REPUBLIC OF PANAMA BUSINESS CORPORATION (BC)

  1. What is the annual registration charge for a Panama corporation and are there any sliding scales relating to authorised share capital?

The annual registration charge for a Panama Corporation is US$250.00. This charge is unaffected by the amount of the company’s authorised share capital.

The first annual registration charge is payable within three months of the incorporation of the corporation and thereafter registration charges are paid for each year, in accordance with the following payment schedule:

Panama corporations registered in January to June of any year

$250 annual registration charge
TOTAL $250
$250 annual registration
charge plus
$50 Surcharge
TOTAL $300
$250 annual registration charge plus
$50 Surcharge plus
$250 penalty
TOTAL $550
Due Date
June 30
July 1 – December 31 Each time the corporation fails to pay the annual registration charge more than one period.
Failure to pay the annual registration charge on the due date shall result in the non-registration of any act, document or agreement and the non issue of any certification relating to the corporation. When payment of the annual registration charge is made within the six months following the due date. Each time the corporation fails to pay the annual registration charge within six months of the charge due date, in addition to the surcharge, the application of a US$250.00 penalty and a marginal annotation indicating that the corporation is not in good standing will apply.

Panama corporations registered in July to December of any year

$250 annual registration charge
TOTAL $250
$250 annual registration
charge plus
$50 Surcharge
TOTAL $300
$250 annual registration charge plus
$50 Surcharge plus
$250 penalty
TOTAL $550
Due Date
December 31
January 1 – June 30 Each time the private foundation fails to pay the annual registration charge more than one period.
Failure to pay the annual registration charge on the due date shall result in the non-registration of any act, document or agreement and the non issue of any certification relating to the corporation. When payment of the annual registration charge is made within the six months following the due date. Each time the corporation fails to pay the annual registration charge within six months of the charge due date, in addition to the surcharge, the application of a US$250.00 penalty and a marginal annotation indicating that the corporation is not in good standing will apply.
  1. What is the government charge to register the incorporation of a Panama corporation and are there  any sliding scales relating to authorised share capital?

The government charge to register the incorporation of a Panama corporation is based upon the authorised share capital of the corporation. The minimum charge is US$60.00 for corporations with an authorised share capital up to US$10,000.00. The following sliding scale applies for corporations with an authorised share capital in excess of US$10,000.00.

AUTHORISED SHARE CAPITAL REGISTRATION CHARGE
US$ 15,000.00
US$ 20,000.00
US$ 50,000.00
US$ 100,000.00
US$ 200,000.00
US$ 300,000.00
US$ 500,000.00
US$1,000,000.00
US$ 64.50
US$ 69.00
US$ 96.50
US$141.00
US$201.00
US$261.00
US$381.00
US$681.00
  1. Are there any requirements to disclose beneficial owners of a Panama corporation to the general  public and are there any requirements to file details of officers and directors with the public or any other Registry in the Republic of Panama ?

There are no requirements to disclose beneficial owners of a Panama corporation to the general public or any other Registry in the Republic of Panama .

Panama Corporation law requires the names and addresses of the initial directors and officers to be included in the Articles of Incorporation filed at the Panama Public Registry. In addition, all changes in the Board of Directors or of corporate officers must be filed at the Panama Public Registry.

  1. Are there any requirements to hold:
  2. An annual general meeting of the shareholders of a Panama corporation?
    b. Meetings of the directors of a Panama corporation?
  3. There are no requirements to hold annual general meeting of the shareholders of a Panama corporation. However, general meeting of shareholders may be held from time to time with the purposes of despatching business reserved to the shareholders under Panama Corporation Law.

Article 40 of the law states:

“40 Whenever under the provisions of this law the approval or authorisation of the stockholders is required, the notice of such stockholders’ meeting shall be in writing and in the name of the President, Vice-President, Secretary or an Assistant Secretary or of such other person or persons so authorised by the articles of incorporation or the by-laws. Such notice shall state the purpose or purposes for which the meeting is called and the time and place at which it is to be held.”

  1. There are no requirements to hold meetings of the directors of a Panama corporation. However, Article 49 of the Panama Corporation Law states that the business of every Panama corporation shall be managed by a board of directors implying a need for regular meetings of the Board of Directors to be held.
  2. Are there any requirements for a Panama corporation to prepare annual financial statements?

There are not any requirements for a Panama corporation to prepare annual financial statements.

  1. Are there any requirements for a Panama corporation to file any form of annual return or tax return in the Republic of Panama ?

Provided that the corporation does not do business in the Republic of Panama there are not any requirements to file any form of annual return or tax return in the Republic of Panama .

  1. What does the annual registration charge filing form of a Panama corporation disclose?

The annual registration charge renewal form of a Panama corporation includes the following details:

– the company name
– registration data (microjacket, roll, entry)
– name and personal identity card number of the legal representative
– name and personal identity card number of the resident agent
– the date of incorporation of the company
– the number of public deed containing the Articles of Incorporation
– period covered by payment
– the amount paid being paid
– any penalties being included

  1. Are bearer shares permitted for a Panama corporation?

Bearer shares are permitted for a Panama corporation.

