Panama- Tag Archives - Business News and Updates

Find the latest Legal updates and changes, industry reviews, regulatory updates, expert legal and accounting advice, Q&A with experts, and much more content.

May 2020 Regulatory Update: Bolivia, Colombia, Costa Rica, Panama, Paraguay

by Team Latin America | May 28, 2020

Our senior legal and accounting experts deliver monthly updates on regulatory and other changes in their respective countries in Latin America. Find out regulatory changes occurring across Latin America that may impact you and your business. Extension for Registry of Commerce renewal in Bolivia Bolivia's response to the COVID-19 includes an extension of the deadline for commercial renewal with the Registry of Commerce. In Bolivia, the government’s response to the COVID-19 pandemic has included an extension of the typical deadlines for companies to provide certain documents to government agencies out to 29 May. These documents include: Annual Financial Statements,the company’s Annual Report 2019, andIncome Tax Declaration. As such, the deadline for commercial renewal with the Registry of Commerce (Registro de Comercio) will be rescheduled. The official due date is pending confirmation from government officials. Colombia reduces contributions from employees and employers In Colombia, Decree 558 of 2020 reduced the required pension contributions from employers and employees in order to increase business cash flow and disposable income for individuals. This is part of Colombia’s overall initiative to prevent mass job loss. These pension contributions are reduced from 16% to 3% - 2.5% from employers and 0.5% from employees). Other Decrees and Circulars announced by Colombia during their COVID-19 Pandemic response include: Circular 021: outlines options for flexible working arrangements, and options to take vacations in advance to avoid further layoffs.Circular 022: confirms...

Why Outsource Corporate Secretarial Services in Panama?

by Legal Team Panama | May 19, 2020

Understand the importance of outsourcing corporate secretarial services in Panama. There are crucial competencies that you should look for in a corporate secretarial services provider in Panama. Panama is one of the most attractive countries for doing business in Latin America. The World Bank states that the country has a fast growing economy with a continuous growth percentage of 4.6% over the last 5 years. We outline crucial competencies to look for in a provider of corporate secretarial services in Panama, and the importance of these services when expanding your business. Importance of corporate secretarial services in Panama When incorporating your business in Panama, it is typical to encounter a number of social and regulatory challenges. These can include language barriers, cultural differences, and an unfamiliar legal framework. Hiring a local provider of corporate secretarial services in Panama can help executives overcome these challenges, allowing them to focus on building a business strategy to develop their company. Furthermore, the right corporate secretarial services provider supports the company’s risk management activities by enabling businesses to comply with local regulations and fulfill corporate obligations. Avoid penalties or sanctions from local institution and generate success for your business in Panama by seeking an experienced, trusted corporate secretarial services provider. What are some available corporate secretarial...

Manage Your Business Risks with Due Diligence in Panama

by Legal Team Panama | May 7, 2020

Managing your business risk with due diligence in Panama while doing business is a key aspect for having an operational company. Foreign executives face various challenges when entering in a new country. Language barriers, different legal frameworks and cultural expectations can be difficult to understand. Therefore, business owners choose to buy operational companies to start doing business immediately. Due diligence in Panama as in other countries offers certainty about operational aspects of the company you’re managing, buying or merging. Undertaking due diligence activities will certify the health of the company and if is convenient for starting a business. The main objective of carrying out due diligence in Panama is to reduce risks by analyzing the operations of the company and validating they comply with local legislation and institutional authorities. Executives need to consider that a sanction from an institutional authority affects the economic growth of the company and even bankrupt it. Why is due diligence important in Panama? Panama is an attractive country for foreign business due to its diversity, strategic location, and business opportunities. Panama is an attractive country for foreign business due to its diversity, strategic location, and business opportunities. According to the General Comptroller (Contraloría General de la República) in 2019 there were 26,000 registered companies, which represents a 4.6% increase in relation to 2018. Furthermore, there were 299 company merges. Buying an operational company is a common practice...

