Public Limited Companies are easily handled, and at the same time, they are really efficient. These companies offer facilities and safety. Law 32, from the year 1927 about the Public Limited Companies of the Panamanian Republic, is also applied to those Public Limited Companies which do local businesses within the Republic of Panama as well as to those companies whose main production activity is considered “offshore”.

The Panamanian companies are used as the perfect icon for asset protection. They could work as a holding company or they could also be the owners of any kind of assets.

The flexibility that these Panamanian companies offer should be considered an important factor due to the fact that this flexibility makes any kind of legal activity possible in Panama even if they were already written as part of the objectives established in the social pact of the firm.

It is also important to mention that the owners and/or stockholders remain anonymous. In addition, they could also conduct their businesses at the same time as the record of transactions is completely private.

OUR FIRM PROVIDES YOU WITH THE POSSIBILITY OF GETTING NOMINATIVE DIRECTORS, FOR YOUR OWN PRIVACY

INCORPORATION REGULATIONS

In Panama, two or more natural individuals could create a society – firm – throughout a Constitutional Social Pact. The founders do not need to be citizens or residents of Panama. According to Article # 2 contained in the Law of Public Unlimited Companies – Number 32, Year 1927, the Social Pact should explain the following piece of information:

GENERAL OBJECTIVE OR PURPOSE OF THE SOCIETY – COMPANY

The Panamanian legislation freely allows any society – firm – to do any kind of business activity; that is the reason why, the list of particular objectives of the company does not prevent the firm from doing some other activities that are not established in the Social Pact.

FIRST DIRECTORS

The Panamanian Law requires the Social pact to include the full names and addresses of the first directors of the society. A minimum of three directors is required. Those members could be either national citizens of the Republic of Panama or foreigners. This law is also about selecting different numbers of directors, dignitaries, with a minimum number of three. In this case, the exact number of directors – dignitaries is determined by the Management Board (executive committee) or the Board of Stockholders; and that would depend on what is already established in the social pact.

DIRECTORS AND OFFICIALS

According to what is established in the social pact, none of the directors could be stockholders. As a matter of fact, the dignitaries do not need to be directors; and the stockholders, directors, and dignitaries could be from any nationality. The only exception is the case of those societies which pretend to do certain commercial activities within the Republic of Panama which are already reserved by national laws for Panamanian citizens.

MEETINGS AND VOTING

The sessions of stockholders and the management board members could take place out of Panama only if they are either previously notified in the clauses of the firm or if they are approved by the law.

In fact, if the clauses of the society allow it, the directors could be represented and vote in the sessions of the management board. The representatives do not need to be directors; indeed, they could be appointed to different posts through a public or private document; with or without the power of substitution. The stockholders could also do the same in their sessions of stockholders.

THE MANAGEMENT BOARD

The stockholders choose the management board members, but the vacancies could be filled with the vote of the majority of the current directors.

The firm should have a president, a treasurer, and a secretary. Besides, this board could also have some other dignitaries as needed by either the management board or the social pact determines. Examples of those representatives could be; a vice-president, an assistant for the treasurer, and an assistant for the secretary. This works out the same way for the first dignitaries when appointed within the social pact. Besides, it is also important to highlight that one person is allowed to have / exercise more than one post.

THE INCORPORATION PROCESS

All of the clauses should be registered and presented to a public notary in Panama before they are enrolled in the mercantile (commercial) section at the office of the Public Register. The clauses of the firm should, in every single case, be enrolled in the Mercantile Register in the corresponding order. These clauses could also be translated into any language, but they must be written in Spanish by an official certified interpreter. The public writing could contain both versions: the original one as well as the Spanish – Translated Version.

The real interested parts do not need to travel to Panama to carry out the incorporation process. Two people who currently live in Panama could create the clauses of the society with the help of a Public Panamanian Notary based on the instructions given by the two interested parts. As it was mentioned above, each founder should enroll a minimum of one share from the authorized total capital. Once the clauses of the firm have been enrolled in the Public Register, the founders could then endorse their rights to the real interested parts in order to give the total control back to the society.

• Some of the main advantages and benefits of an International Society - Firm - are the following ones:
• Tax Exoneration
• Exoneration from Fiscal Rights
• Confidentiality
• Minimum Government Taxes and Fiscal Rights
• Flexible Administration Methods
• Not only the corporative entities but also natural people are allowed to work as dignitaries – directors.
• Designation of Corporative and Normative of Shares
• Keeping the name of the company under secret could be agreed.
• Shares could be emitted in different ways.
• Besides, the main method to be used when making investments in Panama is throughout the creation of a subsidiary investment account.

ANONYMOUS OWNERS

The certificates of the Panamanian Firms’ shares could be emitted in a normative way or as bearer stocks (Bearer stocks are an anonymous way of property) with or without their actual value.

DESIGNATION OF DIRECTORS

Our customers are offered the “Appointed Directors” option for their firms. Due to confidentiality purposes, we prefer to provide our firms with directors/dignitaries. When we hire appointed directors for the societies – firms – that are established for our customers, we always offer our clients pre – signatures and letters with no resignation date from the directors, so that our customers feel that they are able to substitute those directors at anytime.

MEETINGS OF DIRECTORS AND STOCKHOLDERS

The Company’s Yearly General Board Meeting of Stockholders and Directors is not mandatory; nevertheless, if the meeting is carried out, it could take place anywhere in the world, and it could be transmitted by any of the following means: over the telephone, though e-mail, and/or any other kind of electronic tools available.

