PANAMA Law and Practice Contributed by: Rafael Rivera, Malvis Mina, Nicole Pérez and Carolina Lino, BDO Panama
designed to attract foreign investment, promote economic development and support specific industries. Some of these regimes are outlined below. Free Trade Zones Free Trade Zones are designated areas within Panama where domestic and foreign compa - nies can establish operations in different sec - tors, including higher education centres, scien - tific research centres, specialised centres for the provision of health services, high-tech enter - prises, assembly enterprises, finished or semi- finished product processing enterprises, service enterprises, environmental service companies, general service companies, logistics service companies, and manufacturing companies. Currently, there are 16 Free Trade Zones in Pan - ama and six in development, focusing on various industries. Companies established in the Free Trade Zones can benefit from tax, immigration and labour incentives. Colón Free Zone The Colón Free Zone is a free trade zone located at the Atlantic entrance of the Panama Canal. Companies established in the Colón Free Zone are primarily dedicated to the international pur - chase and sale of merchandise, forming a dis - tribution centre from Asia to countries in South America, the Caribbean and Central America. The most common activities of companies established in the Colón Free Zone are the import, export and re-export of merchandise received in large, duty-free volumes, which is subsequently repackaged, labelled, assembled, manufactured and reshipped in smaller quanti - ties to customers.
The Colón Free Zone offers tax, immigration, labour and corporate advantages to companies establishing themselves in this zone. Some of the tax benefits are tax exemption on imports, re-exports, and manufacturing goods, tax exemption on re-export income, etc. Panama Pacifico Regime The Panama Pacifico Regime supports the development of an international business cen - tre, attracting large multinational companies, logistics services companies, various commerce and general industries. The main objective of this regime is to attract foreign direct investment and create jobs in Panama. The Panama Pacifico Regime offers customs, immigration, labour and tax benefits to companies involved in logistics, maritime and airport services, high technology, call centres and shared services, among others. The development of economic activities under the Panama Pacifico Regime will be open to nationals and foreigners. The requirements, criteria and review procedures for registration applications will be applied in a fair, transparent and equitable manner to all applicants, through non-discriminatory commercial treatment, respecting the principles of free competition and free market access. Multinational Companies Headquarters (SEM) Regime The SEM regime aims to encourage multina - tional business groups to establish their reginal and global operations centres in Panama. The Multinational Companies Headquarters is an office with management control in the region, providing services from Panama to related com - panies (parent, subsidiaries or affiliates) in other countries.
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