How Do I Form an NGO in Panama?

by Legal Team Panama | Apr 2, 2020

Discover how to form a non-governmental organization NGO in Panama. Panama is an exciting country with many opportunities to do business, including for those focused on non-profit activities. Operating an NGO supports the development of Panama’s economic, social, and other landscapes. The economy itself has shown consistent, positive growth year on year, reflecting a healthy environment for new NGO operations. The Panamanian government guarantees certain benefits to support non-profit foundations or associations working to develop communities and benefit the country. Entities like the US Embassy in Panama have worked with local NGOs in this context. What is an NGO in Panama? Panama's economy has shown consistent, positive growth year on year, reflecting a healthy environment for new NGO operations. To be able to understand the process to incorporate an NGO in Panama, it’s important to understand the structural and governance characteristics of this legal entity. The NGO in Panama can be a public or private entity with the essential characteristic of being a non-profit association. The statutes of an NGO cannot stipulate ways to generate income by themselves. Panama’s Constitution allows the incorporation of any association insofar as its operations are considered to align with public order and morality. Private, non-profit NGO entities need to acquire a legal status before the Ministry of Justice. Steps to form an NGO in Panama The process to incorporate an NGO in Panama can take several months, and is broken down into 5 essential steps:...

How to Liquidate a Company in Panama

by Legal Team Panama | Mar 27, 2020

Find out the necessary steps to dissolve and liquidate a company in Panama. Because of the commercial benefits that Panama has to offer foreign businesses, the country supports one of the highest rates of newly established companies in Latin America. In 2019, 26,000 legal entities were established in Panama - an increase of 4.7% in relation to the companies established in 2018. Despite the support Panama and its special economic zones offer business, companies may choose to exit the market through a liquidation procedure. Despite the support the country and its special economic zones offer business, companies may choose to exit the market through a liquidation procedure. A company in Panama might go into liquidation in the following cases: Voluntary dissolve of the companyInvoluntary dissolve of the company by bankruptcy In Panama it's important to complete this process to end operations, to avoid governmental or commercial debts. If the process is not completed this would set a bad credit history for the company and its shareholders in Panama, and complicate further business in the country. How to dissolve a company in Panama Before you can liquidate the assets of your company in Panama, you must first go through a dissolution process complying with all governmental authorities, The government entities responsible for the dissolution of a company in Panama are the: Public registry (Registro Público de Panamá)National Tax Authority (Dirección General de Ingresos)Ministry of Commerce (Ministerio de Comercio e Industrias) - this is if the...

Business Incentives in the Special Economic Zones of Panama

by Legal Team Panama | Mar 17, 2020

Find out how special economic zones in Panama can support your expanding business in Central America. Panama supports a number of special economic zones that offer wide-ranging benefits to companies operating within them. Panama has one of the strongest and stable economies of Central America. According to the World Bank, Panama ranks as the second-fastest growing economy in the Caribbean and Latin America with a forecasted growth of 3.7% in 2020. This consistent growth supports increasing business confidence in establishing a company in Panama. If your business is related to import and export goods, Panama is the country you’re looking for to start expanding. Panama supports a number of special economic zones that offer wide-ranging benefits to companies operating within them. The most important special economic zones in Panama are the following: Colon Free ZonePanama PacificoCity of Knowledge. Choosing the right special economic zone in Panama for your business needs depends on the location where you want to trade goods from, and/or your principal business activity. How do special economic zones in Panama benefit business? The special economic zones in Panama offer benefits related to immigration, labor and fiscal incentives to encourage foreign investment into the country. Depending on your commercial focus, each special economic zone offers a different set of incentives to suit different business models. Establishing your company in the Colon Free Zone in Panama The Colon Free Zone in Panama was the first special economic zone established in the country in 1984....

What is an Employer of Record in Panama?

by Legal Team Panama | Mar 10, 2020

Panama is an attractive market for foreign investors when it comes to a strategic geographical location, Panama Canal, their business environment, use of the dollar, attractive tax system and other factors. Panama ranks first in receiving foreign direct investment (FDI) in Central America, reaching US$ 5.5 billion in 2018. Working with an employer of record in Panama can be beneficial for your business. However, it’s not always easy for foreign executives to start a business in Panama. Being an employer engaged in a new market, it can be challenging to deal and comply with all employment law regulations, including paying employee benefits. Gain insight into the beneficial employer of records services in Panama when expanding your company. An Employer of Record carries out legal and requirements of immigration and employment and payroll services. What is an Employer of Record? Employer of record, also known as an EOR, is an external partner of a company. EOR companies are the third party that is hired to take responsibility for the formal employment tasks of your company. They carry out legal and requirements of immigration and employment and payroll services. However, they do not serve to day to day work activities like the evaluation of employees.In specific, they carry out legal activities like: Organizing all visas and work permits for the employees, trying to avoid delays or refusals.Offering a recorded entity for running a local, compliant payroll inside the country.Knowing all labor laws in the selected country, concerning to local employee contracts and worker...