Executive Decree No. 22 of 2023, regulates Law 207 of 2021 in Panama that establishes the Authority for the Impulse of Investments and the Promotion of Exports of Panama (PROPANAMA). In this sense, PROPANAMA is established as a legal entity under public law with autonomy in its financial and operational management, which purpose is to impulse investment and export activities in the country.
Among the effects of the El Niño climate phenomenon in Panama, is there are very intense rains towards the Atlantic slope that cause flooding and a decrease in rainfall towards the regions located on the Pacific slope and an increase in the Caribbean slope.
This decrease in the Pacific slope has caused a drought in the Panama Canal, which is reflected both in the canal’s budget for the next fiscal year and in its water condition. According to the Canal Administration, it is estimated that this condition will continue until September of next year, which translates into a draft of 44 feet and daily transit limited to between 30 and 22 vessels, instead of the 36 to 38 vessels that They regularly transited the Panama Canal.
Why did Panama adopt the U.S. dollar as its official currency?
Panama’s adoption of the U.S. dollar as its official currency in 1904 marked a crucial turning point in its economic history. The decision to dollarize was driven by several factors, including a need for economic stability and international credibility.
Before dollarization, Panama used the Colombian peso as its official currency. However, this led to economic instability and currency devaluation. To address these issues and attract foreign investment, Panama made the bold move to adopt the U.S. dollar.
What are the benefits and challenges of using the U.S. dollar in Panama’s economy?
Panama’s unique currency system of dollarization offers several benefits. It provides stability by linking Panama’s economy directly to the robust U.S. dollar. This stability has resulted in low inflation rates and increased investor confidence.
However, dollarization also presents challenges. Panama has limited control over its monetary policy, as it cannot print its own currency. Additionally, it must ensure a steady supply of U.S. dollars to meet its economic needs. Despite these challenges, the benefits of dollarization have far outweighed the drawbacks, contributing to Panama’s economic success.
The United States has chosen Panama as a strategic partner to strengthen the semiconductor supply chain. Panama’s geographical location and political and economic stability make it a key logistics center. This partnership will benefit both countries by diversifying the supply chain and creating economic and technological opportunities for Panama. The collaboration promises to drive sustainable development and regional competitiveness in the digital era.
The investment can be:
Real Estate Investment: until October 15, 2024, the sum of $300,000.00, after that date the investment must be $500,000.00.
Stock Market: The sum of $500,000.00
Fixed Term Deposit: The sum of $750,000.00
The Panama Canal has been a catalyst for global trade and has impacted the global economy. In this article, we will analyze the economic impact of the Canal from a legal perspective and discuss how our law firm can assist in matters related to maritime transportation and international trade.
Impact on Global Trade
The Panama Canal facilitates the passage of approximately 5% of global trade, connecting the Pacific Ocean with the Atlantic and significantly reducing transportation times and costs. The Canal has influenced international trade by allowing countries to expand their markets and diversify their supply sources.
From a legal standpoint, the Panama Canal is governed by a series of international laws and regulations that ensure equal access, safety, and environmental protection in the transit of vessels. Furthermore, the Canal has been a driver for the signing of trade treaties and cooperation agreements between countries.
The Role of Our Law Firm
Our law firm can advise and represent clients in matters related to international trade and navigation through the Panama Canal. We provide legal services in areas such as compliance with customs regulations, resolution of commercial disputes, drafting and reviewing maritime transportation contracts, and consultancy on foreign investments and trade agreements.
Additionally, we are committed to sustainable development and environmental protection. Therefore, we also advise our clients on implementing sustainable business practices and complying with applicable environmental regulations when transiting the Panama Canal.
The Panama Canal has been a key factor in the growth of global trade and the global economy. Our law firm takes pride in helping our clients navigate the legal complexities related to international trade and transit through this remarkable engineering achievement.
The Panama Canal’s surroundings host astonishing biodiversity. In this article, we will examine the legal framework that protects the biodiversity and environment in the Canal’s vicinity and discuss the importance of environmental protection in the context of sustainable development.
