NOTICE
LAW 254 OF NOVEMBER 11, 2021 OF PANAMA
Extends the obligations to maintain
Accounting records and supporting documentation to Panamanian companies.
Author: Dimisel Hernández, associate.
The Republic of Panama has enacted Law 254 by which it obliges companies of Panamanian nationality that: (i) do not carry out operations within Panama (“Offshore”); or, (ii) are only holding companies (“Holding Companies”), to maintain accounting records and supporting documentation at the offices of their Resident Agents in Panama, for their annual submission to the General Revenue Directorate of Panama (DGI), under penalty of a fine for non-compliance from US$5,000.00 up to US$1,000,000.00.
In this tenor, companies of Panamanian nationality that comply with the aforementioned characteristics must annually provide the Resident Agents with the following documents, who in turn must remit them to the DGI of Panama. Namely:
Statement indicating the physical address where the accounting records and supporting documentation of the entity are kept; as well as the name and contact information of the custodian of such information.
Original or copy of the accounting records and supporting documentation of the company corresponding to the previous fiscal period.
For corporations, copy of the stock certificates and shareholders registry.
Depending on the resident agent in Panama, additional documents may be required.
For the fiscal year ended December 31, 2021, companies have until October 31, 2022 to provide the above mentioned documentation. Subsequent years, the documents must be submitted no later than April 15 of each year.
The resident agent may resign as agent of the company that fails to comply with this new provision and that does not submit the accounting records or supporting documentation at the time it is required to do so or that does not comply with the deadlines established for the delivery of such information. In these cases, if the corporation does not have a resident agent, it will be withdrawn from the Public Registry of Panama, and a penalty must be paid for its reinstatement.
In that order, if you have a Panamanian corporation, we will be pleased to assist you in complying with this legal provision. You can contact us at [email protected] or at +1.809.566.7111.
