There is a reason why the Republic of Panama is today regarded as one of the most business-friendly countries in the world. While the strong economic growth of the country along with investor friendly policies being followed by the government are all reasons enough, there is something far more attractive being offered in the Republic of Panama. And this is the establishment of a Panama Bearer Shares Corporation. The Panama bearer shares corporations are today recognized the world over as one of the best ways to protect one’s assets and financial privacy.
Functioning of Panama bearer shares corporations.
Let us first understand how a Panama bearer shares corporation works. Unlike in most parts of the world, in the Republic of Panama, you can actually own a bearer shares corporation. This means the corporation is owned by the person who has physical possession of the certificates of stock. In the United States for instance, the names of the owners have to be entered into a public registry and they become public knowledge. On the other hand, in the Republic of Panama, only the names of the directors of the corporation have to be entered into the public registry. Nominee directors can be hired by the corporation and they are considered as employees, not owners of the corporation. Thus, the name of the owner will not appear in any public registry.
It is also very easy to transfer these stock certificates. There will be no recorded proof of the sale of these certificates and you can very simply and privately hand over the stock certificates to another person. It is then very difficult for the authorities anywhere to link you to this transaction.
In the Republic of Panama, a corporation can own bank accounts, invest in real estate and stocks, have boats, planes, cars and other assets as also own other businesses. All this can be managed without anyone ever knowing or being able to prove who the owner of the corporation really is. As far as the public is concerned, all these assets belong to the Panama bearer share corporation that has purchased them all.
You might wonder that if you were to open a bank account in the name of the Panama bearer share corporation, you might be required to provide information about who the owner is and identity documents of the owner. This is quite true but it is also true that the banking secrecy laws in the Republic of Panama are amongst the best in the world and it is next to impossible to get banks to reveal the names of the account holders.
It takes only two to three days for a Panama bearer shares corporation to be set up and you can contact any of the local consulting firms to help you with the setting up of the corporation. When you add the ease and simplicity with which any investor or businessman can set up a Panama bearer share corporation to the rest of the advantages listed above, it is not difficult to see why this is considered such an attractive option.

1.Extensive Asset Protection – If you are truly concerned about day to day intrusions into your financial privacy and worry about how best to keep your assets safe, we would suggest that you look at setting up a corporation or foundation in the Republic of Panama. The names of the owners of the foundation or corporation are never entered into any public registry making purchases, sales and transfer of assets very easy and highly confidential. Your offshore banking account information stays protected and you can be sure that through a Panama foundation or corporation, your assets stay protected.
2.Huge Tax benefits – Most of the countries will not bother about where your business is located or conducted, what your investments are and where your bank accounts are located so long as you report all your income and pay the required taxes to the appropriate tax authority. On the other hand, consider the Republic of Panama. You might establish your business here but so long as the income is derived from sources outside Panama or business conducted outside of the country, you do not have to pay any tax on it. You can safely transfer the income to your Panama offshore bank account.
3.Ease of Operation – Many offshore banks require some form of identification documents from the person opening a bank account. While this may cause you some concern, it need not as Panama has very strict privacy laws that prevent anyone from releasing any accountholder information. If you have all the documents necessary, you can easily set up your bank account in one day.
4.Absolute Privacy – You could consider opening a bank account directly or you could consider setting up a Panama Private Interest Foundation to manage your assets and open a bank account in the name of the foundation. A foundation cannot have any owners and so all the details provided to the bank will be those of the foundation keeping the owners anonymous.
5.Extensive Range of Services – Panama offshore bank accounts can provide you with all the banking services that you need. Not only will you be provided with credit cards and debit cards that you should be able to use anywhere in the world, you will be given the facility of online banking. Through online banking, you can transfer funds to your account or withdraw money from your accounts, in complete privacy.
6.Safety of Funds – The Republic of Panama does not have tax treaties with any other country – this means that foreign authorities cannot pursue your funds placed in the Panama offshore bank account in an effort to prove tax evasion or to prosecute you.
7.Dollar Economy – The currency of the Republic of Panama is the Balboa and is fixed at parity with the U.S. dollar. You therefore do not have to worry about losing out money during conversions.
8.Conservative Nature of Banks – Since the Republic of Panama has no central bank, Panama offshore banks have been historically conservative allowing them to easily withstand major fluctuations in the global economy. This has ensured that the assets of depositors of any Panama offshore bank are well-protected at all times.
9.Sufficient Liquidity – Panama Offshore Banks are financed mainly by local deposits that are a result of the strong economic growth the country has seen in the last few years. This has allowed them to carry capital that is nearly twice of what is required ensuring that Panama offshore banks do not depend on any external financial markets.
10. Naturally Safe – Very rarely is the Republic of Panama affected by natural disasters that affecting the entire banking infrastructure as often happens in some offshore destinations.

