Sunday, December 10, 2006

Shipping and Mailing Solutions in Panama

>> my package went were?
Shipping and Mailing Solutions in Panama

When your address changes from “128 Elm Street, Farmsville TX 76508” to “El Cangrejo, la Vía Argentina, la primera calle después del parque, a una media cuadra norte del almacén, frente a la casa amarilla de tres pisos, apartmento tres D, ciudad de Panamá, República de Panamá”, receiving your Christmas cards from family in the States may not be as simple as it used to be. Christmas cards, however, are probably not your main concern. When you choose to live in a foreign country, many items are simply unavailable or out of your budget when available locally. The fact is that sometimes you will need to receive documents and packages quickly and securely. Luckily, there are several solutions.
a po box in miami
In Panama, several companies offer mail-forwarding services. These private mail companies provide you with a PO Box address in Miami to receive your mail and then forward it to Panama within 48 hours. Most companies will deliver the mail to your home. The cost for this service is based on the weight of your correspondence, which generally runs around $3-4 per pound depending on the terms of your contract. It is a good idea to know how much mail you expect to receive in order to select the plan that suits your needs. Keep in mind that magazines with several hundred pages can weigh up to 2 pounds each. Another benefit of maintaining a US mailing address is that you will not be charged a fee by your credit card company for having an address overseas or receive your frequent flier statements in Spanish.

internet purchases
While shopping is great in Panama, there are occasions when you need to shop online. There are several things to keep in mind when placing an order. The first is to know the weight of your purchase as well as the size of the box. With that information, you can consult with your mail-forwarding provider as to the expected cost of delivery, taxes, and customs fees. The cost of bringing in merchandise varies depending on the item, but expect to pay between 10-20% in taxes. If you do not have a credit card from the US, it is often difficult to place orders online. Some of the larger mail-forwarding services place your orders online for you using their credit cards.
air vs. maritime cargo
Depending on how quickly you need to receive your package, you can opt for what is called maritime shipment. Your package will arrive safely, but will take a week or two longer. However, the savings in freight costs can be significant for large, heavy items over eleven pounds. You will still have to pay taxes and customs fees. Once again, it is important to consult with your mail-forwarding provider, since the address for delivery via maritime shipment may be different from the one you would use for shipments by air cargo.
international couriers
Sending correspondence from Panama using your mail-forwarding provider is generally done using their discounted rates with DHL and FedEx. Some mail-forwarding companies offer a less expensive option using the Priority Mail service in the US.
deciding on a service
If you have decided to use a mail-forwarding service, it is a good idea to ask for references. Friends and business acquaintances may offer insight into which companies are more reliable than others. You may also want to visit the office and ask how their operations work.
A mail-forwarding service is a good way to stay in touch with friends and family back home. It is very helpful to be able to receive urgent items in a safe, economical way. If you do your homework and ask the right questions, you will overcome one of the challenges of living abroad.º
By Pamela Oakes Aguilar
Airbox Express

Saturday, December 02, 2006

Relocating pets to Panama

Before shipping a dog or cat to or from the Republic of Panama, contact local airline personnel, to determine shipping requirements, size and type of cage needed.
To import a dog or cat into Panama, you have to bring:
1) Health certificate authenticated by Panamanian Consul or with Apostille from the Department of State,
2) Vaccinations certificate authenticated by Panamanian Consul or with Apostille from the Department of State,
3) Pay US$130.00 for quarantine fees at any BANCONAL Banco Nacional de Panama with an appropiate form

4) If entering through Aeropuerto Internacional de Tocumen an attorney or acquaintance in Panama has to request an exemption from quarantine in writing before the health minister 2 weeks before the trip - indicating arrival and pet information. The request must be submitted hand-delivered at PETA-MINSA (Proteccion de Alimentos of Ministerio de Salud, at former Gorgas US Army Hospital, tel. 562-1671)
With these documents the pet will be allowed into the country. Without 4), the pet will be subject to 30-days quarantine and then released to you. Without any documents, the pet will be returned back to the country of origin.
Some Panama government officials are off-duty on weekends/holidays. PETS ARRIVING DURING OFF-DUTY HOURS WILL BE LEFT IN THE AIRPORT CARGO SECTION WITHOUT FOOD!!!

