Panama Multinational Headquarters (MHQ)

Benefits of establishing your MHQ in Panama.

Panama´s location make it a very competitive place to set up a Multinational Headquarter due to the countries integrated banking and financial center, great port system in the Atlantic and Pacific Oceans, hub of the Americas, the Panama Canal, as well as all the incentives the government offers multinational companies, among others.

The law defines a Multinational Company as “An artificial person whom have their Main Office in a determinate country, it develops important productive activities, commercial, financial and of services in diverse countries. The companies will be considered as a multinational because they operate solely in certain country, even though they have important operations in different regions in the inside of this country and they decide to establish a branch, affiliate, subsidiary or associated company in Panama to carry out business transactions in the region.”.

A MHQ is define by law as “A multinational company that from Panama carries out operations that are directed to offer the services defined in this Law to their Main Office or to their subsidiaries or to their affiliates or associate companies, or if they establish their Main Office in Panama, and furthermore Business Groups. The Headquarters will always be part of multinational companies with international or regional or important operations in their origin country.”

Number and Classes of Shares: The “authorized capital” and “share capital” concept no longer exist under the BVI BC Act. The BVI BC Act specifies the requirement for the memorandum to state the maximum number of shares that the company is authorize to issue. BVI BC’s are not required to specify the par value of its shares or currency however, clients may request this option.

To be consider a MHQ, the Multinational Company must have assets equal or greater to US$200,000,000.00, or have presence by way of subsidiaries or associated companies in over 40 countries, which operate under the same brand.

MHQ´s can carry out the following activities, to wit:

• – The direction and/or Administration for the business operations in a specific or global geographical area of a company of the business group. It is referring to the services of strategic planning, business development, management and/ or training of personnel, operations control and /or logistics.
• – Logistics and storage of components or parts, required for the manufacturing or assembly of manufactured products.
• – Technical assistance for the companies of the Business Group or clients that have acquired some product or service from the company and, by virtue of which it is obliged to provide the services of assistance.
• – The financial management, includes the treasury services to the Business group
• – The accounting of the Business Group.
• – The elaboration of plans that are part of the designs and/ or constructions, or parts of them that constitutes part of the typical business activities of the Main Office or of anyone of their subsidiaries.
• – The electronic processing of any activity including in the consolidation of operations of the Business Group. This serviceincludes the operations of networks.
• – Counseling, coordination follow-up of market andadvertisement guidelines of goods and services produced by their Business Group.
• – The operations and investigation support and the development of products and services for the Business Group.
• – Any other analogous service approved previously by the Cabinet Council through grounded resolution, while it meets the requirements set forth in this Law.

If you have any questions,
please feel free to contact
me at mario@gdeplaw.com.