The regime for the custody of bearer share certificates issued by Panama corporations, regulated under Law No. 47 of 6th August 2013 has been amended under Law No. 18 of 23rd April 2015 which main changes include the entering into effect of the Law and the transition period as it would be explained hereunder.
When will the Law be effective?
- The law will become effective as of May 4, 2015 (prior to the amendment effective date was August 2015).
What will happen as of May 4, 2015?
- Any new corporation incorporated as of this date and that wishes to issue bearer share certificates must file with the Public Registry resolutions confirming their decision to be able to issue bearer shares. Furthermore, once the corporation authorizes the issuance of bearer share certificates, it will have a 20 days period to deposit said certificates with an authorized custodian.
- Any existing corporation with bearer share certificates may either (i) replace said certificates for nominative shares or (ii) deposit any bearer share certificates with an authorized custodian and file with the Public Registry resolutions confirming their decision to be able to issue bearer shares. In any case, the deadline for existing corporation is now December 31, 2015 (prior to the amendment was August 2018).
What will happen as of December 31, 2015?
- Unless a corporation files with the Public Registry Office resolutions confirming their decision to continue issuing bearer share certificates, all Articles of Incorporation shall be considered automatically amended to prohibit the issuance of bearer shares, as of December 31, 2015.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.