Panama Regulates Law 526: How Companies Must Demonstrate Economic Substance
Executive Decree No. 32 of 2026 regulates Law 526 on economic substance for passive income. We explain the five criteria covering personnel, facilities, decision-making, expenses and documentation that multinational group entities must meet from fiscal year 2027, and the 15% rate applied when they fall short.
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The Family Protocol: What It Must Contain and How It Protects Your Business Across Generations
Most family businesses don’t survive to the third generation. The reason is almost never a lack of talent — it’s the absence of clear rules about who leads, how decisions get made, and what role each family member plays.
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SHAREHOLDERS AGREEMENTS IN PANAMA: WHAT IT MUST CONTAIN AND HOW TO FORMALIZE IT
Panama’s sociedad anónima is minimalist by design. The pacto social doesn’t resolve what happens when shareholders disagree — that’s the role of a different document: private, and too often missing.
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Annual Review of Your Panama Company: What to Check and When
Owning a company in Panama is not a one-time procedure. It is a structure with recurring obligations that must be reviewed every year and whenever the company’s circumstances change.
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Ultimate Beneficial Owner Transparency: Obligations and Responsibilities in Panama
The term “ultimate beneficial owner” comes up often, but it is not always clear who must report it, how frequently, or what legal responsibility comes with keeping it current. Understanding these elements precisely is now a basic condition for operating any corporate structure in Panama with confidence.
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Panama’s Law 526: The Three Economic Substance Requirements
The law is clear in its structure. What remains to be defined is its practical interpretation — and that is precisely where companies need to prepare with information, not assumptions.
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Passive foreign-source income under Law 526: which categories apply to your structure?
The law does not apply to all income generated by a Panamanian entity. The second threshold is the type of income — and that analysis must come before the substance analysis.
Continue ReadingQualified Entity under Law 526: The Framework That Already Exists and What the Regulation Will Define
Law 526 established Panama’s economic substance framework, while the executive regulation will define the applicable thresholds. Companies can already assess the four confirmed pillars and prepare before the regulation takes effect.
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Does Law 526 Apply to Your Structure? The Analysis to Complete Before August
Law 526 has a specific applicability threshold. Before analyzing any pillar of economic substance, there is a prior question that determines whether everything else applies.
Continue ReadingPrivate Interest Foundations and Law 526: What the Family Office Client Needs to Know
Law 526 changed Panama’s tax landscape, but it did not eliminate patrimonial planning tools. The Private Interest Foundation remains valid — when you understand its position in the new framework.
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