Update On Panama Residency

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Back in May of this year, President Martinelli of Panama created a new “Specific Country” residency permit to make it easier for foreigners to work in Panama. After a number of teething problems the original requirements have since been amended or perhaps clarified. Now it is stipulated that you must either own property in Panama (held in your own name; most people hold real estate in this country through a Panama corporation) or set up a corporation and obtain a business license.

Finally, most recently, it was explained to me by my attorney here in Panama, Rainelda Mata-Kelly, that the particulars of the program have been expanded or clarified further to provide for the holy grail: a work permit. To get one under this new program, all you need is an offer letter for employment.

It appears at the moment (remember, this is all a very fast-moving target) that the department of labor will start the work permit process if you’ve filed your residency application. The residency application can then be finalized because your work permit is in process…and the work permit can then be approved when the residency permit is approved.

For businesses that need skilled labor (like ours), these new rules are a huge deal. Until this new ruling, businesses were limited to hiring but one foreigner for every nine Panamanian employees. I can tell you from experience that this could be a serious limitation.

No one knows how long the new permits will be available. The program should remain in place at least throughout the rest of Martinelli’s presidential term (elections will be in May 2014) but likely the next president will revoke Martinelli’s executive order creating this opportunity.

Fortunately, though, this new residency permit gives you permanent residency immediately (unlike current investor residency options, which grant only temporary residency at first). This means you don’t have to renew your permit multiple times before becoming a permanent resident and those who have obtained residency under this new program shouldn’t have any problem. Additionally, Panama has a history of grandfathering people already in the system.

If Panama is on your radar and you’re from one of the 24 countries on the list, this is the best opportunity and now is the best time you’re going to have to obtain easy and quick permanent residency in this country…even a work permit. Assume it will all go away in 2014.

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About Author

Lief Simon

Lief Simon has lived and worked on five continents and traveled to more than 60 countries. In his long career as a global property investor, Lief has also managed multimillion-dollar portfolios of rental properties, for others and for himself. He offers advice on international diversification in his twice-weekly Offshore Living Letter and monthly Simon Letter dispatches.