Panama Friendly Nations Visa

The Friendly Nations Visa in Panama is a special immigration program designed to facilitate the process of obtaining permanent residency for citizens of specific countries considered to be "friendly" towards Panama. This program, also known as the Panama Friendly Nations Visa, was established to attract foreign nationals who can contribute positively to the country's economy and society.

Panama Law Connection has a team of legal specialists who can assist with your Friendly Nations Visa application, so if you are interested in applying, please feel free to contact us today!

Key features of the Friendly Nations Visa include:

• Eligible Countries: Initially, the program included a list of over 50 countries whose citizens were eligible. However, the list and criteria have evolved over time, so it's important to check the most current information.
• Requirements: Applicants typically need to demonstrate economic ties to Panama, which can be fulfilled through various means such as owning a business, being employed in Panama, or owning real estate in the country. Additionally, applicants must provide various documents, including a criminal background check, health certificate, and proof of financial solvency.
• Permanent Residency: One of the main attractions of this visa is that it leads to permanent residency in Panama. After meeting the initial requirements and maintaining their status for a certain period, applicants can apply for permanent residency.
• Path to Citizenship: While the Friendly Nations Visa primarily offers residency, it can also serve as a pathway to citizenship, subject to the fulfillment of additional requirements and a longer-term commitment to living in Panama.
• Changes Over Time: The Friendly Nations Visa program has undergone changes, including adjustments to the list of eligible countries and the requirements. These changes reflect Panama's evolving immigration policies and economic objectives.

This visa is particularly popular among expatriates and retirees who seek to live in Panama, attracted by the country's climate, lifestyle, and friendly immigration policies.

What countries are eligible for the Friendly Nations Visa?

Citizens from the following countries are eligible to apply for the Friendly Nations Visa:

Andorra, Argentina, Australia, Austria, Belgium, Brazil, Canada, Chile, Costa Rica, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Great Britain, Greece, Hong Kong, Hungary, Ireland, Israel, Japan, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Mexico, Monaco, Montenegro, Netherlands, New Zealand, Norway, Paraguay, Poland, Portugal, Republic of Korea, San Marino, Serbia, Singapore, Slovakia, South Africa, Spain, Sweden, Switzerland, Taiwan, United Kingdom, Uruguay, USA.

What are the application requirements for the Panama Friendly Nations Visa?

The application requirements for obtaining provisional residency under the Panama Friendly Nations Visa program are detailed and vary for the main applicant, dependent spouse, and dependent children. Here are the requirements:

For the Main Applicant:

• Valid passport for at least 6 months from the application date.
• A second valid ID for at least 6 months from the application date.
• Five passport-size photos.
• National criminal background certificate, recently issued, apostilled or authenticated by a Panamanian Consulate – valid for 6 months.
• Economic Solvency (one of the following):
  • - Employment Offer: Job offer from a Panamanian company, including the company certificate of public registry and business license. A work permit application is required at the start of the provisional residency application. The work permit is awarded in 6-9 months.
  • - Real Estate Ownership: Owning Panamanian property with a registered value of at least USD $200,000 (can be financed through a Panamanian bank).
  • - Certificate of Deposit: Fixed-term deposit of at least USD $200,000 in a Panamanian bank for 3 years.
• Health certificate issued by a local doctor within the last 90 days before submitting the application.
• Criminal background check from the country of origin, less than 6 months old.
• Power of Attorney.
• Certified checks for fees: USD $800.00 for the National Immigration Service and USD $250.00 for the National Treasury.
• Sworn declaration.

For the Dependent Spouse:

• Valid passport for at least 6 months from the application date.
• Five passport-size photos.
• Certified checks: USD $250.00 for the National Treasury and USD $800.00 for the National Immigration Service.
• Marriage certificate and national criminal background certificate, recently issued, apostilled or authenticated – valid for 6 months.
• Notarized proof of address in Panama.
• Proof of financial solvency: Recommended to show a balance of USD $8,000 if using a joint bank account with the main applicant.

For Dependent Children (up to 25 years old):

• Valid passport for at least 6 months from the application date.
• Five passport-size photos.
• Certified checks: USD $250.00 for the National Treasury and, if the child is 12 years or older, USD $800.00 for the National Immigration Service.
• Birth certificate showing both parents' names, recently issued, apostilled or authenticated – valid for 6 months.
• For children 18 years or older: National criminal background certificate, certificate of singleness, proof of full-time studies, and list of academic credits.

For Permanent Residency:

After two years of holding provisional residency, applicants can apply for permanent residency. The same requirements as for provisional residency must be met, except for the national criminal background certificate and the payments of USD $250 to the National Treasury and USD $800 to the National Immigration Service.

How long does it take to apply for the Friendly Nations Visa?

The application process for the Panama Friendly Nations Visa is divided into several phases and can take up to three years in total, including waiting periods between phases:

Phase 1 – Obtain Temporary Residency ID: The initial step involves filing the application and obtaining a Temporary Residency ID for the applicant and dependents, which requires their physical presence in Panama. After receiving a temporary residency permit, there is a waiting period.

