1989 - 2019 30 years in business Friday, 19th April 2019

PANAMA: Draft Bill No. 167

For the prevention of money laundering, the financing of terrorism and the proliferation of weapons of mass destruction.

Dear Clients,

We would like to update you on Draft Bill No. 167, which has been approved in the National Assembly of Panama. It is expected to be duly sanctioned and published in the Official Gazette, at which point it will become law.

Once the bill becomes law we, as a Panamanian firm (among several other professional sectors) our agent and providers will be considered a ‘regulated party’ under this law. As such, we will be required to hold information on the beneficial owner of all the companies that we service, among other requirements, as described below.

This means we will be required to carry out additional due diligence procedures when conducting transactions for clients regarding certain activities. These include:

  • The organisation of inputs or contributions for the creation, operation or management of companies
  • The creation, operation or management of legal entities or structures
  • The sale of business entities
  • Acting or arranging for another person to act as director holding a power of attorney from a company, a partner within a partnership or a similar position in relation to other legal entities
  • Provision of a registered address, business address or physical space, a mailing or administrative address for a company, partnership or any other legal entity or legal structure
  • Acting or arranging for another person to act as a nominee shareholder for another person
  • Acting or arranging for another person to act as trustee of a specific trust or to perform an equivalent function for another form of legal structure


As regulated parties, we will be required to conduct due diligence procedures for individuals, legal entities and trusts, as well as enhanced due diligence procedures when ‘politically exposed persons’ are involved.

In addition to identifying and obtaining the necessary documentation regarding the beneficial owners, shareholders, directors, founders, council members, settlors, authorised parties and beneficiaries, the Regulation also requires us to:

  • Understand the purpose of the business relationship
  • Establish a financial profile, duly upholding the source of funds and origin of assets
  • Request the respective certifications that evidence the incorporation and good standing of legal entities
  • Understand the nature of the client’s business, shareholding and control structure


In all these scenarios, where the beneficial owner is a legal entity, due diligence measures will be extended until the final individual is known.

In cases involving ‘politically exposed persons’, the applicable measures are:

  • Having systems that determine whether the client or the beneficial owner is a PEP
  • Obtaining written approval from senior management to establish (or to continue, in the case of existing clients) business relationship with these clients
  • Identify the financial and transactional profile of the PEP, as to the source of their wealth and the source of funds
  • Carrying out continuous and enhanced monitoring of operations throughout the business relationship



Non-compliance with this Regulation carries a penalty ranging from US$5,000 to US$1,000,000, according to the gravity of the offense and the degree of recidivism.

Should you need any clarification, please do not hesitate to contact us at : info@cardwell-capital.com

Therefore be reviewing company files, to request the missing information from you, if necessary.

Best Regards
Cardwell Advisory Desk



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