SEM PROGRAM FOR MULTINATIONAL COMPANIES

There are various special programs that are specifically designed for multinational companies that have headquartered in Panama to boost Panama’s growth & economy. 

SEM MULTINATIONAL COMPANIES CHARACTERISTICS

Panama is an attractive place for investments and has established laws and regulations allowing foreign companies & investors to promote international trade, manufacturing and complimentary services. The purpose of SEM companies is to  promote Panama’s economic growth. The areas known as Special Economic Zones or Free Zones. SEM’s  objective is to provide defined services to its headquarters, affiliate or subsidiary from Panama.

The special program of the multinational corporation headquarters in Panama, known as SEM, provides many benefits in form of tax exemption, labor, customs and immigration. It grants multinational companies greater flexibility to capture Latin American market of over 400 million people.

ACTIVITIES PERMITTED FOR SEM COMPANIES 

• Management for operations of a multinational company within the group of companies such as: strategic planning, business development, personnel training, operations or logistics;
• Logistics and/or storage of components or parts of manufacturing products;
• Technical assistance not only for the companies of the EG but also for the clients for products and services of the EG;
• Financial management, including treasury to EG;
• Accounting of the EG;
• Preparing blueprints that form part of the design and/or construction that constitute the ordinary course typical of the business activity of the main office of the company or any of its subsidiaries;
• Processing electronic data of any activity including consolidations for the EG operations and network operations;
• Advice, coordination and follow-up for EG goods and services, marketing and advertising;
• Support for operations and research, as well as EG goods and services development;
• Other analogous services previously approved by the Cabinet Counsel according to Law 41.

Benefits of SEM Companies

Some of benefits of Multinational Headquarters established in Panama include:

• Complementary and dividend tax exemption
• Exemption from sales tax for services rendered to the corporate group abroad
• Exemption of license tax
• Exemption from income tax and VAT for services provided to the business group outside the country.
• For services provided to entities located in Panama, income tax rates are reduced by 50%
• Foreign personnel of the company with a Multinational Headquarters license that is covered by a Permanent Employment Visa for Multinational Company will not be subject to income taxes if payment is received from abroad, with exemptions extended to social security contribution and education taxes
• 5% income tax (reduced rate).
• 2.5% remittance tax (reduced rate).
• Exemption of ITBMS, except for those services provided to related entities located in Panama.
• Exemption from the Operation Notice tax.

Companies can also take advantage of immigration and labor benefits including:

• Flexibility to exceed the 10% limit of foreign workers as a percentage of a company’s total workforce
• Permanent residency for permanent staff (after 5 years)
• Visas for full time employees are available for 5 years and are renewable; also extendable to family members
• Short term visas for technicians (3 months, renewable).

SEM Companies Requirements

In order to establish Multinational Headquarters in Panama, the multinational company must have:

• The capital of the group that owns the SEM must be equal to or greater than US$200 million
• Maintain a minimum of full-time employees and annual operating expenses appropriate to the nature of the business
• All applications must be submitted to the SEM Licensing Commission

All applications are made to the MHQ license commission and if all the requirements are met, the application process is usually complete within 10 to 15-day period. Ministry of Commerce and industries, operates a one stop window service to speed up the process in order to obtain the MHQ license of Multinational Companies Headquarters and visas for the foreign personnel and their dependents.

CONTACT OUR EXPERT IMMIGRATION ATTORNEYS FOR SEM MULTINATIONAL VISA LAWS  & REGULATIONS DETAILS!

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• SEM: Temporary visa for permanent staff of a multinational company 

This visa can be requested by a company hiring foreign workers for administrative & executive positions. It will be granted for a period of five (5) years.  This renewal can be done multiple times without limitation and holders of this visa do not require to apply for work permits.

The residency requirements are as follows:

1. Valid passport
2. Police clearance report from the country of origin (apostilled)  
3. Certificate of good health by a Panama doctor 
4. Letter of employment and responsibility from the SEM company signed by the legal representative. The letter should include the designated position, duration of the contract, duties to be performed, salary, source of salary, indicate the insurance to which the employee will belong, and state the company’s responsibility for repatriation if necessary.
5. Certification of a medical insurance policy, whether collective or individual.
6. Certification issued by the Technical Secretariat of the Multinational Company Headquarters Licensing Commission.

• SEM: Temporary visa for dependent of permanent staff of a multinational company 

This visa is applicable to spouses or partners united for a minimum of five years under conditions of singularity and stability, children under eighteen years of age and up to twenty-five years of age, provided they are studying regularly and are financially dependent on the permanent staff of Multinational Company Headquarters, disabled children living with them, and parents of said personnel, who remain in the national territory under the responsibility of the main applicant. These visas will be valid for the same term as the one granted to Permanent Staff SEM.

