Panama banks are required by law to apply "Know-Your-Customer" (KYC) policies in order to have information in their files which would allow Panama authorities to know who the ultimate beneficiary owner (UBO) is, in case of a criminal investigation for violation of Panama laws. If your bank is not asking for this information, it is because they have no intention of sticking around for long and your money may actually be at risk of vanishing.
Regulated banks are demanding the following:
1) Personal interview with the accountholders (and/or Copy with Apostille of the passport of the accountholders)
2) ORIGINAL letters of reference from TWO (2) banks of EACH of the foreign director/ Council members and the foreign client,
3) Last statement of account from the two banks.
In addition, so that all Panama transfers are not subject to unjustified scrutiny by US banks, Panama banks must comply with Qualified Intermediary provisions enacted by the IRS.
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In addition, so that all Panama transfers are not subject to unjustified scrutiny by US banks, Panama banks must comply with Qualified Intermediary provisions enacted by the IRS.
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http://www.superbancos.gob.pa/aspec_prevencion/index_eng.aspAGREEMENT 8 (2006)
The Superintendency of Banks is responsible for looking after the maintenance of the soundness and efficiency of the banking system as well download pdf AGREEMENT 12 (2005)
Of December 14, 2005 - Prevention of the misuse of Banking and Trust Services download pdf SPECIAL AGREEMENT 12 E (2005)
Of December 14, 2005 - Guide with examples of Suspicious Operations download pdf AGREEMENT 5 (2003)
Of June 12, 2003 - Basic guidelines relating to the exercise of electronic banking services. download pdf AGREEMENT 4 (2001)
Of September 5 of 2001 - DEFINITION OF CORPORATE GOVERNANCE. For the effects of this Agreement, Corporate Governance will be understood as the group of rules that govern with transparency the relationship and behavior between the Senior Management of the Bank, its Board of Directors, its shareholders, its depositors and any other stakeholder, which produces the strategic objectives of the enterprise, the means, resources and procedures to attain these objectives, as well as the system for the verification of the monitoring of responsibilities and controls corresponding to each level of the Bank�s structure. download pdf RESOLUTION JD No. 032-2005
Of December 21, 2005 - Whereby the scope is set for the concept of Due Diligence contained in Article 3 of Agreement 12-2005 download pdf
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List of Approved KYC Rules and Rules Awaiting Approval
Revenue Procedure 2000-12 states that the IRS will not enter into a qualified intermediary (QI) withholding agreement that provides for the use of documentary evidence obtained under a country's know-your-customer rules if it has not received the know-your-customer practices and procedures for opening accounts and responses to 18 specific questions listed in the revenue procedure.
This document lists those countries that have submitted know-your-customer rules. Two lists are provided -- a list of countries whose know-your-customer rules have been approved by the IRS and a list of countries whose know-your-customer rules have been submitted but not yet approved.
The qualified intermediary agreement contains an attachment that lists the specific types of know-your-customer documentary evidence for each country that is sufficient for purposes of the qualified intermediary agreement. The IRS is working together with the organizations that have submitted acceptable know-your-customer rules to develop standardized attachments. The attachments can be seen here as soon as they are available. For more information, see Rev. Proc. 2000-12 and Announcement 2000-48 .
If a country is on the approved list, entities and branches located in that country may submit their QI applications even if the IRS has not yet agreed to a specific attachment for that particular country. Once a specific attachment has been developed for a particular country, the IRS will associate the attachment with the qualified intermediary agreement it sends for signature. A qualified intermediary may suggest amendments to the attachment, but departures from the standardized attachment may delay processing of an application.
This document lists those countries that have submitted know-your-customer rules. Two lists are provided -- a list of countries whose know-your-customer rules have been approved by the IRS and a list of countries whose know-your-customer rules have been submitted but not yet approved.
The qualified intermediary agreement contains an attachment that lists the specific types of know-your-customer documentary evidence for each country that is sufficient for purposes of the qualified intermediary agreement. The IRS is working together with the organizations that have submitted acceptable know-your-customer rules to develop standardized attachments. The attachments can be seen here as soon as they are available. For more information, see Rev. Proc. 2000-12 and Announcement 2000-48 .
