Dolores Cadavid, José A Brenes and Rehut Maimon at Anzola Robles & Asociados  discuss the long term business visa and how it works here.

Long-term transfers

Categories

What are the main work and business permit categories used by companies to transfer skilled staff?

The general work permit rule creates a 10 per cent quota system: salary amounts within the resident company payroll and the number of foreign employees within the resident company workforce must not exceed 10 per cent of Panamanian employee salaries and workforce (10 per cent visa or permit). Skilled personnel, executive personnel and technicians may be transferred to Panama under any of the following options.

Technicians, experts or employees of trust

This category allows foreign specialised or technical personnel, experts, management and executives or what immigration legislation labels as ‘employees of trust’ to apply for a visa and work permit, provided they are sponsored by a resident corporation. Salary amounts within the resident company payroll, and the number of foreign employees within the resident company workforce must not exceed 15 per cent of Panamanian employee salaries and workforce (15 per cent visa or permit).

Companies with fewer than 10 Panamanian employees

This option is also dubbed the ‘Marrakesh visa’, because it was adopted in accordance with provisions within the Marrakesh Agreement. It allows a small business to hire one foreign employee in a company with fewer than 10 employees, provided the company hires a minimum of three Panamanian employees.

Employees whose work product materialises outside Panama

This category allows a resident corporation to hire foreign employees provided the employees’ services are effective outside Panama and the employee is hired to work in the local branch, subsidiary or affiliate of a foreign company or business group.

Employees who work for companies with a government contract

This category allows a resident corporation that has been awarded government contracts to hire foreign employees to meet the labour requirements under the government contract. Terms and conditions for the visa and work permits will usually vary and will be set taking into account applicable regulations and the profile of the project and contractor.

Employees who work for companies established in the Panama-Pacifico Area

Under this alternative, a corporation licensed and operating within the Panama-Pacifico business park may hire foreign employees.

Employees who work for companies established in the City of Knowledge

This category allows corporations licensed and operating within the City of Knowledge (CK) business park to hire foreign employees to perform technical, research and development and management activities.

Employees who work for companies established in the Colón Free Zone

This category allows corporations licensed and operating within the Colón Free Zone (CFZ) to hire foreign employees.

Employees of multinational companies

This visa category allows corporations operating under a special business licence designed for multinational corporations to sponsor foreign employees.

Employees of free-zone designated areas

This category allows corporations licensed and operating within any designated free zone (FZ) business parks to hire foreign employees to render technical or management services.

The ‘friendly nations visa’

This visa is for employees who come from countries that maintain good diplomatic and commercial relationships with Panama and that are part of a list of countries published by the Panamanian government. It has become very popular, because it does not have any major additional requirements to meet, other than being a national from one of the countries published in the list of friendly countries. The friendly nations visa allows foreigners from friendly countries to apply for a permanent residency on economic or professional grounds, provided they demonstrate having an economic or professional reason to immigrate to Panama and a minimum solvency of US$5,000. The list of friendly countries has been modified a few times, always to include additional countries.

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

Recommended by the president of Panama

This category is for employees who, for reasons of national interest or the provision of services to Panama, are recommended by the president and merely requires that the visa and work permit be previously approved by the president of Panama.

Professional foreigner

This category allows visas and work permits to foreigners who have a bachelor’s, master’s or doctoral degree, as long as the profession is not restricted to foreigners. The degree must be approved by a Panamanian state university, prior to requesting the visa and work permit. For details of restricted professions, see question 6.

Temporary technical work permit and visa

Skilled personnel and technicians immigrating to Panama for periods of 15 days to nine months may apply for a temporary technical work permit and visa. This temporary work permit and visa allows for short-term transfers of personnel to provide training or specific work assignments within Panama.

Procedures

What are the procedures for obtaining these permissions? At what stage can work begin?

Visas and work permits are intrinsically related, and depend on each other. Procedures to obtain the majority of the permits listed in question 10 are the following:

• preregistration: the foreign national must preregister his or her general information online with the NIS;
• registration: the foreign employee must register with the NIS;
• visa application: the foreign employee must file for a visa application with the NIS;
• immigration status: once the visa application is filed, the foreigner receives a provisional status under his or her visa category. The NIS issues a certification with the immigration status of the foreigner (immigration status);
• work permit application: the work permit application is filed before the ML. The work permit application must include the immigration status;
• work permit review: the ML reviews the work permit. If the work permit is approved, the applicant must file a copy of the resolution approving the work permit and the employment ID card issued by the ML with the NIS; and
• visa approval: after submitting the work permit resolution issued by the ML, the NIS will review the applicant’s file and, if found compliant, will approve and issue the visa.

