Task

Description

Solution recommended

Incorporate the company

This would need to be with 3 directors that fully comply with the CNV requirements.  Not nominees. 

You will need to provide the principal executive, who may (or may not) be the Legal Representative of the company. 

For practical purposes, it is very important that the Legal Representative be in Panama and readily available to sign documents as may be required.  This is also the person to sign contracts on behalf of the company.  At this stage, I would recommend that the legal representative be the one of you that is available in Panama.  

It is necessary to have at least 2 more directors on the Board of Directors.  Both of these directors should fulfill the profile required for the National Securities Commission (CNV).  But their CVs and backgrounds should be considered, and discussions among the partners as to what they are most comfortable with. 

The shareholder(s)

The shares must be owned by persons that are acceptable to the CNV

The CNV will be looking for transparency and accountability with respect to the company shareholders.  They will not be accepting of “anonymity” with respect to the shareholders, but rather “full disclosure”. 

It would be recommendable that the shares therefore be issued to the principals, in their personal names (or in a trust where there is transparency and it is not easy to transfer the shareholding).

Shareholder Agreements

If more than one shareholder

An issue which arises from holding the shares in personal name is that the company should have in place a shareholder agreement between the principal parties, setting out their participation and agreements in the company.  Do you already have this in place? 

It may also be necessary to review the company’s Articles of Incorporation to include protection of minority shareholders and also to include a clause which restricts the transferability of shares (in order to comply with the CNV regulations regarding the transfer of shares of a registered brokerage house).   

Articles of Incorporation

Restrictions to be included, in order to comply with CNV regulations

One of the requirements for the CNV will be that shares not be readily transferrable and I would need to review and draft the Articles of Incorporation to make sure that other changes are not required. 

Principle Executive Exam

This is required for each one of the principals

The list of topics is provided by the CNV, but it is in Spanish. We can provide a translation of this to English, the cost is $0.03 / word. 

Compliance Officer exam

Topics to be covered + recommendation

We can email you the topic list (again in Spanish). 

I may be able to assist you with contacting a person that may be prepared to act as the Compliance Officer for you.

Portfolio accounting system

Trading System  & PeachTree

PeachTree accounting should be used, since this is the accepted program by the Tax Department.     

Accounting Firms & Auditors

Should be independent

It is very important to have an independent firm from the start, as they will need to sign off on the business plan / projections that are prepared for the CNV. 

If you do not have relationships with accounting firms in Panama, I would be happy to investigate and recommend 3-4 firms for you to interview with. 

Business Plan

At least 3-year plan

This forms an integral part of the application, as well as being something that your banking partners will want to see in the documentation supporting the account opening with them. 

Contracts & application forms

Accommodate to Panamanian law.

In preparation for the application, these need to be adequate for the laws of Panama, in order to attach with the application. 

Labour law

Need contracts for employees

These will need to be prepared according to staffing requirements.   The company will need to be registered with the SS department.  It will also be necessary to have payroll software, appropriate for Panamanian Social Security. 

Immigration

Investor visa

For principals – if they wish to move to Panama

Work permit

For principal executives of the company that move to Panama and work as brokers or otherwise.