PANAMA Law and Practice Contributed by: María Teresa Diaz, Nadya Price and Joaquín De Obarrio, Patton Moreno & Asvat
4.7 Sister-Ship Arrest Sister ships or vessels owned by affiliates may be sued and arrested in rem in lieu of those on which the claim originated, when the applicable substantive law so permits. The plaintiff must file prima facie evidence demonstrating that, under the applicable substantive law, the arrest of a sister ship is viable, and that the vessel subject to the arrest is a sister ship under the applicable substantive law. 4.8 Other Ways of Obtaining Attachment Orders Law 8 of 1982, as amended, allows a party with reason to believe that, during the time prior to a judicial recognition of their right, they will suffer imminent or irreparable danger to request from the Maritime Court the most appropriate con - servatory or protective measure which will pro - visionally guarantee, depending on the circum - stances, the effect of a judgment on the merits (ie, an injunction order). Such a measure is nor - mally in the form of an order against the sale, transfer or mortgage of a Panamanian vessel. Accordingly, the Maritime Court may issue an order restraining the sale of a Panamanian- registered vessel upon the filing of a complaint against the vessel or its owner with a peti - tion accompanied with evidence of the exist - ence, and the merits, of the claim. The plaintiff must deposit security with the court, which is fixed by the court as between USD10,000 and USD50,000. The security must be posted in: • cash; • certified cheques issued by banks licensed to operate in Panama; • Panamanian public debt titles; or • any other guarantee agreed by the parties.
The plaintiff must file a complaint, together with security for damages and all the preliminary evidence to support the facts of the complaint. Initially, documents may be filed in fax or PDF copies with an undertaking to produce the origi - nals within a short period of time. Once issued, the court sends the order to the Department of Registration of Titles and Encum - brances of the Shipping Bureau, and such authority makes a note on the records of the vessel. 4.9 Releasing an Arrested Vessel Once the arrest is executed, the defendant or any other interested party may petition the release of the arrest by posting a security which is affixed by the court to cover the amount of the claim, interest (three years), arrest expenses and legal fees. The security must be posted in; • cash; • certified cheques issued by banks licensed to operate in Panama; • Panamanian public debt titles; or • any other guarantee agreed by the parties. The parties may agree on the amount, the nature and the conditions of the security which will be substituted for the arrested vessel, and must jointly petition the judge for the lifting of the arrest, consigning the agreed bond at the same time. The parties may agree on other types of guarantees such as letters of indemnity/letters of undertaking (LOIs/LOUs), bank letters or prop - erty and casualty (P&C) insurance letters. If the parties do not reach an agreement as to the amount and nature of the security to be consigned, the court shall, on a motion by the defendant or a third party interested in lifting the arrest, set the amount of the security so that it
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