What kinds of companies can I incorporate in Panama?

Panama several types of companies, of which the most common is the Sociedades Anónimas which are great low cost general purpose structures.

Panamanian company law is based on that of Delaware and is very flexible. Anyone foreign or Panamanian can create such a company. The only real requirement is that you have a registered agent in Panama (a local law firm) and pay the annual franchise tax of $250. (This recently increased from $150)

Unlike other offshore jurisdiction there is no such thing as an IBC (International Business Corporation) as all companies have the same features. For a company not to be taxed in Panama, it must not generate income in Panama.

For more information see: The formation and operation of Panamanian Corporations

Update 11-March-2004: Mr. Vallarino commented below that my original statement of there only being one type of company is wrong. I have updated the above statement to reflect this change.

He mentions 3 additional corporate entities:

• Sociedades Civiles
• Sociedades en Comandita
• Sociedades de Responsabilidad Limitada

Very interesting. I would love to hear more about this. If Mr. Vallarino would like to explain more about the different types I will happily publish it here.

This entry was posted in the following Categories: Corporate and Trust Law

Comments:

This statement is wrong.

Panama has a bunch of other corporate entities in the book (Sociedades Civiles, Sociedades en Comandita and Sociedades de Responsabilidad Limitada).

They are seldom used, but they do exist (I know of a case of a large local U.S. direct investment which used an S.R.L. to deal with the check-the-box regulations applying to S.A.'s).

Posted by: Juan Ramón Vallarino J. at March 11, 2004 01:51 PM