Panama requires CITES species control certificates from the country of origin and approvals from ANAM (Areas Protegidas at Autoridad Nacional del Ambiente, Curundu, tel. 532-7223) and MIDA (Cuarentena Agropecuaria of Ministerio de Desarrollo Agropecuario, Curundu, tel. 232-5340).
For a list of Panamanian consulates providing more information, go to Embassyworld, or
This information is subject to changes, specially since government entities regularly change telephone numbers or locations without previous notice and 99.99% of the time do not provide information by email or fax. It is provided for informational purposes only and not intended to serve as advice. Travelers should rely instead on their own inquiries at the relevant entities at least 1 month before the date of travel.

Tuesday, November 21, 2006

Panama's Good Value Lures Americans in Search of the Good Life

Live Like a King for Dollars a Day

Panama's Good Weather, Good Beaches, Good Value Lures Americans in Search of the Good Life


PANAMA CITY, Panama, Nov. 2, 2006 —
- Joe Urby and his wife, Stacey Waldren, call it their four-year plan. They live in San Antonio, Texas, with their three children. But when their youngest son heads off to college in four years, the Urbys plan to pull up stakes in Texas and head to Panama.
"We want to make some decisions now, so that four years from now we've got a whole new life planned out for us," says Joe, a self-employed businessman.
Watch the story tonight on "Nightline" at 11:30 p.m. ET.
At age 47, Urby and Waldren are too young to think of retiring. They do not plan to move to this small Central American country to sit idly by the sea.
"My plan is really to take over my life again and for us to reinvent our life," says
Waldren and Urby are just two of 250 people who paid close to $1,000 to attend a four-day conference in Panama City, Panama, on the secrets of retiring -- or reinventing life -- in exotic locales like Panama. The conference is sponsored by a group called International Living, which says it is in the business of helping people make their dreams come true. Most of the attendees are Americans.
"We have the retirees or people who are thinking about retiring," says Suzan Haskins, International Living's resident Panama specialist as she checks off the different groups at the conference. "We have the second-home market. We also have just pure investors. All are people who are looking for an opportunity to buy something they can't buy in the United States."
And that's the common thread here: affordable retirement, affordable investment.

Avoiding 'Poverty or Worse'

Take a trip 45 minutes out of Panama City to the seaside community of Coronado, and Panama's appeal becomes obvious. Fred Morris, a retired minister, and Ron Davidson, a former computer programmer, take a spin in a golf cart at sunset. Davidson and his wife have just built a three-bedroom home that backs onto a PGA-certified golf course. The beach is a few blocks away, the club swimming pool is just down the street, so are the riding stables.
In Florida, this gated-community lifestyle would be within reach only for millionaires, but here the mathematics are very different.
Fred bought his five-bedroom home earlier this year for $160,000. In Panama, Davidson and his wife have discovered they can live like a king and queen for less than a princely sum. They paid cash for their home, and their monthly expenses -- including two cars, insurance, food, a daily maid and a gardener -- come to just
"I couldn't afford to live in Orlando where I was," says Fred. "On my pension, I simply couldn't. It would have been poverty or worse, whereas down here we are living a very comfortable life on the same amount of money."
For years, small numbers of adventurous Americans have migrated south to Mexico or Costa Rica in search of affordable and exotic retirement alternatives.
But today, as the baby boom generation contemplates retirement, moving to Latin America has become an increasingly appealing option. The reason: Future retirees look at their bank accounts and prospective pensions and realize they simply don't add up.
"I personally don't want to work until I'm 65 or 70 years old to try and depend on a social security program that may not be there," says Urby. "I'd rather work to be 50 years old and reinvent myself in a different type of business or enterprise in a Latin American
country and only need half as much income to live off of. That's exciting."
And that explains why the skyline of Panama City is itself being reinvented almost overnight. This city of just a million inhabitants now has 30 new condo projects under construction and another 70 approved, including two waterfront towers that will be 100 floors high.

