Real Estate Rules

The Law in Panama state that only LICENSED real estate agents are able to promote, show and collect commissions for sales of properties not belonging to them personally!

IN ORDER TO RECEIVE A REALTORS LICENSE, FOREIGN NATIONALS NEED 5 YEARS OF PERMANENT RESIDENCY, A VALID PANAMENIAN WORKING PERMIT AND NEED TO PASS THE EXAMINATION ISSUED BY THE MINISTERIO DE COMERCIO E INDUSTRIAS.

PERSONS FOUND TO BE ACTING AS REALTORS NOT FULFULLING THE ABOVE REQUISITIES CAN BE PENALISED WITH FINES UP TO USD 10,000.00

ALL REAL ESTATE CONTRACTS SUCH AS LISTINGS, DEMANDS FOR COMMISIONS, ETC GONE INTO WITH UNAUTHORIZED PERSONS ARE NOT VALID OR LEGAL AND CAN SERVE AS PROOF OF ILLEGAL ACTIVITY.

YOU ARE NOT OBLIGATED TO PAY ANY COMMISIONS TO UNAUTHORIZED REALTORS!!!! OR FOREIGNERS ACTING AS REALTORS !!!!

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A Guide to buying Real Estate in Panama

Panama has two different types of property:

A.- Titled Property

Titled property is not unlike "fee-simple" titles in the USA.
The Panamanian Public Registry has jurisdiction over
the registration of titled properties throughout the country.
Titled property is verifiable through the Public Registry
system and is guaranteed by the constitution of the
Republic of Panama. Titled property can also be
mortgaged. The bank will register a lien against the title
as collateral on the loan. Titled properties are subject to
annual property taxes when the registered value is over
US$30,000 unless the buyer has obtained an exemption
for the construction of a new dwelling. This is a pro-rated
tax exoneration based on the value of the dwelling.
Buying titled property normally requires the following
procedure:

1. Promise to Purchase Contract:

A small down payment is made at the signing of the promise to purchase contract.

The down payment secures the property and establishes time for the title search

and to coordinate payment arrangements for the closing.

Registering this contract at the Public Registry ensures the property

cannot be sold to another party during the escrow period.

2. Title Search:

A proper title search includes:

a). Verification that the seller in fact has title to the property

and it is free and clear of encumbrances, liens, or other issues that could affect

the free disposition or transfer of the title;

b). A review of the official survey map, and a professional surveyor

to physically verify the map points on the property

(to avoid future boundary conflicts);

c). Verification of utility debts (water)

d). Verification of payment of property taxes and/or of the tax exemption.

3. Buy-Sell Contract:

This contract is registered at the Public
Registry and the final balance is paid to the seller, or an
escrow agent. Payment is made when the title is transferred to
the buyers' name. Payment can be issued by a bank,
contingent on receiving from the seller proper title to the
property. The buyer can open a bank account (or get a
mortgage) and then formally request that the bank issue
payment as soon as it is presented with the registered public
deed transferring title to the buyer. Real estate agents normally
get paid only when the sale closes.

4. Possession Rights Certification Transfer:

Possession rights for the property are officially transferred to
the buyer when the Certification of Rights of Possession is

transferred to the buyers' name. Transfer to the buyer’s name occurs

when the buy-sell contract is signed by each party. If the possession rights

are in a corporations' name, there is no transfer of certification,

only a transfer of shares of the corporation. The buyer can keep the same officers

in the corporation or appoint new members. Buyers of corporate
possession rights properties through the purchase of the corporation itself,

should ensure the annual corporation tax (Tasa Unica) is up to date.

A change of corporate officers cannot be officially recorded at the

Public Registry if the tasa Unica is in arrears.