Banking secrecy laws prohibit banks and other financial institutions from releasing information about their account holders. These laws are typically enforced by a fine and at times, even a jail term. While many countries do have banking secrecy laws in some form or another, the Republic of Panama is one of the few reputed to enforce it to the letter, not hesitating to put the offenders even behind bars.

A Look At What Other Countries Offer

Countries like Switzerland, Cayman Islands, Liechtenstein, Hong Kong, Singapore and Belize, all claim to have strict banking secrecy laws. However, over the years, it has been found that there is more and more pressure on these countries to change their legislation so that information about account holders can be obtained more easily.

Some of these countries like Switzerland for instance, has recently announced that it will adopt OECD regulations that govern international banking transparency and provide information more readily. Previously, many of the above stated countries made a clear distinction between tax evasion and tax fraud and would not cooperate with foreign governments in case of mere tax evasion cases. However, many of them are now willing to provide information about their foreign account holders provided the authorities can provide them with specific and concrete evidence about the tax evasion. This has dealt quite a blow to the reputations of these countries as banking strongholds.

Till recently, Uruguay and the Republic of Panama were two countries that still held some of the strongest bank secrecy laws in the world. However, Uruguay has entered into Mutual Legal Assistance Treaties and Tax Treaties with many countries.

The Republic of Panama has continued with the same banking secrecy laws that were put in place many years ago to protect the account holders. While efforts have also been made to strengthen these laws, no stone is left unturned when it comes to implementing even the current ones. The government is very clear that any person associated with the banks who discloses any private information about the clients will be dealt with severely.

It is also important to note that though Panama also has entered into Mutual Legal Assistance Treaties with other countries, it has ensured that this applies only to cases that involve crime such as terrorism, money laundering or narcotics. The Republic of Panama does make sure that the MLAT is not used to get information in civil cases such as business litigation or matters of tax evasion.

In terms of the strength of the banking secrecy laws, the long tradition of enforcing these laws and the consistent as well as stringent manner in which these laws are enforced, the Republic of Panama is way ahead of many other offshore jurisdictions.

There are many advantages to investing in real estate in the Republic of Panama.
To begin with, it is a certainly a good financial investment. There is currently such great interest in the Republic of Panama from both domestic and foreign buyers that properties in Panama do not take long to appreciate. An investor has to purchase a property and then wait for just a few months before selling it off at a much higher price, making a neat profit in the process.
The Republic of Panama is also becoming increasingly popular with tourists as it has something to offer to everyone. A property near a popular vacation spot can earn handsome income through rising rentals and a surge in tourist population.
The Republic of Panama offers favourable tax incentives to all buyers interested in buying properties in the country. These tax-breaks make it really worthwhile for foreign buyers to invest in some real estate in the Republic of Panama.

Increase in tourism and in the number of people for whom the Republic of Panama is a favourite offshore destination will lead to certain increase in rental values and tenancy rates. Experts point out that the real estate market in Panama has yet to reach the mass market appeal and that it is probably just at the start of a high-growth period. With many predicting the same for the construction industry, it is not difficult to see why this is probably the best time to invest in real estate in the Republic of Panama.

The Government too is doing its bit to attract investors for the real estate by improving infrastructure and putting in place tax incentives. Investing in real estate in the Republic of Panama now almost certainly gets one a substantial capital gain. Prime property can be had from as little as $100/square foot and for spectacular bay-front properties in the City one has to pay just $170/per square foot onwards. On the other hand, consider Florida where similar properties cost anywhere from $500 to $1000/square foot. Also, nowhere else, will you get such a range of properties as in the Republic of Panama – from the modern Panama City high-rises to beautiful beachfronts to breath-taking highland real estate.
Regardless of whether one wants to start a new life in the bustling city life of Panama City, retire to a lovely ocean-view home or just invest in some of the attractive properties, there is bound to be something for everyone who is looking to invest in the real estate market of the Republic of Panama.