Legislation and Conservation Agencies
Panama boasts solid legislation and dedicated agencies for environmental protection and biodiversity conservation. The General Environmental Law (Law 41 of 1998) establishes principles and standards for the protection, conservation, and restoration of the environment. Additionally, Panama’s Ministry of Environment is the government entity responsible for implementing and enforcing environmental policies and laws.
Furthermore, there are protected areas in the Canal region, such as Soberanía National Park, which play a crucial role in conserving biodiversity and preserving the water resources that supply the Canal. These areas are regulated by specific laws and managed by the National Environmental Authority (ANAM) and the Panama Canal Authority (ACP).
Corporate Responsibility and Sustainability
The Panamanian legal framework also establishes responsibilities for businesses regarding environmental protection. Environmental legislation requires companies to comply with specific standards and conduct environmental impact assessments before undertaking development projects in sensitive areas.
The ACP, for its part, has implemented sustainability policies in the management and operation of the Canal, including reforestation programs, water quality monitoring, and promotion of environmentally friendly practices in the maritime sector.
Conserving the Panama Canal’s surroundings is essential for ensuring its sustainable operation and preserving its unique biodiversity. The Panamanian legal framework and cooperation between government agencies and the private sector play a pivotal role in protecting and promoting the environment in the region.
The Panama Canal is an iconic engineering feat that impacts global trade and economy. In this article, we will explore the fascinating legal history of the Canal, from its beginnings to how it has influenced international relations and global commerce.
Involvement of France and the United States
Alexander, who was at the closing ceremony of the IDB Board of Governors held in Panama, added that the country generally grows more than the region.
The idea of constructing a canal in Panama dates back to the 16th century. France’s involvement began in 1879 when Ferdinand de Lesseps obtained a concession from the Colombian government to build a sea-level canal in Panama. However, the French project failed.
In the early 20th century, the United States showed interest in constructing a canal in Central America. Following the failure of the French project, the U.S. government negotiated the Herrán-Hay Treaty with Colombia. However, the Colombian Senate rejected the treaty in 1903.
Shortly thereafter, with support from the United States, Panama declared independence from Colombia. Just 15 days later, Panama and the United States signed the Hay-Bunau-Varilla Treaty, granting the U.S. perpetual control of a 10-mile-wide zone across Panama. Construction of the Panama Canal began under U.S. control in 1904 and was inaugurated in 1914.
Torrijos-Carter Treaty and Canal Handover
The Hay-Bunau-Varilla Treaty was criticized in Panama for the lack of Panamanian representation and participation in its negotiation. By the mid-20th century, tensions between Panama and the United States led to the signing of the Torrijos-Carter Treaties in 1977, negotiated by Panamanian leader Omar Torrijos and U.S. President Jimmy Carter.
These treaties stipulated the abolition of the United States’ perpetual control over the Canal Zone and the gradual handover of the Canal to Panama. On December 31, 1999, full control of the Canal was transferred to Panama. Since then, the Panama Canal Authority, an autonomous government entity, has been in charge of the administration, maintenance, and operation of the Canal.
Free Zones are part of a special simplified global regime for the establishment and operation of companies that contribute to the development of the country and the creation of jobs, framed in the global goods and services economy.
The Free Zones in Panama are governed by Law 32 of 2011 and regulated by Executive Decree No. 62 of 2017, which establish a wide range of tax, royalty and tariff benefits; as well as special flexible immigration and labor regimes that encourage business activity.
The licenses granted by the Ministry of Commerce and Industries (MICI) to operate in the to Free Zones are:
1. License as Promoter and/or Free Zone Operator
2. Operation License as a company established in the Free Zone
On January 25, 2023, Mr. Jean Carlos Morales Pascual, an attorney at our law firm, participated in the Executive Meeting organized by the Chamber of Commerce, Industries, and Agriculture of Panama where the topic “Consumption Trends 2023” was discussed. The central theme focused on the instability, insecurity, and skepticism of the local consumer as a result of the COVID-19 pandemic.
Facing this reality, there exists, however, a growth in the sale of certain products such as those pharmaceutical products and in particular, flu remedies, analgesics, and generic drugs. On the other hand, there has also been an increase in animal feed and fabaceous or legume products.
