Law 47 of August 6, 2013, aims to adopt a custody regime for certificates of shares issued to bearers.
According to the law, every owner of shares issued to the bearer shall appoint an authorized custodian to hold bearer share certificates in custody.
Who can be an authorized custodian?
These can be general license banks and trust companies established in the Republic of Panama, regulated by the Superintendency of Banks of Panama. Also authorized are securities houses and central securities depositories regulated by the Superintendence of Securities Market of Panama.
Likewise, attorneys registered with the Fourth Chamber of General Business of the Supreme Court of Justice are authorized to act as custodians.
Foreign custodians are also accepted, who must have a license for the exercise of their activities established in member jurisdictions of the Financial Action Task Force on Money Laundering.
Obligations of the authorized custodian
Depending on whether the custodian is local or foreign, they must comply with different obligations. Among the general obligations are:
- Maintain all documentation related to the provision of the custody service at the Panama headquarters in case of being a local custodian or at the address provided to the resident agent in case of being a foreign custodian.
- Maintain physical custody of the bearer share certificates issued during the duration of its function as custodian.
- Keep the information received in reserve.
Bearer Shares Issued Certificate: Information to be Provided
At the time of delivery of the certificates in custody, the issuing company must provide the following:
- Sworn declaration rendered by the owner of the shares issued to the bearer must include his full name, nationality, identity card number, physical address, telephone number, and e-mail address.
- Full name, physical address, telephone number, and e-mail address of the resident agent of the issuing company.
For details of Law 47 on custody of bearer shares see here.