Political Calm and Profitable Canal

Developer José Bern steps off the construction elevator on the 17th floor of condo tower shooting skyward. In a few months his Grand Bay Tower will cap at 27 floors.
The condos here are all sold. Bern says he didn't even have time to open a sales trailer or launch a marketing campaign. The inquiries flooded in over the Internet, and 95 percent of the buyers were Americans.
The United States has invaded Panama several times: with armies. The current American invasion has
been much calmer but equally surprising. Bern says it began quietly about three years ago, with one or two inquiries from Americans a month. Now it is constant.
Why Panama? There is terrible poverty here, but by Latin American standards Panama is relatively safe and politically stable. The U.S. dollar is the currency, so there is no need to convert. And many of the doctors are U.S. trained. It helps that dinner can be had for $10 or less. A daily maid costs $150 a month.
This country of 3 million is best known for the 51-mile canal that allows ships to pass from the Atlantic to the Pacific in just hours. When the United States handed control of the canal to the Panamanians in 1999 there were ominous predictions of failure.
Instead, the canal is busier than ever, and its safety record is better than ever. Last year it paid a dividend of more than $400 million to the Panamanian government. Which explains why
last month the people of Panama enthusiastically approved a referendum that allows the government to proceed with a $5.2 billion expansion that will allow bigger ships and more ships to make the crucial crossing. That is certain to bring more jobs and more investment.

'More Difficult If You Can't Speak the Language'

What about the fine print? Suzan Haskins, the International Living representative in Panama reminds prospective buyers that this is a foreign country. The official language is Spanish.
"It's more difficult here if you don't speak the language," she says. "You will find that everyday things that you did back home are much more difficult here. Here in Panama everybody speaks English at the bank, but having a worker come into your house and trying to tell him what's wrong with your washing machine or trying to get your telephone service fixed or something like that, those little
things are much more difficult if you are in a place that you don't speak the language."
Haskins says this kind of retirement is for Americans with a sense of adventure.
"I think most people who do it have already traveled," she says. "A lot of people have lived in different places around the world or they have taken vacations in foreign countries so they already kind of know what to expect."

Distance Is the Downside

As dusk settles over Coronado, Fred Morris and Ron and Mayra Davidson share a beer and reflect on their choices.
For Fred, the move has been easy. He was a minister in several Latin Americans countries and he speaks fluent Spanish. Mayra Davidson is from Panama, so for her this is a homecoming.
Although Panama City is just three hours from Miami and Houston, Ron Davidson says the hardest part for him is
being away from family.
"The downside is that our kids are in the States and our grandkids are in the States, so we don't get to see them often," says Ron. "It's a bigger price than we thought."
Fred Morris misses his family too, but he says that with a daughter in Washington and a son Oklahoma City, he didn't get to see his family more than once a year when he was in Orlando. Now, he says, the entire family has a free place in the tropical sun when they come to visit in Panama.
"We just love the place," says Fred. "My wife and I, we couldn't dream of a better place."
Are they on the leading edge of a new American invasion here?
"We fear that," says Fred Morris with a wide grin. "We fear it."
They all laugh as they look around and reflect on their reinvented lives.

Travel Panama
The mix of warm weather and affordable housing is luring a growing number of Americans who are relocating to Panama. (Kathryn Cook/AP Photo)

