Offshore Banking Panama, Bank Secrecy, Anonymity

by Elliot Clark on December 23, 2008

Panama’s Corporation Law 32 of 1927 states that corporations can be founded by two persons that are residents or non-residents. Panama’s Corporation Law in many cases resembles Delaware Business Corporation Law of 1926. Unlike many offshore banking Panama treats both domestic and offshore companies in the same way. All corporations in Panama pay taxes for domestically generated income, while income generated from foreign sources is exempted from taxes.

Legislation of Panama obliges corporations to have minimum of three directors and minimum of three officers. Three managers can also be three officers of a company (President, Secretary and Treasurer or other positions they desire). Legislation of Panama Offshore Banking center allows appointing officers that are not at the same time shareholders and they can be non-residents of Panama. In addition, directors can be physical persons or companies.

Following concepts can not be used without license or special permission:

Bank, Investment Fund, FundPanama Offshore Banking Management, Trust, Assurance, Re-Insurance, Savings, Building Society, etc and their foreign translations;

All local corporations are required to use “Corporation”, “Incorporate”, “Sociedad Anonima” or the abbreviations “Corp”. “Inc” or “S.A” in their company name;

Typical share capital is $10,000 that is divided into 100 common shares of no par value. Minimum emission is either one share of no par value or one share of par value. Higher capitalization of a company is subject to higher government fees.

Advantages of establishing offshore company in Panama are:

1. High degree of secrecy and anonymity;

2. No obligation to disclose final owners;

3. No obligation to submit financial statements or hold general shareholder meetings;

4. Exemption from taxes: all transactions conducted in Panama are exempted from taxes;

5. Moderate establishment and annual costs and fees;

6. No Capital requirements;

7. Small registration fee on capital;

8. Corporations established in Panama are free to conduct any legal transactions in any country and in any currency;

9. Corporations are free to issue “non-standard securities”;

10. Shareholders, directors and officers may be residents of any country. Directors do not need to be shareholders;

11. Shareholders are allowed to vote by proxy voting;

Offshore Banking License
Panama Offshore Banking Company is a tool through which offshore banking sector operates. Panama offshore banking company is established as a normal corporation in Panama and then applies to Panama Ministry of Commerce to receive the license fro conducting financial services. These services include:

1. Opening and maintaining offshore banking accounts and receiving deposits;

2. Managing, investing funds and making loans;

3. Receiving interest and dividends on third party funds;

4. Serve as a part of payment system;

5. Conduct consulting, advisory and audit services;

6. Making precious metal buying/selling though the Internet;

7. Factoring;

8. Providing leasing services, if company share capital exceeds $100,000

Companies established in Panama that do not possess a license granted by Ministry of Finance are prohibited to conduct offshore banking services.

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