Procedure guide · Business and employment
Registering a Branch of a Foreign Company in Panama
How a foreign company registers a branch in Panama's Public Registry: parent company documents, assigned capital, tax registration and when to use a subsidiary.
- Law
- Law 32 of 1927, Article 90
- Registry
- Public Registry of Panama
- Liable party
- The parent company
- Updated
On this page
In short
A foreign company can operate in Panama without creating a new company by registering as a foreign company in the Public Registry to open a branch or office. The branch is not a separate legal entity: the parent company is liable for its obligations. To register it, you must formalize the parent's articles of incorporation in Panama, prove that it exists and declare the capital it will allocate to the country.
Branch or Panamanian subsidiary?
- Branch: it is the same foreign company operating in Panama. It is easier to keep aligned with the parent, but the parent is liable with all its assets.
- Panamanian subsidiary: a new legal entity, usually a corporation in which the parent is a shareholder. It limits liability to what is contributed to the subsidiary.
- Special regime: if the company belongs to a multinational group that provides services from Panama, consider the SEM regime.
In both cases, what is earned in Panama is taxed there as Panamanian-source income (see territorial taxation), and profits the branch sends to the parent may be subject to withholding, like dividends.
Requirements
- A public deed formalizing the foreign company's articles of incorporation before a Panamanian notary.
- A copy of the company's latest balance sheet, with a statement of the part of the capital it uses or plans to use in business in Panama.
- A certificate that the company is incorporated and authorized under the laws of its country, authenticated by the Panamanian consul or apostilled.
- Translation into Spanish by an authorized public translator of any documents in another language.
- A power of attorney to a Panamanian lawyer, who files the registration.
Required documents
- Apostille or legalisation
Parent company's articles of incorporation
To be formalized in Panama
- Apostille or legalisation
Parent company's latest balance sheet
With the statement of capital for Panama
- Apostille or legalisation
Certificate of good standing of the parent company
Spanish translations
By an authorized public translator
Power of attorney to the lawyer
Step by step
01
Get the parent company's documents in its home country
Articles of incorporation, latest balance sheet and certificate of good standing, apostilled or legalized (see embassies and consulates).
02
Have them translated into Spanish
By an authorized public translator in Panama.
03
Formalize them before a notary
The lawyer formalizes them in a public deed with the statement of the capital allocated to Panama.
04
Register the company in the Public Registry
From registration, the foreign company can operate in Panama through its branch.
05
Register to operate
Register for the DGI's RUC, get the business license and, if you hire workers, register with the CSS.
Costs
- Notary and registration fees
- Depends on the case
- Annual flat feeRegistered foreign companies also pay it
- Under the Tax Code
- Apostilles, translations and lawyer
- Variable
Frequently asked questions
Can the branch have employees in Panama?
Yes, like any employer: with Panamanian contracts, CSS registration and, for foreign staff, work permits.
What are its annual obligations?
Similar to those of a Panamanian company operating in the country: annual flat fee, accounting, income tax return and business license (see annual corporate obligations).
Do I need a branch if I only sell to Panamanian customers from abroad?
Not necessarily. Registration is needed to have offices or agencies and do business in Panama. If you only sell from abroad, review with a lawyer whether your activity creates an establishment in Panama.