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The Republic of Panama has a land mass of approximately 75,420 sq km, is located between Costa Rica and Colombia, forms the narrowest and lowest portion of the isthmus that links North and South America. It is best known for the Panama Canal which joins the Caribbean Sea to the North Pacific Ocean and connects Central America to South America.
The population of Panama is approximately 3.4 million, about 52% of which reside in Panama City, consisting of mainly the Mestizos (70%) and a mix of West Indians, Caucasians and Indians. The dominant religion is Roman Catholicism.
Panama was a Spanish colony until 1821. In 1903, Panama broke an alliance with Colombia and became an independent republic.
There are three Branches of Government:
An autonomous Electoral Tribunal supervises voter registration and all citizens over the age of 18 are required to vote.
The Colon Free Zone is located on the Caribbean side of the Isthmus of Panama near the Atlantic entrance to the Panama Canal. This Free Trade Zone is the second largest in the world after Hong Kong. Operations and transactions taking place in the Free Trade Zone are subject to a special tax treatment whereby imports from other parts of the world and re-exports to other countries are exempted from any import or export taxes imposed by Panama. Income earned from re-exports is taxed at specially reduced rates. Panama has the world’s largest shipping registry and a well- established Banking centre. Economic growth will be bolstered by the Panama Canal expansion which began in 2007 and is expected to complete in 2014-15 at a cost of US$5.3 billion. The project will more than double the Canal’s present capacity enabling it to accommodate the modern super tankers that are becoming too large to transverse the existing transoceanic crossway. Without the expansion, it was anticipated that the Panama Canal would be forced to turn away approximately 37 per cent of the world's container ships by 2011. Other areas of economic activity are in agriculture, manufacturing, construction, transport, tourism and financial services.
Spanish is the official and spoken language. English is also spoken widely in urban areas and is used daily in commerce and international trade.
United States Dollar.
Based on Spanish Civil Law with many Common Law influences, particularly regarding Company Law.
Corporation Law No. 32 of the 1927 Commercial Code, Decree Law 5 of 1997 and Executive Decree 296 of 1997.
Generally, corporations are incorporated under the Corporation Statute Law 32 of the 1927 Commercial Code. Limited Liability Companies and Limited Partnerships are used also.
By presentation of the proposed corporation's signed Articles of Incorporation before a Notary Public who creates a Public Deed for registration at the Public Registry.
Cannot undertake the business of banking, trusteeship and trust administration, insurance, assurance, reinsurance, fund management, investment funds, collective investment schemes or any other activity that would suggest an association with the banking, finance, fiduciary or insurance businesses.
Spanish and certified English translations.
Yes, must be maintained in Panama at the address of the Registered Agent.
Two days, subject to name approval.
A name that is similar to or identical to an existing company. Names of well known companies incorporated elsewhere or a name that implies government patronage.
Names may be expressed in any language using the Latin alphabet. The Registrar may request a Spanish or English translation.
Bank, building society, savings, insurance, assurance, reinsurance, fund management, investment fund, trust or their foreign language equivalents.
All Panamanian corporations must end with the suffix Corporation, Incorporated, Sociedad Anónima or the abbreviations Corp, Inc or SA. They may not utilise the suffix Limited or Ltd.
The standard authorised share capital is US$10,000 divided in to 100 common voting shares of US$100 each or 500 common voting shares of no par value; the capital may be expressed in any convertible currency. The minimum issued capital is either one share of no par value or one share of par value.
Non-voting shares, preferred shares and registered shares. Bearer shares can be issued but no-par-value and bearer shares must be fully paid when issued. The registered agent must keep the bearer shares certificate in safe custody and must notify the Registrar that the shares have been issued.
No corporation tax is levied on non-Panamanian sourced income.
Annual Franchise Tax of US$400 is payable.
Whilst there is no requirement to file audited accounts with the authorities, a company is required to keep financial records, which reflect the financial position of a company.
Both corporations and natural persons may act as directors and the minimum number of directors is three. They may be of any nationality and need not be residents of Panama. Panamanian companies are also required to appoint a minimum of three officers (president, secretary and treasurer) who may also be the directors.
A company secretary must be appointed, who may be a natural or corporate person. The company secretary may be of any nationality and need not be a resident of Panama.
The minimum number of shareholders is one.
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