If a country is on the approved list, entities and branches located in that country may submit their QI applications even if the IRS has not yet agreed to a specific attachment for that particular country. Once a specific attachment has been developed for a particular country, the IRS will associate the attachment with the qualified intermediary agreement it sends for signature. A qualified intermediary may suggest amendments to the attachment, but departures from the standardized attachment may delay processing of an application.
ATTACHMENT FOR PANAMA
1. QI is subject to the following laws and regulations of Panama governing the requirements of QI to obtain documentation confirming the identity of QI�s account holders.
(i) Law No. 42 of October 2, 2000.
(ii) Decree Law No. 9 of 1998.
(iii) Agreement No. 9-2000 of October 23, 2000.
(iv) Decree Law No. 1 of July 8, 1999.
(v) Interbank Agreement No. 34 of the Panama Banking Association.
(vi) Panama Banking Association�s Guide for the Prevention of the Wrongful Use of Bank Services.
2. QI represents that the laws identified above are enforced by the following enforcement bodies and QI shall provide the IRS with an English translation of any reports or other documentation issued by these enforcement bodies that are relevant to QI�s functions as a qualified intermediary.
Item 1(i): Superintendency of Banks, National Securities Commission, and Financial Analysis Unit.
Item 1(ii), (iii): Superintendency of Banks.
Item 1(iv): National Securities Commission.
Item 1(v), (vi): Board of Directors, Panama Banking Association.
3. QI represents that the following penalties apply to failure to obtain, maintain, and evaluate documentation obtained under the laws and regulations identified in item 1 above.
Fines from US$5,000 to US$1,000,000, private admonition, public admonition, removal of officers, annulment of banking license, intervention in bank�s administration with compulsory reorganization or liquidation, expulsion from Panama Banking Association.
4. QI shall use the following specific documentary evidence (and also any specific documentation added by an amendment to this item 4 as agreed to by the IRS) to comply with section 5 of this Agreement, provided that the following specific documentary evidence satisfies the requirements of the laws and regulations identified in item 1 above. In the case of a foreign person, QI may, instead, use a Form W-8 in accordance with section 5 of this Agreement. Either QI, or a banking or securities association in Panama, may request an amendment of this item 4.
(i) For natural persons:
(a) Passport,
(b) National identity card,
(c) Driving license that bears a photograph.
(ii) For legal persons:
Copy of certificate of incorporation, memorandum of association and by laws, trust deed or certified copy of extracts from the trust deed.
5. QI shall follow the procedures set forth below (and also any procedures added by an amendment to this item 5 as agreed to by the IRS) to confirm the identity of account holders that do not open accounts in person or who provide new documentation for existing accounts other than in person. In the case of a foreign person, QI may, instead, use a Form W-8 in accordance with section 5 of this Agreement. Either QI, or a banking or securities association in Panama, may request an amendment to this item
(i) QI shall not open an account by any means other than by establishing in person the identity of a customer through the account holder�s own identity documents, except as permitted in (ii), (iii) and (iv) below.
(ii) QI may obtain by mail or otherwise a copy that is an exact reproduction of the specific documentary evidence listed in item 4 above from another person that is subject to know-your-customer rules that have been approved by the IRS for purposes of qualified intermediary agreements, provided that the laws and regulations listed in item 1 permit QI to rely on the other person to identify the account holder.
(iii) QI may obtain a photocopy of the specific documentary evidence listed in item 4 by mail or otherwise remotely from the account holder or a person acting on behalf of the account holder, provided that the photocopy has been certified as a true and correct copy by a person whose authority to make such certification appears on the photocopy, and provided that the laws and regulations listed in item 1 permit QI to rely on the certified photocopy to identify the account holder.
(iv) (iv) (a) QI may obtain by mail or otherwise a copy that is an exact reproduction of the specific documentary evidence listed in Item 4 from an affiliate of QI or a correspondent bank of QI, provided that the affiliate or correspondent bank has established in person the identity of the account holder and the laws and regulations listed in Item 1 permit QI to rely on documentation provided by that affiliate or correspondent bank to identify the account holder.
