Corporation registration in Panama

The company name must not be very similar to existing names on the registrar and it must not contain words suggesting any connection to the government. Additionally, the name must not be similar to the names of existing foreign companies. It must end with a word or abbreviation signifying a corporate body or limited liability, for example such words are “Corporation”, “Incorporated”, “Sociedad Anonima”, “Corp.”, “Inc.”, “S.A.” etc. The name of the company must not contain any words suggesting activity for which license is required such as Bank, Insurance, Assurance, Re-Insurance, Trust, Trustee, Fund Management, Investment Fund, Building Society or foreign words with the same meaning.

A Panama corporation is required to have a registered office address in Panama which must be provided by an authorised registered agent there.

A Panama corporation is required to have three directors which shall be the company’s officers. The board of directors will appoint the positions of president, treasurer and secretary. Corporate entities can be appointed as directors. There is no requirement for them to be locals and there is no requirement regarding the place and frequency of board meeting. The directors’ details are registered on the record that can be accessed by the public.

A Panama corporation is required to have a secretary. There is no requirement for them to be locals and corporate entities can be appointed as secretary. The director and secretary can be the same person.

One shareholder is the minimum required, there is no requirement for them to be locals and corporate entities can be appointed as shareholders. There is no requirement regarding the place and frequency of shareholder meetings. The shareholders details are not accessible on the public record.

The beneficial owner’s details are not registered on the public record and cannot be accessed by the public.

The corporation’s owners are free to determine any amount as the authorised capital at incorporation and it can be de-nominated in any currency, though the US Dollar is mostly preferred and the amount of USD 10,000 is highly suggested, divided into 100 shares each having USD 10 value. The authorised capital is the maximum amount of capital that the company is authorised by its constitutional documents to draw from its shareholders to issue in exchange shares.

While the corporation’s shares are required to be registered, it is not required that all shares be issued upon the incorporation, however, it is required to issue at least one share. Also, shares without par value and bearer shares are allowed, but the certificates must be held for safekeeping by the register agent and notice must be given to the registrar for the existence of those shares.

It is required that, upon incorporation, one share must be issued that has value of USD 100 and is paid up. The requirement does not apply to the rest of the company’s share capital that is registered.

A Panama incorporation can be incorporated within 10-13 days.

Ready-made but unused Panama Corporations are available, if you are in need for a quicker incorporation process.

There are no substance requirements; on the contrary, a corporation registered in Panama will qualify for an exemption from local corporate income tax if its management and control are not conducted from within Panama.

The Panamanian Corporation must keep accounting records and the relevant documents for five years to reflect accurately its financial situation. The location of the accounting records may be anywhere in the world. However, the directors are obliged to inform the company’s registered agent where the accounts are kept. The Panama Corporation is not required to file its accounting records, given that none of the corporation’s business is carried out in Panama nor any assets are held there. In any case there is no auditing requirement provided by the Law.

There is an exemption from all local taxes for Panama corporations which carry out their business outside Panama, including capital gains, interests, royalties and dividends. Also, no currency exchange or transfer of funds controls are imposed by Panama.