Sunday, November 12, 2006

Pensionado / Rentista Visas

Requirements for the application of the Retiree / Rentista Visa
1) Power of attorney and request by the attorney. Power of attorney must include the information about the applicant (exact address, telephone number...) and full name of parents and nationality. All the information about the attorney must be specified (Office address, telephone and fax number), complete information of cheques that are provided (number of checks, name of nak, date and amount) of all documents enclosed and the legal basis.
2) Good Health Certificate, issued within the three months before the date of the application (must have date, signature and stamp with the name, signature and registered number of the physician)
3) Police record from the country of origin (only when the applicant has less than two years of continuous residence in Panama).
4) Two (2) sets of photocopies of the entire passport, also authenticated by a Notary Public.
5) Four (4) recent passport-size pictures.
6) Certificate issued by the National Bank of Panama, stating that the applicant earns a minimum monthly return of Seven Hundred and Fifty dollars (US$750.00), solely coming from the interest yielded by the certificate of deposit, without any encumbrance of any kind. The certificate deposit must show it being for a minimum term and date of maturity of five years.
7) Copy of the certificate of deposit or contact, authenticated by the National Bank of Panama.
8) Sworn statement about Personal Background signed by the applicant and the Immigration official receiving it (the form may be downloaded in a .PDF file from here).
9) Two sets of copies of all documents submitted, except for the passport.

For the Pensioner / Pensionado visa, items 1), 2), 3), 4), 8), 9) are required. In addition, the following are required:

a) Police record or Certificate of Disposition from police or court in applicant's place of origin.
b) "Duly authenticated document, which certifies the following:
-The applicant's condition as retired or pensioner from a foreign government, international organization or private entities.
-That the applicant receives a monthly pension of no less than US$500 or its equivalent in foreign currency, plus US$100 for each dependant
-In the case of persons retired or receiving a pension from private entities, a document from the corresponding authority certifying the existence of said entity must be submitted

A) In case that the application includes dependents (wife and minor childrens), the requirements for Immigrant Visa as Dependant of Resident must be enclosed, along with two sets of additional photocopies.
B) All documents issued abroad, should be submitted duly apostilled or authenticated by the Embassy or Consulate of Panama in the country that issued it and by the Ministry of Foreign Relations of Panama.
C) All documents issued abroad in language besides Spanish, must be translated by a certified interpreter recognized by the Minister of Justice.
D) Every foreigner must be duly registered in Immigration Movement Section for which the following must be submitted:
* Two (2) passport-size pictures
* Copy of the page of general information in the passport and that which contains the last seal of entry into the country
* US$1 for registration
* Answer the registration questionnaire.
Schedule for submission of documents 8 a.m. to 1 p.m..
FOR RENEWALS OF THE 5-YEAR PASSPORT, items 1) to 9) must be submitted.

Provided by the Directorate of Immigration as of January 13, 2004, and subject to changes

Updated information in

June 30: Last day to file for property tax reductions

June 30: Last day to file for property tax reductions June 30, 2006 is the last day to file for an assessment ("avaluo") in order to reduce for 5 years the amount of property tax payable. This is specially useful for properties about to be sold or which 20-year tax exemption is about to expire. Applicants must provide with their written request: 1) Title certificate not older than 90 days, 2) Appraisal report by a company from a list of pre-approved appraisers. The list of requirements in Spanish from the Catastro office and approved appraisal companies can be downloaded from

Panama traffic regulations

Panama traffic regulations

> so where does a person find this unknown book of driving laws?
> Never heard of it before.

Panama traffic laws that a copy of the Traffic Regulations (Executive Decree 160 of 1993) be inside the car. Non-compliance is fined US$15.

A copy of the Regulations are available online

In addition, foreigners who have more than 90 days since their last entry to Panama must have a Panama license which duration is the same as that of their Immigration card.

New requirements for Special Permit Extensions

New requirements for Special Permit Extensions

Immigration Resolution 38 of April 26, 2006, has been enacted to regulate the granting and renewal of Special Permits and replace Resolution 2975-DMYN of June 6, 1996.

The application must be submitted in person at the Immigration or with notarized, in stamped paper, enclosing:
1) Power of attorney,
2) Copy of passport,
3) Certified check to the order of the National Treasury for US$300, if the applicant is at least 18 years old,
4) Letter from a resident who acts as sponsor of the applicant and is responsible for all the expenses and the eventual repatriation to the country of origin,
5) Evidence of economic solvency of the sponsor,
6) Copy of cedula or residence card of sponsor,
7) Copy of utility bill of the sponsor, to verify his/her location,
8) Immigration Background ("Declaracion Jurada de Antecedentes") form

Special permits may be granted for up to 1 year and only under exceptional circumstances may be extended.