(b) For accounts opened prior to January 1, 2001, if QI was not required under its know-your-customer rules to maintain originals or copies of documentation, QI may rely on its account information if it has complied with all other aspects of its know-your-customer rules regarding establishment of an account holder�s identity, it has a record that the documentation required under the know-your-customer rules was actually examined by an employee of QI, or an employee of an affiliate of QI or a correspondent bank of QI, in accordance with the know-your-customer rules, and it has no information in its possession that would require QI to treat the documentation as invalid under the rules of section 5.10(B) of this Agreement.
Item 1(i): Superintendency of Banks, National Securities Commission, and Financial Analysis Unit.
Item 1(ii), (iii): Superintendency of Banks.
Item 1(iv): National Securities Commission.
Item 1(v), (vi): Board of Directors, Panama Banking Association.
3. QI represents that the following penalties apply to failure to obtain, maintain, and evaluate documentation obtained under the laws and regulations identified in item 1 above.
Fines from US$5,000 to US$1,000,000, private admonition, public admonition, removal of officers, annulment of banking license, intervention in bank�s administration with compulsory reorganization or liquidation, expulsion from Panama Banking Association.
4. QI shall use the following specific documentary evidence (and also any specific documentation added by an amendment to this item 4 as agreed to by the IRS) to comply with section 5 of this Agreement, provided that the following specific documentary evidence satisfies the requirements of the laws and regulations identified in item 1 above. In the case of a foreign person, QI may, instead, use a Form W-8 in accordance with section 5 of this Agreement. Either QI, or a banking or securities association in Panama, may request an amendment of this item 4.
(i) For natural persons:
(a) Passport,
(b) National identity card,
(c) Driving license that bears a photograph.
(ii) For legal persons:
Copy of certificate of incorporation, memorandum of association and by laws, trust deed or certified copy of extracts from the trust deed.
5. QI shall follow the procedures set forth below (and also any procedures added by an amendment to this item 5 as agreed to by the IRS) to confirm the identity of account holders that do not open accounts in person or who provide new documentation for existing accounts other than in person. In the case of a foreign person, QI may, instead, use a Form W-8 in accordance with section 5 of this Agreement. Either QI, or a banking or securities association in Panama, may request an amendment to this item
(i) QI shall not open an account by any means other than by establishing in person the identity of a customer through the account holder�s own identity documents, except as permitted in (ii), (iii) and (iv) below.
(ii) QI may obtain by mail or otherwise a copy that is an exact reproduction of the specific documentary evidence listed in item 4 above from another person that is subject to know-your-customer rules that have been approved by the IRS for purposes of qualified intermediary agreements, provided that the laws and regulations listed in item 1 permit QI to rely on the other person to identify the account holder.
(iii) QI may obtain a photocopy of the specific documentary evidence listed in item 4 by mail or otherwise remotely from the account holder or a person acting on behalf of the account holder, provided that the photocopy has been certified as a true and correct copy by a person whose authority to make such certification appears on the photocopy, and provided that the laws and regulations listed in item 1 permit QI to rely on the certified photocopy to identify the account holder.
(iv) (iv) (a) QI may obtain by mail or otherwise a copy that is an exact reproduction of the specific documentary evidence listed in Item 4 from an affiliate of QI or a correspondent bank of QI, provided that the affiliate or correspondent bank has established in person the identity of the account holder and the laws and regulations listed in Item 1 permit QI to rely on documentation provided by that affiliate or correspondent bank to identify the account holder.
(b) For accounts opened prior to January 1, 2001, if QI was not required under its know-your-customer rules to maintain originals or copies of documentation, QI may rely on its account information if it has complied with all other aspects of its know-your-customer rules regarding establishment of an account holder�s identity, it has a record that the documentation required under the know-your-customer rules was actually examined by an employee of QI, or an employee of an affiliate of QI or a correspondent bank of QI, in accordance with the know-your-customer rules, and it has no information in its possession that would require QI to treat the documentation as invalid under the rules of section 5.10(B) of this Agreement.
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