A corporate bank account can be opened in Panama by local companies and by foreign companies as well. Panama has been removed from the FATF list which includes high-risk countries in terms of financial security. International banks in Panama have no requirement for clients to travel to the country for a meeting with bank specialist in order to begin the procedure of opening a bank account. The country committed to implementing the OECD reporting standard on the AEOI controlling the automatic exchange of information.

Panama banking sector overview
Panama’s banking sector to foreign competition has been opened since in 1970 by placing high priority on banker-depositor confidentiality. Over 90 banks were registered in Panama in early 2013 with total assets close to $90 billion. Overall, the banking legislation establishes three types or categories of operations:

general license banks which are operating as full service banks in Panama by competing for domestic and foreign deposits and loans;

international license – offshore banks which can only accept deposits from persons or organizations located overseas;

representative offices which can only perform representational activities;

two state-owned deposit-taking institutions.

In general, foreign and Panamanian banks are competing on equal terms. Banking institutions are organized as a Panamanian Banking Association and regulated as well as licensed by the Banking Supervisory Authority. There is no deposit insurance scheme available in panama’s banking system.

Top 3 banks of Panama
Country’s banking system is well developed while also becoming an important international banking hub for years with 70 banks operating in the Bank Center. To most popular, trusted and reliable of them are National Bank of Panama, HSBC Bank Panama, Banistmo or Banco Del Istmo.

The National Bank of Panama is one of the government-owned banks, holding deposits of about 5 billion US dollars.

HSBC Bank is a subsidiary of HSBC Holdings plc which headquarters in Panama City by providing corporate banking, personal banking and treasury services to the country.

Banco Del Istmo is the biggest bank in Panama and Central America acquired by HSBC Holdings plc by being a part of the HSBC Group. Before its Grupo Banistmo’s acquisition by HSBC – a former parent company, it was the subsidiary of HSBC Bank (Panama) S.A. and after that it merged into HSBC Bank.

Required documents
In general there are some required documents in order to open a corporate bank account in Panama such as personal information and corporate references from all of the individuals who are signatories on the account. However, there must be some of the additional requirements met in order to begin the process of opening a bank deposit account:

Copies: of financial statements from the account signatory or the Company if available, of the Signatory Passport and second form of identification (driver’s license, state ID card, etc.), of utility bill (water, phone, gas etc.),

Personal references: from established community organizations, lawyers, accountants, business consultants, etc. as well as personal bank references from the account signatory and original commercial references from the account signatory;

Proofs: of the origin of the funds – bank statements, rental leases, business contracts, rental leases etc.;

For Corporations: Certificate of Good Standing from the Public Registry issued within the last ninety (90) days

Letter addressed to the Bank with information such as: short explanation of a business or employment, contact information, number of employees, reason of opening a bank account in Panama, estimated amount of money that will be flowing through the account on a monthly basis, country’s name where the funds are coming from, intended use of the funds.


Time frames
Usually it takes 2 weeks to approve and open bank account in Panama or may be a little it less by the bank’s compliance department. However this procedure may take additional time to process and additional documents might be requested as well. Therefore, the bank may collect all of the necessary information for the client to be able to access his or her account from internet banking or home banking. A debit or a credit card also can be issued upon client’s request.

Privacy policy
In general, Panama Banks provide such private and corporate banking products as multiple currencies, checking and saving accounts, internet and telephone banking, wealth management services, debit and credit cards, fixed term deposits. All these services are provided by maintaining privacy policy which is a constitutional guarantee in panama. Country’s privacy laws are backed by several constitutional articles which guarantees high confidentiality not only for its citizens, but for foreigners as well.

There are several Panama Privacy Constitution Articles describing privacy policy in Panama. For example, Article 44 is protecting private ownership of real property and private investments as long as they are legally acquired by a legal entity or natural person. Panama has special Privacy Codes, Privacy Conventions and Panama Privacy Laws (Law 6;11;13;26 and 51) as well. For example, the Panama Judicial Code states that personal data can only be revealed to the interested party and restricts providing the same information to outside person.