PMC Group Panama offers this package to customers who would like to protect already existing assets, who would like to invest in real estate or financial instruments or entrepreneurs who are looking at starting a company and earning healthy profits. PMC Group Panama has a professional staff with years of experience and a wide range of expertise. They can advise and provide all the necessary assistance to individuals and organizations of any size, to set up Offshore Corporations or Private Interest Foundation. To begin with, they spend some time knowing the clients requirements and explaining to them the benefits of both Panama Offshore Corporations and Private Interest Foundations. For example,
Shares of Panama Offshore Corporation can be issued in physical bearer form and the only documents that have to be publicly recorded are the articles of incorporation. The owners are not mentioned anywhere and the articles will only list the nominee officers and directors. The Republic of Panama does not require any annual general meetings of the directors or shareholders nor any minimum amount of paid up capital. The records as well as the bearer share certificates of the Panama Offshore Corporation can be kept anywhere in the world and nobody has to be informed about its location.
Panama has extremely strong banking secrecy laws. There are serious civil and criminal penalties for the bank and their employees if they are found to have disclosed any information about individuals or corporations who have accounts with them. This has ensured that the Republic of Panama is one of the safest offshore destinations for starting an Offshore Corporation.
Panama Private Interest Foundations work best to protect the assets of the person forming the Foundation. The Foundation has no owner and the assets belong only to the Foundation. Thus they are well-protected against lawsuits or claims by family members. Legally binding instructions decide how the income and assets of the Foundation are to be treated. Though the Foundations themselves cannot run a business, they could own Panama Offshore Corporations that run one, thereby adding another level of secrecy to the ownership.

PMC Group Panama will work with the client to know what will work best for them and then guide them through the various formalities as also help them in completing the necessary paperwork without any hassles.

The rapid economic growth of the Republic of Panama is attracting a large number of financial investors, entrepreneurs and real estate investors to the country. PMC Group Panama is confident that they will benefit enormously from the helpful tax regime and strong privacy laws of the country. PMC Group Panama looks forward to assisting them in their endeavor to establish a Panama Offshore Corporation or in their search for the right investment avenues through a Private Interest Foundation.

Panama Private Interest Foundations, under the Republic of Panama laws, have no owners. The only persons associated with the Foundation are the beneficiaries and the protector of the Foundation whose names do not have to be entered into any public register, thereby giving them complete privacy. Another interesting feature of the Panama Private Interest Foundations is that though they cannot directly take part in commercial activities, they could own corporations that conduct business. If the corporation earns income only from offshore sources, all the income is tax-free. Further, since the Republic of Panama allows bearer-share corporations, the shareholders can be anonymous and if the Corporation is held by a Foundation that has no owner, this offers protection of privacy at many levels.

Here is an overview of some of the other benefits of the Panama Private Interest Foundation.

One of the best features of the Panama Private Interest Foundation is that the entire set-up can be completed in just two to three days.
If one is considering purchasing property outside their home country, they should certainly look into establishing a Panama Private Interest Foundation for the same. One can not only buy real estate but also have bank accounts; invest in financial instruments and art; own cars, planes, corporations and shelter all these assets using the Panama Private Interest Foundation. No amount of personal debt of the true owner can affect the assets of the Foundation.
In many countries, the owner’s assets can be frozen as a preventive measure before a trial is actually concluded and judgement passed. However, the assets of a Panama Private Interest Foundation are not affected by an embargo nor can they be sequestered.
By using Panama Private Interest Foundations, one can take care of family members in the way they want or protect them from others, for e.g. ex-spouses. One can leave instructions stating whom the income of the Foundation should benefit after the owner’s death. These would be legally binding. In this way, assets including corporations and real estate owned by the Foundation will be protected and used for the benefit of family members or descendants of the owner.
Finally, there is no requirement for the Panama Private Interest Foundation to hold any annual meetings, there can be no forced heirs and the transfer of any assets from the owner to the Foundation can be brought into effect in complete privacy.

Uruguay is hoping to be a member of the Organization of Economic Cooperation and Development – a 31-nation club consisting of the world’s top leading industrial states. To qualify as a member, it has to meet some very stringent transparency targets and Uruguay is hoping to do so by passing a new law that requires all residents to declare assets held even outside the country. Critics of this new law say that the government is planning on a very stringent tax regime and that it is not fair on any of its residents, regardless of whether they are citizens or foreigners.

A quick look reveals that deposits held outside the country by citizens as well as foreigners and asset holdings of non-resident companies could be affected by the impending legislation. Further, citizens who do take part in non-resident companies would be required to account for all the income tax and payroll tax that they have paid. When the bill comes into action, residents in Uruguay will have to declare their overseas income and pay income and wealth taxes on it. They will also have to declare their share of assets in investments overseas and pay taxes on income earned from them. This development also affects the privacy of the investors – the legislative changes also intend to place new requirements on bank accounts that were so far considered absolutely secret. According to the new changes, all information about bank accounts and deposits would remain protected by law but if a formal request made to a judge is approved, they may have to be revealed.

