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With a decisive step in its commitment to financial integrity Panama leaves the FATF gray list
The country’s efforts to comply with international standards have borne fruit and Panama has finally been removed from the FATF gray list.
This list, issued by the Financial Action Task Force, identifies nations that do not adequately comply with anti-money laundering and anti-terrorist financing regulations.
Since 2019, Panama had been under the FATF’s magnifying glass due to certain deficiencies in its control mechanisms. However, the country did not sit idly by and activated a comprehensive legislative and fiscal renewal plan. This roadmap aimed at strengthening supervisory measures and instilling a culture of financial transparency.
What was Panama's recipe for change?
Panama chose to renew and strengthen its laws to prevent financial malfeasance. Now, penalties and fines for not adhering to the regulations can be as high as US$5 million, demonstrating the seriousness with which this issue is being taken.
The country has also enhanced the capabilities of its Financial Analysis Unit (UAF). This agency has become a key pillar in the detection and reporting of suspicious financial activities. Thanks to this entity, Panama has been able to collaborate with international bodies, providing relevant data in tax investigations.
A notable innovation has been the creation of the Single Registry of Beneficial Owners, which allows monitoring the legitimate owners of companies and other legal entities, thus minimizing the risk of illicit activities.
This reinvention of Panama, which included more than a dozen improvements, reaffirms its commitment to international standards of transparency. This will undoubtedly position Panama as an attractive destination for investment, tourism and international business, generating a positive impact on its economy.
On the other hand, this removal from the list gives Panama an advantageous position to obtain credit with friendlier conditions in the international arena, which will translate into a boost for national projects.
Is Panama's future outside the gray list assured?
Panama’s removal from the FATF gray list has been received with jubilation and as a confirmation of its financial evolution. However, the FATF urged the country to remain committed to the rigorous implementation of the reforms put in place.
The challenge for Panama will therefore be to remain steadfast on this path of transparency and consolidate its position as a reliable player on the world financial scene. This journey, although arduous, will mark the course of a nation in the midst of a financial and ethical renaissance.
The law firm Caporaso & Partners, in compliance with national regulations, is authorized to offer the service of Resident Agent for Panamanian companies and Custodian of Bearer Shares.