A limited liability company (hereinafter referred to as LLC) is a commercial company with legal personality. Typically, an LLC's equity is the total face value of its equity interests. One of the key features and benefits of an LLC is the fact that shareholders cannot be held personally responsible for the company's debts or liabilities - only the company's assets themselves are at risk. However, the issue of limitation of liability also depends on the national legislation of each jurisdiction. In general, an LLC is a corporate structure that combines the simplified taxation of a partnership with the principle of limited liability of a corporation. For an international trading company it can be the perfect solution as long as the jurisdiction is well chosen.

Functions of a limited liability company
There are no particular circumstances under which you would be obliged to incorporate a limited liability company. An LLC is a type of legal entity that successfully mixes the majority of the most desirable attributes of other company types, which explains why most entrepreneurs opt for an LLC when starting a business. Furthermore, in many offshore jurisdictions there are simplified accounting and record-keeping requirements for LLCs.

Usually, we would advise our clients to consider an LLC as a viable option when they are looking to start up a trading company or a small business within certain limits. LLCs are perfectly suited to those seeking an opportunity to run a business (locally or internationally) and distribute profits at minimum expense. However, you should always bear in mind that an LLC usually does not offer an effective mechanism for introducing a partner with limited voting capacity, or numerous investors, to your business. In these cases, we suggest you consider a limited partnership or a joint-stock company, as these may offer more effective ways to achieve your goals. Incorporating an offshore company in a tax haven jurisdiction may be a good way to reduce maintenance costs.

Advantages and disadvantages of a limited liability company
As with any other legal entity, the LLC has its own pros and cons. Depending on the circumstances and your chosen jurisdiction, there may be other peculiarities in addition to those listed below. That is why we suggest that you consult our lawyers prior to initiating the incorporation process.

The main advantages of an LLC are:

Limited liability of the shareholders with respect to creditors
Smaller minimum capital than for a joint-stock company
Flexible structure: it can operate with one or multiple shareholders
Minimal requirements for board and directors; no supervisory body
Flexibility with regard to taxation
Relatively quick and easy incorporation procedure
Simple bookkeeping and paperwork
Usually one person can be shareholder, director and employee (if required)
The primary disadvantages are:

Limited third-party investment options
The company cannot issue shares publicly

If the government did not require you to prepare and file accounts and annual reports, would you still do so voluntarily and what would be the quality of your company's accounts? Today, many tax haven jurisdictions have no requirements for filing annual or monthly tax returns and reports: offshore companies have an autonomous freedom of choice to retain the documents as they wish. However, more and more offshore jurisdictions have started to modernize and update their legislation, gradually introducing a mandatory requirement to retain financial records and documents, as the beneficial owner of such a company would be the one who would benefit the most . This aspect can play a crucial role, especially when an offshore company is owned and managed by multiple people, providing a more efficient system to monitor assets and monitor decisions made.

For example, in the Seychelles, companies are required to keep bills of exchange without providing accounting records to government authorities, which subsequently allow monitoring of the company's economic status to provide up-to-date information to owners at all times. However, there is no obligation to make financial documents public, nor are there any statutory audit requirements. In theory, the local tax authority may require the company to provide and/or improve its records. However, such a situation can only arise in circumstances provided for by legal acts and can usually be foreseen and avoided.

As we just mentioned, tax havens (BVI, Panama, Seychelles, Nevis, Marshall Islands, Dominica, etc.) do not have to file financial statements with the local authorities. However, today many offshore companies choose to voluntarily prepare financial statements for IBCs and tax haven companies. The reasons for such actions are as follows.

The legal requirements of many offshore companies require proper accounting by the company. Income statements, general ledger and balance sheet of the company must always be available upon request of the registered agent. All accounting documents confirming transactions must also be kept by the company: invoices, contracts, transport documents, bank statements, etc. Such provisions exist in (BVI, Seychelles, Nevis, Belize and many other offshore jurisdictions. Please note that financial records from International Business companies may be stored anywhere in the world, not necessarily at the registered office.

Your bank may ask you for the annual accounts of your offshore company. As banks are tightening their requirements on tax havens, one of the ways to keep your commercial bank account for such a company is to provide accounting statements upon request. Banks often require the simplest accounting reports: income statement and balance sheet.

Your own control over financial operations is the most obvious reason to keep account records for any business.

The development of telecommunications and economic globalization have made it possible for interested investors to set up companies all over the world. With proper research, financial investment and legal backing, business ventures can be safely incorporated in almost any country in the world. Building an international business used to be a complicated entrepreneurial venture, but today it is commonplace with the help of experienced legal and business advisors.

