Panama’s Qualified Investor Permanent Residency program now distinguishes between new‑construction and resale real‑estate investments. Effective September 16 2024, a first‑sale (new) property qualifies with a US $300,000 minimum, while any resale purchase must meet a US $500,000 threshold. The change is codified in Executive Decree No. 17, signed by President José Raúl Mulino and Minister of Public Security Frank Ábrego.
Property tiers and eligibility
| Tier | Definition | Minimum investment* |
|---|---|---|
| First‑sale (new build) | Initial acquisition of a new, unoccupied property directly from the developer or its successor, proven by Public Registry certification and, where required, construction/occupancy permits. | US $300,000 |
| Resale | Purchase of a property previously owned, leased or transferred to an unrelated third party, or previously occupied. | US $500,000 |
*Amounts are expressed in balboas, which are pegged 1:1 to the US dollar.
The decree treats corporate restructurings, trusts, mergers, or segregations as retaining first‑sale status unless the property is sold to an unrelated third party. Inheritance does not constitute a prior sale. Simulated transactions intended to evade the minimum may be disregarded.
Valuation requirements
- The qualifying amount is the lower of (i) the price actually paid, or (ii) a reasonably substantiated commercial value, minus any existing lien.
- The Ministry of Commerce and Industries (MICI) may demand an independent appraisal if the cadastral value appears outdated or doubtful.
- Appraisals must be dated within the previous six months, performed by a professional recognized by Banco Nacional de Panamá and Caja de Ahorros, and be independent of all parties to the transaction.
- The applicant bears the appraisal cost.
Off‑plan contracts
- Off‑plan (pre‑construction) purchases remain subject to the US $300,000 minimum.
- Investors must fund the purchase through a trust at a Panama‑licensed bank or by paying the developer 100 % upfront.
- Full‑payment requires an irrevocable, unconditional bank instrument (standby letter of credit, irrevocable guarantee, or performance guarantee) that stays in force until the property is registered in the buyer’s name.
- If the developer misses construction, segregation, or registration deadlines, the investor may enforce the instrument.
- Investors have 180 business days after a developer default to replace a failed contract with a new off‑plan agreement (once only). Subsequent failure forces a switch to a direct investment (finished property, securities, or fixed‑term deposit).
- Residency based solely on promise‑of‑sale contracts cannot exceed three cumulative years; exceeding this may trigger permit cancellation.
Source of funds
- Applicants must use their own funds and prove ownership and traceability.
- Gifts, donations, or other gratuitous transfers from third parties are excluded.
- “Foreign‑source funds” are defined as money that entered Panama via international transfer or deposits that can be traced to a prior international transfer.
- Each principal applicant must individually meet the minimum; a joint holding can be counted once if the net value satisfies the threshold.
Processing timelines
- MICI must issue an Investment Certification within 15 business days of admission.
- The certification is valid for three months from issuance and must remain valid when the complete file reaches the National Migration Service (SNM).
- SNM retains a 30‑business‑day decision window once a complete file is received.
- Incomplete files must be corrected within 15 business days, or MICI will archive the application and the process must restart.
Securities and fixed‑term deposits
| Asset type | Minimum amount | Holding period |
|---|---|---|
| Private equity, venture capital, or other registered investment funds | US $500,000 | 5 years |
| Debt securities (sovereign bonds, treasury bills, corporate debt, REITs, etc.) | US $500,000 | 5 years |
| Fixed‑term deposits – private banks | US $750,000 | 5 years |
| Fixed‑term deposits – Banco Nacional de Panamá or Caja de Ahorros | US $500,000 | 5 years |
- Market fluctuations that are not caused by the investor do not constitute non‑compliance, provided the investor restores the minimum amount within 90 calendar days of MICI’s notice.
- Deposits must be free of liens or pledges and transferred via international SWIFT in the applicant’s name (or an entity they beneficially own).
Annual verification
- Residents must file an annual verification with MICI 30 calendar days before each anniversary of the immigration resolution.
- If the qualifying investment is sold or otherwise ceases before the five‑year requirement, the resident must notify MICI within 30 days. MICI then grants up to 90 days to reinvest; failure to do so results in automatic cancellation of the residence permit.
Family inclusion and path to citizenship
- Spouses married after approval and newly born or adopted children can be added as dependents for a fee of US $1,000 to the National Treasury and US $1,000 to SNM.
- Changes such as divorce or a child reaching adulthood require notice to SNM and a hearing; automatic cancellation does not occur.
- After five consecutive years of residence, qualified investors and their dependents may apply for Panamanian citizenship. Applications are routed through MICI’s investment window and must include certification that the investment still meets program requirements. Physical‑presence requirements are not specified in the decree.
Transition provisions
- Applications already filed with MICI or SNM before the decree’s effective date remain governed by the previous rules (including the US $300,000 property minimum).
- Applicants with investments or binding contracts dated before the decree have six months from the decree’s entry into force to continue under the old regime.
- Existing Investment Certifications issued before the change retain validity until expiration; new appraisal rules are not applied retroactively unless fraud or falsification is evident.
- Holders of Panama’s “Own Economic Solvency” residence may switch to the Qualified Investor category within 12 months if they meet the new minimums; investments predating 15 October 2020 are excluded.
These revisions aim to steer foreign capital toward new construction, boost employment in the building sector, and tighten safeguards against overvaluation and fund‑source irregularities while preserving a clear pathway from residency to citizenship for qualifying investors.
Source article: www.imidaily.com
