A Guide On Mergers And Acquisitions In Panama

Regulatory framework for foreign investment

The Panamanian Constitution reserves "retail activities" for Panamanian nationals. Various statutes have limited the application of the prohibition to activities that involve the sale of goods to consumers.

By statute, the private sector (national or foreign) may not participate in water and sewage services; in other words, these services are reserved to the State. Likewise, electricity transmission services (as distinguished from generation and distribution) is also by statute reserved to the State.

Certain activities in Panama are reserved totally or partially for Panamanian nationals, based on constitutional provisions and regulated by statute. For example, commercial fishing in national waters is reserved for Panamanian nationals. Similarly, broadcast radio and television is reserved for Panamanians, but foreign persons may own up to 35% of corporations holding concessions for those activities.