Panama – Anticipate Bearer Shares Regime
The Panama Government on its continuous interest of complying with the requirements of international organizations and global standards of highly reputable financial centers has decided to take measures to accelerate the entry into force of Act 47 of 2013, which establishes a regime for the immobilization of Bearer Shares, and also to reduce the transition period for existing companies.
Law 47 requires that bearer shares remain in custody of an authorized custodian. Companies with bearer shares issued before the enactment date (August 6, 2015) originally had a transition period of three (3) years to deposit bearer shares in custody. However, this period was reduced and now ends on December 31, 2015. After the enactment date, all companies that have issued bearer shares will have 20 days to deposit them with an authorized custodian.
OMC Trust through its fiduciary company regulated in Panama, Overseas Management Trust Services Inc., can act as an authorized custodian.
Additionally, the Superintendency of Banks of Panama (SBP) by General Resolution dated December 2, 2014, and the Superintendency of Securities, by General Resolution dated December 3, 2014, established additional measures to identify the ultimate beneficial owner of Panama companies. These resolutions require all banks and brokers to maintain a copy of the Memorandum and Articles of Incorporation for Panama companies which expressly indicate that the company does not allow the issuance of bearer shares or will only allow the issuance of registered shares.
As an alternative to custodial services, you can choose to cancel bearer shares, amend the Memorandum and Articles to prohibit the issuance of bearer shares, and select one of the following options:
• Using a Panama Private Interest Foundation as a shareholder of the company. The Foundation would have its internal Regulations which are a private document that specifies the beneficiaries of the underlying assets and company shares.
• Use a Trust as a shareholder of the company. The Trust would have its internal Regulations or Letter of Wishes which are private documents that specify the beneficiaries of the underlying assets and company shares.
• Appoint a natural person or a legal entity.
