Dear clients and friends,  

We would like to share with you the following informative bulletin regarding certain modifications to the due diligence requirements that the government of Panama enacted on November 11, 2021, in the law known as Law 254 (Ley 254), that introduced adaptations related to tax transparency and prevention of money laundering
 
The law is divided into three categories by legal entity type:1. Legal entities that declare income in Panama: This type of legal entity does not have the obligation to file accounting documentation to its resident agents;
2. Legal entities that operate outside of Panama: This type of legal entity must have financial statements and provide a copy annually to its resident agent, indicating the contact information of the person who maintains the originals, or provide the originals to the resident agent; and
3. Legal entities that do not operate (e.g., holding companies): Law 254 indicates that this type of legal entity must disclose information that demonstrates its (i) assets, (ii) income, and (iii) liabilities.

The deadline for legal entities incorporated before November 11, 2021, to provide the corresponding documentation to their resident agent for the current year, is May 11, 2022.
 
To date, no official regulation for Law 254 has been enacted, however, we will share with you the list of required documents for holding companies to provide to their resident agent in order to comply, as soon as it is made public.  
 
Please note that we are ready to assist you in any matter related to this bulletin.

Mayora & Mayora, S.C.