Can I buy a business in Panama?

Absolutely, you can buy a business in Panama. We bought ours and it was not a difficult process. We had a lawyer handle the transfer of the company. You have to have three owners and one has to be Panamanian. So my husband and I are shareholders and the lawyer is the third representative to make it viable.

 

Owning a business is a little different here. You are issued shares and you have to have a Panamanian on the board of your company. That board member...

Absolutely, you can buy a business in Panama. We bought ours and it was not a difficult process. We had a lawyer handle the transfer of the company. You have to have three owners and one has to be Panamanian. So my husband and I are shareholders and the lawyer is the third representative to make it viable.

 

Owning a business is a little different here. You are issued shares and you have to have a Panamanian on the board of your company. That board member doesn’t necessarily have to be your lawyer. It can be your lawyer, or it can be somebody who you know and trust in Panama.

 

We suggest just going to the lawyers and following their processes.  When you are buying a business, it is a huge step. You are in a foreign country and the law protects the locals as opposed to us. You have to be very careful of what you are buying. Do a lot of homework and research.  Double check everything.

 

It is very important that all of the contracts that you sign are written in Spanish because in Panama, contracts written in English are not legal.  

 

(Panama Roadrunner Secure Transports takes guests kayaking on a Jungle Land tour, pictured.  Also see answers from Jungle Land on Best Places.)

It is legal for foreigners to buy, own operate businesses in Panama. The general exception is retail operations that are reserved strictly for Panamanian nationals; there are a few other activities that have restrictions. For more detailed information consult an attorney.

It is legal for foreigners to buy, own operate businesses in Panama. The general exception is retail operations that are reserved strictly for Panamanian nationals; there are a few other activities that have restrictions. For more detailed information consult an attorney.

As a foreigner, you can buy business in Panama. Panama is very pro-business and encourages foreign investment.  For that and other reasons, foreign investment in Panama has been growing year on year between 15% to as much as 30% annually over the last 8 years, depending on the year.

 

There are many entrepreneurs who are moving to Panama because they see opportunity and are opening businesses.   These business people come not just from North...

As a foreigner, you can buy business in Panama. Panama is very pro-business and encourages foreign investment.  For that and other reasons, foreign investment in Panama has been growing year on year between 15% to as much as 30% annually over the last 8 years, depending on the year.

 

There are many entrepreneurs who are moving to Panama because they see opportunity and are opening businesses.   These business people come not just from North America but also from South America, Venezuela, Colombia, Brazil and other places that can have more challenging living situations.  When they come to Panama they see all the opportunity there is and they see the ease of doing business, which is much simpler than in the complicated business environment in their home countries. We’re seeing retail growth, we’re new shopping malls, we’re seeing strip malls, and new franchises coming from the US. To name a few, I just saw Fudruckers and Little Caesar’s Pizza come in.  All the major fast food chains are here. New luxury brands are coming in: Gucci, Versace, Burberry, and others.  Business people come to Panama both to start their own business and to buy an existing business.

 

(Naviburger at Fuddruckers PYT, Metromall, Panama City, Panama, pictured.)

Since the 15th century, Panamá has been an exceptional trading center, covering all continents, mainly America, Europe and Asia.  One of the prime reasons for this was that gold was one of the most attractive trading commodities, especially from South America to Spain and England.

 

Since that time, Panamá has experienced tremendous growth, and today, is one of the most prosperous countries.  As other countries went through a...

Since the 15th century, Panamá has been an exceptional trading center, covering all continents, mainly America, Europe and Asia.  One of the prime reasons for this was that gold was one of the most attractive trading commodities, especially from South America to Spain and England.

 

Since that time, Panamá has experienced tremendous growth, and today, is one of the most prosperous countries.  As other countries went through a recent economic crisis, Panamá was the  #1 destination for business, tourism and retirement.  This little but wonderful country with a population of only a little over 3 million people offers anything and everything, including year round beautiful weather without snow, and no earthquakes, tornados or similar disasters.  It also offers cultural richness from around the world, the result in part from thousands and thousands of people from all over the world who came for the Panamá Canal construction at the beginning of the 19th century.  Today, Panamá is back to the place it occupied in the 15th century: a land with great opportunity for everyone who wants to come in a respectful way to the country and its people, to have a good quality of life, lower cost of living, and to take advantage of its marvelous nature and environment; mountains, rivers, beaches and much more.

 

The cost of housing and land in Panamá has increased substantially since thousands of foreign retirees and investors have moved here seeking better opportunities, as their dream.  Maybe Panamá is not the ideal place for everyone, but it certainly is a place to consider after you do your homework on exactly what are you pursuing.  Visit the country several times, talk to professionals (locals and foreigners) and do not buy anything until you are certain.

 

For experience I can tell you that the quality of life is higher and the cost of living is much lower than almost any city in the United States, except for housing and land. Where else can you drive to do your fresh fruits and vegetables grocery shopping in the car in every corner in the city of Panamá, at almost half price of the supermarket? (And if you go to the "interior" (country) it is even better.)

 

Panamá offers many opportunities for foreigners to purchase businesses, from beauty parlors to sophisticated corporations, in small towns, or on Panamá Pacifico (the most attractive trade special zone, with special benefits), the Free Zone (in Colón), or any other town.  But in doing this, the purchaser has to be very careful what they purchase.  Everything is very competitive.  Do not buy the first thing you see.  Make a true marketing study with a serious local company.  Do not rely only on some comments or individual suggestions.  Most of the time, that doesn't work, and the business may have to be closed months later, after spending thousands of dollars, because it was a mistake.  I've seen this many times, unfortunately.  Remember, not everyone is honest.  And not every place is suitable for certain types of business.

 

Panamá is mainly about services, and it is saturated with all kinds of them.  But, it is still fast growing in the maritime, logistic, tourist, ports, containers, electric plants, environmental issues, and technology sectors.  If you can come out with a real good new idea, you are in, because everyone welcomes new things.

 

Here are some suggestions:

Be very careful with real estate... not that shines is gold.

 

Panama is not an industrialized country, which is one of the prime reasons why any industry is welcome.  My best suggestion for locations would be around Veraguas, Coclé, Herrera, Bocas Chiriquí, Los Santos or Darien provinces. Excellent sources for workers would be graduates from vocational schools like Chapala (in Arraijan) or Don Bosco (Panama city).  You will have several Indian villages located conveniently close by.

 

Whatever service or product you offer, make sure you offer good customer service.  That is the key.  

 

The most important thing is to contact the right people, such as an attorney or accountant that comes highly recommended.  Do not associate with anybody before you are totally certain that person has a good reputation, and please, nothing political, which could ruin everything.

 

Permits are very hectic in Panamá, and setting up a corporation is kind of expensive, maybe between $1,000 and $5,000, depending on the attorney (you need an attorney for that).  The annual government report at the present time is $350, the Legal Resident Agent (attorney) charges about $250 to do one, and every corporation needs to file.

 

As well as permits, Panamá labor laws are very strict, and you should be very careful with employees and benefits.  There are many foreigners out there without the proper legal papers who are seeking under the table payment.  A good option for employees could be graduates from local schools, like St. Mary's, the Inter-American Academy, Instituto Pedagógico, St. Vincent de Paul.  Others are very well qualified and bilingual.

 

There is much more to say about purchasing business in Panamá, but I think I went on long enough.  Just be careful and purchase a business that you can handle and one of which you have knowledge; otherwise, just like anywhere else in the world, it will not work.

 

(Cover of Multimodal &  Logistics Transports magazine, pictured.)