Panama Corporations (S.A.): Security, Strategy & Global Business Growth

Panama Corporations (Sociedades Anónimas) are one of the most widely used corporate structures by entrepreneurs, investors, and professionals around the world. Their flexibility, confidentiality, and efficiency make them an ideal legal tool to protect assets, develop businesses, and manage international investments. This is why it is very popular to register Corporations in Panama.

Incorporating a company in Panama is not just a legal process—it is a strategic decision that allows you to separate your personal assets, optimize tax planning, and project global business credibility.

Panama is recognized as one of the strongest corporate hubs in Latin America, known for its legal stability, competitive tax advantages, and flexible corporate structure.

Panamanian corporations are ideal for entrepreneurs, investors, independent professionals, international businesses, and anyone seeking a secure and efficient legal structure.

Types of Panama Corporations (According to Their Operations)

Both types follow the same incorporation process before the Public Registry of Panama.

1. Corporations Operating Within Panama

✔ Engage in commercial activities inside the country.
✔ Must obtain a Commercial License (Aviso de Operación).
✔ Must register with the Municipality and file annual tax returns (even if no income was generated).
✔ Ideal for companies offering local services, physical businesses, or operations within Panama.

2. Offshore Corporations (International Use).

✔ Perform activities outside Panama.
✔ Do not require a Commercial License or Municipal Registration.
✔ Are exempt from local income tax, provided the income is generated abroad.
✔ Widely used for asset protection, investment structuring, holding companies, and global operations.

The corporate incorporation process remains the same, and the Notice of Operation may be obtained at any time. Likewise, companies that already hold a Notice of Operation may close or cancel it at any time.

Local companies that maintain an active Notice of Operation are required to file income tax returns in Panama.

There are certain local activities that do not require a Notice of Operation. Further information on these exceptions is available in our blog article on Notices of Operation.

Advantages of a Corporations in Panama

Panamanian Corporations offer a wide range of strategic, legal, and financial benefits for entrepreneurs, investors, and international business structures:

1. Tax Efficiency & Global Investment Freedom

• Offshore profits are 100% tax-exempt in Panama.
• Funds and accumulated profits may be invested or deposited in any country without becoming taxable in Panama.
• Panama applies a territorial tax system, providing an ideal framework for international operations.

2. Fast, Easy, and Cost-Effective Incorporation

• One of the easiest and most affordable jurisdictions to set up an offshore company.
• No minimum paid-in capital required.
• Low annual maintenance costs.

3. No Citizenship or Residency Requirements

• Owners, directors, and officers may be of any nationality or residence.
• Perfect for foreign entrepreneurs and global investors.

4. Flexible Corporate Structure

• Freedom to appoint nominee directors and officers, whether natural or legal persons (our firm can provide them upon request).
• Shareholders’ and directors’ meetings may be held anywhere in the world, including via telephone or electronic means.

5. High Level of Confidentiality & Legal Protection

• Panama offers strong corporate, business, and banking secrecy laws.
• Absolute confidentiality in financial transactions, including the historical use of numbered accounts.
• No obligation to disclose the Beneficial Owner to any public authority (subject to compliance regulations handled privately through the Resident Agent).

6. Asset Protection & Identity Security

• Robust legal framework for asset protection, safeguarding personal assets from corporate liabilities.
• Historically, bearer shares afforded anonymity (modern regulations ensure safekeeping while preserving privacy protections).

7. Full Freedom of International Funds Movement

• Panama has no exchange controls, allowing corporations to freely transfer or manage funds globally without restriction.

8. Operational Flexibility

• A Panama corporation can operate inside or outside Panama, adapting to commercial, investment, or holding activities.
• Ideal for multi-jurisdictional business strategies.

Requirements to Incorporate a Panama Corporation

To begin the incorporation process, you must provide:

1. Proposed company name: three options ending in Corp., Inc., or S.A., which are used for Corporations in Panama
2. Corporate purpose (object): broad or specific business activity
3. Share capital: recommended USD $10,000 (no minimum required by law)
4. Type of shares: registered, common, or preferred shares (bearer shares not allowed)
5. Three directors and officers: president, secretary, and treasurer (individuals or legal entities; one person may hold multiple roles)
6. Due Diligence Form: information on ultimate beneficial owners (we provide the form)

At Panama Legal Group, we verify company name availability and guide you through each step.

Incorporation Services Included for Corporations in Panama

When incorporating your company with Panama Legal Group, you receive:

1. Drafting and notarization of the Articles of Incorporation and Public Deed
2. Registration at the Public Registry of Panama
3. Issuance of shares and shareholder registry
4. Minutes for issuance of shares and subscribers’ resignation
5. RUC registration with the Panamanian Tax Authority (DGI)
6. First year of Annual Franchise Tax (Tasa Única) and Resident Agent included
7. Digital signature and digital registration for document integrity and traceability in our digital platform
8. Free consultations and unlimited client support

💻 You can follow up the entire process online through LEGIX, our digital legal services platform; you can track progress and access all your corporate documents.

Directors & Officers: Structure and Confidentiality

Panamanian law requires a minimum of three directors, who may be natural persons or legal entities of any nationality. Corporations must also appoint officers: president, secretary, and treasurer.

Optional: Nominee Directors Services

Some clients choose nominee directors or officers for privacy or administrative convenience.

In these cases:

1. Panama Legal Group provides nominee directors under a formal contract
2. The client receives a General Power of Attorney to manage the company
3. The identity of the ultimate beneficial owner remains private
4. Nominees may be changed at any time upon request
5. Nominee directors do not participate in business decisions or operations
6. PLG does not offer nominee shareholder services

This service is common in international corporate structures requiring a higher degree of confidentiality.

Complementary Corporate Services

We also provide integrated solutions for full business setup in Panama:

1. Local or international bank account opening assistance for Corporations in Panama
2. Registration with Municipality (when it is a local corporation) and DGI
3. Application for Commercial License (Aviso de Operación) when required
4. Drafting of corporate agreements and manuals
5. Establishment of Private Interest Foundations, when required
6. Support with commercial licenses and special permits
7. Support in the opening of bank accounts
8. Immigration services

These services can be requested individually or as part of a full business setup package, ideal for foreign investors or new companies in Panama.

The incorporation of the company takes from 3-5 business days.

Why Incorporate with Panama Legal Group?

Panama Legal Group is a Panamanian law firm with corporate lawyers, helping in the registration of corporations in Panama and provide:

1. Pioneers in LegalTech in Panama
2. 100% online incorporation and monitoring, without losing personalized service
3. Human, efficient, and expert legal guidance
4. 10% discount on related legal services
5. Continuous support via chat, email, or video
6. Digital monitoring and online corporate file through LEGIX
7. We do not charge for each call or email
8. We coordinate anything you need—from documentation to real estate searches or logistics

Do you have questions about incorporating or operating a company in Panama?
Our legal team can help you understand your obligations, evaluate your structure, and guide you through the appropriate legal steps.

Request a legal consultation or proposal here.
Or contact us directly at info@panamalegalgroup.com

You can also verify information on:

Opening a Bank Account in Panama

Retiree Permanent Residency

Friendly Nations Visa