In contrast, the Republic of Panama still offers enormous tax benefits on income earned offshore. There is no tax on any income that has been earned offshore and the corporation is not required to file any tax returns if all the income was offshore derived. You could establish an offshore Panama Corporation, have an account in a Panama Bank and even maintain an office in the Republic of Panama – if all the income is from offshore sources, you do not need to pay any taxes.

Similarly, the Republic of Panama is also regarded as having one of the best banking secrecy laws even as of today. Panama is a signatory to The Mutual Legal Assistance Treaty but other than in cases where criminal activities have been suspected such as drug dealing, money laundering, terrorism and a few others, it is difficult to use this treaty to force a Panama bank to give up details on bank accounts held with them. Also, unlike many other offshore banking countries, Panama does not allow the MLAT to extend to tax issues. In fact, in the Republic of Panama, even in case of a divorce, bankruptcy or other similar events, the banking information is never revealed.

The Republic of Panama continues on its path of economic growth, attracting investors from the world over by offering attractive tax policies and strict banking privacy laws.

National Transportation Terminal

As you would have undoubtedly heard, the Republic of Panama has witnessed an unprecedented economic growth in the last few years, helped by a boom in almost all the sectors of the economy. I have always believed that if this economic growth is to continue and if citizens of the Republic of Panama are to be part of this success story, the country needs to plan for a modern transportation system. Only through a well-connected and world-class transportation network, can the Republic of Panama hope to deliver on its sophisticated and global ambitions.

Today, the highlights of the Republic of Panama’s public transportation system are no doubt the ‘Diablos Rojos’ or Red Devils. This is an affectionate term coined for the colorful painted buses that form a major part of the Republic of Panama’s public transportation system. The ‘Diablos Rojos’ are usually painted with very bright colors, depicting famous singers, actors, politicians. In fact, it was a trend amongst bus drivers to customize the exterior and interior of their particular ‘Diablo Rojo’. Though these buses have an extensive network, there is no doubt that a modern and growing economy like Panama needs a transportation system that is more efficient and comfortable. Further, a very high percentage of Panamanians own cars leading to massive traffic jams on frequently used highways. In fact, this is one of the major transportation problems faced by the Republic of Panama.

Understandably, to address these problems and bearing in mind, the long-term goal of making the Republic of Panama, particularly Panama City, a world-class destination, it was decided that a citywide metro system would be planned. Totalling about 14 km, it would stretch right across the city. Though this will involve a major reorganization of the existing transport system, I am sure that once the project has been completed, a very large number of passengers will be able to carry out their daily commute more quickly and in greater comfort and security. Moreover, as currently visualized, this project would complement the highly successful ‘Metrobus’ project already being run.

On January 6 of this year, details of the metro project were made public, including the route it would follow. Half of the 14-kilometer stretch will be built underground while the other half will be elevated. As per present plans, it is expected to begin at the National Transportation Terminal in Albrook and will end in the on the north side of San Miguelito, in the Los Andes neighborhood. The metro system is expected to use six-car electric trains that have the capacity to carry 40,000 people per hour. It is believed that the construction of this highly ambitious project is expected to cost around $1 billion and that it will be up and running by 2014 or so.

Though it has been designed primarily to facilitate the daily commute of thousands of people who travel between the northern outskirts to their workplaces in the city center, I would imagine that very soon the metro stations and areas along the metro line will be witnessing a great boom in development that will involve construction of residential and commercial complexes, entertainment facilities as well as new sporting and cultural centers.

I would say, that though the ‘Diablos Rojos’ have had some sentimental value, replacing them with the new metro system will only speed up the growth of the Republic of Panama and aid it in its efforts to become a first world country.

Ernesto Chong

Most of the potential investors who consult with me about possible investment opportunities in the Republic of Panama, are aware of the Colon Free Trade Zone. Most seem to know of it largely as a free zone that drives the economy of the Republic of Panama, while in fact, the Colon Free Trade Zone offers businesses one of the best operating conditions in the world in terms of infrastructure as well as amazing tax benefits.

Let me clarify as I do for my clients why I believe the Colon Free Trade Zone benefits not just the Republic of Panama but foreign investors as well.

