Panama Corporation

Companies in Panama take advantage of Law 41

Law 41 of 2007 was promulgated to provide incentives for international companies to establish regional headquarters in Panama. Most of the incentives are fiscal based, and pertaining to total exoneration of income taxes as well as a host of labour and immigration benefits.

A number of companies are benefiting from this law which include PSA Peugeot Citroen, Western Union, AES, Total, Hyundai, LG and Caterpillar to name a few. One of the important points that are relevant in order for the companies to take advantage of the incentives is that they are of a multinational nature with international or regional operations and by establishing themselves in Panama they are offering not only their businesses support but value added geographical and logistical support to their headquarters subsidiaries and affiliates and associates. Please mention companies cannot fight for the taxation incentives as well as the mentioned labour and immigration benefits require the Commission for Licenses of Multinational Headquarters. It is necessary for the companies to present statements of assets facilities as well as the identification of locations where the businesses will operate, in addition to this the value of their shareholding as well as their stock market share price if applicable is required.

According to the media the license is granted to an indefinite period, which will remain valid as long as no infraction within the Panama legal framework is incurred. Worth mentioning is that Law 41 is specifically formulated to further aid in the issuance of visas for foreign workers of these companies, and who will not stay longer than five years or in the case of temporary personnel, who can stay for a period of three months.

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