Global Tax Alert (News from Americas Tax Center) | 27 April 2015

Panama amends Law on the Custody of Bearer Shares and accelerates its implementation timeline

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On 23 April 2015, Panama enacted Law No. 18-2015 (the Reform), which amends a law passed in 20131 that created a custody regime for bearer shares (the Law) and accelerates the Law's implementation.


The Law includes provisions for the delivery of bearer shares to an authorized custodian.2 Its purpose is to facilitate access to the shareholder information of companies that issue bearer shares.

The Law was to enter into effect on 6 August 2015, two years after its date of promulgation.3 A three-year transition period was provided to comply with the Law for bearer shares issued before the Law's effective date.


The three-year transition period is significantly shortened. The compliance due date is now 31 December 2015, instead of August 2018. As a result, such bearer share certificates will have to be delivered to a custodian or replaced by registered share certificates.

The Law requires the authorization of the board of directors or the shareholders for the company to be subject to the custody regime for bearer shares and that authorization must be registered in Panama's Public Registry.

The articles of incorporation of companies that have not elected to be subject to the custody regime and have not registered the corresponding corporate resolution in the Public Registry by 31 December 2015 will be deemed to have been amended to prohibit the issuance of bearer shares.

The Law is effective 4 May 2015, instead of 6 August 2015. Note, however, that the obligation to deliver to a custodian bearer shares issued after the Law's effective date applies three months thereafter, i.e., 4 August 2015.

This Reform is a step for Panama to meet international transparency standards.


1. Law 47-2013 of 6 August 2013.

2. See EY Global Tax Alert, Panama adopts law creating custody regime for bearer shares, dated 8 August 2013.

3. i.e., 6 August 2013.

For additional information with respect to this Alert, please contact the following:

Ernst & Young Limited Corp., Panama City
  • Luis Eduardo Ocando
    +507 208 0144
  • Klaus Bieberach
    +507 208 0165
  • Isabel Chiri
    +507 208 0112
Ernst & Young, S.A., San José, Costa Rica
  • Rafael Sayagues
    +506 2208 9880
  • Alexandre Barbellion
    +506 2208 9841
Ernst & Young LLP, Latin American Business Center, New York
  • Ana Mingramm
    +1 212 773 9190
  • Enrique Perez Grovas
    +1 212 773 1594
  • Pablo Wejcman
    +1 212 773 5129
  • Leticia Arias
    +1 212 773 7783
Ernst & Young LLP, Latin American Business Center, London
  • Jose Padilla
    +44 20 7760 9253

EYG no. CM5402