The Colon Free Zone, or CFZ abbreviated, is the second largest free zone in the world next only to Hong Kong. With over 1,700 merchant establishments and more than 250,000 visitors coming to the zone every year, it is undoubtedly the largest free zone in the Americas. Visitors to the Colon Free Zone come from different parts of the world – United States, UK, Asia and the Americas.

From the time it was set up in 1948, the Colon Free Zone has witnessed immense commercial activity leading to a highly positive impact on the economy of Panama. In fact, the contribution of the CFZ to the economy of

Panama stands at over $1293 million which is close to 8% of the national gross domestic product or “GDP” and goes to show how the CFZ is an integral part of the Panamanian economy.

I could list many reasons for the success of the Colon Free Zone, but here are a few;

• The strategic location of the Republic of Panama that gives it a geographic advantage

• The re-building of the Panama Canal, a hugely successful endeavor and an engineering marvel

• A US-dollar based economy that ensures zero currency conversion risks

• An international banking center

• Modern and well-equipped container ports

• A well-recognized insurance and reinsurance industry

• Tax and Corporate laws that help facilitate the setting up and running of multinational companies

In addition to all this, I have to point out that the Colon Free Zone offers some of the most competitive prices in the world. It can offer

complete globalization of trade and most importantly ensures speed and efficiency as far as transit of goods is concerned. In fact, even though the Hong Kong Trade Free Zone is larger than the Panama Colon Free Trade Zone, in terms of efficiency and distribution facilities, the Panama Colon Free Zone is widely regarded to be more superior.

Last but certainly not the least, investors and businesses should look at the kind of tax advantages they will enjoy in the Panama Colon Free Zone. As far as the business is concerned, there is absolutely no tax on imports or re-exports thereby ensuring free movement of goods. Companies in the CFZ do not have to pay any corporate income tax as well. All the merchandise that arrives in the CFZ is stored there or leaves the Colon Free Zone is exempt from charges of all kinds, including various taxes and tariffs.

I think that investors and businesses should truly look at the wonderful opportunities the Colon Free Zone offers since with modernization and regular upgrading. It is already the most vital commercial distribution center in the region.

I have always emphasized that the modern and efficient transportation infrastructure found in the Republic of Panama has been a very integral factor in the economic growth and overall development of the country. Recognizing the need to develop this transport network even further and modernize it so as to benefit everyone, the government of the Republic of Panama has taken many steps to provide better transport solutions.

Any discussion about the transportation systems in the Republic of Panama has to start with the Panama Canal.

• Panama Canal – Today, close to 14,000 ships transit across the Panama Canal annually and they carry an enormous amount of cargo as well as passengers. It is estimated that around 700,000 crew and passengers travel through the Panama Canal while 192 million tons of cargo is taken across. With the traffic only expected to increase every year, the port facilities are being modernized and four new container ports are being set up. In fact, the Republic of Panama has one of the largest maritime fleet in the world.

• The government recently put the Merchant Shipping Law into force, which encourages investment in the development of the ports sector enabling them to remain competitive with the world’s best ports. Further, the government too has invested nearly $5 million dollars in various projects aimed at proving various facilities in the country like berths and docks.

• Railroad – A new railroad system is being proposed which is expected to provide efficient intermodal transport facilities between the Atlantic and Pacific ports. With an investment of nearly $80 million being planned for this system, it is believed to complement the transportation network already being provided by the Panama Canal, port terminals, airports and highways. There are a number of convenient transport services being provided by the Panama Canal Railway Company (PCRC) to business executives who have to travel daily between Colon and Panama City. Many tourists who come to Panama City form the cruise port in Colon also find it extremely convenient to use the services provided by PCRC.

• Road Network – Though the total road network in the Republic of Panama is not small (comprising close to 15,000 km), a large percentage of it is still unpaved. This scenario is set to undergo a dramatic makeover with nearly 600 projects in the pipeline all aimed at developing new road networks and enhancing the existing ones. Currently, there are three main roads in the Republic of Panama:

• • Trans-Isthmian Road – Connecting Panama City to the province of Colon

  • Central Road – Connecting Pedasi with Divisa

  • Pan-American Highway – The most important road starting close to the border with Costa Rica and going up to the town of Yaviza.

Obviously, development of roads on such a massive scale is going to require large amounts of investments. A special fund called the Road Maintenance Fund has been set up between the government of the Republic of Panama, which is investing $30 million, while the Inter-American Development Bank (IADB) is contributing $70 million towards this fund.

I am confident that these initiatives towards establishing integrated transport solutions that are efficient, safe and secure, will help spur the economic growth of the Republic of Panama and enable the benefits to reach every part of our country.