Panama’s Efforts to Enhance Corporate Transparency

Strengthening Financial Integrity in Panama

In recent years, Panama has taken significant steps to increase corporate transparency and combat financial crimes such as tax evasion and money laundering. These efforts aim to improve the country’s reputation and reduce its vulnerability to illicit financial activities.

Key Initiatives

Creation of a Beneficial Owner Registry

• In 2019, Panama passed a law establishing the framework for a registry of owners and shareholders behind companies and other corporate entities.
• The registry will be private and only accessible to authorized officials, ensuring that sensitive information remains secure.

Suspension of Delinquent Corporations

• Panamanian authorities have suspended over 385,000 companies due to failure to pay registration fees.
• This move aims to reduce the risk that these companies are used for tax evasion or money laundering.

International Cooperation

• Panama has strengthened its information-sharing agreements with other countries and adopted international standards set by the Organisation for Economic Cooperation and Development (OECD).
• This enables tax authorities to obtain data on offshore accounts held by residents, enhancing their ability to combat financial crimes.

Law Changes

• Recent law changes in Panama allow financial authorities to request accounting records from registered agents.
• This is a crucial step in investigating financial crimes and ensuring that companies operate transparently.

Challenges Ahead

While these efforts are positive steps towards increasing corporate transparency and combating financial crimes, experts caution that weak enforcement and limitations on access to the beneficial owner registry may blunt its effectiveness. It remains to be seen whether Panama’s initiatives will yield the desired results and contribute to a safer and more transparent financial environment.