PANAMA Trends and Developments Contributed by: Kharla Aizpurúa Olmos, Mónica Moreno and Eduardo Oteiza, Morgan & Morgan
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Key Initiatives During President José Raúl Mulino’s first full year in office, his administration has prioritised key initiatives aimed at attracting foreign investment and reshap- ing Panama’s international reputation, altering global perceptions to position the country as an increas- ingly appealing destination. These efforts include: (i) advancing measures to position Panama as a safe and reliable investment hub where the rule of law prevails, thereby strengthening investor confidence; (ii) promot- ing public-private partnerships (PPPs) to launch major infrastructure projects that stimulate economic growth and job creation; (iii) reinforcing fiscal discipline; and (iv) leading major regulation overhauls to the pension system to ensure long-term economic stability. Panama’s Removal from EU List of High-Risk Jurisdictions Earlier in 2025, the European Parliament voted to remove Panama from its list of high-risk jurisdictions afflicted by strategic deficiencies in their national anti- money laundering (AML) and counter-terrorism financ- ing regimes. This milestone followed years of interna- tional scrutiny, despite Panama’s ongoing efforts to combat corruption, tax evasion, and other white-collar crimes considered predicate offences for money laun- dering and other crimes. Panama’s removal from the list reflects the EU’s recognition of the reforms imple- mented and its confidence in the country’s ability to uphold transparency and foster effective co-operation with international bodies and investors. This devel- opment may have a ripple effect on Panama’s bank- ing and finance sector, as it enhances the country’s access to international financial markets, improving the country’s overall creditworthiness and risk pro-
file, and could also contribute to lowering the cost of capital for borrowers, both on the public side and for individual households. In other words, banks, espe- cially from the EU, could now view granting loans or financing to Panamanian borrowers as a less risky endeavour. Since 2015, Panama has undertaken a series of legal reforms and institutional measures to strengthen inter- agency co-operation in the fight against money laun- dering, tax evasion, and terrorism financing. These efforts have not only aligned the country with inter- national standards set by organisations such as the Organisation for Economic Co-operation and Devel- opment (OECD) and the Financial Action Task Force (FATF), but have also led to the enactment of key leg- islation aimed at: • preventing money laundering, terrorist financing, and the proliferation of weapons of mass destruc- tion; • defining offences such as smuggling and customs fraud; • requiring certain legal entities to maintain account- ing records; • further reinforcing and regulating trustees and the trust business; • amending the Criminal Code in relation to offences against the National Treasury; • establishing a register of ultimate beneficial owners for corporations; and • introducing adjustments to enhance international tax transparency and strengthen AML frameworks.
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