However, on 23 April 2015 Panama’s National Assembly amended the above mentioned legal provision through Law No. 18, 2015, reducing the transition period from three years to less than four months becoming effective as of August 07, 2015.
As a consequence of said new legal provisions, new regulations are in place for Bearer Share Certificates, basically as follows:
•Companies that have Bearer Shares Certificates in circulation prior to April 24, 2015 and would like to keep the certificates in a bearer form must place their Bearer Shares Certificates with an authorized custodian by December 31, 2015.
•Companies placing Bearer Shares Certificates into custody must amend their Articles of Incorporation before December 31, 2015 through a Resolution of the Board of Directors or Shareholders, adopting the Bear Shares Custody Regime which must be registered before the Office of the Public Registry of Panama.
•Companies adopting the Bear Share Custody Regime must place their Bearer Shares Certificates with an authorized custodian, along with an affidavit stating the ownership of said shares before December 31, 2015. The consequence for not complying with the above mentioned deadline, if that the owner of the bearer shares will not be able to exercise before the corporation their rights inherent to said shares.
•New companies issuing bearer shares certificates will have to place their certificates with an authorized custodian within 20 days of the shares being issued.
•For those companies with bearer shares not interesting in adopting the Bearer Shares Custody Regime, their shares certificates must be replaced by a share certificate in the name of its owner before December 31, 2015. In case no action is taken in connection with the bearer shares, all share certificates will be converted automatically in a nominatives shares by virtue of the law No 18, as of December 31, 2015, bearer shares will be considered invalid.
•A previously issued bearer share can be convert into shares registered in the owner’s name (i.e. to appoint a natural person or legal entity, including a private interest foundation or in favor of a trust) before December 31, 2015. CENTRAL LAW Panama (BENEDETTI & BENEDETTI) will be pleased to provide custody services agreement for those share certificates that you are interested in keeping in a bearer form, and drafting and filing of the required shareholder or board of directors resolution before the Office of the Public Registry. For those bearer share certificates that yourprefer to convert into nominatives shares, we can also assist you in replacing the share certificates in the name of its owner.
Do not hesitate to contact us to discuss the new regulations and the effects on your Panamanian companies, and how we may assist you.
About Alida Benedetti: Alida Benedetti is a partner at CENTRAL LAW Panama. Her practice is focused in Maritime Litigation, Corporate Law, Mining Law, Privatization and Government Contracts, Administrative Law, Commercial Law, Environmental Law, Banking Law, Labor Law, Merger Acquisition & Joint Venture, Real Estate & Property Law, Securities Regulation, Trust & Foundations, Commercial Transactions and Contract Law, Banking & Finance Law; Communications Law; Immigration; Litigation on Commercial & Civil Matters. She is ranked by Chambers Latin America, Who´s Who Mining, and Legal 500 as a leader in her field. Mrs Benedetti is a graduated lawyer from the University of Panama, School of Law (LL.B., 1977). She has held important positions at the public sector such as member of the Board of Director of the Public Registry of Panama (2000-2004) and Secretary of the Panama Maritime Association (1995-1996); Secretary of the Mining Chamber of Panama (1997-1998); Member of the Editorial Council of La Prensa, Legal Adviser for the National Assembly.
She is an active member of the Panama Bar Association, Panama Maritime Association, International Lawyer Association and the Inter-American Association of Industrial Property (ASIPI). She is also a member of the Asia-Pacific Lawyer Association (APLA). Association Internationale Pour la Protection de la Propiét é Industrielle (AIPPI); Licensing Executive Society (LES); Red Interamericana de Especialistas en Legislación Ambiental (RIELA) and International Bunker Industry Association (IBIA).Alida attends the IBA annual events and is a regular author in corporate matters. She speaks Spanish (Native) and English.
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