Wait Period 1: This period can last up to six months. During this time, the Immigration Office processes the initial application and eventually issues a provisional residency permit.

Phase 2 – Obtain Provisional Residency ID: Once the initial application is approved, the applicant receives a provisional residency ID valid for two years. Throughout this period, the applicant must uphold all the requirements initially met for the application.

Wait Period 2: This is a two-year period during which the applicant must maintain the provisional residency permit requirements.

Phase 3 – Apply for Permanent Residency ID: After holding provisional residency for two years and meeting all requirements, the applicant can initiate the permanent residency application process. There is another waiting period during this phase.

Wait Period 3: The Immigration Office may take up to six months to provide a resolution for the permanent residency application.

Phase 4 – Obtain Permanent Residency ID: Once the permanent residency application is approved, the applicant and dependents obtain the Permanent Residency card. If the applicants are outside Panama, they must return to complete the process. This phase requires one to two days to complete the process and receive the Permanent Residency Card, including a visit to the Panama Immigration Office.

Applicants have a six-month window after the two-year provisional residency period to return to Panama and complete the process for obtaining permanent residency. If not completed within this timeframe, the application may be cancelled.

What documentation do I need to have ready for my application?

For the Panama Friendly Nations Visa application, the main applicant needs to provide a comprehensive set of documents. Here's a detailed list of the required documentation:

• Valid Passport: The passport must be valid for at least 6 months from the application date.
• Second Valid ID: An additional form of identification valid for at least 6 months from the application date.
• Passport-Size Photos: Five photos of the size 2 inches x 2 inches.
• National Criminal Background Certificate: Recently issued, apostilled or authenticated by a Panamanian Consulate in the issuing country, valid for 6 months.
• Economic Solvency Proof: One of the following options:
  • Employment Offer: A job offer from a Panamanian company, including the company certificate of public registry and business license.
  • Real Estate Ownership: Ownership of Panamanian property with a registered value of at least USD $200,000, possibly financed through a Panamanian bank.
  • Certificate of Deposit: A fixed-term deposit of at least USD $200,000 in a Panamanian bank for 3 years.
• Health Certificate: Issued by a local doctor within the last 90 days before submitting the application.
• Criminal Background Check: From the applicant's country of origin, less than 6 months old, authenticated at the Panamanian Consulate or Apostilled.
• Power of Attorney: This document is required for the legal representation during the application process.
• Certified Checks for Fees: USD $800.00 for the National Immigration Service and USD $250.00 for the National Treasury.
• Sworn Declaration: As per the format available on the Panama immigration website.

Each of these documents plays a crucial role in the application process, and applicants should ensure that all documents are up-to-date and comply with the specified requirements.

Can I apply for the Friendly Nations Visa from outside of Panama?

Yes, you can initiate the application process for the Panama Friendly Nations Visa from abroad. However, it is important to note that at some stage of the process, your physical presence in Panama will be required. This is particularly true for obtaining the Temporary Residency ID, as it involves taking a photograph in the Panama Immigration Office. Moreover, certain steps, like finalizing the application and receiving the Permanent Residency Card, also necessitate a visit to Panama. Therefore, while the initial steps can be started from outside Panama, you should plan for travel to Panama as part of the application process.

Do I need a lawyer to make my application for the Friendly Nations Visa?

While it's not mandatory to use a lawyer to apply for the Panama Friendly Nations Visa, it is highly recommended. The process involves navigating complex immigration laws, preparing and submitting numerous documents, and ensuring compliance with all legal requirements. A lawyer, especially one specialized in Panamanian immigration law such as Panama Law Connection, can provide valuable guidance, help avoid common mistakes, and streamline the process. We can also represent you in dealings with immigration authorities. Given the intricacies and potential language barriers, having legal assistance can significantly increase the chances of a successful and smooth application process.

What are the benefits of the Friendly Nations Visa over other options available to foreigners?

The Panama Friendly Nations Visa offers several benefits compared to other visa options available to foreigners. Here's a comparison highlighting its advantages:

Friendly Nations Visa:

• Path to Permanent Residency: Takes two years with two applications. Offers three routes: employment contract with a Panamanian company, real estate purchase over $200,000, or a $200,000 deposit in a CD at a Panama bank.
• Cost: Approximately $10,000, plus $2,000 per dependent.
• Advantages: Provides a straightforward path to permanent residency and is suitable for those with employment or substantial financial resources in Panama.

Pensionado Visa:

• Target Group: Designed for retirees with a lifelong pension of over $1,000 per month for the primary applicant.
• Cost: Under $2,500 for a single applicant and under $3,000 for a couple.
• Advantages: One of the lowest-cost permanent residency visas, quick processing time (1-3 weeks for temporary residency, 4-6 months for permanent), and access to Panama's Pensionado Discount program.
• Limitations: Declares you retired, making obtaining a work visa difficult.