For the full text, see

Immigration office at Cuba Ave. & 38th Str.

Reforestation visa is restablished

According to a media report of May 1, Panama Immigration signed a resolution which restablishes a special visa granted to those who invest US$40,000 in a forestry project.

Since the visa was abolished by a Law, it is not clear how can a mere Resolution go against a law.

Full text in Spanish


Migración restablece la visa forestal

Sady Tapia

Una resolución que restablece el otorgamiento de visas forestales a extranjeros que tengan interés en invertir en Panamá fue firmada por el director de Migración, Ricardo Vargas, para promover la inversión y la actividad de reforestación en el país.

Immigration Resolution 39 of April 26, 2006, has been enacted to grant the Small Investor Visa to investors in forestry businesses. See Comments for more details.

Before adopting a child in Panama...

Panama Requirements for Adoption
1. Application through a Panama attorney-at-law stating the intention and the reason to adopt a boy, girl or teenager, and specify and sex of the minor that they wish to adopt,
2. Socioeconomic and psychological studies conducted by an institution certified in Panama,
3. Request for criminal background check,
4. Medical certificate of the parents issued by a Panama government hospital,

Assistants at Divino Nino home for children
5. Evidence of current labor, stating position, salary, seniority and benefits. In its absence, certified copy of the last two tax returns or banking references,
6. Birth certificate and marriage certificate between persons that comply with the requirements of Article 53 of the Family Code,
7. Two extra judicial affidavits by persons that know the parents (for common law marriages, the affidavits must testify to said fact),
8. Postcard-size pictures of the rooms and outside of the home (glued to a white sheet),
9. Recent picture in color of each of the applicants, as well as of the other residents of their home,
10. Written acceptance of a three (3) month inspection from the declaration of adoption, on a basis as regular as the judge considers appropriate,
11. Express acceptance of a temporary living with the boys, girls and teenager to be adopted,
12. For Panama nationals, certificate of having received training as adopting parents. For foreigners, certificates issued by the central authority of his/her country of residence, or as required by the Ministry,
13. For applicants resident abroad, certified copy of all passport pages and authorization to adopt issued by the central authority of his/her country of residence,
14. For applicants resident abroad, certified copy of the authorization to enter the adopted child into his/her country.

Children at SOS Villages
All documents must be submitted in a single folder with documents placed in the same order as in this list.
Non-Panama documents must be certified with Apostille from the state of origin or by Panama Consul in said state.
Non-Spanish documents must be accompanied with translation by a translator accredited in Panama.

Requirements for Adoption by National Directorate of Adoption (tel. 279-0667) under Article 297A of the Family Code translated by Alvaro Aguilar as of December, 2004.

Media reports about the situation of adoptions in Panama appear in Spanish in:
300 Children without Parents
Waiting for a new family
Obstacles to adoption process: procedure can last from 7 months to 7 years
Adopt me, please!
2000 abandoned children

U.S. company provides real estate investment opportunity in Panama City

Condo Hotel Investors, LLC = Opportunity

Condo hotel investment in Panama City, Republic of Panama is an excellent opportunity. The condo hotel concept is new to Panama City and we are excited to offer this investment to interested parties.

Recently, several exciting headlines have appeared in many national and international publications. All discussing "off shore" real estate investments that appeared to be relatively easy to enter, could be safely held by foreigners, all while providing stellar profit potential. Those articles piqued the interest of the principals of the company, resulting in an in-depth "investigation".

After developing residential and commercial real estate for more than 35 years in the United States, the principals of the company decided to venture out of the country to discover new, exciting and profitable opportunities. The company has spent over two years investigating opportunities in Central America, specifically Costa Rica and the Republic of Panama.

