Incorporation of Companies and Foundations in Panama

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Experts in Corporate and Business Law

K&B Legal Services is a boutique law firm established in Panama that provides legal advice to national and international clients.

Our lawyers offer comprehensive legal services and are trained to guide clients through all their legal matters, ensuring compliance with the ever-changing legal, fiscal, and economic framework.

Incorporation of Companies

Panamenian Corporations

A Panamanian corporation is a legal entity formed by two or more natural persons, which has rights and obligations similar to those of any individual. The articles of incorporation define the rules and regulations, who is in charge, and how the company will operate. 

The incorporation process begins with two individuals called subscribers who appear before a Notary Public in Panama to sign the Articles of Incorporation. This document is then registered in the Public Registry of Panama to form the legal entity.

Panamanian corporations require a minimum of three individual directors in the company, and three officers (President, Secretary, and Treasurer). The same person can assume all three officer positions. A legal representative will be appointed and authorized to sign on behalf of the corporation. Shareholders of the corporation are designated in a physical share certificate that is issued once the corporation is “created” (once the corporation is registered in the Public Registry).

Tax regime and its functions

Panamanian Corporations are subject to the territorial tax regime, which requires payment of taxes only for operations carried out in the territory of the Republic of Panama under a Notice of Operation or Business License. Any income received from offshore activities is exempt from income tax. 

A Panamanian corporation is of interest to anyone interested in doing legal business in Panama. It is an affordable and convenient legal entity that could allow you to achieve your business objectives. The constitution of a Panamanian corporation is easy, quick, and cost-effective as it usually takes from 5 to 7 business days.

Incorporation of Foundations

Foundations in Panama

Foundations are legal vehicles to ensure patrimony protection. A foundation serves as an instrument for asset administration. One or more natural or juridical persons called founder(s) create the foundation, which is administered by a Foundation Council, under the supervision of one or more Protectors, for the benefit of an individual, his family, or a specific social purpose.

Foundations are frequently used as a substitute for a will, to avoid complicated inheritance procedures and taxes, since it coordinates the distribution of inherited assets.

The participants involved are the Founder(s), the Foundation Council, and the Protector.


  • Foundation patrimony is constituted by donations and is independent of its founder’s one.
  • Founder heirs can’t challenge donations made to the foundation, and the foundational patrimony is protected against the founder’s creditors.
  • The foundation may carry out financial activities on a non-habitual basis.

Most common uses

  • Administer property, cash, or assets on behalf of a founder and in favor of one or more beneficiaries.
  • Serve as a “Family Foundation” that administers goods and assets of one or more families.
  • Avoid the fragmentation of family businesses to third parties.
  • Administer assets for humanitarian, religious, or charity purposes.
  • Protection of vulnerable persons, minors, or persons unqualified to manage their assets.

Advantages and benefits

  • Any assets, cash, or securities whose income is not of Panamanian source are tax-exempt.
  • Members of the Foundation Council, Protectors, and Resident Agent are legally obliged to keep silent about the foundation operations under penalty of fine or imprisonment.
  • The incorporation procedure is fast, from 5 to 7 working days.
  • The foundation assets are separated from the founder’s one, and can’t be seized, or subject to any action or precautionary measure.

«Our lawyers offer comprehensive legal services and are trained to accompany our clients in all their matters.»


Consult us and incorporate your company or foundation in Panama.

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