Are you thinking about buying a Panama shelf corporation with a bank account? If so, there are a few very important factors you need to consider first.
Not the least of which is how you will maintain the bank account for your business in Panama after you become the owner.
In this article, we’re going to walk you through these factors and discuss whether you will be able to keep your bank account or not.
This article is part of our free series on Business Banking in Panama. You can access this series right now by using the link above.
In addition to detailed account opening guides, this free series on Panama banking also discusses the largest banks in Panama, Panama opening requirements, the costs of banking in Panama, and much more. Use the link above to start exploring all of your free Panama banking content right now.
Alternatively, use the table of contents to continue exploring whether a Panama shelf corporation with a bank account is right for you.
Table of Contents
- Panama Shelf Corporation With Bank Account
- Challenges Keeping Shelf Corporation Bank Accounts
- Who Can Acquire a Panama Shelf Corporation?
- Benefits of Shelf Companies
- Frequently Asked Panama Banking Questions
- Do You Want to Open Panama Bank Accounts?
Panama Shelf Corporation With Bank Account
Buying a Panama shelf corporation with a bank account is seen as a faster way to obtain a legal entity with banking facilities. However, while company ownership is easily transferred, transferring company bank accounts can face additional challenges.
First, to clarify, a shelf corporation is an entity that is already incorporated. In other words, an individual can buy the entity “off the shelf” instead of going through the process of incorporating a new entity from scratch.
With this in mind, one of the main benefits of buying a shelf corporation is the time savings between acquiring an existing entity and registering a new one. That said, there are other benefits to acquiring a shelf corporation, which we’ll discuss below.
Not surprisingly, there are a number of jurisdictions where shelf corporations are available to buy, including Panama. In fact, as a major offshore jurisdiction, almost all corporate service providers and lawyers in Panama will have shelf corporations available.
That said, a shelf corporation does not always come with a bank account. Instead, many service providers sell shelf corporations and bank account opening services separately.
On the off chance that a shelf corporation has a bank account, the new owner will need to provide updated information to the bank prior to transacting. While this may sound like a simple administrative process, it isn’t always the case, especially when dealing with a Panama corporation.
Challenges Keeping Shelf Corporation Bank Accounts
As we’ve discussed elsewhere, banking a Panama corporation can be a challenge both in Panama and abroad. This is especially true if the Panama corporation is an IBC with no onshore activity in Panama.
Like elsewhere, Panama banks are moving away from supporting purely offshore structures. In many cases, they are closing existing customer accounts during annual or event-driven compliance reviews.
One example of an “event-driven” compliance review is when a company has a new owner. Similar to opening a bank account for a new company, the bank needs to complete due diligence on the new owner and receive supporting documentation.
While the new owner may meet all of the requirements of the bank, it’s possible that the corporation no longer meets the bank’s standards. If this is the case, the bank will (in most cases) immediately close the account. On the other hand, if the new owner does not meet the requirements of the bank, then the bank account of the Panama shelf corporation will also be closed.
In other words, acquiring a Panama shelf corporation with a bank account is not a guaranteed solution for most people’s banking objectives. Instead, it’s often much easier to register a new company and set up a new bank account from scratch.
However, if you are still interested in acquiring a Panama shelf corporation and want to understand the benefits of doing so, we’re going to cover these topics for you in greater detail below.
Who Can Acquire a Panama Shelf Corporation?
A Panama shelf corporation can be acquired by any individual, group of individuals, entity, or group of entities, regardless of citizenship, residency, or country of registration. In other words, anyone can buy a Panama shelf corporation.
The process to acquire a Panama shelf corporation is straightforward and can often be completed within several business days. And, as mentioned, most corporate service providers and lawyers in Panama will offer shelf corporations to their clients.
That said, it is important to compare the prices before acquiring a shelf company in Panama. In most cases, the costs will vary depending on the age of the corporation (based on the registration date).
Not surprisingly, older shelf companies tend to have higher prices as they can be used for a wider range of economic activities such as fulfilling RFPs with registration age requirements.
Benefits of Shelf Companies
The benefits of Panama shelf companies include:
- Immediate access to a corporate entity in Panama
- Meeting corporate age requirements for RFPs and tenders
- Reduces the administrative process of registering in Panama
- Does not require travel to Panama
- Possibility of leveraging an existing Panama bank relationship
It’s important to reiterate that a Panama shelf corporation with a bank account is not a suitable option for most individuals. Instead, registering a new company (in Panama or abroad) often provides a better foundation for business and structuring purposes.
Additionally, if you are specifically looking for banking solutions, then you should consider the limitations of a Panama shelf corporation prior to purchasing.
If you are interested in exploring business banking options in Panama further, don’t forget to visit our comprehensive guide on Banking in Panama, available in the link above.
Alternatively, if you would like to explore all of your offshore banking options, download our free guide and compare Panama to some of the top banking jurisdictions available.
Do You Want to Explore All Your Offshore Banking Options?
Frequently Asked Panama Banking Questions
Below are a few of the most common questions we receive from people exploring banking in Panama. If you have further questions about Panama, don’t hesitate to contact us directly.
What Can I Do With a Shelf Corporation?
After acquiring a shelf corporation, the owner can use the entity for any corporate activities that are legally allowed in the jurisdiction of registration. Likewise, if the entity is licensed, then it can carry out any activities that are permissible under the license it holds. In short, after being transferred to new owners and paying any outstanding fees and taxes, a shelf corporation can do anything that a newly registered corporation can do.
What Is an Aged LLC?
An “aged LLC” is another term for “shelf corporation”, which is a company that was registered at some point in the past and is not being used for commercial purposes. Corporate service providers and lawyers offer aged LLCs and shelf corporations to their clients for purchase.
What Is the Difference Between Shelf Companies and Shell Companies?
The main difference between shelf companies and shell companies is that a shelf company is inactive while a shell company is usually engaged in financial transactions and may own underlying assets.
Do You Want to Open a Panama Bank Account?
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