| Panama is a great place to live and work. In recent | | | | routinely drop their guard in a deceptively familiar legal |
| years Panama has been growing in popularity among | | | | environment of Panama, which is based on the |
| investors, expatriates and retirees alike. Recently | | | | Delaware Corporations Law and similar to the |
| popular online publication "International Living" rated it | | | | Wyoming Limited Liability Company Law, but allows |
| as the No. 1 place to retire in the world, and for good | | | | bearer shares and untitled real estate sales. |
| reasons. According to the Economist Intelligence Unit, | | | | Panama has a court and judicial system built around a |
| Panama's economy grew by a historical 11.2% in 2007 | | | | civil code, rather than the Anglo- American system of |
| after increasing 8.7% during 2006 and this economic | | | | reliance upon case law and judicial precedent. |
| expansion is expected to continue in 2008. This is | | | | Fundamental procedural rights in civil cases are |
| mainly due to substantial growth in the financial and | | | | broadly similar to those available in U.S. civil courts; |
| construction sectors, tourism and the commercial | | | | however as a whole, the system is inefficient and |
| expectations placed in the ongoing expansion of the | | | | prone to abuse. The business community lacks |
| Canal. Panama's dollar-based economy offers low | | | | confidence in the Panamanian judicial system as an |
| inflation and zero foreign exchange risk. Its legal and | | | | objective, independent arbiter in legal or commercial |
| regulatory regimes are business friendly. Its | | | | disputes, especially when the case involves powerful |
| government is stable, democratic, and reform minded | | | | local figures with political influence. In a few cases the |
| and actively seeks foreign investment in all sectors, | | | | appearance of corruption has been so widely |
| especially services, tourism and retirement properties. | | | | accepted as to constitute conventional wisdom. |
| Panama offers a higher quality of living at a lower | | | | Arbitration is always a better choice at the Center |
| cost and with less crime than typical Central | | | | for Mediation and Arbitration established by the |
| American destinations, although Panama City is rapidly | | | | Panamanian Chamber of Commerce or at various |
| getting to world pricing. Panama has a wealth of | | | | European or American arbitration centers and courts. |
| variety to offer whether it is beaches, lakes, | | | | Since Spanish is the official language in Panama, |
| mountains or the countryside and prices for real | | | | always make sure the request your transactional |
| estate purchases with a range of choices for | | | | documents in English as translations of the Spanish |
| practically any budget. | | | | documents and never sign any agreements in Spanish |
| The Colon Free Zone, the second largest in the world | | | | if you do not speak and read the language! Legal |
| after Hong Kong, is a vital trading and transshipment | | | | documents are not interesting reading, but it is a |
| center serving the region and the world. Panama has | | | | must for a successful investment. |
| no restrictions on the outflow of capital or outward | | | | The Public Register of Panama provides much |
| direct investment. Its accession to the World Trade | | | | transparency to the company registrations, |
| Organization in mid-1997 opened up trade and | | | | recordings of mortgages and liens and for transfer of |
| lowered tariffs. | | | | title to properties, however, it also prone to misuse |
| According to Panama's constitution, nationals and | | | | by unscrupulous parties, albeit, by licensed |
| foreigners are treated equally under the law. Both | | | | professionals as well. |
| Panamanian and foreign companies must fulfill the | | | | Lastly, but just as importantly, Panama has many |
| same basic requirements to organize and operate | | | | experienced attorneys and established laws firms, |
| most types of business activities in Panama. There | | | | however, Panama Bar does not follow the conflicts |
| are restrictions on foreigners participating in retail | | | | of interest rules and stringent ethical standards as we |
| trade and practicing certain professions. In practice, | | | | do in the US, hence again, cautions must be |
| however, there are legal ways to overcome these | | | | exercised. For the very least, ask the partner of the |
| restrictions. Panama has one of the most modern and | | | | firm to warrant to you that other members of the |
| flexible corporate law frameworks in Latin America. | | | | firm are not involved in representing parties adverse |
| Panama is an interesting and potentially profitable | | | | to your interests and transactions and do not use |
| jurisdiction for licensing agreements and joint | | | | affiliated entities as trustees if the firm is |
| ventures as well as routine commercial operations for | | | | representing the seller in your purchase transaction. A |
| international companies. | | | | good local bank can be easily hired as a trustee. |
| Having listed all the good reasons to invest in | | | | Use your common sense to build a team of advisors |
| Panama, the caveat is - you must be careful, so to | | | | you can trust and you will do very well in beautiful |
| paraphrase the famous line from the Wizard of Oz: | | | | Republica de Panama! |
| "This ain't exactly Delaware, Dorothy!" | | | | Copyright 2008, Juliette M. Passer, Esq. |
| Foreign investors, especially from the US and Canada, | | | | |