Given the series of regulations that have been issued in Panama, ranging from the well-known Law 23 of 2015 to subsequent complementary laws enacted to date, which address the prevention of money laundering and financing of terrorism and weapons of mass destruction, we often ask ourselves:

• What is the role of the Resident Agent in respect of the legal entity with which it is linked? 
• What are the repercussions of the absence of a Resident Agent? 
• What level of responsibility does the Resident Agent owe to my company/foundation? 
• Is the cost of the annual fees charged for this service justifiable?

In order to give an indication of the amount of work that the Resident Agent of today has to do, and the level of responsibility implied in the current exercise of this role, it would be ideal first of all to understand the obligations of each of the parties involved in this legal relationship, some of which are set out below:

Obligations of the Resident Agent:

1. To address the information requirements, such as prevention measures, exercised by supervisory bodies and competent authorities, in relation to clients and their activities, in order to rule out the existence of suspicious relationships that may be linked to money laundering and the financing of terrorism and the proliferation of weapons of mass destruction. 
   
   
2. To adopt measures to carry out basic due diligence of the client (legal entity), without prejudice to the requirements of the Law; keep records of the information and documentation that is collected for the purposes of identifying and verifying the legal entity and its ultimate beneficiaries, understanding the commercial nature of the client.
   
   
3. To verify if their client’s funds, assets or property belong to or are controlled by persons or entities listed by international organizations as being linked to planning, threatening or carrying out a terrorist act, and in such an event, to notify the Financial Analysis Unit (UAF).
   
   
4. To keep copies of the accounting records of the legal entities for which they act as Resident Agents, for a minimum period of 5 years from the last day of the calendar year in which the transactions to which these records apply were generated; in the event of dissolution, said records must be maintained for the same period of time.
   
   
5. Report the ultimate beneficiaries of legal entities to the (RUBF) Single Registry of Ultimate Beneficiaries, of the Superintendence of Non-Financial Subjects.
   

Obligations of Legal Entities:

1. Assist and provide the Resident Agent with all information requested by him, regarding the directors, officers, shareholders, attorneys-in-fact, members of the foundation council, founders, administrators and ultimate beneficiaries or of any natural person linked to the company and/or private interest foundation, thereby respecting and thus complying with the Due Diligence procedures required by the norms.
   
   
2. Take care, and be responsible for ensuring that all information and/or documentation provided to the resident agent is true, accurate and not more than three months old.
   
   
3. Provide to the Resident Agent on 30 April each year, the accounting records or a copy of the accounting records for the fiscal period ending on 31 December of the previous year.
   
   
4. Report to the Resident Agent in writing each year the name and contact details of the person who keeps the accounting records and supporting documentation in their custody and the physical address where they are kept.  
   
   
5. At all times, keep updated the information provided and notify the Resident Agent if there is any change to the person who maintains the accounting records or supporting documentation in their custody; as well as changes in the members of the board of directors, shareholders, members of the foundation council, changes in the foundation’s regulations, etc.
   
   
6. If required by the competent authority, they will provide the Resident Agent with supporting documentation for the accounting records, within the time period established by the competent authority, in order to comply with said requirement.
   
   

Just by mentioning the most important responsibilities, it is clear that providing these services represents a very sensitive challenge, as the implications for any omission, non-compliance or absence of trained personnel, in terms of internal procedures associated with due diligence and handling of confidential information that is provided, may result in both parties receiving a series of administrative and financial sanctions, in proportion to the seriousness of the offense.

The Compliance Department of ROSAS RODRÍGUEZ & ASOCIADOS is trained to deal with the regulations that have been issued, complying with the established norms covering due diligence and collaboration with the competent authorities, providing the required information, while processing the data relevant to the information in our care, all as required by the rules that regulate this matter. Allow us to advise you! 

Legal Basis: Executive Decree 241 of 2015, Executive Decree 363 of 2015, Executive Decree No. 587 of 2015, Law 52 of 2016, Law 254 of 2021 and Executive Decree No. 13 of 2022.