Short Stay Visa for Remote Workers/Digital Nomads:

• Purpose: Ideal for remote workers or digital nomads.
• Duration: Up to nine months, extendable for an additional nine months.
• Cost: About $1,500.
• Advantages: Good for those exploring Panama before deciding to invest or move permanently.
• Limitations: Does not lead to permanent residency.
• Requirements: Proof of income of $36,000 yearly from a foreign company or online business.

Qualified Investor Visa (Red Carpet Visa or Golden Visa):

• Target Group: Investors in real estate, stock market, or bank investments.
• Quickest Path to Permanent Residency: Can be obtained in 30 days.
• Cost: Around $15,000 to $18,000.
• Advantages: No need to be present in Panama to apply. Offers various investment routes.
• Limitations: High financial requirements.
• Requirements: Investment options include $300,000 in real estate, $500,000 in pre-sale real estate projects, $500,000 in Panama Stock Market investment, or $750,000 in a bank fixed-term deposit.

The Friendly Nations Visa stands out for its balance between accessibility and the benefits it offers, particularly for those with a job in Panama or the ability to make substantial financial investments. It provides a clear route to permanent residency, though it's not the cheapest option and takes longer than some visas.

Why choose Panama Law Connection for my Friendly Nations Visa application?

Panama Law Connection stands out as an excellent choice for your Friendly Nations Visa application, offering distinct advantages:

• Expertise in Panamanian Law: Our specialization in Panamanian legal matters ensures that you receive knowledgeable and accurate advice, particularly important in immigration matters.
• English Language Proficiency: Being an English-speaking law firm, we bridge the language gap, crucial for understanding complex legal processes.
• Customized Services for Foreigners: Our experience in dealing with English-speaking foreigners means they are adept at addressing the specific challenges and concerns of expatriates.
• Efficient Process Management: With our expertise, Panama Law Connection can navigate the legal system efficiently, potentially saving you time and reducing the stress associated with the visa application process.
• Strong Local Representation: Our ability to represent you in Panama is invaluable, especially if you're applying from abroad or can't be present in the country throughout the process.

Overall, Panama Law Connection is a top-tier choice for handling your Friendly Nations Visa application, combining legal expertise with a deep understanding of the needs of foreign applicants.

Tax implications for Friendly Nations Visa holders in Panama

When considering relocating to Panama under this visa, it's important to understand the tax implications, particularly for foreigners. Here's a detailed overview:

Panama's Tax System Overview

• Territorial Taxation: Panama employs a territorial tax system, meaning only income earned within Panama is taxed. Income from foreign sources, typically, is not taxed in Panama.
• Income Tax Rates: For income generated within Panama, progressive tax rates apply. These rates are subject to change, and it's advisable to consult with a tax professional for the latest information.

Tax Implications for Friendly Nations Visa Holders

• Foreign Income Exemption: Holders of the Friendly Nations Visa generally won't pay Panamanian taxes on foreign-source income. This includes income such as foreign salaries, pensions, and investment income.
• Local Income Taxation: If you engage in employment or run a business in Panama, that locally-sourced income will be subject to Panamanian income taxes.

Reporting Requirements and International Agreements

• Global Income Reporting: Depending on your home country's tax laws, you may be required to report your worldwide income. For example, U.S. citizens and residents must report all global income to the IRS.
• FBAR and FATCA: U.S. citizens and residents are also subject to Foreign Bank and Financial Accounts (FBAR) and Foreign Account Tax Compliance Act (FATCA) reporting requirements for foreign financial accounts.
• Double Taxation Treaties: Panama has signed double taxation agreements with several countries. These treaties can help prevent the same income from being taxed both in Panama and your home country.

Property Taxes in Panama

• Real Estate Taxes: If you buy property in Panama, you'll be subject to property taxes. There are exemptions and reductions available, particularly for properties under certain values or used as primary residences.
• Transfer Taxes: Buying or selling property in Panama involves transfer taxes, which should be factored into the cost.

Estate and Inheritance Tax Considerations

• No Inheritance Taxes: Panama does not levy inheritance taxes, which can be advantageous for estate planning.
• Estate Planning Laws: It's crucial to understand both Panamanian and your home country's estate planning laws, especially if you have assets in multiple countries.

General Tax Considerations

• Sales Tax (ITBMS): Panama imposes a sales tax known as ITBMS on most goods and services.
• Capital Gains Tax: There are capital gains taxes on the sale of certain assets, including real estate, though exemptions and special rates may apply.

The Importance of Professional Guidance

• Seek Expert Advice: Given the complexities of tax laws and their propensity for change, consulting with tax professionals knowledgeable in both Panamanian and your home country's tax laws is crucial.
• Stay Informed: Regularly update your understanding of any changes in tax laws or regulations in Panama and your home country that might affect your tax obligations.

The Panama Friendly Nations Visa offers an attractive option for those seeking residency in Panama, with significant tax benefits, especially regarding foreign-source income. However, understanding the full scope of your tax obligations in both Panama and your home country is essential to ensure compliance and optimize your financial planning. It's advisable to engage with experienced tax advisors to navigate these complexities successfully.