with the maximum privacy possible.

  • Economic substance requirements in Panama

    There are no economic substance requirements applicable to companies in Panama.

    The exclusion to this rule is companies registered in the Panama-Pacific Economic Area and carrying out certain types of activity.

  • Reporting requirements in Panama

    For companies that do not conduct any activity in the territory of Panama, there are no legal requirements to file accounts and tax returns in Panama. Therefore, Panama company formation is a great way to do business globally without tax and reporting requirements.

Key Features

    General Information

  • Jurisdiction - Independent nation
  • Entity type - Corporation (Sociedad Anonima)
  • Corporate Tax - 0%
  • Currency - PAB and USD
  • Currency Exchange Control - No
  • Legal framework - Civil law mixed with Common Law for companies
  • Recognition of Trust - Recognised
  • Court of final appeal - the Supreme Court of Justice of Panama
  • Business Activity Restrictions

  • Business Activity Restrictions - No. Subject to standard licensed types of activities.
  • Economic Substance Requirements - Not applicable
  • Requirements to Directors

  • Register of Directors - Publicly accessible
  • Minimum Number of Directors - 3
  • Corporate Director - Available
  • Local director - Not required
  • Nominee Director - Available
  • Requirements to Secretary

  • Secretary - Not required. Optional.
  • Local Secretary - Not required
  • Requirements to Shareholders

  • Register of Shareholders - Publicly not accessible. Stored in Registered Office
  • Minimum Number of Shareholders - 1
  • Corporate Shareholder - Available
  • Annual General Meeting - Not required
  • Location of Meetings - Anywhere in the World
  • Nominee Shareholder - Available
  • Share capital

  • Minimum Authorized Share Capital - USD 1
  • Standard Authorized Share Capital - USD 10,000
  • Minimum Issued Share Capital - USD 1
  • Currency of Share Capital - USD or any other
  • Reporting Requirements

  • Preparation of Accounts - Not required
  • Filing of Annual Return – Not required
  • Publicity of Annual Return - Not public
  • Audited Accounts – Not required
  • Other features

  • Redomiciliation to/from Jurisdiction - Permitted
  • Shelf companies - Available

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