  1. Are there any restrictions relating to the issuance of bearer shares by a Panama corporation?

Save as described in “10” following – There are no current restrictions on the issuance or custody of bearer shares issued by a Panama corporation.

  1. Must all issued shares be fully paid up on a Panama corporation?

Article 21 of Law 32 of February 26, 1927 reads in part:

“21 Shares of stock may be issued as fully paid and non-assessable, as partly paid or without any payment having been made thereon.”

Notwithstanding, Article 28 of Law 32 of February 26, 1927 states:

“28 Shares may be issued to bearer only if fully paid and non-assessable.”

  1. Can CHCL Fiduciary Group open bank accounts in the Republic of Panama on behalf of its clients, and if so, what are the requirements?

CHCL Fiduciary Group can, through its agents in the Republic of Panama , arrange for the opening of bank accounts in the Republic.

The requirements for bank account establishment are as follows:

  1. Notarised copies of valid passports of signatories to the account and directors, officers and principal owner, if not a signatories.
  2. Certified Copy of Public Deed containing the Articles of Incorporation and of any deeds containing any amendments thereto.
  3. Good Standing Certificate.
  4. Bank references addressed to the bank for the company (if applicable) and for the directors, officers, principal owner and signatories to the account.
  5. Proof of physical address of company.
  6. Proof of physical addresses of the directors, officers, shareholders and signatories to the account
  7. What is the minimum number of directors that a Panama corporation may have?

Article 2(9) of Chapter I of Law 32 of February 26, 1927 states:

2(9) The number, name and addresses of its Directors, of which shall not be less than three.

Additionally, Article 49 of Chapter V of Law 32 of February 26, 1927 states:

49 The business of every corporation shall be managed by a Board of Directors composed of not less than three directors, all of whom shall be male or female persons of legal age.

It should be noted that by Executive Decree No. 296 of December 19, 1997 power was also given to juridical persons to act as officers and directors of Panama corporations.

  1. Are Panama corporations required to have a President, Secretary and Treasurer or is the appointment of officers optional?

Article 65 of Chapter VI of Law 32 of February 26, 1927 states:

65 Every corporation shall have a President, a Secretary and a Treasurer, who shall be chosen by the Board of Directors and may also have such other officers, agents and representatives as the Board of Directors or the by-laws or the articles of incorporation may determine and who shall be chosen in the manner provided thereby.

Furthermore, Article 66 states:

66 Any person may hold two or more offices, if so provided by the articles of incorporation or by the by-laws.

Additionally, Article 67 states:

67 No officer need be a director of the corporation unless the articles of incorporation or by-laws so require.

  1. What is the standard authorised share capital of a Panama corporation incorporated by CHCL Fiduciary Group?

The standard authorised share capital of a Panama corporation incorporated by CHCL Fiduciary Group is US$10,000.00 divided into 100 shares with a par value of US$100.00 each.

  1. Can the authorised share capital of a Panama corporation be denominated in any recognised  currency?

Article 2(4) of Law 32 of February 26, 1927 states:

2(4) The capital stock and par value of shares of any corporation may be expressed in terms of the legal currency of the Republic of Panama or of gold units of the legal currency of any other country, or in both;

  1. How many members must a Panama corporation have?

There are no restrictions on the number of members that a Panama corporation may have.

  1. Is it true that a Panama corporation must have a Registered Office and a Registered Agent? If so, who can fill these positions?

Panama corporations are not required to keep a Registered Office. However, every Panama corporation must have a Resident Agent in the Republic of Panama , who must be either a lawyer or a law firm licensed to practice law in the Republic.

  1. What restrictions on the use of names are there and what words must be included to indicate  limited liability of a Panama corporation?

The use of the words “Trust”, “Bank”, “Insurance”, “Fiduciary, “Reinsurance” or any of their derivatives are restricted.

In addition, the name of a corporation incorporated under Law 32 of February 26, 1927 , shall contain a word, phrase or abbreviation, indicating that it is a corporation, as distinguished from a person or an association of another type, such as “Sociedad Anónima”, “Corporation” or “Incorporated”. The word “Limited” or its usual abbreviation “Ltd.” will not be suitable for this purpose because it does not indicate a corporation under Panama law. The words “Limited” or “Ltd.” may be used, however, if followed by S.A. , “Sociedad Anónima” or “Corp.”, etc.

  1. Can meetings of directors and shareholders of a Panama corporation be held anywhere in the world?

Subject to its articles of incorporation and/or bylaws a Panama corporation may hold meetings of directors and shareholders anywhere in the world.

  1. Can meetings of directors and shareholders of a Panama corporation beheld by written resolution?

Subject to the articles of incorporation and/or the bylaws of the corporation meetings of directors and shareholders of a Panama Corporation can be held by written resolution.

  1. How long does it take to get:
  2. A Panama Corporation name check?
    b. Incorporation of a Panama Corporation completed?
    c. Dispatch of a Panama Corporation documentation?

Under normal conditions:

  1. Name of a Panama Corporation can be checked in less than one hour.
  2. Incorporation of a Panama Corporation can be completed within two business day.

c. Dispatch of a Panama Corporation corporate pack can be completed within one business day.