The company has determined the Republic of Panama offers the best opportunity for safe investment with substantial upside profit potential. After reading the additional information, we feel you will agree.......

For more information on condo hotel investments in Panama, go to

Opening your bank account in Panama


Vista de la Ciudad de PanamáForeigners are subject to "Know-Your-Customer" (KYC) requirements when opening an account with a bank in Panama. Subject to changes according to internal procedures of each bank, applicants must appear in the person at the bank for a personal interview and provide :

1) 2 Letters of Reference from 2 other banking institutions, authenticated with Apostille or by Panama Consul, addressed to the bank in Panama,

2) Copy of the passport and another picture identification (providing the original documents for verification)

3) Tax return or other document which will help the bank identify the income range of the applicant and compare it with the movement of account.

The Panama Superintendent of Banks has a website where all institutions licensed to provide banking services are listed. Institutions which do not appear in this listing act in violation of local laws and depositors risk losing their deposits.

In addition, Panama banks owned by investors holding publicly-traded shares, disclose their financial statements and relevant events to the Panama Stock Exchange

, which helps to gauge their financial solvency.

Processing Zones and City of Knowledge provide business opportunities

Panama hopes processing zones mimic maquiladoras' export success


WASHINGTON -- When people talk about free- trade zones in Panama, they usually mean the Colon Free Zone -- a heavily guarded, merchandise-packed city within a city, which last year imported and re-exported $10.6 billion worth of electronics, clothing, liquor and other luxury goods.

But now, Panamanian officials are promoting a different animal, called Export Processing Zones. These sprawling industrial parks -- housed in former U.S. military buildings now being turned over to the Panamanian government -- hope to copy the success of Mexico's border-area maquiladoras, nurtured by preferential tax and duty treatment.

Speaking Wednesday to 100 potential investors at a conference in Washington, Nicolas Ardito-Barletta, administrator of Panama's Interoceanic Regional Authority, outlined his government's plans to boost the relative importance of manufacturing in Panama's service-oriented economy.

Alvaro Aguilar, a Panama City attorney attending the conference, said EPZs could also offer data-processing and database maintenance services under a draft law that Panama's Ministry of Foreign Affairs is preparing.

"It's not just apparel and sweatshops. Under this law, they'll get all the same incentives and benefits as if they were doing apparel," he said, noting that "now, with Y2K (Year 2000 computer) problems, they're hiring tons of programmers from India. Our idea is that Panama can do that, too."

Click here for full text.

Saturday, October 07, 2006

Buying your Real Estate in Panama

Acquiring Real Estate in Panama

By Alvaro Aguilar
,* 2001

- Ownership and Holding of Properties by Foreigners

Panama is one of several Latin American countries that welcome foreign investment into real estate, by allowing full ownership of property by citizens of any country. Added to other advantages such as use of the U.S. dollar as legal tender, a legal system for accurate registration of property titles and a cadre of U.S.-trained engineers and architects, Panama City has become the destination of investments into real estate as seen in its urban skyline. Rural properties are also of interest for foreigners, since the American Association of Retired Persons named Boquete in Western Panama as the 4th best foreign location for living by U.S. retirees.

The Panama Constitution guarantees the right to ownership of property, as well as equality between nationals and foreign residents before the law. However, special restrictions can be enacted for immigration and health purposes. Ownership of property by foreigners is not allowed in the areas up to 10 km away from the borders, which are covered by inaccesible rainforest thereby leaving the best lands open to foreign investment. The seas, lakes, rivers and the Panama Canal waterway are non-transferrable public domain, while owners of beaches and islands must grant a public right-of-way to the sea.

The Constitution forbids confiscation of properties as a penalty, although property acquired under money laundering schemes is subject to forfeiture. Expropiation is allowed for emergency public interest purposes, but only after a hearing with the owner and payment by the Government of fair, adequate and prompt compensation under international standards. Bilateral investment treaties with the U.S., France, United Kingdom and most European countries further ensure protection of investments from citizens of said countries.