Due to the great consumer demand for these products, the forecast is for the appearance of new companies dedicated to their elaboration and/or distribution, which in turn will lead to an increase in legal services to meet this new demand.
Last Tuesday, January 10, a batch of 75,600 doses of Pfizer’s Bivalent vaccine against COVID was received in Panama.
These doses will be applied as of Friday, January 13, which is seeking to strengthen the vaccination program and mitigate the spread of COVID in the country.
The Ministry of Health highlights that this vaccine protects against the variants of the COVID-19 virus, B.5, XBB, BQ1 and BQ.1.1 that currently circulate, making Panama one of the first countries in the region to receive this vaccine.
How did the construction of the Panama Canal impact Panama’s economy in the early 20th century?
The construction of the Panama Canal was a monumental undertaking that began in 1904 and was completed in 1914. It had a profound and lasting impact on Panama’s economy. During the construction period, the influx of funds, job opportunities, and economic development associated with this colossal project ushered in a new era of prosperity for the nation.
Panama became a hub of activity as people from around the world flocked to the region to work on the canal. This resulted in a significant boost to the country’s economy. The construction provided employment for thousands of Panamanians and immigrants, and the money flowing into the country stimulated local businesses.
What is the ongoing economic significance of the Panama Canal?
Even a century later, the Panama Canal remains a crucial economic artery, contributing significantly to Panama’s economy. It generates substantial revenue through tolls paid by ships passing through its locks. This revenue not only supports the maintenance and operation of the canal but also fuels economic growth in the surrounding areas.
Moreover, the Panama Canal continues to stimulate trade, tourism, and investment in the region. Its strategic location allows ships to bypass the lengthy and treacherous journey around South America, making it an indispensable part of global trade routes. As a result, Panama has positioned itself as a key player in international commerce.
Law 51 of 2008, as amended by Law 82 of 2012 (the “Law”) establishes the regulatory framework for the creation, use and storage of electronic documents and the electronic certification of signatures in Panama.
The Law also establishes the regulatory framework for certain commercial acts carried out through the Internet, mainly in relation to information concerning the execution of electronic contracts and the conditions relating to the validity and effectiveness of such contracts; the obligations and responsibilities of commercial service providers through the Internet, including those who act as intermediaries in the transmission of content through communication networks; including offers, promotions and contests; and the penalties applicable to commercial service providers through electronic means.
Through a Civil Works Construction Contract, a construction company undertakes to execute a project for the benefit of another called owner, who in turn is obligated to pay a certain price.
In some cases, controversies and conflicts arise from said contract, which can be resolved through alternative methods of conflict resolution such as arbitration, conciliation, or mediation, provided that the parties have agreed to it in their respective contracts.
In any every case, the following conditions must always be complied with: (i) the contractual and legal basis of the claim must be identified; (ii) the claim must be recorded; (iii) there must be technical support accompanied by documentary and expert evidence; and (iv) the corresponding actions must be carried out to notify the other counter-party of the claim.
By: Ana Cristina Alzamora
Our Political Constitution, aligned with international patterns, served as the basis for the enactment of Law 81 of March 26, 2019, regulated by Executive Decree 285 of May 28, 2021, which together constitute the general legal framework for the protection of Personal Data in Panama, setting the minimum standards that must be met to comply in the processing of Personal Data and establishing the applicable sanctions in case of non-compliance of the rules.
By: Ana Cristina Alzamora
On September 1, 2022, Executive Decree No. 121 was issued, with the purpose of creating the regulatory framework that allows the supervised and controlled use and access of cannabis and its derivatives, for therapeutic, medical, veterinary, scientific, and research purposes throughout the Republic of Panama, and at the same time prohibits the sale of medicinal cannabis door to door or by internet.
Any product derived from cannabis for the purposes at hand will be subject to a system of surveillance and supervision by the Ministry of Health, which is the competent authority to establish the requirements, receive applications for acquisition licenses, store, transport, dispense and/or market, consume and export cannabis and its derivatives for medicinal purposes.
By the same token, on September 1, 2022, Executive Decree No. 85 was issued, creating the National Directorate for the Monitoring of Activities Related to Medicinal Cannabis.
By: Arielka Zamora