USAGE OF THE PANAMANIAN SOCIETIES / FIRMS

You could have bank accounts, accounts in trust, short and long term deposits, and other financial or commercial title.

You could act as an intermediary in transactions involving local companies.

You could act as an owner of apartments, houses, businesses, buildings, and any other kind of movables or real properties.

You could act as an owner of the shares of other firms, companies, and legal entities.

You could open charge accounts and time deposits.

You could use them as a means to invest on time deposits, shares, bonuses, mutual funds, and/or any other kind of financial or commercial titles.

You could also use it to create international trust. You could also act as a trust administrator, as a beneficiary, or even as a trustee of the fund.

You could also use it as means to obtain earnings – incomes – and some other dividends.

ADVANTAGES OF PANAMANIAN PUBLIC LIMITED COMPANIES

Creating one of these firms takes approximately twenty four hours to be incorporated once the required information is received. In addition, it takes two business days to be registered in the Public Register, and in case of emergency cases, the societies will always be available at anytime.

An established number of stockholders is not required by the Panamanian Law for the society to exist; and that is the reason why, just one single person could possibly own all of the shares. The beneficiary – owner – or the person who is designated by him/her could be authorized with a general power from a lawyer to carry out any type of activity towards the benefit of the company.

All of the shares of the firm could be emitted as bearer stocks. In this case, it is not necessary to keep an official record of the stockholders’ identity.

Normally, different legislations demand a minimum capital to start working with the firm. The Panamanian Law does not require a minimum capital; what this law requests is to have the interested parts establish a total amount of the social capital; the number and the value next to the shares by which these are divided as well as the shares of the firm which will be emitted without a nominal value (Article 22 of the Law).

The Panamanian Law does not require any link between the payment from the capital and the value of the firm’s assets, so when a society – firm – with a paid B/.10,000.00 capital could get assets even of millions. In other words, the value next to the shares does not necessarily correspond to the value written on the accounting books of the firm.

All of the meetings of stockholders should be carried out within the Republic of Panama; unless anything else has previously been expressed in the Social Pact or in the articles of the association. This standard allows us to carry out meetings even out of the Republic of Panama.

The announcement of the meeting should be given out in writing and signed by the president, the secretary, and the person or individuals mentioned in the Social Pact.

If all of the stockholders who have the right to vote show up, so there will immediately be a quorum, and so it is no necessary to announce the meeting. If it is not well known whether all of the stockholders would come, so the meeting must be announced in advance due to the fact that it is the procedure established in the Social Pact. Unless, the society determines something else, the announcement should be given personally or through e-mail to each stockholder who has been given the right to vote. The announcement should be given within a minimum of ten days or a maximum of sixty days before the meeting.

If the society has emitted bearer stocks, the announcements for stockholder meetings should published (usually in a local newspaper) as established by the Social Pact. A stockholder could cancel any meeting before or after it takes place.

SOCIETY PLACEMENT

The Social Pact states that the placement for the society should be within the Republic of Panama. The society; however, could run businesses; establish branches and/or offices all over the world.

DIGNITARIES

A society could have a president, a treasurer, and a secretary from any nationality; and they do not need to be directors. The appointed directors are usually elected as the dignitaries of the firms.

The society – firm – could have as many dignitaries as established by the Management Board, the Social Pact, or the articles of the association. One person could have two or more posts, but the president and the secretary should not be the same person as it is recommended.

MANAGEMENT BOARD

The administration of the society – firm – is conducted by the Management Board which should be composed of a minimum of three member directors of age from any nationality. If the firm is devoted to certain business activities within Panama such as retail businesses, the directors must be citizens of Panama. The number of directors could be incremented and/or reduced by the stockholders at anytime. The vacancies in the Management Board could be taken by the vote of the majority of the current directors.

MEETINGS

The directors participate in meetings celebrated anywhere in the world. The directors could be represented and vote at the Management Board meetings (the mandates do not need to be directors and could be appointed by a private public document; with or without the power of substitution).

Unless the Social Pact states something else, none of the directors or dignitaries could be stockholders.

ACCOUNTING BOOKS OF THE SOCIETY

The society should have a minor ledger and a record of shares (a confidentially private document saved by the dignitaries of the society) anywhere in the world. If we supply the directors and appointed dignitaries, we keep the accounting books of the firm protected. Why? Those books need to be properly stamped and signed by a public notary in Panama.

INCORPORATION PROCESS

According to the Law of Panamanian Firms, a society or company could be created by two or more people from any nationality. They would carry out the Social Pact in Panama by being assisted by a public notary. The clauses could be written in any language, but if they are translated into another language different from Spanish, they must be attached to the translation written by an official interpreter. The notary would hand out a certificate indicating that the original one (in the foreign language) has been properly translated. Once the clauses are approved by the public notary, they then need to be enrolled in the Public Register. As soon as the firm is already enrolled, it turns into a legal entity.

As a matter of fact, the two appointed stockholders (usually lawyers) come to the public notary and sign the deed of the society – firm agreeing to take a share each. The founders then transfer the shares to the buyers through a written agreement attached to the deed of the firm. The owner(s) of those rights fall upon the only person (for example the client) with interest in the society or firm. That is the reason why, it is not necessary for the customer to come to the Republic of Panama or to sign any document related to the formation of the firm.