Possesion rights may be requested from the Government over public lands available for agricultural purposes. However, possession rights are not clearly registered and do not grant as many rights as property rights.

Leases on property are also available. A non-interest bearing, refundable deposit with the Ministry of Housing is required as well as registration of the contract with said Ministry. Lease agreements with terms above 3 years must be registered at the Public Registry.

- How is property transferred

Unlike the U.S., where each county has court clerks for registration of title deeds, Panama has a single, centralized, computerized, national Public Registry where ownership and encumbrances of Property, Condominiums (called Horizontal Property), Airplanes and Ships are registered. Property-related transactions are not valid before the public until recorded at the Public Registry. The centralized system allows a title search at the Public Registry to reveal in a single day the measurements, coordinates, mortgages, encumbrances, judicial actions, restrictions, rights-of-way of each property, which is assigned a "finca" number for identification purposes.

The Civil Law requires that the buyer and seller appear in person before a Notary Public to close the sale. However, parties located abroad can grant a power of attorney before their local Notary Public and Panama Consul to appoint an attorney-in-fact to conduct said formality in Panama. The Notary Public drafts a Public Deed, a true copy of which is registered at the Public Registry in 1 or 2 weeks. Transfers of property are subject to a registration duty of US$2.50 for every US$1,000 of the transaction price (usually paid by the buyer), as well as a Capital Gains Tax of 2n the assesed value of the property (levied on the seller) increased at a 5r 10nnual rate from the previous sale price.

Properties that are not being used actively are subject to adverse possesion claims by residents without title that live there for 15 continuous years without opposition from the owner. This is not a problem in real estate markets of Panama City and other urban areas, but is a potential source of disputes in large, remote, rural properties. A physical inspection and a search of the plat at the Property Surveyor's Office ("Catastro") is a must before purchasing such rural properties. Local insurers do not provide title insurance but some U.S. buyers have sought coverage from specialized insurers abroad.

Condominiums and gated communities may be subject to a special Horizontal Property regime. This regime allows individual housing or office units to be separately sold, while their current and future owners remain subject to use restrictions in the By-laws of the complex. The permanent nature of these privately-enacted restrictions make this regime an efficient tool for developers interested in preserving the special nature of large residential and commercial developments.

- Financing of real estate

With almost a hundred general-license banks, Panama has no shortage of financial institutions willing to lend credit-worthy buyers of urban properties, subject to a mortgage on the land or a pledge of funds as collateral. The use of the U.S. dollar as currency and the lack of exchange restrictions allow banks to grant 25-year mortgages at rates between 7 and 11Àwhich are among the most favorable lending conditions in Latin America. After their purchase, urban properties with high resale value can serve as collateral to finance an ongoing business activity of the property owner.

In practice, a prospective buyer requests a letter from the bank financing the purchase, stating that payment will be made once the transfer of title and the mortgage are simultaneously registered at the Public Registry. This serves as an escrow service which provides an additional guarantee for both the bank and the buyer. Valid mortgages must be granted before a Notary Public and recorded at the Public Registry. Applicable registration duties are of US$0.25 for every US$100 of the mortgage amount.

- Tax incentives

Real estate with an appraised value above US$30,000 is subject to yearly property taxes between 1.4nd 2.1ænbsp; However, the Panama Government provides incentives to the construction of buildings and ownership of residences, which encourage investments by locals interested in a secure tax shelter. The fact that construction provides needed employment to unskilled labor and addresses a chronic housing shortage, has prompted the Government to provide the following tax incentives:
1) 20-year exemption of property tax on the value of buildings and improvements, (in force until 2006, after which the maximum will be of 15 years.)
2) Exemption of Capital Gains Tax on the first sale of residences,
3) Banks granting residential mortgages for new residences below US$62,500 receive a negotiable tax credit equivalent to interest reduced in 2 to 4 points below the prevailing rate,
4) Buyers of residences can deduct from their taxable income the amounts paid as interest for mortgages without the tax credits listed in 3),
5) Developers can deduct up to $1,000 on taxable income from the sale of low-income housing with a price of less than US$14,000,
6) Developers can declare as non-taxable income the profits from sale of real estate that are re-invested in the construction of new residences, as long as the value of the new building is below US$62,500 and equivalent to four times the amount of the profits realized.

