
It is not surprising that there are approximately half a million companies incorporated in Panama. Then by incorporating an offshore company in Panama you can benefit from a top-notch business environment for foreigners, not only because of its status as a low taxing jurisdiction but due to its flexible and favorable laws of incorporation, which have helped to position itself as a prime offshore jurisdiction.
Panama has wintessed continuous and exponential ecnomic growth since the turn of the century resulting in a gross domestic product (GDP) of $68.5 billion (all figures in USD). Accordingly, a rise in general prosperity has been seen, as measured by gross national income (GNI), which reached $14,950 that same year.
Panama success is not only due to its strategic location between North- and South America, but also that it is home to the Panama Canal – an artifical waterway that connects the Pacific Ocean and the Caribbean Sea. Roughly 14,000 ships pass through this canal each year, which accounts therefore for 2% ouf the country’s GDP. Another contributing factor is the country’s famously secure banking sector and favorable tax arrangements for investors.
According to the UN’s 2020 World Investment Report, the Central American country is the largest recipient of foreign direct investment in the sub-region, reaching $6.07 billion of FDI inflows in 2019. Panama is also considered one of the best countries to do business globally, as highlighted by the World Bank’s Doing Business 2020 report.
If you are thinking about incorporating an offshore company in Panama, or have already established a presence in the country, read on what kind of benefits it could have. Or go ahead and contact us now.
Benefits to Incorporating an Offshore Company in Panama
Forming an offshore company in Panama has many benefits, from bank secrecy laws that warrant your security, to tax incentives for multinational companies. Below we outline the top 10 reasons for opening an offshore company in Panama:
- Ease of Entry: Flexible laws and regulations in Panama make it simple to incorporate and maintain companies.
- Company registration in Panama takes approximately two weeks
- There is no need to be in the country during or after the process
- No accounts have to be presented to the government
- Board meetings may be held anywhere in the world

- Tax Benefits: Given the country’s territorial system, if a company’s income is obtained outside of Panama, there is no obligation to pay income tax.
- Asset Protection: There is a high level of asset protection. An offshore company incorporated in Panama can act as a holding company or own assets and real estate anywhere in the world, shielding them from future liability.
- Confidentiality: Panama offers corporations full confidentiality in all areas of operation and in addition:
- Panama offers bearer shares that allow the owner to remain anonymous
- Corporate objectives can be kept out of the Articles of Incorporation
- Bank secrecy laws that punish disclosing account information to third parties
- Panama has no mutual legal assistance treaties (MLAT’s).
- No Exchange Controls: Panama has no restrictions on monetary remittances abroad and does not impose currency exchange controls on offshore companies, so funds can flow freely in and out of the country.
- No Nationality Restrictions: The directors, shareholders and officers can be of any nationality and live in any country.
- Flexible Share Capital Requirements: Offshore companies incorporated in Panama have no limit on the amount of share capital and do not require paid-in capital. Also, non-par value, voting and nonvoting shares are allowed.
- Free and Stable Economy: Panama benefits from a stable economy and government, and is at the top of the list of the world’s freest economies.
- Colon Free Trade Zone: This area is located in a strategic geographic position, having access to several maritime routes and to the most important ports in Latin America. Additionally, it offers duty free storage, repackaging and reshipment of any goods.
- Communication Systems: Due to Panama’s low risk of natural disasters, the telecom sector is able to offer companies a reliable communication system and access to the best high-bandwidth and fibre optic networks.

Biz Latin Hub can be your single point of entry to Panama
Incorporating an offshore company in Panama has several advantages for both individuals and companies looking for a favourable tax regime and strong privacy law. At the Biz Latin Hub we can help ensure that you select the right corporate structure and assist you with the entire establishment process.
If you have any questions about the benefits of incorporating your company in Panama, reach out to us now.
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The information provided here within should not be construed as formal guidance or advice. Please consult a professional for your specific situation. Information provided is for informative purposes only and may not capture all pertinent laws, standards, and best practices. The regulatory landscape is continually evolving; information mentioned may be outdated and/or could undergo changes. The interpretations presented are not official. Some sections are based on the interpretations or views of relevant authorities, but we cannot ensure that these perspectives will be supported in all professional settings.