The advantages of founding a company abroad are as numerous as they are obvious. Many countries offer specific locational advantages, ranging from natural resources and well-established infrastructure to beneficial laws and regulations that encourage growth in a particular industry. Likewise, it can be difficult to start a business or an acquisition in your own country due to adverse situations: political or regulatory environment, lack of resources and more. In this situation, it makes sense to consider an overseas option that offers greater opportunities for growth, development, and success.

Company registration in Angola
When setting up a business in Angola, an interested investor must conduct due diligence regarding legal procedures, international regulations and sufficient investment for success. It is crucial to understand cultural, social and political factors that influence starting and growing one's business. Failure to do so may result in unintended consequences. Poorly researched and toneless international launches often end in disaster as time, money and energy is wasted due to poor planning.

Legal Documents
Every country in the world presents its own intricate challenges when it comes to starting, developing and maintaining a business. Owners, financiers and investors must make these commitments with the support of a knowledgeable and experienced legal team. Only someone with in-depth knowledge of local and international corporate law will be able to set up an overseas business while avoiding the pitfalls that plague many new businesses.

Additionally, smart business people can consider ways to invest in foreign companies without actually starting their own businesses. In these situations, it is still beneficial for the investor to partner with a knowledgeable global economics and litigation advisor. International investments create a truly diverse portfolio that offers growth opportunities that were unthinkable decades ago.

Potential investors, venture capitalists and entrepreneurs should consider the existing infrastructure in Angola when considering starting a new business. While extensive infrastructure and systems can help make the process of starting a business a smooth one, it could also represent market saturation and reduced growth potential. On the other hand, a lack of infrastructure is often a major obstacle to growth; However, the lack of infrastructure points to a clear market opening for a creative and efficient new business.

Bank account opening in Angola
In connection with the incorporation of a company, it is necessary to open one or more bank accounts in Angola. Confidus Solutions offers the ability to open a bank account in over twenty jurisdictions, making it easy for you to avoid challenging language barriers or bureaucratic hassles.

Virtual Office in Angola
Since a registered address is a necessity for international business, Confidus Solutions enables foreign investors to set up a virtual office in Angola. This address allows international entrepreneurs to accept mail, arrange for shipping and set up a registered bank account in their country of business.

Tax regulations
If you are in the process of researching a business formation in Angola, consult a lawyer or consultant with extensive experience in the area you are considering. This advisor can help you with everything from laws and tax structures to local helpers. You need to consider every aspect from the local office to your highest organizational structure; Make sure you recruit the best possible mentors as you embark on this exciting but challenging process.

Evaluation of company’s substance
It is extremely relevant to organise a sufficient level of substance for your international structure. There are two levels of substance for you to consider. They could be referred to as objective economic substance and subjective economic substance.

Objective economic substance is the level of economic activity and the actual setup of a foreign corporate entity. Subjective substance is the specific activities of the foreign corporate entity in correlation with the legal framework in the countries involved. It depends on the specific situation of your company, the actual international corporate structure, the applicable anti-avoidance tax regulations in your country of origin, jurisprudence on this issue in the jurisdictions involved and the rules of the applicable treaty for the avoidance of double taxation.

Generally, it is accepted by many jurisdictions that the Company qualifies as resident company if:

Decisions are taken in the jurisdiction of the company (including signing agreements, board meetings, etc.);
Directors of the company have major influence and control over company’s business (control bank accounts, control cash flow, conclude business contracts, etc.);
Directors are tax residents of jurisdiction of the company.
However, tax authorities normally would have more questions as they investigate presence of the company. The following FAQ (frequently asked questions by the tax offices) may help in planning your further steps of developing economic substance for your company:

Where do the Directors of the company reside?
Who has control over the corporate bank account?
Who actually signs contracts, resolutions, minutes, decisions and other company documents?
Where do the sales and operations actually take place?
How do your clients and suppliers communicate with your Company (by phone, e-mail)?
How can potential clients find information about your Company? (Do you have web-site? Do you use advertisement?)
How does your Company’s headquarters look like? Do you have a physical office? (Are there any employees?)
It might look like your Company’s substance really needs enhancement. Adding substance and establishing a management office is usually a tailored-made exercise. Confidus will help you fully evaluate your current situation and will offer step-by-step solutions on creating a Management Office.