Foreign investors should seek the advice of competent tax counsel in their country of residence to determine their applicable fiscal compliance requirements and liabilities.

- Special zones of interest

The XVIII- and XIX- century buildings of the Old Panama City (called "Casco Viejo") represent a historical district of interest, for which special incentives have been enacted. Only residential, commercial, tourist and cultural projects that preserve the architecture of the district are allowed, after being reviewed by the a government board. In addition to normal tax incentives, banks granting mortgages Casco Viejo projects receive a negotiable tax credit equivalent to interest reduced in 2 to 4 points below the prevailing rate.

The largest real estate transaction in the Americas is the ongoing sale or lease of 300,000 acres of land and buildings of the former Panama Canal Zone turned over by the U.S. to Panama in 1999. The Autoridad de la Región Interoceánica (ARI) a government entity in charge of attracting investors interested in converting these facilities into economically-viable businesses. Business opportunities are grouped into:
1) Maritime activities: container ports, ship chandling and repair, salvage operations),
2) Industrial parks: maquiladoras, information technology and other environmentally-sound industries,
3) Tourism: retirement communities, hotels and eco-tourism, and
4) Education: higher education and research.

Parcels available for commercial or residential development are listed in the local media and the ARI Internet website. Also available for sale are 3,000 housing units already built in suburban areas.

Non-residential parcels or pre-existing facilities are offered by ARI for lease or concession for a renewable period of up to 25 years. Private investors can also submit project proposals with the respective feasibility and environmental studies to ARI, which if approved will then be open to public offering. Said contracts are granted under a public bid procedure. In the case of mega-projects where only a few qualified operators exist worldwide, an exemption from the public bid procedure may be exceptionally granted that allows direct contracting. Housing units are offered for sale by ARI and sold to the offeror paying the highest price above the base price listed in the media.

Additional incentives for real estate developers are described in the Export Processing Zones, Tourism and Reforestation sections.

For publication in Amcham Panama "ABC of Investing in Panama 2001-2002"

Pictures from info-panama used for non-commercial purposes

Getting your resident visa in Panama


Permanent Residency ("I-" visas) is granted to foreigners:

1) Investing US$40,000 in a Panama non-retail business and effectively employing 3 Panamanians,

2) Holding a US$200,000 CD time deposit (plazo fijo) account in a Panama bank for at least 2 years,

3) Owning a fully-paid house for US$80,000, a timed deposit for at least 2 years, for at least US$120,000 and "provide evidence of the source and amount of income used to cover his/her general expenses",

4) Married to a Panamanian spouse, subject to an interview to verify if it is a bona fide marriage.

Residents earning income from Panama sources (except bank accounts in Panama or securities from Panama public companies) must pay Panama income taxes on said income.

"I-" visa holders can apply also for a permanent residence "cedula" card.

Pensioner Visas are granted to foreigners:

1) Holding a US$125,000 CD in the Panama National Bank yielding US$750.00 monthly for 5 years as Retiree ("Rentista"),

2) Earning a pension from a social security or any foreign government pension authority above US$500.00 monthly as Pensioner ("Pensionado").

Other residence categories exist that are applicable to foreigners sponsored by local employers or educational institutions as part of a foreign worker quota of no more than 10% per company.

In addition to specific documents depending on the type of visa requested, all applicants (except for Married to a Panamanian spouse Visa and Pensioners) must provide, at least:

1) Police Record or Certificate of Disposition from the Town Court of the applicant, authenticated by Panama Consul or with Apostille from the Department of State of origin (except for Pensioners),

2) Medical exam by a Panamanian doctor

Information is valid as to 2/6/2005 and is subject to changes at the discretion of the Directorate of Immigration in Panama City.