All documents that are issued outside of Panama and are submitted to the NIS in support of the visa and work permit application, must be in Spanish and legalised by the consular system or the Hague Convention Abolishing the Requirement of Legalisation for Foreign Public Documents.

The employees of multinational companies (MC) visa has a shorter procedure, because it does not require the applicant to apply separately for a work permit. Once the MC visa application is filed, the NIS reviews the application. If the application is found to be compliant with the regulations, the NIS will approve the MC visa. The MC visa approval will also provide the foreign employee with permission to work in Panama.

Labour legislation in Panama forbids foreigners from commencing any work activity while the work permit application is in progress. The ML must have effectively issued the work permit before the foreigner may begin working.

Period of stay

What are the general maximum (and minimum) periods of stay granted under the main categories for company transfers?

The NIS generally grants stays for one year, renewable for up to five additional one-year periods. Nevertheless, under the most recent amendments to immigration law, certain categories of work-related visas confer the applicant a permanent status within the territory of Panama, after the second year of renewal. For details of the visas that confer permanent residency status from the second year, see question 29.

Processing time

How long does it typically take to process the main categories?

For all the main categories, the NIS usually takes from four to five months to process a visa application, and the ML may take two to three additional months to approve or reject a work permit. However, these time frames may vary depending on backlogs and other factors.

Visas and work permits for employees who work for companies with a government contract, are licensed within the Panama-Pacifico Area (PPA) or within the CK and licensed as MC, or applying under the friendly nation criteria, in most cases are processed in half the time it takes for other visas or work permits.

Staff benefits

Is it necessary to obtain any benefits or facilities for staff to secure a work permit?

As a general rule, employees must be enrolled with the Panamanian social security system (SSS). Social security benefits including medical care and retirement benefits are provided by the SSS. Housing and other benefits are not a requirement to secure an immigration permit.

A foreign employee working under an MC visa is an exception. Employees working under an MC visa must show they have private health insurance coverage to secure their immigration and work permit. The private health insurance coverage is secured by the MC.

Panamanian legislation does not require any additional benefits or facilities to hire foreigners.

Assessment criteria

Do the immigration authorities follow objective criteria, or do they exercise discretion according to subjective criteria?

Immigration authorities generally follow objective criteria. Visas are usually granted or rejected based on technical criteria and requirements. However, the NIS frequently follows principles and guidelines that are not listed within the law or any issued NIS regulation, in essence adding subjectivity to the process and sometimes making it hard to follow and complete.

NIS authorities, however, do allow applicants some flexibility in complex and unusual cases.

High net worth individuals and investors

Is there a special route for high net worth individuals or investors?

Panamanian immigration legislation does contain special visas for investors and high net worth individuals. These visas vary according to the type of investment, as follows:

• investment in real estate: permanent residency in Panama may be obtained by individuals personally investing a minimum of US$300,000 in any type of real property located within Panama. The property must be directly owned by the foreign investor;
• investment in time deposits: permanent residency in Panama may be afforded to individuals opening a time deposit in Panama with a minimum value of US$300,000 and a minimum duration of three years. The time deposit must be maintained in the name of the investor;
• investment in real estate and time deposit: permanent residency in Panama may be granted to individuals investing a minimum of US$300,000 in a combination of real property and a bank time deposit. Both must be held in the name of the foreign investor;
• investment in forestry: permanent residency in Panama may be issued to individuals investing a minimum of US$80,000 in reforestation or forestry plantations that have a minimum area of 20 hectares. Personal investment is not required and may be channelled through reforestation companies licensed by the National Environment Authority;
• investment in companies: permanent residency in Panama may be obtained by individuals investing US$160,000 or more in the capital of a corporation in Panama; and
• investment in companies licensed to do business within an FZ: permanent residency in Panama may be issued to individuals investing a minimum of US$250,000 in companies licensed to operate within an FZ-designated area.

