The History of one of the most attractive residency visa programs in the world
First introduced by Executive Decree in 2012, Panama´s Friendly Nations Visa was created to provide a more efficient process for foreign investors to obtain residency in the Republic of Panama. The purpose for creating this streamlined program was to promote Panama´s economic and commercial development and to generate a boost to employment through the acquisition or creation of new companies and international investment.
For almost a decade this has proven to have been the most popular visa program of choice for persons seeking permanent residency in the country. In that time, almost 20,000 residence permits under the permanent resident immigration subcategory as a foreigner (from those countries designated as maintaining friendly, professional, economic and investment relations with the Republic of Panama) have been granted. In 2012, citizens from 50 nations were able to apply through this visa programme and the list of nations was later expanded to 54. These nations included Australia, Canada, China, New Zealand, South Africa, the United Kingdom, the USA as well as various Asian countries and EU members.
Panama´s Friendly Nations Visa program has been heralded as one of the most attractive in the world owing to its short processing time of anywhere between three to six months to be granted permanent residency and, by comparison to other similar residency visa programmes, the low cost of establishing economic or professional ties to Panama. Until this year, economic ties in Panama could be established through becoming a director or major shareholder of a Panamanian corporation and depositing $5,000 in a Panamanian bank account.
One other favourable characteristic of the Friendly Nations Visa program was the lack of strict requirements to have personal presence in the country. Permanent resident status could still be maintained with just a visit for a week or so every two years.
Changes to the Panama Friendly Nations Visa
On May 7th, 2021, the Decree of 2012 was modified to add new conditions and requirements to the Friendly Nations Visa migration subcategory. The three major changes are as follows;
- The addition and removal of some nations whose citizens could qualify to apply for the visa.
- The addition of the new provisional permit card stage where applicants must wait for two years before being able to apply for permanent residency.
- The three methods in which economic ties can now only be established.
The new process for applying for the Panama Friendly Nations Visa
Where before, the process for applying for a permanent visa was immediately recorded and took just a matter of months, the new changes have installed a provisional residency permit stage which is two years in duration before a permanent residency permit can be applied for and obtained.
The process starts with the filing of the initial application form, along with all of the required supporting documentation, with the immigration office for a temporary residency permit. The applicant must also meet the requirement of establishing economic ties in Panama, which is depicted below. Usually, it takes six months for the immigration office to process the initial application and issue a provisional residency permit. This provisional permit is valid for two years.
After two years, the applicant can apply for the permanent residency permit and file the appropriate form with updated versions of the original supporting documentation. Again, it will normally take the immigration office six months to process the application for permanent residency. All In all, the period it takes to obtain permanent residency in Panama is now three years.
Establishing economic ties in Panama
The economic activity requirement when applying for the Panama Friendly Nations Visa permit is now limited to the following three options;
1. For Employment reasons.
The applicant must be employed in Panama by a legal Panamanian Corporation with a formal contract of employment and a work permit. The letter of proof of employment must be on a company letterhead, signed by the employer’s legal representative, certifying the position, salary, and commitment to bear repatriation costs (if applicable).
2. For Real Estate Investment Reasons.
Purchase a real estate property with a minimum value of $200,000. Bank financing is permitted for the property purchase. To verify property ownership, the applicant must present a certificate from Public Registry of Panama that indicates the property is held in either their own personal name or in the name of a legal entity where it is clearly indicated that the applicant is the final beneficiary of that entity.
3. By way of Certificate of Fixed Term Deposit.
The applicant must make a deposit, of no less than $200,000, in a national bank of Panama. The certificate must include details of title, value, term and must be free of encumbrances with a minimum validity of three years. As with the method of applying for permanent residence through real estate investment, the certificate of deposit must be held in either their own personal name or in the name of a legal entity where it is clearly indicated that they are the final beneficiary of that entity.
What if you have dependents?
If the applicant wishes to include his (or her) spouse a marriage certificate, along with the all the other required documentation for the immigration office, as mentioned earlier, must be presented. In the event of any dependent children, birth certificates must be provided.
Important note
Any documents provided that support the application process, and which originate abroad must be Apostilled and authenticated at the Panamanian Consulate in your country.
Does Panama still offer that silver lining?
It would certainly appear that the goal posts have been narrowed in terms of Panama´s affordability to establish permanent residency. However, for those that are seriously considering moving full time to the isthmus, supply of real estate is exceeding demand at present and with that there are some real bargains to be found. Couple that with the many other advantages that can be found in Panama for ex-pats, which are highlighted in other articles in our Insights section and Panama certainly still holds its own as an attractive option.
How Topaz Services can be of assistance
If you would like more information on the requirements to apply for, or assistance with obtaining, your permanent residency in Panama then please do not hesitate to contact us on our contact page.
We understand that relocating to another country can be a daunting prospect but, as a British-managed company in Panama, our service offer comes with decades of local experience and practice with a broad local network of professionals. Coupled with our ability to speak with you in English, your decision to engage our services could prove to be of invaluable support when making this important and exciting next step in your life. We can recommend to you a suitable local lawyer and act as your liaison, collate your application documentation and guide you through the stages of the process.
We consider ourselves Panama’s base for traditional British service from specialists in the formation and management of corporations, wherever domiciled, and foundations, providing services to professional firms, institutions and individuals since 1981. Our international public and private sector experience in fiduciary and corporate administration is unrivalled in Panama.