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Update and new legal obligations of Due Diligence and Accounting Record

The Republic of Panama, with the firm objective of complying with the different international standards of prevention, approved Law 254 - 2021 which is in force.


In relation to the above, in our capacity as Resident Agent, we are obliged to require from our clients’ certain records and documents in compliance with current regulations:


I. DUE DILIGENCE. We are obliged to:

  1. Complete the due diligence of the client, final beneficiaries, officers, directors, administrators, signatories, legal representatives and / or representatives of the Corporations (S.A.), Limited Liability Companies (S de R.L.), Foreign Companies registered in Panama (S.E.) and Private Interest Foundations (FIP). (Agreement No. JD-01-2020 Article 5)

  2. Obtain the information and documentation related to the financial and transactional profile of the client. (Law 254-2021 Article 9)

  3. Obtain a copy of the share certificates and shareholder records of the S.A. (Law 254-2021 Art. 17)


II. ACCOUNTING RECORDS - LAW 254-2021


1. For S.A. and FIP IN FORCE (Article 17):

  • Conservation: They must keep their accounting records for a minimum period of five years in the offices of the Resident Agent within the Republic of Panama or in any other place, inside or outside the Republic of Panama, as determined by the administration agents of S.A. or FIP.

  • Annual Delivery of Documentation: Copies of the accounting records of the S.A. and FIP must be provided to the Resident Agent no later than four (4) months following the expiration of each fiscal year, that is, no later than April 30 of each year. According to this, copies of the accounting records for the year 2021 must be delivered to us no later than April 30, 2022.

  • Report Custody Information: Inform the Resident Agent in writing each year of the name and contact details of the person who maintains custody of the accounting records and their supporting documentation, as well as the physical address where they are kept.

  • Report Changes of Custody: If there is a change in the person who maintains custody of the accounting records and their supporting documentation, or in the custody address, the S.A., S de R.L., S.E. and/ or FIP must immediately write to the to the Resident Agent to inform the name and contact details of the new custodian, and/or the new physical custody address.

2. For S.A., S de R.L., S.E. and/or FIP SUSPENDED (Article 17)

  • In relation to these entities, to be reactivated they must provide us with a copy of their accounting records. Such copies will be kept in our offices.

3. For CHANGE of Resident Agent (Article 18)

  • The S.A., S de R.L., S.E. and/or FIP must inform the new Resident Agent of the name and contact details of the person who maintains custody of the accounting records and their supporting documentation, with the physical address where they are kept.

4. For DISOLUTION of S.A., S de R.L., S.E. and/or FIP (Article 18)

  • To register the dissolution, the S.A., S de R.L., S.E. and/or FIP must provide us with copies of the accounting records and their supporting documentation, corresponding to the previous five years.

Legal entities that carry out their commercial operations within the Republic of Panama are exempt from providing the accounting records or a copy thereof to the Resident Agent. III. SANCTIONS: Entities that fail to comply with prevention rules will be exposed to severe penalties that could include:

  1. Suspension of corporate rights

  2. Fines of US$5,000.00 up to US$1,000,000.00 (failure to comply with obligations relating to accounting records)

  3. Liquidation and forced dissolution of the entity

To learn more about Law 254-2021 and its sanctions access the following LINKS:

INFANTE & PEREZ ALMILLANO confirms that all the information provided to us in relation to compliance with these requirements will be kept strictly confidential in our files and may only be provided to the competent authority in Panama in case of requirement under the established legal parameters. For any additional information or clarification regarding these measures adopted by the government of the Republic of Panama, we remain at your orders. You can contact us at info@ipal.com.pa

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