Executive Decree No. 13 of March 25, 2022, modified by Executive Decree No. 15 of March 30, 2022, regulating Law No. 129 of March 17, 2020, which creates the Official Private Registry System of Final Beneficiaries of Legal Entities.
Pursuant to this Law, lawyers and law firms that provide services as resident agents must provide the Superintendence of Non-Financial Subjects (SSNF) with information on the final beneficiaries of the legal entities in which they serve as resident agent, so that the information is accessible to the competent authority.
Recently, the Superintendence of Non-Financial Subjects (SSNF) launched the Official Private Registry System of Final Beneficiaries of Legal Entities, developed in conjunction with the technological and institutional support of the National Authority for Government Innovation (AIG).
The SSNF will assign a Single Registration Code (CUR) to each resident agent who properly completes the information and documentation required by the Registry System.
The resident agent will have a period of 15 business days from the constitution of the legal entity to report and enter its data in the Registry System. If the resident agent does not keep the CUR active, then the resident agent will not be able to register any corporate act before the Public Registry of Panama.
Resident agents who keep the CUR active must provide the following information, based on the professional services provided on:
- Legal entity subject to registration
- Full name
- Enrollment date
- Address. Understood as the physical location where it carries out its main activity and its administrative procedures.
- Main activity
- Jurisdiction or jurisdictions where it operates (if commercial). In case of operating in more than one jurisdiction, information on each one must be provided.
- Tax Identification Number. This field refers to:
- Taxpayer Registry in Panama
- Tax identification numbers where the legal entity is a tax resident.
- Final Beneficiary
- Full name
- Panama identification card/passport number
- Date of birth
- Date on which the condition of final beneficiary is acquired. In case the exact date is not kept, the date on which the resident agent was informed of such condition will be taken.
In our legislation, the final beneficiary is understood as: “the Person or natural person who, directly or indirectly, owns, controls and/or exercises significant influence over the account relationship, contractual relationship, and/or business or the natural person in whose name or benefit a transaction is carried out, which also includes natural persons who exercise ultimate control over a legal entity”.
Additionally, the rule provides that the following will be considered as the final beneficiary of legal entities:
- Natural persons who ultimately own or control 25% or more of the shares, participations or voting rights in the legal entity.
- Natural persons who exercise control of the legal entity through other means.
- If the conditions described above are not met, the natural person who occupies the superior administrative position or who exercises effective control over the entity will be taken as the final beneficiary.
- Regarding Private Interest Foundations, the natural person who receives economic benefits, whether direct or indirect, and any other natural person who exercises final control of the entity.
- Regarding Trusts, the trustee, protector, beneficiaries and any other natural person who exercises control over it, shall be considered the trustor.
- In the case of legal entities in liquidation, bankruptcy or insolvency proceedings, the final beneficiary refers to the natural person appointed as liquidator or curator.
- In cases where the shareholder of the legal entity has died, the executor will be taken as the final beneficiary.
Failure by the resident agent to comply with the foregoing will lead to the SUSPENSION of the corporate rights of the legal entity. In other words, if the legal person has not been duly registered or updated in the Registry of Final Beneficiaries, the legal person will not be able to register any act, document and/or agreement in the Public Registry of Panama, will not be able to obtain certificates of good standing, nor enter into contracts, dispose of assets, or distribute dividends.
We inform our clients that at LOVILL we are prepared to comply with this regulation and continue to provide our clients with the best service. We thank you in advance for your cooperation in responding in a timely manner to our requests for due diligence information in order to keep the required information updated in our systems.