B.- Concession Property

Concession property is not unlike “land lease”
arrangements, common in Mexico or Hawaii. Concession
Property is government owned property, where the
government has granted a concession to an individual or
organization for a specific purpose, such as a real estate
development, hotel, or marina. Concessions in Panama are
generally granted for a maximum of 20 year (renewable)
periods. Some concessions are granted for up to 40 years
(renewable) in specially designated areas such as the
Amador Causeway or where there are commercial and
condominium developments currently being sold (Naos
Harbor, for example).

Concession Property is often located on islands, in special coastal or

other protected areas where titles are not permitted by law.

Real estate developments over concession property often offer investors

time share or fractional ownership arrangements. Unlike Possession Rights property,

Concession property is guaranteed by the government through a

specific contractual agreement.

CONTRACTS IN ENGLISH HOLD NO LEGAL WEIGHT IN PANAMA.

Contracts signed are legally binding documents, and you should ensure that you have read and
understood them completely before signing.

All judicial processes in Panama are conducted in Spanish. For any real estate transaction in Panama, a
contract written solely in English carries no legal weight, and is generally not recognized. All contracts for
property must be in Spanish on a formal public deed, and signed before a public notary, in order to be
legally enforceable and where applicable, be filed at the Public Registry.

GET PROFESSIONAL HELP. Engaging a reputable attorney and licensed real estate broker is
recommended.

BEFORE HANDING OVER ANY MONEY, MAKE SURE YOU CONSULT

WITH A PROFESSIONAL AND DO A PROPER DUE DILIGENCE INVESTIGATION

OVER THE PROPERTY TO ENSURE YOU AREN'T BUYING A BIG PROBLEM!

IT IS IMPORTANT TO UNDERSTAND THE RULES AND

PROCESS YOUR PROPERTY TRANSACTION CORRECTLY.

Visas for Retires

VISAS FOR RETIRED, PENSIONED, AND INCOME EARNING FOREIGNERS

Individuals obtaining any of the visas falling within this group shall be entitled to the following benefits:

Exemption from custom duties for the import of house hold goods or items for personal use, only once, up to the sum of Ten Thousand US Dollars (US$10,000.00)
Exemption from custom duties, every two (2) years, for the import of a motor vehicle for family or personal use

However they may not work within the national territory, except in the following cases:

When they render specialized services, not offered by Panamanians in the National Government or in its decentralized entities.
When they have invested in the capital of a business enterprise substantive sums of money and after obtaining an authorization from the Ministry of Labor.
When they are members of the Board of Directors of the Companies in which they have made investments

1. Pensioned tourist visa: This visa shall be granted to the foreigner retired or pensioned by foreign governments, international bodies or private entities, receiving a minimum monthly pension of five hundred dollars (US$500.00), plus an additional one hundred dollars (US$100.00) for each dependent, to his/her spouse and children under eighteen (18) years of age. The pensioned or retiree individual does not need to pay the Panamanian Government any type of deposit or immigration fees in connection with the obtainment of said visa.

The visa is granted for a one (1) year term, but it can be renewed indefinitely for one (1) year terms.

2. Visa for a retired income earner (retiree visa): The foreigner who has retired from his private activities and is able to make a time deposit in the National Bank of Panama generating a monthly interest (yield) of seven hundred and fifty dollars (US$750.00), may be able to obtain this type of visa. The interested party, his/her spouse and children under eighteen (18) years of age, shall be entitled to a special Panamanian passport.

The visa and the Panamanian passport are granted for a five (5) year term.

Professional fees for the pensioned tourist visa, and the retiree visa are about One thousand Five Hundred US Dollars (US$1,500.00) plus expenses Two Hundred and Fifty US Dollars (US$250.00).

IMMIGRANT VISAS

Individuals leaving their place of residence intending to establish permanently
within the Republic of Panama may obtain any of the immigrant visas, providing the established requisites.