The requirements for applying for permanent residency are:

1. 1. Notarized power of attorney 

1. 1. Five (5) passport-sized photos

1. 1. Valid passport 

1. 1. Police criminal record from the country of origin or residence (apostiled) 

1. 1. Certificate of good health by a Panama doctor 

1. 1. Letter of employment and responsibility from the SEM company signed by the legal representative. The letter should include the designated position, duration of the contract, duties to be performed, salary, source of salary, indicate the insurance to which the employee will belong, and state the company’s responsibility for repatriation if necessary.

1. 1. Certification of a medical insurance policy, whether collective or individual.

1. 1. Certification issued by the Technical Secretariat of the Multinational Company Headquarters Licensing Commission.

1. 1. Proof of relationship: Apostiled Marriage certificate and birth certificates if applicable  

1. 1. Letter of Responsibility from the Permanent Staff with SEM Visa 

1. 1. Proof of residency in Panama 

1. 1. For children or individuals under guardianship and upbringing who are of legal age but under twenty-five years, the following must also be provided:
      1. 1. Certification of studies from an educational institution accrediting their full-time or regular student status.
      1. 1. Affidavit Declaration of solteria before signed before a Notary Public 

• SEM: Temporary visa for temporary staff of a multinational company 

The requirements for applying for this type of visa residency are:

1. 1. Notarized power of attorney 

1. 1. Five (5) passport-size photos

1. 1. Valid passport  

1. 1. Police clearance report ( apostiled) 

1. 1. Certificate of good health by a Panama doctor 

1. 1. Letter of employment and responsibility from the SEM company signed by the legal representative. The letter should include the designated position, the existence of a contract between the company and the foreigner, specifying the technical or training services required, duration, service fees, the source of these fees, whether local or foreign, and the suitability or specialization of the personnel.

1. 1. Certification of a medical insurance policy, whether collective or individual.

1. 1. Certification issued by the Technical Secretariat of the Multinational Company Headquarters Licensing Commission.

• SEM: Permanent visa for an individual who has worked as permanent staff of a multinational company 

The documents for permanent residency are:

1. 1. Notarized power of attorney 

1. 1. Five (5) passport-size photos

1. 1. Valid passport 

1. 1. Certificate of good health by a Panama doctor 

1. 1. Certified check of $250.00 to the National Treasury 

1. 1. Proof of investment in the national territory, which will be demonstrated by presenting at least one (1) of the following requirements:
      1. 1. Bank certification that the applicant has opened a fixed-term deposit account in their name, with a minimum duration of three (3) years (the fixed term must be free of any encumbrance) in any local bank for a minimum amount of One Hundred Fifty Thousand Balboas ($150,000.00). 
      1. 1. Certification from the Public Registry of Panama proving ownership of real estate, personally titled to the applicant with a minimum value of One Hundred Fifty Thousand Balboas (B/.150,000.00) free of encumbrances.
      1. 1. The applicant may also demonstrate a mixed investment, derived from obtaining a fixed-term deposit and the purchase of real estate, provided that this investment has a minimum value of One Hundred Fifty Thousand Balboas (B/.150,000.00).

1. 1. Letter of employment and responsibility from the SEM company signed by the legal representative. The letter should include the position held, the duration of employment with the company, confirmation that the employment relationship has ended, salary, and the duties performed.

1. 1. Certification issued by the Technical Secretariat of the Multinational Company Headquarters Licensing Commission.

• SEM: Permanent visa for foreigner who continues to work for a multinational company 

The requirements for applying for permanent residence are:

1. 1. Notarized power of attorney 

1. 1. Five (5) passport-size photos

1. 1. Valid passport

1. 1. Certificate of good health by a Panama doctor 

1. 1. Certified check of $250. to the National Treasury 

1. 1. Letter of employment and responsibility from the SEM company signed by the legal representative. The letter should include the position held, the exact time of performing functions for the company, the salary, the duties performed, and it should also specify that the worker continues to work for the company.

1. 1. Bank Certification: This must be issued by a Panamanian bank, from the month before the submission of the application, reflecting a balance of no less than four average figures, which must be increased by $1,000. for each dependent (if applicable).

1. 1. Documentary proof of the foreign worker’s affiliation with the Social Security Fund, which may be:
      1. 1. Copy of the Social Security card.
      1. 1. Any other document required by the Social Security authority and immigration authority to verify this purpose.

1. 1. Certification issued by the Technical Secretariat of the Multinational Company Headquarters Licensing Commission.

GET IN TOUCH WITH OUR EXPERT IMMIGRATION ATTORNEYS TO FIND OUT IF YOU QUALIFY UNDER SEM  SPECIAL VISA PROGRAMS

EMAIL: CUSTOMER@PANAMALEGALCENTER.COM

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