Unlike the visa categories listed in question 10, investor visas do not grant the option of applying for a work permit. Accordingly, these visas do not allow investors to work in Panama.

Is there a special route (including fast track) for high net worth individuals for a residence permission route into your jurisdiction?

No. The applicant must complete the application in accordance with the procedures outlined in question 11.

Highly skilled individuals

Is there a special route for highly skilled individuals?

There is no specific route for highly skilled individuals. However, some immigration permits have a shorter term of approval including friendly nation visas, MC visas, visas and work permits for employees that work for companies licensed within the PPA and visas and work permits for employees that work for companies established in the CK.

Panama also has a ‘professional visa and work permit’ that allows individuals with very specific educational backgrounds to apply for a permanent residency and work permit, provided their main profession is not restricted to Panamanians. For a list of professional activities whose practice is restricted to Panamanians, see question 6.

Ancestry and descent

Is there a special route for foreign nationals based on ancestry or descent?

There is no special route for foreign nationals based on ancestry or descent. There is a special procedure in the law that allows children of Panamanian nationals born abroad to register as Panamanian nationals before the Electoral Tribunal.

Minimum salary

Is there a minimum salary requirement for the main categories for company transfers?

Yes, there is a minimum salary requirement for the majority of the main categories. The following main categories have a minimum monthly salary requirement, as follows:

• visas for technicians, experts, management and executives or employees of trust: US$850;
• visas for companies with less than 10 Panamanian employees: US$1,000;
• visas for employees whose employment is supervised outside Panama: US$2,000;
• visas for employees that work for companies licensed in the PPA: US$1,000 in the case of employees of trust; and
• visas and work permit for employees that work for companies licensed in the CFZ: US$2,000 for executives and managers, technical personnel and employees of trust.

Salary requirements may increase depending on the type of visa and the number of dependants.

Resident labour market test

Is there a quota system or resident labour market test?

Panama does have a local employee quota system. The general work permit rule creates a 10 per cent quota system (see question 10).

Foreign specialised or technical personnel, experts, management and executives enjoy a slightly higher quota of 15 per cent (see question 10).

However, various types of visa categories create exceptions to the 10 per cent and 15 per cent quotas, always provided the number of foreign employees does not exceed the number of local employees on the payroll of the company. See question 10 for a list of exceptions.

Despite the local employee quota requirement, there is no need to advertise locally or perform any local labour search before hiring a foreigner. However, work permits for technicians and experts require the resident corporation to train a Panamanian employee for the same position.

Additionally, labour laws require the replacement of the foreign technician or expert with a trained Panamanian employee within a five-year term, counted from the day the ML first issues the work permit. Employers that sponsor a technician or expert file a commitment letter with the ML, listing the name and ID number of the Panamanian technician or expert that will replace the foreign employee.

Shortage occupations

Is there a special route for shortage occupations?

There is no specific or special route for shortage occupations.

Other eligibility requirements

Are there any other main eligibility requirements to qualify for work permission in your jurisdiction?

Technicians and experts applying for a visa and work permit based on their skills must provide evidence of having acquired the skills or expertise that is the basis of employment. Proof of skills or expertise must be demonstrated by producing certificates, diplomas, licences or degrees issued by educational institutions or foreign authorities, or reference letters issued by previous employers.

Third-party contractors

What is the process for third-party contractors to obtain work permission?

Third-party contractors cannot obtain a work permit on behalf of other companies. However, it is not uncommon for human resources and employment companies to sponsor foreigners, file their visa and work permit application and outsource the foreigner to a local company.

Additionally, Panamanian immigration legislation does not expressly limit or prevent employees from working within the premises of another company. However, working in another company’s premises may create liability to the other company for unpaid salary and benefits or any other breaches of employee rights under the labour code and labour agreement.

Recognition of foreign qualifications

Is an equivalency assessment or recognition of skills and qualifications required to obtain immigration permission?

An assessment or recognition of skills and qualifications is required to obtain certain immigration permissions such as the visas and work permits for technicians and experts.

Technicians

To gain approval of the visa and work permit, technical personnel must obtain and file with the ML academic letters, diplomas, certificates or similar documents certifying their technical capacity.

Experts

To obtain approval of a visa and work permit, expert personnel must obtain and file a reference, professional or business letter certifying their expertise with the ML.