Panama Company Formation & Corporate Law
Corporate law comprises the rules that govern the incorporation, operation and running of companies. At MYD we support our clients so their organizations comply with current regulations and internal rules, laying solid foundations for growth.
Corporations are governed by Law 32 of February 26, 1927 and are a widely used vehicle for investors around the world. One of their main benefits is that shareholders are not personally liable for the company's debts: their liability is limited to the amount of their capital contribution.
Capital is divided into shares, which may be issued in registered or bearer form. Bearer shares must be held by an authorized custodian, in accordance with Law 47 of 2013.
Key benefits include: (1) the identity of shareholders is private and does not require public disclosure; (2) the company's assets are kept separate from those of the shareholders; (3) there is no restriction on the type of investments the company may make, and it may hold unlimited assets anywhere in the world; (4) the company may be incorporated by any person, whether or not Panamanian or resident in the country; (5) under Panama's territorial income tax regime, a company whose income has effect outside the country is not subject to income tax and need not file a return on foreign-source income.
Private interest foundations were created by Law 25 of June 12, 1995 and have since become a widely used asset protection instrument.
They operate through two documents: the Foundation Charter, a public document that creates the foundation, and the Regulations, a private and confidential document detailing beneficiaries, assets and their distribution.
Private interest foundations may not pursue profit-making purposes, although they may carry out non-habitual commercial activities such as holding bank accounts, making investments or responding to debts and obligations.
Key benefits: (1) there is no succession process upon the founder's death; (2) foundation assets cannot be seized due to acts of the founder or the foundation council; (3) there are no shareholders or partners, only beneficiaries designated in the Regulations; (4) exemption from all taxes, fees or charges on the incorporation, modification or termination of the foundation, as well as on the transfer of its assets and the income they generate, provided such assets or securities are of foreign source or not taxable in Panama.
At MYD we assist our clients with the review, drafting and negotiation of all types of contracts, both personal and business. Contracts are the foundation of commercial relationships, and a solid contract can be key to the success of any transaction. Our team provides the information relevant to decision-making and conducts the corresponding legal due diligence.
Our contract services: (1) customized contracts: we draft contracts tailored to the specific needs of your business and transactions; (2) review of existing contracts: we thoroughly review your contracts to ensure they meet your objectives and protect you against potential risks; (3) contract negotiation: we represent you in negotiations to secure favorable terms and conditions for your business; (4) employment contracts: we advise on drafting employment agreements, non-compete agreements and confidentiality clauses; (5) real estate contracts: we have experience in lease agreements, real estate purchase and sale, and development agreements.
At MYD we offer specialized M&A services for companies looking to grow, expand or restructure strategically. Our team supports you at every stage of this process.
What we do: (1) We design an M&A strategy aligned with your long-term business objectives. (2) We conduct exhaustive due diligence to identify and mitigate legal and financial risks before the transaction. (3) We represent your interests in negotiations and prepare the necessary documentation, including purchase and merger agreements. (4) We verify that the transaction complies with all applicable regulations and legal requirements. (5) We work to close the deal efficiently and securely, protecting your interests at every stage.
The Notice of Operation is regulated by Law 5 of January 11, 2007. It is the government-issued document that authorizes a natural or legal person to carry out commercial or industrial activities in Panamanian territory.
As a general rule, the Notice of Operation is the only procedure required to start a commercial or industrial activity in Panama, and it is supervised by the Ministry of Commerce and Industry. Certain regulated activities may require additional permits.
At MYD we guide our clients through this process and ensure their business complies with all legal requirements: (1) we assess your company and operations to determine whether it must file the Notice of Operation; (2) we prepare the necessary documentation and file the Notice with the relevant authorities; (3) we provide ongoing follow-up to ensure compliance with legal obligations and make any applicable updates.
International and offshore companies
When a Panama corporation isn't the best fit, we also set up and maintain companies abroad: in the BVI, Belize, Nevis, the Bahamas, Anguilla, Seychelles and the Marshall Islands, as well as US LLCs in Delaware and Florida. We help you choose the jurisdiction, handle due diligence and coordinate with local registered agents.
International and offshore company formationCorporate lawyers for doing business in Panama
Panama company formation is one of the most common reasons international clients reach out to us. The Panama corporation (sociedad anónima) is a flexible, internationally recognized vehicle: it keeps personal and business assets separate, can operate inside or outside the country, and gives multiple shareholders a clear set of rules. Choosing the right structure at the outset saves cost and restructuring later on.
As your Panama corporation lawyer, we help you decide whether a corporation, a limited liability company, a private interest foundation or a combination of structures best fits your activity, where your partners are based and what you plan to do next. We prepare the articles of incorporation, register the company with the Public Registry, act as or appoint the registered agent, and walk you through ongoing duties such as beneficial ownership reporting, corporate records and the updates the rules require.
Our work continues after registration. We support the company throughout its corporate life: shareholder and board minutes, capital increases, changes of officers, share transfers, bank account openings, operating licenses and regulatory compliance. As the business grows, we advise on mergers, acquisitions, reorganizations and shareholder agreements.
We work with local clients and with investors from all over the world, in person or remotely, in English and Spanish. If you also need commercial contracts, want to hire staff or buy property for your operation, we coordinate with our contract, employment and real estate teams so one legal team looks after your business in Panama.
Frequently asked questions
Can a foreigner set up a corporation in Panama?
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Yes. Panamanian law allows people of any nationality, whether or not they live in Panama, to be shareholders, directors or officers of a company. We guide you through the due diligence and beneficial ownership requirements.
Do I need to travel to Panama to form a company?
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Usually not. We can run the process remotely, reviewing your documents online and coordinating the signing and legalization of anything that needs to be executed in your home country.
What is the difference between a corporation and a private interest foundation?
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A corporation is mainly designed for trading and investing, while a private interest foundation is mostly used for asset protection and estate planning. We explain which one suits your goal, or whether you need both.
What ongoing obligations does a Panama company have?
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It must keep a registered agent, maintain accounting and corporate records, keep beneficial ownership information up to date and pay the applicable annual fees and filings. We offer ongoing corporate maintenance so nothing falls behind.
Does my company need a license to operate in Panama?
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If the company will carry out commercial or industrial activities inside Panama, it generally needs an operating notice and, depending on the activity, additional permits. We assess your business and handle the filings.
How do you help me choose the right structure?
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We look at your business activity, where your partners are based, your tax and estate goals and your growth plans. We then set out the available options with their benefits and obligations, so you can decide with the full picture.
Let's talk about your matter
Tell us about your situation and we'll walk you through your options in an initial consultation, in person or remotely, in English or Spanish.
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