The foreign client who applies for any of the immigrant visas shall consign a repatriation deposit, through a certified or management check, for the amount of
Five Hundred US Dollars (US$500.00), in favour of the Ministry of Government and Justice. If the foreigner client maintains his immigrant status foir more than one (1) year, the repatriation deposit shall ingress to the National Treasury without any claim for refund. However, the following persons do not have to consign the repatriation deposit:

Immigrants married to Panamanians
Immigrants under twelve(12) years of age

1. Immigrant visas for investors: This visa is granted to those foreigners who wish to invest their own capital, not less than Two Hundred Thousand US Dollars (US$200,000.00), in the Republic of Panama, for the purpose of engaging in commercial, financial or industrial activities. The applicant’s spouse and children under age may obtain the same benefits as dependants, including the right to apply for the Panamanian citizenship.

If the visa is approved by the Department of Immigration and Naturalization, a provisional permanence permit, valid for one (1) year, is issued to the investor, conditioned to the commitment of employing at least three (3) Panamanians in his/her business.

This provisional permit can be renewed up to three consecutive times, provided that the commitment acquired is duly complied with. Upon the termination of the third renewal period, the Department of Immigration and Naturalization issues a permit of permanent residence with the right to a personal identity card (cédula).

2. Immigrant visa for forestry investors: This visa is granted to such foreigners who wish to invest their own capital, not less than Forty Thousand US Dollars (US$40,000.00), in forestry matters within the Republic of Panama. The applicant’s spouse and children under age may obtain the same benefits as dependents, including the right to apply for the Panamanian citizenship.

If the visa is approved by the Department of Immigration and Naturalization, a permit of provisional residence is issued to the investor. If he/she maintains the investment until the final cuts in the plantation or for ten (10) years, he/she will obtain the permanent residence with the right to a personal identity card (cédula).

3. Immigrant visa by means of resolution of the Ministry of Labor: This visa is granted to foreigners who shall render services within the Republic of Panama as executives, technicians or employees, provided the type of employment has not been reserved by Law exclusively to nationals. The interested party must enter with a tourist visa, be registered upon arrival, obtain an employment, request a change of immigration status, and obtain a labor permit from the Ministry of Labor.

The applicant’s spouse and children under age may obtain the same benefits as dependents, including the right to apply for the Panamanian citizenship.

If the visa is approved by the Department of Immigration and Naturalization, a provisional permit of permanence is issued to the employee for one (1) year, after which the permanent residence is granted to him/her with right to obtain the personal identity card (cédula).

4. Immigrant visa for the spouse of a Panamnian citizen: For the foreign client married to a Panamanian, the Immigration laws of the Republic of Panama offer the possibility of applying for an immigrant visa, which is granted for a provisional term of one (1) year, after which the permanent residence is granted to him/her with right to obtain the personal identity card (cédula).

After three (3) years of having obtained the permanent residence, the Constitution of the Republic of Panama grants the right to the foreigner married to a Panamanian of opting for the Panamanian citizenship.

In case the matrimonial link has been dissolved after having children, the foreigner shall have the same right to opt for the Panamanian citizenship after three(3) years of permanent residence, provided that the permanent residence was obtained prior to the dissolution of the matrimony.

5. Immigrant visa for self-sufficient individuals: This visa is granted to foreigners who have enough income to cover the expenses for all their family’s necessities, to his/her spouse and children. In order to apply for such visa, the applicant must deposit the sum of Two Hundred Thousand US Dollars (US$200,000.00) in a local bank, for the term of the provisional visa, which is one (1) year.

Upon applying for the permanent residence, after the year of provisional visa, the foreign client must prove that the deposit at the bank will remain for a period of one (1) additional year with a written confirmation from the bank certifying the deposit.

This visa is perfect for foreign clients that are retired or pensioned, or for those who are not working anymore and would like to live of the income they receive.

VERY IMPORTANT NOTICE: Any foreigner, before becoming a Panamanian citizen, shall loose his resident status if he remains outside of the Panamanian territory for more than three (3) consecutive years.

Jose Branca 507-720-1109 Email Jose

Real Estate Rules

A Guide to buying Real Estate in Panama

Visas for Retires