PANAMA Law and Practice Contributed by: María Teresa Diaz, Nadya Price and Joaquín De Obarrio, Patton Moreno & Asvat
An advantage of this type of registration is that no enrolment fees apply to vessels enrolled in Panama under this registration for the first time, and they will be exempted from paying part of the applicable regular annual tonnage taxes and fees. In addition, they will be exempt from need - ing to have technical, safety and security certifi - cates on board, but the respective RO should make the pertinent annotations concerning the lay-up status in the subject certificates. Once re-activated, an inspection must be car - ried out by an RO to ascertain that the vessel is duly fitted in accordance with all national and international maritime laws and regulations, as a requirement for reverting to a regular interna - tional service registration. In addition, Panamanian law allows dual bare - boat-charter registrations. A ship with primary registration on a foreign registry is permitted to be registered under the laws of Panama as secondary registry, pursuant to bareboat char - terparty arrangements. The inverse situation is also permitted by Panamanian law. The system under Panamanian law results in dis - persing of the features or attributes of registra - tion. The laws of the primary registry govern the juridical status of a vessel in terms of the con - cept of ownership and encumbrances, while the laws of the special subordinated registry govern matters regarding the administrative and techni - cal operation of a vessel – ie, manning, labour relations, safety and security matters. A vessel registered in Panama under a bareboat- charter agreement will have a registration valid for a period of up to the validity of the bareboat- charter agreement; this period may be renewed as per renewals of the subject charter agree - ment.
A vessel registered under this special type of registration will be considered a Panamanian- registered vessel and will only be allowed to fly the Panamanian flag. Likewise, it will be subject to all regular applicable taxes, fees and duties in accordance with Panamanian law. Payment in respect of these applicable during the whole period of registration must be made in advance upon enrolment. 1.6 Registration of Mortgages Ship mortgages are required to be registered at the Ships Registry in order to provide legal and binding effects against third parties. A Panamanian mortgage may be executed in any language and must be notarised by way of acknowledgement of the legal capacity of the signatories and the authenticity of the signatures thereof. The notary’s signature must then be legalised by a Panamanian consul or via apos - tille. Registration may be effected preliminarily via the filing of an application form containing the description of the essential terms of a mortgage. This preliminary registration is completed during the course of one business day and has full legal effect for a period of six months, within which period the interested party must file for perma - nent registration. Upon completion of permanent registration, the effects are retroactive up to the time and date of the preliminary registration. Permanent registration may be effected via two alternative procedures: • by way of a full translation of the mortgage into the Spanish language and protocolisa - tion before a Panamanian notary public into a public deed, which is filed for registration with the Ships Registry; or
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